1. Peter has a Commercial Package Policy (CPP) that has a Building and Personal Property Coverage Form (BPP) with a Causes of Loss Broad Form covering his building with a $750,000 limit. A tropical storm struck the area near Peter's building and the strong winds tore most of the shingles from the building's roof and shattered multiple windows with flying debris. An outside fixture also sustained heavy damage due to the wind. The total amount of damages was $40,000 for the windows and shingles; and $10,000 for the outside fixture. How much will Peter's insurer pay for damage to his outside fixture?

   		The loss is not covered.
   		$5,000
   		$10,000
   		$40,000

The Equipment Breakdown Protection Coverage Form insuring agreement under which the insurer agrees to pay reasonable costs the insured incurs in stamping merchandise with the word "Salvage" is

		Spoilage Damage.
		Expediting Expenses.
		Brands and Labels.
		Ordinance and Law

1. All of the following are additional coverages in both the Building and Personal Property Coverage Form and the Builders Risk Coverage Form, EXCEPT:

   		Fire department service charges
   		Preservation of property
   		Increased cost of construction
   		Debris removal

1. Gilmore Certified Public Accountants occupies a commercial building insured under a Building and Personal Property Coverage Form (BPP). Gilmore is interested in adding the Agreed Value optional coverage to its policy. Mr. Gilmore's insurance agent explains that underwriters will need to review the policy and decide how to write the coverage. Insurers underwrite Agreed Value optional coverage carefully for which one of the following reasons?

   		The insurer is obliged to pay the ACV of the damaged property, regardless of the limit of insurance purchased.
   		Claims settlements under agreed value policies are typically higher than those under policies that include an 80 percent coinsurance clause.
   		Insureds are often tempted to underinsure, knowing they will not suffer a coinsurance penalty when the agreed value option is in effect.
   		If the Agreed Value coverage option is not renewed, the coinsurance condition cannot be reinstated.

A claim representative explains the settlement of a claim to an insured. The insured is concerned that he will not be able to replace his damaged business personal property when he learns that depreciation will be applied. The cost to replace property with new property of like kind and quality less depreciation is referred to as the

		Selling price.
		Replacement cost.
		Actual cash value.
		Depreciated value.