Florida 2-20 General Lines Agent (Property, Casualty, Commercial Lines and Florida Law) flashcards

Dwelling Policy (DP-2 Broad Form) provides limited coverage for tree removal costs when a tree damages a covered structure due to a covered peril.

• Typically $500 per tree sub-limit.
• Applies if the tree damages a dwelling, other structure, or blocks a driveway/ramp for disabled.
• Covered perils include windstorm, hail, weight of ice/snow/sleet, or non-owned vehicle impact.

Memory trick: Tree's fall, structures hit, five hundred bucks to quit.

A Dwelling Policy form providing 'open perils' coverage for the dwelling and other structures, meaning it covers all direct physical losses unless specifically excluded. Personal property (Coverage C) is covered on a named perils basis.

• Dwelling (Coverage A) and Other Structures (Coverage B) are 'open perils'.
• Personal Property (Coverage C) is 'named perils'.
• Common exclusions include flood, earthquake, war, nuclear hazard, and wear and tear.

Memory trick: DP-3 is Open for Dwelling, Named for Stuff.

Equipment Breakdown Coverage (formerly Boiler and Machinery) covers direct physical damage to covered equipment caused by a sudden and accidental breakdown, including mechanical or electrical failures.

• Covers sudden and accidental mechanical/electrical breakdown.
• Applies to direct physical damage to the equipment itself.
• May include related coverages like business income or spoilage if endorsed.

Memory trick: Sudden break, direct damage, repair the part, not the baggage.

This policy covers the condominium building, common elements, and property owned by the association. It may also cover fixtures, appliances, and interior finishes within individual units if required by the condominium declaration.

• Covers common property and association-owned items.
• Coverage for unit interiors (fixtures, appliances, improvements) is determined by the condominium declaration.
• Does not typically cover unit owners' personal property or liability.

Memory trick: Association covers common; unit interior depends on the declaration's command.

Coverage D (Loss of Use) in an HO-3 policy includes Fair Rental Value, which reimburses the insured for the loss of rental income from a portion of the insured premises rented to others, when made uninhabitable by a covered peril.

• Part of Coverage D (Loss of Use).
• Covers lost rent for the period of restoration.
• Applies if a covered peril makes the rented portion uninhabitable.

Memory trick: Extra living costs or lost rent, Coverage D is heaven-sent.

Replacement Cost is a method of valuation that pays the cost to replace or repair damaged property with new materials of like kind and quality, without any deduction for depreciation.

• Provides full cost to rebuild/replace, up to policy limits.
• Encourages policyholders to rebuild or repair rather than take a cash settlement.
• Often requires the insured to actually repair or replace the property before the full RC payment is made (initially paid ACV, then RC upon completion).

Memory trick: Value your property: ACV 'Depreciates', RC 'Replaces'.

A formula used in property insurance to determine the amount an insurer will pay when the insured fails to maintain the required percentage of coverage relative to the property's value.

• Formula: (Amount of Insurance Carried / Amount of Insurance Required) x Amount of Loss = Amount Paid.
• Amount Required = Property Value x Coinsurance Percentage.
• Applies when the insured is underinsured based on the coinsurance clause.

Memory trick: Carried over Required, then times the Loss.

Standard Commercial Property Policies typically exclude damage caused by flood, which is defined as a general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties.

• Flood is a standard exclusion in all commercial property forms.
• Must be purchased separately, often through the NFIP.
• Includes overflow of inland or tidal waters, unusual accumulation of run-off, mudslides.

Memory trick: War, nuclear, flood, and quakes are not for standard takes.

Part of an HO-3 Homeowners policy that provides coverage for structures on the insured premises that are separated from the dwelling by a clear space, such as detached garages or sheds.

• Standard limit is typically 10% of Coverage A (Dwelling).
• Covers structures like detached garages, sheds, fences.
• Coverage is usually on an open perils basis, similar to Coverage A.

Memory trick: A is for home, B for the shed, C for your stuff, D for your bed.

The DP-3 Special Form generally covers vandalism, but commonly includes an exclusion for damage caused by a tenant of the insured.

• DP-3 is an 'all-risk' policy for the dwelling, covering perils not specifically excluded.
• Vandalism and malicious mischief are typically covered perils.
• Exclusions often include intentional acts by the insured, or damage caused by tenants, to prevent moral hazard.

Memory trick: DP-3 covers Vandalism, but not when the 'T'enant is the culprit.

An endorsement that increases the amount of insurance for specific, pre-defined periods during the policy term, typically used for businesses with seasonal fluctuations in inventory or business income.

• Allows higher coverage limits during peak seasons (e.g., holidays, harvest season).
• Prevents over-insuring for the entire year while ensuring adequate coverage when needed most.
• Often used in conjunction with Business Income or Building and Personal Property policies.

Memory trick: Endorsements help 'Adjust' your BI for special times.

The right of the insurer to take possession of damaged property after paying for its full value, and then sell it to recover a portion of the loss.

• Applies typically to total losses.
• Reduces the net cost of the claim for the insurer.
• Property owner must relinquish ownership to the insurer.

Memory trick: Don't just pay, sometimes you can Salvage the day!

Under the Building and Personal Property Coverage Form (BPP), 'Building' includes the structure, additions, permanently installed fixtures, machinery, and equipment, as well as outdoor fixtures.

• Covers the physical structure itself.
• Includes permanently installed items like plumbing, electrical, HVAC.
• Also covers fixtures, which can include permanent artistic installations like murals.

Memory trick: Buildings are fixed, personal property moves, others' property just grooves.

A Dwelling Policy that provides named perils coverage for both the dwelling and personal property, including perils beyond the basic form like theft, falling objects, and weight of ice/snow/sleet.

• Named perils coverage for both dwelling and personal property.
• Perils include fire, lightning, internal explosion, extended coverage perils, V&MM, burglary damage, falling objects, weight of ice/snow/sleet, accidental discharge of water, freezing.
• Broader than DP-1 but not 'all risk' like DP-3 for the dwelling.

Memory trick: 1 is basic, 2 is broad, 3 is special for the dwelling god.

The Building and Personal Property Coverage Form (BPP) typically excludes structures considered 'land' or 'water' property, such as bridges, roadways, patios, and especially docks, piers, wharves, and retaining walls not part of a building.

• Standard BPP excludes land, water, bridges, roadways, patios.
• Docks and piers fall under these exclusions due to their nature/location.
• Specialized endorsements or Marine policies are usually needed for coverage.

Memory trick: Buildings and your stuff, but not the earth or sea's fluff.

The DP-2 Broad Form covers the perils included in DP-1 (Basic Form) plus a list of additional named perils, offering broader protection for dwelling and personal property.

• Includes all DP-1 perils (Fire, Lightning, Internal Explosion, extended perils like Windstorm, Hail, Riot, Vehicle/Aircraft, Smoke, Volcanic Eruption).
• Adds 'Broad Form' perils such as Bursting of Pipes, Falling Objects, Weight of Ice/Snow/Sleet, Accidental Discharge of Water, Freezing, etc.
• Excludes certain common perils like flood, earth movement, and neglect unless specifically endorsed.

Memory trick: DP-2 adds 'WALTZ-C' to the basic perils.