Question 1

The business income and extra expense coverage form covers loss of business income and continuing normal operating expenses.How is business income (revenue)defined?

Accepted Answer

The answer of The business income and extra expense coverage...

Question 2

If the optional replacement cost coverage provision is not selected,how are losses settled under the building and personal property (BPP)coverage form?

Accepted Answer

Without the optional replacement cost coverage provision, losses are settled based on actual cash value, which is the value of the property at the time of loss, taking into account depreciation. This means that the settlement amount may be less than the original purchase price or market value.

Question 3

Which of the following statements about the ISO businessowners policy is true?

Accepted Answer

The ISO businessowners policy includes business income and extra expense coverage as an additional coverage, offering protection against loss of income and extra expenses incurred to keep a business operational after a covered loss.

Question 4

Which of the following statements concerning terrorism insurance is (are)true?
I.Terrorism insurance covers direct physical damage to the insured's property resulting from an act of terrorism.
II.Terrorism insurance and be added through an endorsement to the commercial property insurance policy or purchased as a separate,stand-alone policy.

Accepted Answer

Both statements I and II are true. Terrorism insurance covers direct physical damage to the insured's property resulting from an act of terrorism and it can be added through an endorsement to the commercial property insurance policy or purchased as a separate stand-alone policy.

Question 5

Jenkins Manufacturing is concerned that a competitor may attempt to hack its computer network and insert malware on Jenkins Manufacturing computers,causing the computers to crash.That stand-alone property insurance policy can Jenkins Manufacturing purchase to pay for such damage to their computers?

Accepted Answer

The answer of Jenkins Manufacturing is concerned that a competitor...

Question 6

Which ocean marine coverage provides comprehensive liability insurance for property damage caused by the ship to piers and docks,damage to the ship's cargo,and injury to the passengers or crew?

Accepted Answer

Protection and indemnity insurance, also known as P&I insurance, is a type of marine liability insurance that provides comprehensive coverage for property damage caused by the ship to piers and docks, damage to the ship's cargo, and injury to the passengers or crew. It also covers other liabilities such as pollution, wreck removal, and fines and penalties. Therefore, protection and indemnity insurance is the best choice for the given scenario.

Question 7

CompuFix services desktop and laptop computers.The owner of CompuFix is concerned that computers that are left with the business to be repaired may be damaged or destroyed.To address this risk,CompuFix should purchase

Accepted Answer

Coverage for property held by bailees is specifically designed to protect businesses that temporarily possess the property of others for the purpose of repairing, storing, or transporting it. This type of insurance will cover any damages that may occur to a customer's computer while it is in CompuFix's possession. Mobile equipment and property insurance and equipment breakdown insurance would not provide coverage for property held by others, and a block policy for dealers would likely be more applicable to businesses that sell computers rather than repair them.

Question 8

John is risk manager of Alpha-2-Omega Company.John wants coverage for "direct physical loss" ("open perils" coverage)under the business and personal property (BPP)coverage form.Which causes-of-loss form should he select?

Accepted Answer

The special form provides open perils coverage for direct physical loss, which is what John wants. This form covers any cause of loss that is not specifically excluded in the policy. The other forms have limitations on the types of losses that are covered, such as the basic form which only covers fire, lightning, and limited other perils. The standard form adds coverage for some additional perils, but still has limitations. The broad form provides coverage for more perils than the standard form, but still has limitations on coverage. Therefore, the best choice for John is the special form as it provides the most comprehensive coverage for his needs.

Question 9

Brandie's first job out of college was working for a national insurance brokerage.Her boss gave her a book to review that contained many different insurance forms.One interesting form provides open-perils coverage,but excludes losses usually covered by standard property insurance contracts (fire,wind,hail,explosion,etc. ).Brandie boss told her that some businesses purchase the coverage to supplement their other property coverages,as it provides flood coverage,earthquake coverage and insurance for other losses that are not excluded.The interesting policy form Brandie found was

Accepted Answer

The form described in the question provides open-perils coverage but excludes losses usually covered by standard property insurance contracts. This is characteristic of difference in conditions (DIC) insurance, which is a type of policy that provides coverage for losses that are not typically covered by standard property insurance policies. DIC policies may include coverage for flood, earthquake, and other perils not covered by standard policies. Inland marine insurance covers property in transit, while commercial umbrella liability insurance provides additional liability coverage beyond the limits of underlying insurance policies. Protection and indemnity insurance is a type of liability insurance for vessel owners. None of these options fit the description of the interesting policy form described in the question.

Quiz 25: Commercial Property Insurance

The business income and extra expense coverage form covers loss of business income and continuing normal operating expenses.How is business income (revenue) defined?

If the optional replacement cost coverage provision is not selected,how are losses settled under the building and personal property (BPP) coverage form?

Which of the following statements about the ISO businessowners policy is true?

Jenkins Manufacturing is concerned that a competitor may attempt to hack its computer network and insert malware on Jenkins Manufacturing computers,causing the computers to crash.That stand-alone property insurance policy can Jenkins Manufacturing purchase to pay for such damage to their computers?

Which ocean marine coverage provides comprehensive liability insurance for property damage caused by the ship to piers and docks,damage to the ship's cargo,and injury to the passengers or crew?

CompuFix services desktop and laptop computers.The owner of CompuFix is concerned that computers that are left with the business to be repaired may be damaged or destroyed.To address this risk,CompuFix should purchase

John is risk manager of Alpha-2-Omega Company.John wants coverage for "direct physical loss" ("open perils" coverage) under the business and personal property (BPP) coverage form.Which causes-of-loss form should he select?