Arkansas Insurance Adjuster Practice Exam

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Question: 1 / 400

For how long does the BOP provide loss of income on an 'actual loss' sustained basis?

6 months

18 months

24 months

12 months

The Businessowners Policy (BOP) is an insurance policy designed for small and medium-sized businesses. It provides coverage for property damage, liability, and loss of income due to a covered peril. "Actual loss" means the actual amount of income lost during the time that the business is closed or unable to operate due to a covered loss.

Option A is incorrect because 6 months is too short of a time period to accurately cover for actual loss sustained by a business.

Option B is incorrect because 18 months also may not be enough time to cover the full extent of the actual loss sustained by a business.

Option C is incorrect because 24 months is a longer time period than most businesses would need to recover from a covered loss.

Therefore, option D, 12 months, is the most appropriate answer as it provides a reasonable and sufficient amount of time for a business to recover

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