West Virginia Property and Casualty Licensing Practice Exam

What types of incidents are covered under the DP2 (Broad Form) policy?

1. Flood, theft, and vandalism

2. Fire, lightning, and internal explosion

3. Wear and tear, earthquakes, and machinery breakdown

4. Civil disturbances and acts of terrorism

The correct answer is: Fire, lightning, and internal explosion

The DP2 (Broad Form) policy provides coverage for specific perils, primarily focusing on risks associated with property loss. Among the covered incidents, fire, lightning, and internal explosion are significant because they represent common causes of property damage that a homeowner may face. Fire is one of the most prevalent risks, potentially resulting from accidents or natural causes, making it a critical component of property insurance. Lightning, while less frequent, can lead to severe damage to structures and the contents within, earning its inclusion in the policy's coverage. Internal explosion refers to incidents that occur within a covered structure, which can lead to substantial property loss as well. In comparison, other options present perils that are either not covered under a DP2 policy or do not align with the specific risks outlined in the policy. For instance, while flood and theft may seem like valid concerns for homeowners, these events are typically excluded from standard coverage unless additional endorsements are purchased. Similarly, wear and tear as well as machinery breakdown are considered maintenance issues rather than insurable perils. Lastly, civil disturbances and acts of terrorism are generally covered under specific policies or riders, but are not included in the typical DP2 coverage. The focus on fire, lightning, and internal explosion aligns with