Alabama Property and Casualty Practice Exam

Which type of risk is included in the Nationwide Marine Definition?

1. Commercial Property Floater Risk

2. General Liability Risk

3. Workers Compensation Risk

4. Homeowners Risk

The correct answer is: Commercial Property Floater Risk

The Nationwide Marine Definition is a regulatory framework used to classify certain types of property insurance that are unique and traditionally considered to fall under marine risks, reflecting the nature of coverage for movable or transportable property rather than fixed property. The intention behind this classification is to ensure that policies covering specific risks related to transportation and movement of goods are accommodated within an appropriate insurance structure. Commercial Property Floater Risk is indeed included in the Nationwide Marine Definition because it pertains to property that is not fixed to one location and can be subject to movement, such as equipment, goods in transit, or property used in commercial endeavors. These risks are often covered by policies that fall under the marine classification due to their distinct characteristics tied to mobility and transport. In contrast, General Liability Risk, Workers Compensation Risk, and Homeowners Risk concern different aspects of insurance that are not specifically tied to the movement or transport of property. General Liability focuses on liability exposures arising from business operations, Workers Compensation pertains to employee-related injuries or illnesses in the workplace, and Homeowners Risk deals with personal residence-related exposures. Thus, they do not fall under the classification associated with the Nationwide Marine Definition.