STATE FARM PROPERTY EXAM WITH
QUESTIONS & VERIFIED ANSWERS GRADED A+
In property insurance actual cash value is defined as which of the following - ANSWER-Replacement cost at the time of the loss, less depreciation
Peril is most easily defined as - ANSWER-the cause of loss insured against
What is a leading factor in the determination of actual cash value -ANSWER- replacement cost
Replacement cost is defined as - ANSWER-full replacement of property at its current cost, new and without reduction for depreciation
Property insurance that provides 100k coverage for a building and 50k coverage for personal property at a single location is called - ANSWER-Specific coverage
Which of the following is used in the formula for calculating the actual cash value of a property - ANSWER-replacement cost
What is the purpose of the coinsurance clause found in property insurance policies? - ANSWER-Encourage the insured to insure the property closer to its full value
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An insured has a liability policy that sets the amount at 50k for all claims that arise from a single incident. which type of limit of liability does this insured's policy have? - ANSWER-per occurrence
When the amount of insurance written in a property policy is not subject to any coinsurance provision and that amount is paid in the event of a covered loss, the coverage is said to be written as - ANSWER-stated amount
What is stated amount coverage - ANSWER-In stated amt coverage the value of the insured property is determined at the time the policy is written.
in the event of a loss, that amount is paid without regard to any coinsurance provision.
However, if the loss is less than the total, the insurer has salvage rights with the insured having first right of refusal of the salvage.
What type of liability would a person who owns a swimming pool have? - ANSWER-Absolute
What is absolute liability - ANSWER-Any conduct that is inherently dangerous imposes absolute liability. the claimant does not have to prove anything
Insurable interest in the property covered in a policy must be proven - ANSWER- at the time of loss
Which of the following is NOT an element of negligence
breach, unbroken chain, libel, duty - ANSWER-libel
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