A homeowners policy that pays for loss only from causes specifically listed in the policy, such as fire, lightning, or windstorm, uses which coverage structure?
A. Open-peril (all-risk) coverage
B. Named-peril coverage
C. Guaranteed replacement coverage
D. Blanket coverage
Source: General insurance principle
Among the standard ISO homeowners forms, which one is generally recognized as covering the dwelling on a broad 'special form' (open-peril) basis?
A. HO-1 (Basic Form)
B. HO-2 (Broad Form)
C. HO-3 (Special Form)
D. HO-8 (Modified Coverage Form)
Source: General insurance principle
The HO-6 policy form is written specifically to insure which type of property interest?
A. A single-family detached home
B. A mobile or manufactured home
C. A condominium unit owner's interior improvements and personal property
D. A landlord's rented dwelling structure
Source: General insurance principle
A valuation method that pays a claim based on the cost to repair or replace damaged property with new property of like kind and quality, with no deduction for depreciation, is called:
A. Actual cash value (ACV)
B. Market value
C. Agreed value
D. Replacement cost value
Source: General insurance principle
Actual cash value (ACV) is most commonly calculated using which formula?
A. Replacement cost minus depreciation
B. Replacement cost plus depreciation
C. Original purchase price with no adjustment
D. Market value plus depreciation
Source: General insurance principle
