If You Have a Loss Due to a Flood

question 42

Multiple Choice

If you have a loss due to a flood,

• A) Your homeowner's insurance should normally cover the loss.
• B) You must have already purchased special coverage if you live in an area that has frequent floods in order to be covered.
• C) FEMA (Federal Emergency Management Agency) will automatically provide coverage if this is your second flood loss.
• D) You need an umbrella policy for coverage.
• E) Your additional living expenses coverage will apply if you move to an area that has not flooded in one year.

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Definitions:

Consideration

A legal concept referring to something of value given by both parties to a contract that induces them to enter into the agreement to exchange mutual performances.

Mirror-Image Rule

The principle that holds that the terms of the acceptance must mirror the terms of the offer; if the terms of the acceptance do not mirror the terms of the offer, no contract is formed, and the attempted acceptance is a counteroffer.

Mixed Sale

A contract that combines a good with a service or real estate.

Conditional Title

A legal status indicating that ownership of a property or asset will transfer from one party to another only after specific conditions have been met.