Georgia Adjuster Practice Test

What significant change occurs when adding a Mobile Home endorsement to a Homeowners policy?

1. The coverage limits increase

2. The description of covered property is changed

3. It adds coverage for personal property only

4. It removes coverage for any stationary structures

The correct answer is: The description of covered property is changed

Adding a Mobile Home endorsement to a Homeowners policy primarily alters the description of the covered property. This endorsement specifies that mobile homes are included as part of the insured property under the policy, which means that the coverage is explicitly extended to these structures. Homeowners policies are typically designed for traditional dwellings, and the inclusion of a mobile home necessitates a change in how coverage is applied. The endorsement clarifies that a mobile home, often with different structural characteristics than a standard home, will be treated under the terms of the policy. This distinction is crucial because mobile homes can have unique risks associated with them, such as mobility and different liability exposures. The other options—such as increasing coverage limits, solely covering personal property, or removing coverage for stationary structures—do not accurately capture the primary function of the Mobile Home endorsement. This endorsement's main purpose is to ensure that mobile homes are recognized and appropriately insured within the context of the existing homeowners policy.