Dwelling PolicyQuestion 74 of 158
A landlord's tenant must move out for three months while fire damage to the rented house is repaired. Which DP coverage reimburses the landlord for the rent the tenant would have paid?
a.Coverage B — Other Structures
b.Coverage C — Personal Property
c.Coverage E — Additional Living Expense
d.Coverage D — Fair Rental Value
Explanation
Coverage D, Fair Rental Value, reimburses the landlord for lost rental income when a covered loss makes the rented dwelling unfit to live in, for the time reasonably required to repair or replace it. Coverage E, Additional Living Expense, pays extra costs the named insured incurs when displaced from a dwelling they themselves occupy — not the landlord's lost rent. Coverages B and C apply to other structures and personal property, not rental income.
Law Reference: ISO Dwelling forms — Coverage D Fair Rental ValuePractice all 158 questions free — no signup required.
Related questions on this topic
- A California Personal Lines broker-agent is asked to write property coverage for a client. Which of the following risks is BEST suited for an ISO Dwelling Policy and within the broker's license scope?
- Which ISO Dwelling Property form provides open-perils (special form) coverage on the dwelling structure but continues to insure personal property on a named-perils basis?
- By default, on what valuation basis does the DP-1 Basic Form settle a partial loss to the dwelling?
- A landlord insured under a DP-3 is sued by a tenant who slipped on a broken porch step. What does the base DP-3 pay toward the landlord's liability defense?
- A landlord's DP-3 rental house has been vacant for 75 consecutive days while between tenants. Vandals break in and spray-paint the interior. How does the policy respond?
- A DP-3 dwelling has a replacement cost of $500,000. The landlord carries $300,000 of insurance and suffers a $60,000 partial loss with a $1,000 deductible. Using the coinsurance proportionate formula, what is the insurer's payment?
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