Arkansas Insurance Adjuster Practice Exam

Will the damage to Sally's home be covered after a bear breaks in, and why?

1. Yes. Wildlife is a commonly named-peril found on all homeowner's policies

2. No. Since Sally did not take reasonable efforts to run the bear off, no damages may be covered

3. Yes. The HO-3 is an open-peril policy, without an exclusion for wildlife

4. No. 'Bear-Entry' is not listed as a named peril in Sally's HO-3 policy

The correct answer is: Yes. The HO-3 is an open-peril policy, without an exclusion for wildlife

The damage to Sally's home will be covered because the HO-3 policy is an open-peril policy, which means it covers all losses except those specifically excluded. Since there is no exclusion for wildlife, the damage from the bear breaking into her home would be covered. Option A is incorrect because not all homeowner's policies cover wildlife as a named peril. Option B is incorrect because the reason for the bear breaking in is not a factor in determining coverage. Option D is incorrect because the specific act of "bear-entry" is not listed as an exclusion, meaning it is covered.