1. All of the following statements concerning homeowner’s policy endorsements ar
ID: 364016 • Letter: 1
Question
1. All of the following statements concerning homeowner’s policy endorsements are correct EXCEPT
a. The inflation guard endorsement increases property limits by an annual percentage selected by the insured.
b. The home day-care coverage endorsement is appropriate for a person conducting a home day-care business for older adults.
c. The personal property replacement cost loss settlement endorsement changes the loss settlement basis for most types of covered personal property.
d. The earthquake endorsement provides coverage subject to the same deductible that applies to other covered perils.
2. Describe some key elements of Title Insurance.
3. Additional coverage may be needed for personal property that is subject to sublimits in a homeowner’s policy. Such property includes all the following EXCEPT
a. Furs
b. Jewelry
c. Silverware
d. Antiques
Explanation / Answer
1. All of the following statements concerning homeowner’s policy endorsements are correct EXCEPT a. The inflation guard endorsement increases property limits by an annual percentage selected by the insured. TRUE b. The home day-care coverage endorsement is appropriate for a person conducting a home day-care business for older adults. TRUE c. The personal property replacement cost loss settlement endorsement changes the loss settlement basis for most types of covered personal property. FALSE These have a limited coverage d. The earthquake endorsement provides coverage subject to the same deductible that applies to other covered perils. TRUE 2. Describe some key elements of Title Insurance. Title insurance is a form of indemnity insurance mainly used in the United States that insures against financial loss from problems in ownership of real estate property and from the invalidity of mortgage loans. Title insurance defends against a lawsuit taking the title away, or reimburse the insured for the actual financial loss incurred up to the dollar quantity of insurance provided by the policy. The cost of title insurance has two parts: premium and service fees. Title insurance premiums are based on five monetary considerations, which are Maintaining current title information on property local to that operation, i.e., title plant Searching and examining the title to subject properties Resolving or clearing defects to title Covering title defects Allowing for a reasonable profit 3. Additional coverage may be needed for personal property that is subject to sublimits in a homeowner’s policy. Such property includes all the following EXCEPT a. Furs TRUE b. Jewelry TRUE c. Silverware TRUE d. Antiques FALSE As the actual value is never determined
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