Property & Casualty Insurance Exam (National Portion)Property InsuranceMedium
An insured's commercial building sustained damage from a burst pipe, causing extensive water damage to the interior. The policy is a Broad Cause of Loss form. Which of the following perils would specifically cover this type of damage?
- AFalling objects
- BWater damage (from plumbing systems)
- CWeight of ice, snow, or sleet
- DVandalism
Show answer & explanationAnswer & explanation
Correct answer: B. Water damage (from plumbing systems)
The Broad Cause of Loss form expands on the Basic form by adding several perils, including falling objects; weight of ice, snow, or sleet; and water damage from accidental discharge or overflow of plumbing, heating, air conditioning, or automatic fire protective systems.
Why the other options are wrong
- A. Falling objects is an added peril in the Broad form but does not relate to a burst pipe.
- C. Weight of ice, snow, or sleet is an added peril in the Broad form but does not relate to a burst pipe.
- D. Vandalism is covered under the Basic form, not specific to burst pipes.
Broad Cause of Loss Form (Commercial Property)
A named perils form that covers all the perils in the Basic form plus additional perils, offering more comprehensive coverage than Basic.
- Adds perils like falling objects, weight of ice/snow/sleet, water damage from plumbing discharge, collapse, etc.
- Still a 'named perils' policy (only listed perils are covered).
- Intermediate level of coverage between Basic and Special forms.
Memory trick: Broad perils 'broaden' coverage by adding common issues like 'wet and heavy stuff falling'.