Assignment 9

Question 1

Inflation Guard optional coverage

Answer 1

Coverage for the effects of inflation that automatically increases the limit of insurance by the percentage of annual increase shown in the declarations.

Question 2

Replacement Cost optional coverage

Answer 2

Coverage for losses to most types of property on a replacement cost basis (with no deduction for depreciation or obsolescence) instead of on an actual cash value basis.

Question 3

External exposure

Answer 3

A property outside the area owned or controlled by the insured that increases the probability of loss to the insured’s building and its contents.