17 Free Pennsylvania Property & Casualty Practice Questions: Dwelling & Homeowners Policies (2026)
How to Use This Dwelling and Homeowners Set
This set covers the dwelling and homeowners policies. On the Pennsylvania Property and Casualty exam, Dwelling Policy Concepts is 4% (6 items) and Homeowners Policy Concepts is 7% (10-11 items), and both are tested through short scenarios rather than bare definitions.
Each question gives you a loss or a client need and asks which coverage, form or endorsement responds. Read the stem first, decide what the insured is trying to protect, and only then look at the options. The 17 questions are grouped by the skill they build.
Practice Questions 1-6: Naming the Coverage or Endorsement from the Need
Matching a client's need to a coverage or endorsement: lost rent, personal property settlement, identity fraud, libel, a condominium unit and a home business.
Question 1 (Chapter 2)
A Pennsylvania homeowner purchases a DP-3 dwelling policy for their primary residence. The policy includes Coverage A for the dwelling at $200,000. Which of the following statements is correct regarding Coverage B (other structures) under this policy?
- A) Coverage B is automatically included at 10% of Coverage A, or $20,000, for structures such as a detached garage.
- B) Coverage B must be purchased separately and is not included unless specifically endorsed.
- C) Coverage B provides coverage for personal property stored in other structures up to 50% of Coverage A.
- D) Coverage B is only available if the other structures are used for business purposes.
Show answer & explanation
Answer: A
Under a dwelling policy (DP-3), Coverage B for other structures is automatically included at 10% of the Coverage A dwelling limit. For a $200,000 dwelling limit, this results in $20,000 of coverage for detached structures like garages or sheds. Option B is incorrect because Coverage B is standard, not optional. Option C confuses Coverage B with Coverage C (personal property). Option D is incorrect because business use may require additional endorsements but does not determine eligibility for Coverage B.
Question 2 (Chapter 2)
Under a Pennsylvania homeowners policy, which endorsement provides replacement cost coverage for personal property, overriding the actual cash value settlement?
- A) HO 04 42 - Permitted Incidental Occupancies
- B) HO 04 55 - Identity Fraud Expense
- C) HO 04 54 - Earthquake Coverage
- D) HO 23 63 - Personal Property Replacement Cost — Pennsylvania
Show answer & explanation
Answer: D
The HO 23 63 endorsement is the Pennsylvania-specific endorsement that provides replacement cost coverage for personal property, ensuring losses are settled without depreciation. HO 04 42 relates to incidental business occupancies, HO 04 55 covers identity fraud expenses, and HO 04 54 provides earthquake coverage—none of which alter personal property settlement to replacement cost.
Question 3 (Chapter 2)
Which endorsement would a Pennsylvania homeowner add to their policy to cover losses from identity fraud expenses, such as legal fees and lost wages due to restoring credit after a theft?
- A) HO 04 26 - Limited Fungi, Wet or Dry Rot, or Bacteria
- B) HO 24 71 - Business Pursuits
- C) HO 04 55 - Identity Fraud Expense
- D) HO 04 54 - Earthquake Coverage
Show answer & explanation
Answer: C
The HO 04 55 endorsement specifically provides coverage for identity fraud expense, including costs like legal fees, lost wages, and expenses related to restoring credit records after identity theft. HO 04 26 addresses limited fungi or bacteria coverage, HO 24 71 covers business pursuits liability, and HO 04 54 provides earthquake coverage—none of which relate to identity fraud.
Question 4 (Chapter 2)
A Pennsylvania homeowner has an HO-3 policy with Coverage A (dwelling) of $250,000. The policy includes the Personal Injury endorsement (HO 24 82). Which of the following scenarios would be covered under this endorsement?
- A) The insured accidentally backs their car into a neighbor's fence, causing $1,000 in property damage.
- B) The insured's guest slips on an icy sidewalk and breaks their ankle, resulting in $3,000 in medical bills.
- C) The insured is sued for libel after posting false statements about a coworker on social media.
- D) The insured's jewelry is stolen from their home during a burglary.
Show answer & explanation
Answer: C
The Personal Injury endorsement (HO 24 82) adds coverage for offenses such as libel, slander, defamation, false arrest, and wrongful eviction. Option C describes a libel claim, which is covered under this endorsement. Option A is a property damage liability claim covered under the base personal liability coverage. Option B is a bodily injury liability claim also covered under base personal liability. Option D is a personal property loss covered under Coverage C, not liability.
Question 5 (Chapter 2)
A Pennsylvania homeowner has an HO-6 (Unit-Owners) policy for their condominium. The condominium association's master policy covers the building structure and common areas. Which of the following is primarily the responsibility of the HO-6 policy?
- A) Coverage for the roof and exterior walls of the building.
- B) Coverage for liability arising from the maintenance of common areas.
- C) Coverage for personal property and improvements and betterments made by the unit owner.
- D) Coverage for flood damage to the basement of the unit.
Show answer & explanation
Answer: C
The HO-6 policy is designed for condominium unit owners and typically covers personal property, improvements and betterments (upgrades made by the owner), and sometimes loss of use and liability. The condominium association's master policy covers the building structure, including roof and exterior walls, and common areas. Option A is incorrect because the roof and exterior walls are covered by the master policy. Option B is incorrect because liability for common areas is typically covered by the master policy or the association's liability policy. Option D is incorrect because flood damage is not covered under standard HO-6 or master policies without a separate flood endorsement.
Question 6 (Chapter 2)
Which of the following perils is covered under a DP-2 Broad Form dwelling policy but NOT under a DP-1 Basic Form?
- A) Fire
- B) Lightning
- C) Internal explosion
- D) Windstorm
Show answer & explanation
Answer: D
The DP-1 Basic Form covers fire, lightning, and internal explosion. The DP-2 Broad Form adds coverage for windstorm, hail, explosion, riot, and aircraft. Therefore, windstorm is covered under DP-2 but not DP-1. Options A, B, and C are perils covered under both forms.
Get the 25-question sample set by email
Want a full-exam practice set to study offline? Drop your email — we'll send 25 questions across every content area, each with the answer and explanation.
No spam. Just the questions and one optional follow-up.
Practice Questions 7-12: Named Perils, Bare Walls, Loss of Use and Home Businesses
Hail on a dwelling form, what a unit-owner policy picks up behind a bare-walls master policy, and the endorsements that fit a business run from home.
Question 7 (Chapter 2)
A Pennsylvania homeowner purchases a DP-2 Broad Form dwelling policy for their rental property. The policy includes Coverage A for the dwelling at $150,000. After a hailstorm damages the roof, the insured files a claim. Which of the following statements is correct regarding the coverage for this loss?
- A) The loss is not covered because hail is only covered under DP-3 Special Form.
- B) The loss is covered only if the homeowner added the Windstorm and Hail endorsement.
- C) The loss is covered because hail is a named peril under the DP-2 Broad Form.
- D) The loss is not covered because dwelling policies do not cover hail damage to rental properties.
Show answer & explanation
Answer: C
The DP-2 Broad Form specifically includes hail as a named peril, so damage from a hailstorm is covered under this form. Option A is incorrect because hail is covered under DP-2, not exclusive to DP-3. Option B is incorrect because hail is already included in DP-2; no additional endorsement is needed. Option D is incorrect because dwelling policies do cover hail damage, and rental properties are eligible for dwelling policies.
Question 8 (Chapter 2)
A Pennsylvania homeowner purchases an HO-6 Unit-Owners policy for their condominium. The association's master policy is written on a 'bare walls' basis. After a fire in the building, the drywall and interior paint in their unit are damaged. Which of the following is most likely true regarding coverage for these items?
- A) The HO-6 policy covers the drywall and paint under Coverage A as building items within the unit that the owner is responsible for.
- B) The HO-6 policy covers the drywall and paint only if the homeowner added the Scheduled Personal Property endorsement.
- C) The condominium association's bare-walls master policy covers the drywall and paint as building property.
- D) The drywall and paint are not covered under either policy because they are considered landlord's property.
Show answer & explanation
Answer: A
Coverage A of the HO-6 covers alterations, appliances, fixtures and improvements that are part of the building within the unit, plus any building items the association's documents make the unit owner responsible for. Under a bare-walls master policy, interior drywall, paint, flooring and cabinets fall to the unit owner, so the HO-6 responds under Coverage A. Option B names an endorsement for valuable personal property, not building items. Option C is wrong because bare-walls coverage stops at the unfinished structure. Option D is wrong because the items are covered by the HO-6.
Question 9 (Chapter 2)
A Pennsylvania homeowner has an HO-3 policy with Coverage A (dwelling) of $250,000. They experience a covered loss that makes their home uninhabitable. They incur $2,000 in hotel expenses and $300 in increased meal costs while displaced. Which coverage under the HO-3 policy would reimburse these expenses?
- A) Coverage D (loss of use)
- B) Coverage C (personal property)
- C) Coverage B (other structures)
- D) Coverage E (personal liability)
Show answer & explanation
Answer: A
Coverage D (loss of use) of the homeowners policy pays additional living expense, the necessary increase in living costs while the home is uninhabitable after a covered loss, such as hotel stays and higher meal costs; it also pays fair rental value for a rented part of the premises. Coverage C covers personal property, Coverage B covers other structures, and Coverage E is personal liability, none of which applies to living expenses.
Question 10 (Chapter 2)
A Pennsylvania homeowner has an HO-3 policy. They operate a home-based business selling handmade crafts online. A customer slips and falls during a pickup at the home, resulting in bodily injury. Which endorsement would most likely provide liability coverage for this business activity?
- A) Home Day Care (HO 04 97)
- B) Business Pursuits (HO 24 71)
- C) Personal Injury (HO 24 82)
- D) Permitted Incidental Occupancies (HO 04 42)
Show answer & explanation
Answer: D
The Permitted Incidental Occupancies endorsement (HO 04 42) extends the homeowners policy to an incidental business conducted on the residence premises, including liability for customers who visit for that business. The Business Pursuits endorsement (HO 24 71) covers an insured's work as someone else's employee and excludes a business the insured owns, so it does not fit a self-employed crafts seller. Home Day Care (HO 04 97) is specific to day care, and Personal Injury (HO 24 82) covers offenses such as libel or slander, not premises injuries.
Question 11 (Chapter 2)
A Pennsylvania homeowner purchases a DP-3 dwelling policy for their primary residence. The policy includes Coverage A for the dwelling at $250,000. After a fire, the dwelling is a total loss. The homeowner had not updated the policy limit in three years, during which time construction costs increased significantly. Which endorsement, if added to the policy, would most directly address this situation by automatically increasing the dwelling limit to account for inflation?
- A) DP 04 72 - Theft Coverage
- B) DP 04 11 - Automatic Increase in Insurance / Inflation Protection
- C) DP 11 43 - Dwelling Under Construction
- D) DP 01 37 - Special Provisions — Pennsylvania
Show answer & explanation
Answer: B
The DP 04 11 endorsement provides automatic increases in the dwelling coverage limit to keep pace with inflation or rising construction costs, which directly addresses the scenario where the policy limit has become inadequate due to increased costs over time. DP 04 72 adds theft coverage, DP 11 43 covers dwellings under construction, and DP 01 37 modifies the policy to comply with Pennsylvania cancellation and nonrenewal laws, none of which automatically adjust limits for inflation.
Question 12 (Chapter 2)
A Pennsylvania homeowner has an HO-3 policy. They operate a part-time hair styling business from their home, with clients visiting for appointments. A client slips on a wet floor and suffers an injury. Which endorsement would be most appropriate to address liability arising from this business activity?
- A) HO 04 97 - Home Day Care
- B) HO 24 71 - Business Pursuits
- C) HO 24 82 - Personal Injury
- D) HO 04 42 - Permitted Incidental Occupancies
Show answer & explanation
Answer: D
The Permitted Incidental Occupancies endorsement (HO 04 42) is designed for a business conducted on the residence premises, such as a studio, office or small salon, and extends liability coverage to clients who visit for that business. HO 24 71 Business Pursuits covers an insured's activities as someone else's employee and excludes a business the insured owns, so it does not respond here. HO 04 97 is specific to home day care, and HO 24 82 covers personal injury offenses like libel or slander, not a slip-and-fall.
Practice Questions 13-17: Loss of Use, Interior Items, Mold and Vacancy
Working out what the insurer pays: additional living expense against the limit, interior items in a condominium unit, a mold endorsement and a vacancy question.
Question 13 (Chapter 2)
A Pennsylvania homeowner with an HO-3 policy experiences a covered loss that makes their home uninhabitable. They incur $3,500 in hotel expenses and $800 in increased meal costs while repairs are made. The policy’s Coverage D (Loss of Use) limit is 20% of Coverage A, and Coverage A is $400,000. How much will the insurer pay for these expenses?
- A) $0, because meal costs are excluded under Pennsylvania HO policies.
- B) $4,300, as the policy reimburses actual additional living expenses up to the Coverage D limit.
- C) $3,500, as the policy only covers hotel expenses and excludes meal costs.
- D) $8,000, as the Coverage D limit is $80,000 (20% of $400,000), and the insurer pays the full claim.
Show answer & explanation
Answer: B
Coverage D (Loss of Use) in an HO-3 reimburses additional living expenses (ALE), including hotel costs, meals, and other necessary expenses incurred while the home is uninhabitable due to a covered loss. The limit is 20% of Coverage A ($400,000), so the maximum is $80,000. Since $3,500 (hotel) + $800 (meals) = $4,300 is within this limit, the insurer will pay the full amount. Distractors: A is wrong because meal costs *are* covered; C is wrong because meal costs *are* included in ALE; D is wrong because the claim is well below the limit, and the insurer pays actual expenses, not the full limit.
Question 14 (Chapter 2)
A Pennsylvania homeowner with an HO-6 (Unit-Owners) policy experiences a covered loss that damages their interior walls, cabinets, and flooring in their condominium unit. The condominium association’s master policy covers the building structure and common areas. Which of the following statements is correct regarding coverage under the HO-6?
- A) The HO-6 covers the interior walls, cabinets, and flooring under Coverage A, as building items within the unit that the owner is responsible for.
- B) The HO-6 covers the interior walls but excludes cabinets and flooring, as these are typically covered by the master policy.
- C) The HO-6 covers the cabinets and flooring but excludes the walls, as the master policy handles structural elements.
- D) The HO-6 covers none of these items, as the master policy is responsible for all interior improvements in a condominium.
Show answer & explanation
Answer: A
HO-6 (Unit-Owners) Coverage A covers the unit's interior building items, fixtures, alterations and improvements, including walls, cabinets and flooring, while the master policy covers the structure and common areas. B and C are wrong because the HO-6 covers all three items; D is wrong because the master policy does not pick up the owner's interior improvements.
Question 15 (Chapter 2)
Under a Pennsylvania dwelling policy, if a dwelling has been vacant for more than 60 consecutive days, what is the consequence regarding coverage?
- A) The policy is automatically cancelled by the insurer.
- B) Coverage is suspended until the property is reoccupied.
- C) The insurer must provide a 10-day notice before nonrenewal.
- D) Vandalism and malicious mischief coverage is excluded.
Show answer & explanation
Answer: D
Under dwelling policy conditions, if a dwelling has been vacant for more than 60 consecutive days, coverage for vandalism and malicious mischief is excluded. The policy is not automatically cancelled (A), coverage is not simply suspended (B), and while nonrenewal may involve notice, the 60-day vacancy rule specifically triggers the vandalism exclusion, not a notice requirement for nonrenewal (C).
Question 16 (Chapter 2)
A Pennsylvania landlord with a DP-2 Broad Form policy experiences a covered loss (burst pipe) that causes $30,000 in water damage to the rental property. The policy includes Coverage A (dwelling) for $250,000, Coverage B (other structures) for 10% of Coverage A, and Coverage C (personal property) for $50,000. The landlord vacated the property for 45 days before the loss occurred. Under Pennsylvania dwelling policy terms, what is the correct outcome for this claim?
- A) The insurer will deny the claim entirely because the property was vacant for more than 30 days, which is a standard exclusion under DP-2 policies.
- B) The insurer will pay the full $30,000 claim, as water damage from a burst pipe is a covered peril under DP-2, and the 45-day vacancy period does not automatically void coverage.
- C) The insurer will pay the claim, but will reduce the payment by 50% because the property was vacant for more than 30 days, as required by the Pennsylvania Dwelling Policy Special Provisions (DP 01 37).
- D) The insurer will pay the claim in full, but will issue a warning and require the landlord to add a vacancy permit before renewing the policy, as permitted under 40 P.S. § 1171.5(a)(9).
Show answer & explanation
Answer: B
Vacancy exclusions in Pennsylvania dwelling policies (including DP-2) typically apply only after 60 consecutive days of vacancy, not 30 days. A burst pipe is a covered peril under DP-2, and 45 days of vacancy does not trigger the exclusion. With no deductible stated, the insurer pays the full $30,000. Option A applies an incorrect 30-day threshold. Option C invents a 50% reduction clause that does not exist. Option D invents a warning/permit requirement that is not a standard policy term.
Question 17 (Chapter 2)
A Pennsylvania homeowner adds the Special Provisions — Pennsylvania endorsement (DP 01 37) to their dwelling policy. What is the primary purpose of this endorsement?
- A) To provide coverage for earthquake damage.
- B) To automatically increase dwelling limits for inflation.
- C) To provide theft coverage for personal property.
- D) To modify the policy to comply with Pennsylvania cancellation and nonrenewal laws.
Show answer & explanation
Answer: D
The DP 01 37 endorsement incorporates Pennsylvania-specific requirements, particularly relating to cancellation and nonrenewal procedures in accordance with state law. It does not provide earthquake coverage (A), which is separate; automatic inflation protection is provided by DP 04 11 (B); and theft coverage is addressed by DP 04 72 (C).
The Dwelling and Homeowners Mistakes That Cost Marks
Confusing fair rental value with additional living expense. In the dwelling policy, lost rent from a rented unit is Coverage D, Fair Rental Value. The insured's own extra living costs, such as a hotel and higher meal costs, are paid under loss of use in the homeowners policy.
Paying the limit instead of the loss. Loss of use reimburses the actual, necessary extra expense up to the limit. A claim far below the limit is paid as incurred, not at the limit.
Treating a condominium unit as bare. Under a bare-walls master policy, drywall, paint, flooring and cabinets fall to the unit owner, so the unit-owners policy responds under Coverage A.
Assuming a named-peril dwelling form leaves out common perils. The DP-2 Broad Form names hail, so a hail loss to the roof is covered without an extra endorsement.
Choosing an endorsement by its number instead of its job. Tie each form to what it does: identity fraud expense, personal injury offences such as libel, incidental occupancies for customers who visit, inflation protection for the dwelling limit, limited fungi coverage.
Your Next Step
If these questions exposed a gap, listen to the matching lesson in the Pennsylvania Property & Casualty course preview, then come back and rework the questions you missed. For more topics, see all of our free Pennsylvania Property & Casualty practice questions.
Free: 25 Pennsylvania P&C practice questions
Liked this article? Get 25 exam-style questions emailed to you — with full answer explanations, no credit card. Closest thing to studying offline.
No spam. Just the questions and one optional follow-up.
Study this topic with LanePrep
Listen to these audio chapters on your commute — no screen required.
Related Articles
How to Pass the Pennsylvania Property & Casualty Exam on Your First Try (2026)
8 min read
$122.50 + Fingerprints: Pennsylvania P&C License Cost 2026
7 min read
25 Free Pennsylvania P&C Exam Practice Questions (2026)
25 min read
Is the Pennsylvania Property & Casualty Exam Hard? Pass Rates and Difficulty (2026)
6 min read
17 Free Pennsylvania Property & Casualty Practice Questions: The Personal Automobile Policy (2026)
14 min read
17 Free Pennsylvania Property & Casualty Practice Questions: Pennsylvania Property & Casualty Law (2026)
16 min read