Question

Identify three exclusions to the Builder's Risk Policy:

a) Acts of God, Vandalism, and Theft
b) Design Flaws, Employee Injuries, and Pollution
c) War, Terrorism, and Earthquakes
d) Faulty Workmanship, Normal Wear and Tear, and Contractual Penalties

Answer 1

Option d (Faulty Workmanship, Normal Wear and Tear, and Contractual Penalties) represents exclusions typically found in a Builder's Risk Policy. These policies cover unforeseen damages but exclude routine degradation, quality of work issues, or contractual liabilities.

Step-by-step explanation:

The exclusions to a Builder's Risk Policy generally relate to specific risks that are not covered under the policy terms. In the context provided, option d: Faulty Workmanship, Normal Wear and Tear, and Contractual Penalties are typical exclusions in a Builder's Risk Policy. These policies are designed to cover unforeseen incidents that cause damage to a construction project, such as a dwelling being damaged or burglarized, but they typically do not cover design-related issues, routine degradation, work quality, or liabilities that arise from contractual obligations.