Georgia Property & Casualty Practice Exam

What is the most practical solution for Mary to obtain additional liability coverage for her music lessons?

1. Add the Home Day Care Coverage endorsement

2. Purchase a second homeowners policy

3. Add the permitted incidental occupancies endorsement

4. Purchase a dwelling policy

The correct answer is: Add the permitted incidental occupancies endorsement

The most practical solution for Mary to obtain additional liability coverage for her music lessons is to add the permitted incidental occupancies endorsement to her existing homeowners policy. This endorsement is specifically designed to cover business activities that may be conducted within the home, such as offering music lessons. By adding this endorsement, Mary can extend her liability coverage to include the risks associated with her music teaching while staying under her current policy. This approach is advantageous because it typically comes at a lower cost than obtaining a separate policy and allows her to maintain the comprehensive benefits of her homeowners insurance. Additionally, the endorsement can provide coverage for potential liability claims that could arise from her business activity, offering peace of mind while she pursues her teaching. The other options may not adequately address her specific liability coverage needs or could involve more cost and complexity than necessary.