Other Than Life (OTL) Practice Exam

What type of damage is covered under all perils coverage?

1. Rusting of the vehicle body

2. Radioactive contamination

3. Vandalism of a vehicle

4. Damage caused while under the influence of drugs

The correct answer is: Vandalism of a vehicle

All perils coverage is a comprehensive type of insurance that generally protects against a wide range of risks, including losses resulting from theft, vandalism, and various forms of accidental damage. Vandalism specifically aligns with the provisions of all perils coverage because it entails deliberate actions taken by others to damage or destroy property, including vehicles. This type of coverage is designed to provide broad protection, making it essential for policyholders looking to safeguard their property against various unforeseen events, including those caused by third parties. In contrast, rusting of the vehicle body is typically considered normal wear and tear, which is generally excluded from coverage. Radioactive contamination falls under specific exclusions in insurances due to its unique risk profile and hazards. Damage caused while under the influence of drugs often relates to behavior exclusions in policies, where coverage may be denied if the damage is associated with illegal or reckless actions. Thus, vandalism is the only option that is consistently covered under all perils coverage, highlighting the importance of this protection for vehicle owners.