New Hampshire Insurance Licensing Practice Exam

The term that refers to the value of the insured property up to a specified amount is the stated amount. This type of insurance coverage indicates that the insurer agrees to cover the property for a specific sum that is determined at the time the policy is issued, regardless of the actual cash value or replacement cost at the time of a loss. Essentially, when a claim is made, the insurer will pay up to the stated amount, which provides clarity and certainty for both the insured and the insurer about the limits of coverage.

Agreed value typically involves a pre-established valuation of property that is recognized by both the insurer and the insured, which avoids disputes in the event of a loss, but it doesn't fit the definition as a specified value limit. Replacement cost refers to the amount necessary to replace the property without considering depreciation, while functional replacement focuses on replacing damaged property with materials or items that serve a similar function but may not be the same as the original. Thus, the correct choice emphasizes a defined monetary limit on coverage, which characterizes the stated amount approach.