Exam 25: Commercial Property Insurance

A navigation error caused a cargo ship to run aground on a reef.The ship,valued at $1.5 million,was carrying $1.5 million in grain and $1.5 in electronic devices.The ship sustained a $150,000 physical damage loss.If this loss is a "particular average" loss,how will the loss be settled?

Which of the following types of forms is used to insure fluctuations in business personal property,such as inventory and finished goods?

If the optional replacement cost coverage provision is not selected,how are losses settled under the building and personal property (BPP)coverage form?

An Inter-Ocean Transfer cargo ship was forced to jettison some cargo in heavy seas.The various interests in the voyage at the time the property was jettisoned were Value of the ship $2.0 million Value of lumber and wood chips 1.0 million Value of iron ore $2.0 million If $400,000 worth of iron ore was jettisoned,for how much of this amount would Inter-Ocean Transfer be responsible under general average?

Jenkins Manufacturing is concerned that a competitor may attempt to hack its computer network and insert malware on Jenkins Manufacturing computers,causing the computers to crash.That stand-alone property insurance policy can Jenkins Manufacturing purchase to pay for such damage to their computers?

Frank's property insurance requires periodic reporting of inventory values.Frank believes he can save money by under-reporting the inventory.Last period,Frank reported $200,000 when the value was really $400,000.Shortly after filing the report,when the value was $500,000,the inventory was destroyed.Ignoring any deductible,how much will Frank's insurer pay?

Which of the following statements about the building and personal property coverage form is (are)true? I.A limited amount of coverage is provided for pollutant cleanup and removal at the described premises if the release or discharge of the pollutant results from a covered cause of loss. II.Fire department service charges are specifically excluded because they are a normal cost of doing business.

Tom opened a store in a mall.His store is located between a theater and a department store.Tom counts on the theater and department store to generate walk-in business at his store.While his store has been successful,Tom knows that if either or both of the other businesses closed,his store would suffer an economic loss.What type of dependent property situation is illustrated in this scenario?

John is risk manager of Alpha-2-Omega Company.John wants coverage for "direct physical loss" ("open perils" coverage)under the business and personal property (BPP)coverage form.Which causes-of-loss form should he select?