State Farm Insurance License Practice Exam

Which residences are eligible for coverage under a Dwelling Policy?

1. Only single-family homes

2. Mobile homes and residences rented to others

3. Only vacation homes

4. Only townhouses

The correct answer is: Mobile homes and residences rented to others

The eligibility for coverage under a Dwelling Policy is broad and includes various types of residences, making the selection of mobile homes and residences rented to others correct. A Dwelling Policy can provide coverage for structures that are not owner-occupied, such as rentals, which means that properties rented to others qualify for this type of insurance. Additionally, mobile homes are typically included under the various forms of Dwelling Policy depending on other underwriting guidelines. This flexibility allows property owners who may not fit the traditional single-family home model to acquire necessary insurance coverage for their properties. Understanding that Dwelling Policies are not limited to single-family homes or specific living arrangements is crucial for answering questions regarding property insurance accurately. In contrast, the other options are overly restrictive and do not account for a wide range of properties eligible for Dwelling Policy coverage. Single-family homes, vacation homes, and townhouses do not encompass the complete scope of what a Dwelling Policy can cover.