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Chapter 2 Property and Casualty Insurance for Homes and Businesses
Most homeowner’s policies cover personal possessions up to 50%
of the total coverage. So, if the homeowner’s policy provides $100,000
in coverage, it will cover electronics and other possessions up to
$50,000. Individual items may be limited to $1,500 or $2,000. What if
there are items that are more valuable than this limit? Those items can
be added to the policy by scheduling them.
Scheduling simply means that an item and its value are stated on
the policy. A small additional premium is paid for this. For example,
a rare piece of art or expensive jewelry should be scheduled. In some
cases, the receipt for the item may need to be supplied, or the item may
need to be valued by an expert.
Checkpoint 2.1
1. What does homeowner’s insurance cover?
2. What coverage protects you if somebody is hurt on your property?
3. How is earthquake coverage included in a homeowner’s policy?
4. What determines if a homeowner can purchase flood insurance?
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coverage amount be?
Build Your Vocabulary
As you progress through this course, develop a personal glossary of
insurance terms and add it to your portfolio. This will help you build your
vocabulary and prepare you for a career in insurance. Write out a definition
for each of the following terms, and add it to your personal insurance
glossary.
property and casualty insurance
mortgage
replacement cost
cash value
depreciation
endorsement
umbrella policy
scheduling