Los Angeles Claims Adjuster Property and Causality Practice Exam

Which property insurance cause of loss form covers all risks of loss?

1. Basic form

2. Broad form

3. Special form

4. Named peril form

The correct answer is: Special form

The Special form is designed to provide comprehensive coverage for property by insuring against all risks of loss, except for specific exclusions outlined in the policy. This means that unless a peril is explicitly excluded, it is typically covered, making it the most extensive option available for property insurance. This all-risk approach is beneficial for property owners who want maximum protection against unforeseen events that could cause damage or loss. In contrast, the Basic form and the Named peril form only cover specific perils that are clearly listed in the policy. The Basic form usually includes a limited range of perils, primarily covering fire, lightning, and a few others, while the Named peril form lists particular risks that are insured, leaving coverage gaps for other potential risks. The Broad form provides a wider range of coverage compared to the Basic form but still does not match the all-inclusive nature of the Special form. Therefore, the Special form is the correct choice when looking for a policy that covers all risks of loss, ensuring property owners are protected against a vast array of potential damages.