California Property & Casualty Broker-AgentProperty InsuranceMedium
A homeowner has an HO-3 policy and discovers that their valuable collection of vintage comic books, appraised at $15,000, was stolen during a burglary. The policy has a Coverage C (Personal Property) limit of $100,000. What is the maximum amount the policy will pay for the stolen comic books, before any deductible is applied?
- A$2,500
- B$10,000
- C$1,500
- D$5,000
Show answer & explanationAnswer & explanation
Correct answer: A. $2,500
HO-3 policies typically have special limits of liability for certain categories of personal property. For theft of valuable papers, such as stamps, tickets, and often comic books (depending on specific policy language, but generally grouped with collectibles), the limit is commonly $2,500.
Why the other options are wrong
- B. This is not a standard special limit for this category of property.
- C. This is a common limit for items like firearms or silver, but not for collectibles like comic books.
- D. This is a common limit for theft of jewelry, watches, furs, and precious stones.
HO-3 Special Personal Property Limits
HO-3 policies impose specific sub-limits on certain categories of personal property, particularly for theft, to control exposure for highly valuable or easily convertible items.
- Applies to specific categories (e.g., jewelry, firearms, valuable papers)
- Often lower than the overall Coverage C limit
- Can be increased via endorsement (e.g., Scheduled Personal Property Endorsement)
Memory trick: HO-3: Special Limits for Specific Treasures