Mississippi Property & Casualty Practice Exam

What is the maximum amount of money covered under homeowners insurance?

1. $1,000

2. $1,200

3. $1,500

4. $2,000

The correct answer is: $1,500

Homeowners insurance typically covers property damage, liability, and additional living expenses, but the amount of coverage can vary based on the terms of the policy and the provider. The question asks about a maximum amount, which suggests a specific component of coverage rather than the overall insurance limit. In many standard homeowners insurance policies, there is a specific limit that may be associated with certain types of property or claims, such as personal property. While $1,000, $1,200, and $1,500 might represent limits in certain policy settings or specialized riders, $2,000 often represents the standard minimum for broader personal property coverage in many typical policies. It's common for personal property coverage to have a maximum that generalizes to such levels, especially in policies under certain classification where the insured has basic coverage. Therefore, if the question is attempting to pinpoint a specific widely accepted figure that would reflect basic coverage limits within the industry, then $2,000 would logically be a more accurate reflection of that limit compared to the other figures listed. This choice aligns with the coverage norms seen in homeowner policies, suggesting it might represent an accepted or standardized limit for personal property coverage.