Hawaii Insurance Adjuster License Practice Exam

What distinguishes homeowner policies from dwelling policies regarding eligibility requirements?

1. Homeowner policies require the property to be owner-occupied

2. Dwelling policies are generally more expensive

3. Homeowner policies require named insured residence at the property

4. Dwelling policies cover more types of property

The correct answer is: Homeowner policies require named insured residence at the property

Homeowner policies are specifically designed for properties that are occupied by the owner, which means that the named insured must reside at the property covered by the insurance. This occupancy requirement is a key distinction from dwelling policies, which can cover rental properties or those not occupied by the owner. Homeowner policies often provide a broader range of coverage options, including personal liability protection and coverage for personal belongings, but they do necessitate that the homeowner lives in the residence. While the idea that dwelling policies can cover various types of properties is relevant, it does not address the fundamental eligibility requirement that differentiates the two policy types. This aspect illustrates the importance of understanding the occupancy guidelines for forwarding appropriate coverage in insurance practices. Therefore, the requirement for the named insured to reside at the property is the defining feature of homeowner policies that sets them apart from dwelling policies.