North Carolina Adjuster Practice Exam

In a North Carolina homeowners policy, what is the special limit of coverage for the theft of a firearm?

1. $5,000

2. 10% of Coverage C (max $10,000)

3. $20,000

4. Standard limit of $5,000

The correct answer is: 10% of Coverage C (max $10,000)

In a North Carolina homeowners policy, the special limit of coverage for the theft of a firearm is indeed 10% of Coverage C, with a maximum cap of $10,000. This is significant because Coverage C generally pertains to personal property, and homeowners policies typically have broader coverage that may not apply uniformly across all item categories. The limitation is established to address the unique nature of certain high-value items while still providing a reasonable level of compensation in case of theft. Firearms are often subject to specific regulations and may require special handling within insurance policies due to their value and potential for risk. Therefore, knowing that the coverage extends up to 10% of Coverage C, but does not exceed $10,000, accurately informs policyholders about the financial protection available to them in relation to theft events involving firearms, ensuring that they understand both the limits and the value of their coverage.