Florida 2-20 General Lines Agent (Property, Casualty, Commercial Lines and Florida Law)Property InsuranceHard
A client is purchasing a new Homeowners policy (HO-3). They have a significant collection of rare coins valued at $30,000. They are concerned about coverage for this collection, especially against theft. The standard HO-3 policy has a special limit of liability for theft of jewelry, watches, furs, and precious and semi-precious stones of $1,500. What is the standard special limit of liability for theft of silverware and pewter under an unendorsed HO-3 policy?
- A$1,500
- B$2,500
- C$500
- D$5,000
Show answer & explanationAnswer & explanation
Correct answer: B. $2,500
An unendorsed HO-3 policy has specific special limits of liability for certain categories of personal property, particularly for theft. While jewelry, watches, furs, and precious/semi-precious stones have a $1,500 limit for theft, the special limit for theft of silverware, silver-plated ware, gold-plated ware, pewter ware, and related items (including those made of these materials) is typically $2,500.
Why the other options are wrong
- A. This is the limit for jewelry, watches, furs, and precious/semi-precious stones, not silverware.
- C. This is incorrect; $500 is a limit for other specific items, not silverware.
- D. This is incorrect; $5,000 is not a standard special limit for silverware.
HO-3 Special Limits of Liability
Specific monetary limits within a Homeowners policy that cap the amount paid for certain categories of personal property, especially for losses due to theft.
- Applies to specific types of property (e.g., jewelry, firearms, cash)
- Often lower than the overall personal property limit
- Can be increased with endorsements (e.g., scheduled personal property)
Memory trick: HO-3 limits: Small amounts for big valuables, especially if stolen.