Question

According to the Common Policy Conditions, under what circumstances can the insured transfer rights or duties under a policy?

Describe how a policy may be canceled by an insurer or an insured according to the Common Policy Conditions.

A building values at $400,000. It is insured for $250,000 value. A covered cause of loss happened and caused $10,000 loss. The policy has a $5,000 deductible. Please calculate the amount payable with the following two scenarios:

Scenario 1:

Co-insurance requirement = 80%

Scenario 2:

Co-insurance requirement = 90%

What three general categories of property (corresponding to the three coverage agreements) does the Building and Personal Property Coverage Form (BPP) cover?

What items that might otherwise be considered building property does the BPP exclude?

Summarize property covered under the BPP for each of the specified types of personal property.

Answer 1

Answer 1. As per the Common Policy Conditions, insured should have the insurer’s written consent to transfer rights or duties under a Policy. In case, if insured dies then the same policy will be automatically transfers to the legal person of the insured.

Answer 2. As per the Common Policy Conditions, at any point if an insurer wants to cancel the policy then the insurer either needs to mail or send the written notice of cancellation to the insured first name at least 10-11 days before the cancellation date if cancellation is relating to nonpayment of premium amount. After from this 30 days for other reason. Policy can be cancelled at any time just by mailing or sending written notice of cancellation.

Answer 3 Scenario 1

                    Building Value $400,000

                     Co-insurance Requirement 80 percent

                     Required Amount of Insurance $ 320,000 (80% of 400,000)

                     Actual Amount of Insurance $250,000

                     Amount of Loss $ 10,000

Co- Insurance formula = (Actual Amount of Insurance) X Amount of Loss = Amount of claim

                                            (Required Amount of Insurance)

                                        = (250,000 divide by 320,000) X10, 000 = 7,812.5 minus policy deductible of 5,000 equals $2,812.5

  

Answer 3. Scenario 2

                    Building Value $400,000

                     Co-insurance Requirement 90 percent

                     Required Amount of Insurance $ 360,000 (90% of 400,000)

                     Actual Amount of Insurance $250,000

                     Amount of Loss $ 10,000

Co- Insurance formula = (Actual Amount of Insurance) X Amount of Loss = Amount of claim

                                            (Required Amount of Insurance)

= (250,000/360,000) X10, 000 = 6,944.4 minus policy deductible of 5,000 equals $1,944.4

Answer 4. Yes, the BPP covers buildings, personal property of others as well as your business personal property covers under Building and personal property coverage form (BPP).

Answer 5. The following items BPP excludes: Land, Water, bridges. Roadways, walks etc. Buildings where retaining walls are not considered, piers and docks.

Info needed for question 6. Please provide the specified types of personal property?