09 Basics of Property Insurance Part 1

Property Insurance

Insurance that covers losses to personal property.

Real Property

The actual structure or buildings, such as houses or commercial buildings.

Personal Property

Movable contents within a building, including clothes, appliances, and furniture.

Scheduled Coverage

A type of insurance policy that lists specific items or details that are covered.

Blanket Coverage

A type of insurance policy that covers items without a detailed list of what is covered.

Limits of Insurance

The maximum amount an insurance policy will pay for a covered occurrence.

Named Peril

An insurance policy that covers only the perils specifically listed in the policy.

Open Peril

An insurance policy that covers all risks of direct physical loss except those specifically excluded.

Basic Perils Policy

The least expensive insurance policy that covers essential risks such as fire, lightning, and explosion.

Extended Coverage

Additional coverage for perils like wind, civil commotion, and vandalism that may extend beyond basic perils.

WC Schaeffer

A mnemonic to remember the basic perils covered under a basic policy.

Broad Perils Policy

A named peril policy that covers all basic perils plus additional perils identified by the acronym BIG Effect.

BIG Effect

An acronym representing additional perils covered under a broad policy, including Burglary and Ice damage.

Special Perils Policy

An all-risk policy that covers everything except for a few specific exclusions.

Direct Loss

Immediate damage caused directly by a peril.

Indirect Loss

Loss resulting from a direct loss, such as additional living expenses incurred while a home is being repaired.