Chapter 12:Miscellaneous commercial policies

The Equipment Breakdown Coverage does not cover which of the following?

A)Breakdown test Equipment Breakdown coverages include property damage, expediting expenses, business income, spoilage damage, newly acquired premises, ordinance or law, errors and omissions, and brands and labels.

Which of the following bonds is not a type of Fidelity Bond?

A)Court A Court Bond is a Surety Bond required by the court to enforce certain behavior.

The Farm Liability Insurance policy covers each of the following, except:

A)Coverage K - Non-farming Liability

Bonds are contracts that involve all of the following parties, except:

A)Director The insurance company issuing the bond is the surety or guarantor, the party owing the duty is the principal or obligor, and the party who is paid by the surety if the principal fails to perform is the obligee.

Which of the following perils is not insured under a professional liability insurance policy?

A)Discrimination Other covered perils include conflict of interest, malpractice, neglect, errors and omissions, and breach of contract.

All of the following are considered implied warranties, except:

A)General Average Implied warranties aren't always written into the contract, but are generally understood by all parties and binding upon them. Examples of implied warranties include no deviation in voyage, legality, and seaworthiness.

The Mobile Agricultural Machinery and Equipment Coverage Form does not include coverage for:

A)Irrigation equipment

Protection and Indemnity (P&I) Insurance is similar to which of the following coverages?

A)Liability Protection and Indemnity, or P&I, is purchased by the ship owner to protect against cargo lost due to the insured's negligence, damage to other property when not caused by collision, damage to property on board caused by collision, and injuries to seamen resulting in unworthiness of the vessel.

Aircraft All Risk coverage includes which of the following levels?

A)On the ground, taxiing, and in flight

Which of the following is covered under the Electronic Data Processing Floater?

A)Printers Also covered are computers and their components and systems used exclusively in the insured's computer operation, such as air conditioning or electrical equipment; the other choices are exclusions.

Which statement is true of The Equipment Breakdown Protection Coverage Form?

A)The form automatically includes Business Income and Extra Expense Coverage Business Income and Extra Expense Coverage are automatically provided.

All of the following underlying coverages must be purchased in order to qualify for the Umbrella and Excess Liability policy, except:

A)Workers' Compensation Commercial Auto Liability is also a required underlying coverage to qualify for the Umbrella policy.

The Nationwide Marine Definition includes all of the following classes of property, except:

A)umbrella The other three classes are exports, domestic shipments and property in transit, and commercial property floater.

Which of the following perils is not insured against by the Special Causes of Loss form under the Farm Property policy?

B)Dishonest or criminal acts

Under Ocean Marine Coverage, breach of each of the following implied warranties will void the contract, except:

B)Express Express warranties are those that are written into the policy contract.

Which of the following is false about Livestock Coverage Form?

B)Livestock are covered while in transit by common carrier Livestock are not covered when being transported by common carrier.

Which of the following is NOT a type of coverage provided under a farm liability policy?

B)Professional liability -A farm liability policy does not provide coverage for professional liability.

The Annual Transit Form is designed for which of the following?

B)Protecting property being shipped to others or being received from others on multiple occasions throughout the year The Annual Transit Form is designed for firms that send or receive substantial amounts of shipments by common carrier.

Which of the following is not true of the Multi-Peril Crop Insurance?

B)The residual market provides this coverage at the state level This coverage is written by private insurers and is reinsured by the Federal Crop Insurance Corporation (FCIC) to cover primarily the corn and maize, cereal grains, soybeans, tobacco, and cotton crops.

When does coverage cease under a Crop/Hail Insurance Policy?

B)When the crop is harvested Coverage ceases under a Crop Hail Policy when the crop is harvested. Coverage is written per growing season rather than on an annual basis.

An entity who owns a fleet of trucks and hauls its own goods should purchase:

C)A Motor Truck Cargo Owners Form The owner's form covers loss to goods owned by the insured and shipped on the owner's trucks.

Under Equipment Breakdown Insurance, which of the following is considered 'one breakdown'?

C)All breakdowns occurring at the same time that are the direct result of the same cause

Which of the following scenarios would be covered by E&O insurance?

C)An agent neglects to renew a customer's policy after they paid the premium Failing to renew a policy is considered a negligent act resulting in the failure to meet reasonable standards of care in his or her field. E&O does not provide bodily injury coverage.

What is the name of the uniform document that common carriers are required to issue to the shipper of the goods being transported?

C)Bill of Lading The Bill of Lading is a receipt for the goods being shipped that sets forth the basic agreement between the carrier and the shipper.

The Equipment Breakdown Protection Coverage Form does not provide which of the following types of coverage?

C)Earth movement damage

Which of the following coverage forms covers equipment during transportation, unloading and installation until control is given to the purchaser?

C)Installation Floater The Installation Floater is designed to cover contractors for the equipment they are installing on contracted jobs while that equipment is being transported or being installed on the job site.

All of the following are true of the Equipment Breakdown Protection Coverage Form, except:

C)Malfunction is included in the definition of breakdown The definition of breakdown does not include malfunction, including adjustment, alignment, calibration, cleaning, or modification.

Which statement is false regarding the Farm Liability Coverage Form?

C)Medical payments provide coverage only when the insured is legally liable

In Surety bonding, the party to whom the surety is answerable is the:

C)Obligee The Obligee is the party for whose benefit the bond is written.

An Aircraft Hull Policy provides all the following coverage, except:

C)Passenger Liability Coverage The Hull policy provides coverage against risk of physical loss or damage while it is on the ground and while it is in flight.

Which of the following is covered by Coverage E of the Farm Property Coverage Part?

C)Scheduled farm personal property

The Controlled Inland Marine Coverage forms provide insurance for which of the following?

C)Signs Signs, accounts receivable, commercial articles floater, jewelers block coverage, valuable paper and records, and equipment dealers coverage are controlled, or filed, forms; the other choices are uncontrolled, or unfiled forms and also include contractors equipment, electronic data processing, and installation floaters.

Under the Equipment Breakdown Protection Coverage Form, the __________________ condition will apply if the covered equipment is subject to a dangerous exposure.

C)Suspension The Suspension condition allows the insurance company to immediately suspend coverage against the loss.

Which type of cargo policy would cover a person who owns his/her own truck and hauls his/her own goods?

C)The Motor Truck Cargo Owners Form

Which of the following is not an Aviation Insurance Cause of Loss?

C)ground taxi only All risk covers when the aircraft is on the ground, during taxi, and in flight.

While working together on the roof of a barn, the insured's neighbor fell off and broke his ankle. Which of the following is true about the resulting claim under the insured's Farm policy?

D)Coverage J - Medical Payments is no-fault coverage and will pay for necessary medical expenses that the neighbor incurred regardless of negligence

Under the Farm Property Coverage Form, the definition of Farm Personal Property includes which of the following?

D)Equipment, supplies, and products of farming

Ocean marine Hull Coverage and Cargo Coverage are written on which basis?

D)Full valued basis Cargo and Hull Insurance are written on a full valued basis. The valuation of the cargo includes the stated value of the invoice, import duties, and freight charges.

Which of the following is covered under Aircraft Liability Insurance?

D)Liability claims arising from the ownership, maintenance or use of an aircraft Aviation Insurance Liability includes Aircraft Liability, Airport Liability and Hangerkeepers' Liability. Aircraft Liability insurance covers claims arising from the ownership, maintenance, or use of an aircraft.

Farm property loss conditions include which of the following?

D)Loss to pairs or sets Other loss conditions include abandonment, appraisal, duties, other insurance, legal action against the insurer, loss payment, recovered property, subrogation, and unoccupancy and vacancy.

Inland Marine Policies are generally written on what basis?

D)Open Perils

Which of the following is excluded under the Farm Property Coverage Form?

D)Ordinance or law Also excluded are nuclear hazard, war and military action, flood loss to property other than livestock, and earthquake loss to property other than livestock.

Property eligible to be insured under the Nationwide Marine Definition does not include:

D)Personal property at the insured residence

Inland Marine Policies are primarily designed to insure:

D)Property that is mobile in nature and may be away from insured's premises Inland Marine insurance is designed for property that is portable, or that is being shipped from place to place. Generally, fixed property is not eligible.

Which of the following is not covered under the Valuable Papers and Records Floater?

D)Securities -Money and securities are not covered under the Valuable Papers and Records Floater.

The Accounts Receivable Coverage Form will cover loss of records that results from:

D)The collapse of a building damaged by fire -Accounts receivables coverage provides insurance when the insured's business records are destroyed in a loss caused by a covered peril. The collapse of a building damaged by fire would be considered a direct loss by fire.

Which of the following forms is designed to insure a single shipment of goods?

D)Trip Transit Policy

Which peril is excluded on the Crop and Hail Insurance policy?

D)Wildlife This policy also excludes failure to harvest a mature crop, share cropping, loss from injury to buds, blossoms, blooms, leaves, and vines unless the crop is affected.

Which of the following covers an employee in a position of private trust and protects an employer against loss caused by the employee's dishonesty.

D)fidelity