Question 1

What is the primary characteristic that distinguishes inland marine insurance from standard property insurance?

Accepted Answer

Inland marine insurance covers property that is mobile or in transit, rather than property at a fixed location. It evolved from ocean marine insurance to address risks associated with goods and equipment that move between locations on land.

Question 2

What types of property does a contractors equipment floater typically cover?

Accepted Answer

A contractors equipment floater covers mobile tools, machinery, and equipment used at construction or job sites, such as cranes, bulldozers, compressors, and hand tools. Coverage follows the equipment wherever it is located, whether at a job site, in transit, or temporarily stored at a yard.

Question 3

What is the purpose of builders risk insurance and what property does it cover?

Accepted Answer

Builders risk insurance is designed to cover buildings and structures under construction against physical loss or damage during the building process. It typically covers the structure itself, materials on site, and materials in transit to the job site, protecting the owner and contractor during the vulnerable construction period.

Question 4

What is the difference between a shipper's interest policy and carrier's liability coverage in transit insurance?

Accepted Answer

A shipper's interest policy covers the cargo owner's financial interest in goods being transported, paying for losses based on the value of the goods regardless of who caused the loss. Carrier's liability coverage protects the transportation company and only pays based on the carrier's legal liability, which is often limited by tariff rates.

Question 5

What is the key difference between a scheduled inland marine policy and a blanket (unscheduled) inland marine policy?

Accepted Answer

A scheduled inland marine policy lists each covered item individually with a specific stated value assigned to each piece, providing certainty about what is covered and for how much. A blanket policy covers a class of property up to an aggregate limit without itemizing individual pieces, offering flexibility when inventory changes frequently.

Property and Casualty Insurance License Exam — Inland Marine Insurance

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