Georgia Property & Casualty Practice Exam

Why might someone choose a dwelling policy over a homeowners policy?

1. the house is not eligible for a homeowners policy because its value is below the insurer's

2. the house is under construction

3. the insured wants liability as well as property coverage

4. the house is tenant occupied

The correct answer is: the insured wants liability as well as property coverage

Choosing a dwelling policy over a homeowners policy can be influenced by specific coverage needs. In this context, a dwelling policy is typically designed for properties that are not owner-occupied, providing coverage primarily for the physical structure rather than the owner's personal liability. This makes it suitable for landlords or those renting out homes, as the policy can be tailored to provide property coverage without including liability, which the insured may choose to cover separately. In cases where liability coverage is crucial in addition to property coverage, homeowners policies usually provide that built-in liability coverage. However, if an individual is looking specifically for property protection without the added liability component, a dwelling policy fits those needs. It's essential for anyone considering which type of policy best meets their needs to assess both property and liability coverage levels and what their primary purpose for the policy might be. The other options might not present valid reasons for choosing a dwelling policy over a homeowners policy. For example, if the house is under construction, a builders risk policy would be more appropriate. Similarly, if the house is tenant-occupied, a dwelling policy can indeed be appropriate, but it is not the primary reason for choosing that option over a homeowners policy; homeowners policies can also cover certain tenant-occupied situations. Lastly, if the house