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    Question

    A provision added to a home owners insurance policy that

    automatically adjusts the coverage limit on the dwelling each time the policy is renewed to reflect current construction costs is termed as?
    A Double Insurance Correct Answer Incorrect Answer
    B Inflation Guard Clause Correct Answer Incorrect Answer
    C Industrial Insurance Correct Answer Incorrect Answer
    D Gap Insurance Correct Answer Incorrect Answer
    E None of these Correct Answer Incorrect Answer

    Solution

    Inflation guard coverage is an optional endorsement that protects the rebuild cost of your home. It automatically increases the amount of insurance on your home a certain percentage each year to account for the disparity caused by inflation.

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