Georgia Property & Casualty Practice Exam

Which peril is NOT typically covered under a basic property policy?

1. Riot

2. Earthquake

3. Smoke

4. Sprinkler leakage

The correct answer is: Earthquake

The correct answer is earthquake. A basic property policy usually covers a variety of perils, but certain significant risks, such as earthquakes, are generally excluded. Earthquake coverage is typically only available through additional endorsements or specialized policies, reflecting the potential for extensive and costly damage that earthquakes can cause. Riot, smoke, and sprinkler leakage, on the other hand, are considered standard perils that are often included in basic property coverage, as they are more common threats to property. Since these perils typically result in damage that is more manageable for insurers based on historical data, they are included under the basic policy. This distinction helps individuals understand the limitations of their coverage and the importance of assessing their specific risks when selecting insurance.