Property & Casualty Insurance Exam (National Portion)Property InsuranceEasy
A homeowner has an HO-3 policy. A storm causes a tree to fall, damaging the roof of their home. The homeowner's friend helps them put a tarp on the roof to prevent further water damage. The cost of the tarp and the friend's labor (paid in cash) is $300. Where would this expense typically be covered?
- AAdditional Coverages - Reasonable Repairs
- BCoverage D - Loss of Use
- CCoverage A - Dwelling
- DAdditional Coverages - Debris Removal
Show answer & explanationAnswer & explanation
Correct answer: A. Additional Coverages - Reasonable Repairs
The cost to temporarily protect the property from further damage after a covered loss is typically covered under 'Reasonable Repairs' or 'Preservation of Property' within the Additional Coverages section. This includes expenses for emergency measures like tarping a damaged roof.
Why the other options are wrong
- B. Coverage D covers additional living expenses or lost rent, not costs to mitigate property damage.
- C. Coverage A covers the dwelling itself, not the temporary repairs to prevent further damage.
- D. Debris Removal covers the cost of removing debris (like the tree), not temporary repairs to the structure.
Reasonable Repairs (Homeowners Additional Coverage)
An additional coverage in homeowners policies that pays for the reasonable costs incurred by the insured to protect covered property from further damage after a covered loss occurs. This includes temporary repairs like boarding up windows or tarping a roof.
- Covers temporary measures to prevent further damage.
- Applies after a covered loss.
- Includes costs for materials and labor.
- Aims to mitigate the overall loss.
Memory trick: After a loss, make REASONABLE repairs to SAVE.