Arkansas Insurance Adjuster Practice Exam

What BOP endorsement would cover a company's lost business income and extra expense due to loss of electrical service?

1. This type of loss cannot be covered

2. Utility Time Element

3. Spoilage

4. Utility Services - Direct Damage

The correct answer is: Utility Time Element

A This type of loss cannot be covered This option is incorrect because there is an endorsement that can cover a company's lost business income and extra expense due to loss of electrical service. It is important to have this coverage in case of unexpected events such as power outages. C: Spoilage This option is incorrect because spoilage coverage would apply to perishable items that require specific storage conditions, such as food or medication. It would not cover the loss of business income and extra expenses due to loss of electrical service. D: Utility Services - Direct Damage This option is incorrect because utility services coverage would only cover the direct physical damage to the utility services, such as pipes or power lines, and not the resulting loss of business income and extra expenses. Utility Time Element endorsement, also known as Utility Interruption coverage, is specifically designed to