Question

Mark has a Homeowners 3 (special form) policy that provides $120,000 of insurance on his dwelling and $100,000 on personal property. The replacement cost of the home is $200,000. Assume the coinsurance requirement is 80% and ignore any deductible. Treat each case separately

6. Mark accidentally spills a can of paint while painting the living room. A wall-to-wall wood floor of the room (which is considered part of the dwelling) is badly damaged and must be replaced.

Would the wood floor be covered by Mark’s policy? Yes No If yes, explain your answer: If no, explain why not:

Answer 1

6. Answer: No

The wood floor would not be covered by Mark’s policy. Homeowners 3 (special form) policy provides protection against 16 open perils which include falling objects. But damage to property inside the building is covered if the roof or outside wall of the building is first damaged by the falling object. Here the paint spill has damaged the wall to wall wood floor which is inside the building. Moreover, the loss that results from the neglect of the insures is also not covered. Here Mark neglected to use reasonable means to avoid damage to the floor while painting the house. Hence the loss would not be covered by Mark’s policy.