COMPREHENSIVE EXAM REVIEW

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What are the maximum limits of coverage provided under a policy issued by the Missouri Medical Malpractice Joint Underwriting Association?

$1 million per claimant and $3 million for all claimants in a policy year

Before cancelling a property insurance policy for non-payment of premium, an insurer must give the insured how many days' written notice?

Within how many days must an insurer notify a claimant it is either accepting or denying the claim?

Within how many working days must the insurer advise the claimant that the claim is accepted or denied?

Within how many working days must the insurer advise the claimant that the claim is accepted or denied? A-21 B-30 C-15 D-10

If the Department of Insurance denies a producer license application, the applicant may request a hearing within how many days of the denial?

The Association covers existing claims prior to the determination of insolvency or that are submitted within how many days after the determination of insolvency?

When must a producer notify the Director of any change in legal address? A-Within 15 days B-Within 90 days C-Within 30 days D-Never

Within how many days must an employee report a workplace injury to the employer?

Yesterday you bought a new car and traded in your old car that was covered for liability only and your insurance agent tells you that your new car must be added to your policy within how many days?

4 days--If the Declarations page indicates that NO Collision or Other than Collision coverage applies to at least one vehicle, the insured has 4 days to report for coverage to apply.

Transportation Expenses Coverage under Part D of the Personal Auto Policy begins how long after the covered auto has been stolen? A 48 hours B 72 hours C 24 hours D Immediately

48 hours

An employer required to provide Workers' Compensation in Missouri has a MINIMUM of how many employees? A

The amount of insurance provided to cover personal property under Coverage C of a Homeowners Policy, is:

50% of Coverage A--The basic amount of Coverage C insurance is 50% of the Coverage A Limit. This amount can be increased by payment of an additional premium.

In Missouri, what is the weekly rate of compensation under WC law? A 25% of the actual weekly wage B 33 2/3% of the actual weekly wage C 100% of the average weekly wage D 66 2/3% of the average weekly wage

66 2/3% of the average weekly wage

The coverage period for a wedding present floater may not exceed how many days after the wedding day?

All of the following would be considered a covered resident under the Homeowners Policy, except:

A 22-year-old exchange student

Binders

A Binder is a legal agreement that serves to effect insurance coverage temporarily until the actual insurance policy can be issued. It contains only the essential coverage information except premium. The premium will be determined after underwriting.=

In insurance, a document that verifies how and when a loss happened and includes the cost of damages, is called: A A Certificate of Insurance B A Binder C A Notice of Loss D A Proof of Loss

A Proof of Loss

Under Section II of the Homeowners Policy, an employee whose duties are related to the maintenance or use of the residence premises, is defined as:

A Residence Employee

Which of the following binders WAS issued legally? A A binder that was not replaced by a policy; the binder fee of $10 was waived B A binder that was not replaced by a policy; the binder fee of $50 was waived C A binder that was replaced by a policy with a different effective date D A 3-day binder for which no premium was charged

A binder that was not replaced by a policy; the binder fee of $10 was waived--When a binder is issued and is not replaced by a policy, the insurer may waive the binder fee if it is $20 or less.

Which of the following defines a surplus lines broker?

A broker who places risks with authorized but nonadmitted carriers

Which of the following best describes the purpose of the Insuring Agreement in an insurance policy?

A determination of the coverage provided

Under Medical Payments of the Personal Auto Policy, there is no coverage for any of the following, except: A A passenger while occupying the covered auto B The policyholder's vehicle while it is being used as a public or livery conveyance C Any person while occupying a vehicle that has fewer than four wheels D A vehicle being used in a recognized racing activity

A passenger while occupying the covered auto

A potential cause of loss, such as fire, explosion, flood, or theft is considered to be:

A peril

In the Personal Auto Policy, the definition of Family Member includes: A A person related by blood, marriage or adoption who is a resident of a household (including a foster child) B Any person using the insured automobile with the Named Insured's permission C Persons related to the Named Insured who have frequent use of the insured automobile D A member of the Named Insured's immediate family, regardless of place of residence

A person related by blood, marriage or adoption who is a resident of a household (including a foster child)

The Missouri Automobile Insurance Plan provides auto coverage to which of the following individuals?

A person who is not able to obtain auto insurance through ordinary markets--The Missouri Automobile Insurance Plan provides basic coverage for individuals who have been unable to obtain auto insurance through normal markets, and all insurers selling auto insurance in Missouri must participate.

A personal auto policy can only be cancelled for suspension/revocation of the insured drivers license or for nonpayment of premium after it has been in effect for how many days? 60 50 30 20

A personal auto policy that has been in effect for 60 days may be cancelled only for the suspension/revocation of the insured drivers license or nonpayment of premium.

In the insurance world, a potential for a loss is said to be:

A risk

Under Section II of the Homeowners Policy, all of the following would be considered an Insured Location, except:

A secondary location that the insured uses for a business

A contract whereby only one party is bound to future performance, is said to be:

A unilateral contract

John is the agent for ABC Insurance and Jane is the insured. Who is the principal in this agency relationship?

ABC Insurance

When responsibility without fault or negligence applies, such as employers are completely liable for work related injuries, or owners of wild animals kept in captivity are completely liable for injuries caused by those animals, this is an example of:

Absolute Liability

Absolute Liability--The doctrine of Absolute Liability is a doctrine that applies only in special situations, most often to activities that present an extreme likelihood of harm to others when mishaps occur.

In insurance, when the number of similar units increase, the predictability of the loss improves:

According to the Law of Large Numbers

The Personal Article Floater Policy provides excellent coverage for antiques and claims are normally settled on which of the following basis?

Actual cash value with some exceptions

An insurer that is authorized to do business in a particular state is said to be:

Admitted

The idea that there are always some insureds (risks) that are less desirable than average risks, and that these insureds tend to seek or continue insurance coverage to a greater extent than better risks is termed:

Adverse selection

Which of the following is not true about insurance financial ratios? The quiz is currently paused. The combined ratio sums the operating and expense ratios Loss reserves are considered when determining the loss ratio The combined ratio sums the loss and expense ratios Expense ratio is dividing an insurer's total operating expenses by total written premiums

After determining the loss ratio and the expense ratio, the combined ratio is determined by adding those two ratios together.--The combined ratio sums the operating and expense ratios

Agents/Brokers are not contracted by the FAIR Plan; therefore, which of the following would apply? A. They have unlimited binding authority B. They can accept payment on behalf of the FAIR Plan C. They cannot accept payment or issue binders on behalf of the FAIR Plan D. They can be contracted after 1 year of service

Agents/Brokers are not contracted by the FAIR Plan and cannot accept payments or issue binders on behalf of the FAIR Plan.--They cannot accept payment or issue binders on behalf of the FAIR Plan

What is the name of the organization that will assist applicants in securing basic property insurance, to issue policies and to administer the program and the joint reinsurance association? A.Missouri Placement Facility B.Manufacturing Placement Facility C.Basic Property Placement Facility D.All Industry Placement Facility

All Industry Placement Facility is the organization which will assist applicants in securing basic property insurance, to issue policies and to administer the program and the joint reinsurance association (it may also be referred to as the FAIR Plan).--All Industry Placement Facility

Which of the following is prohibited to be included in the premium? A.Inspection fee B.Service charge C.Policy fee D.Installment premium charge

Also prohibited is a finders' fee or regulatory filing fee, but whenever an extra charge is made for an installment premium plan, it will be considered part of the premium and labeled as a premium installment charge.---Installment premium charge

All of the following are false concerning the National Flood Insurance Program, except:

Although private insurers sell and service flood insurance in addition to that provided by the National Flood Insurance Program, the federal government 100% reinsures all flood insurance.-----------Payment for losses are made by the federal government

All of the following are false concerning the National Flood Insurance Program, except: A-When coverage is on dwelling property, it is extended to include trees, shrubs, and plants B-Flood policies are available only from the National Flood Insurance Program C-Payment for losses are made by the federal government D-Agents may bind flood insurance for up to 15 days prior to submitting the final application

Although private insurers sell and service flood insurance in addition to that provided by the National Flood Insurance Program, the federal government 100% reinsures all flood insurance.==Payment for losses are made by the federal government

Under a Homeowners Policy, an accident that results in bodily injury or property damage, is considered: A A Contingent B An Aggregate C An Act of God D An Occurrence

An Occurrence

In insurance, the term that best defines a sudden, unplanned event which is unforeseen and unintended, is:

An accident

An agent has authority to do all of the following, except: The quiz is currently paused. Solicit applications on insurer's behalf Countersign insurance contracts Appoint a solicitor as his or her representative Represent the insured's interest

An agent is primarily the representative of an insurer. A broker represents the insured. However, agents still have a responsibility to provide insureds with the most suitable products.--Represent the insured's interest

Robert bought his home insurance from Insure+ last year and decided to add his wife's jewelry to the policy. Which of the following will be necessary in order to give Robert the jewelry coverage he wants?

An endorsement

If an insurance producer conceals pertinent benefits, coverage's or other provisions of any insurance policy to the claimant when they are pertinent to a claim, the act is considered? A. Bartering B. Misrepresentation of an application C. Misrepresentation of provisions D. Acceptable if it were not intentional

An insurance producer concealing from any first-party claimant the benefits, coverages or other provisions of any insurance policy when these benefits, coverages or other provisions are pertinent to a claim is considered misrepresentation of provisions. ------Misrepresentation of provisions

The Reasonable Expectations Doctrine states that:

An insured is entitled to coverage that a reasonable and prudent buyer can expect

Which cancellation reason regarding the commercial line of business requires 90 days' notice?

An insurer may terminate an entire line or class of commercial casualty insurance by giving the Director 90 days' notice before mailing notices to the insured(s). The other choices require only 60 days' notice to the insured.------Termination of a line of business

Robert's agent discusses homeowner coverage for several types of motor vehicles that Robert owns and advises Robert that which of the following is not covered? A Dune buggy used on a public beach B Motorized custom wheel chair for his mother C Motorized golf cart while golfing at the club D Riding lawn mower for his 3 acre lot

An owner vehicle designed for recreational use off public roads must be used on the insured premises for coverage to apply.--Dune buggy used on a public beach

Which of the following best describes a hostile fire?

An uncontrolled fire, or one that has spread beyond where it was intended to be

Which of the following describes Fiduciary Responsibilities?

Anyone acting as an insurance producer or agent for an insurer shall be held responsible in a trust or fiduciary capacity for any money collected or received for the insurer

The third-party claimant is which of the following?

Anyone making a claim against the first-party claimant

When the insurer and the insured cannot agree on the value of the property or the amount of a loss, which of the following establishes the procedure to use?

Appraisal Clause

Under Part C of the Personal Auto Policy, when the insured and the insurer do not agree on the recovery of damages or the amount recoverable by the insured, what system is used to resolve the disagreement? A Appraisal B Subrogation C Compromise D Arbitration

Arbitration

Which of the following is used to resolve differences between the insured and the insurer?

Arbitration

In order to self-insure professional liability risks, at least how many medical professionals must apply to the Director?

At least three duly licensed medical professionals residing in Missouri may associate in order to apply to the Director for a license to self-insure its professional liability risks by designating a registered agent, provide a plan of operation, and advise if the bylaws will be incorporated into the association's policies.=3

Of the Dwelling Policy Forms, which one does not cover Damage by Burglars?

Basic Form (DP-1)

Sam recently purchased a personal umbrella policy that does not provide coverage for which of the following?

Besides damage to property in the insured's care, custody, or control, the umbrella also excludes automobile, watercraft, or personal liability without underlying coverage.---------Property damage liability to property in Sam's care

Sam recently purchased a personal umbrella policy that does not provide coverage for which of the following? A Property damage liability to property in Sam's care B Personal Injury coverages C Sam's automobile liability D Worldwide coverage

Besides damage to property in the insured's care, custody, or control, the umbrella also excludes automobile, watercraft, or personal liability without underlying coverage.---Property damage liability to property in Sam's care

Which of the following methods of writing insurance is used to provide insurance on properties at different locations, using one policy, and a single limit of insurance?

Blanket

Which of the following methods of writing insurance is used to provide insurance on properties at different locations, using one policy, and a single limit of insurance?

Blanket--Blanket insurance covers more than one item of property on one policy for a single amount of insurance, which applies to each item as needed.

In Liability Insurance, Personal Injury includes all of the following, except: A Bodily Injury B Libel C False Arrest D Slander

Bodily Injury

Coverage E of a Homeowners Policy would cover which of the following? A The transmission of a communicable disease by an insured B Bodily Injury to an insured C Bodily Injury to a guest which is caused by the insured's pet dog D Bodily Injury arising out of the application of corporal punishment by an insured

Bodily Injury to a guest which is caused by the insured's pet dog

In the Personal Auto Policy, the definition of Bodily Injury includes: A Bodily harm, sickness or disease, including death that results there from B Physical Injury to, destruction of and loss of use of tangible property C Defamation of character D False Arrest

Bodily harm, sickness or disease, including death that results there from

In the appraisal process of an insurance policy, when the insurance company and insured cannot agree upon the amount of the loss, and a third person is selected to help in the appraisal, this third person is called an: A Adjuster B Umpire C Agent D Claim representative

Both the insurance company and insured's representatives (usually appraisers) provided for in the appraisal provision will agree upon the third person to serve as an Umpire. If the two appraisers fail to agree, they will submit their differences to the Umpire, and an agreement of any two of the three will set the amount of the loss.--Umpire

A direct loss is best described as:

Bursting of a water pipe that causes water damage

Absolute Liability

The doctrine of Absolute Liability is a doctrine that applies only in special situations, most often to activities that present an extreme likelihood of harm to others when mishaps occur.

Which Statutory Law Defense states that damages are reduced in proportion to the degree of negligence?

Comparative Negligence

When damages are reduced in proportion to the degree of negligence, this is an example of:

Comparative Negligence--Comparative Negligence is a statutory defense wherein the parties involved, or a court, determine the degree of negligence of each party and the damages awarded are adjusted accordingly.

When a loss occurs as a result of two causes of loss, where one cause of loss is excluded and the other cause of loss is included, the situation is known as:

Concurrent Causation

Because the insurance company must pay claims and the insured must comply with the policy terms, the insurance contract is considered which of the following types of contracts?

Conditional contract

In an insurance contract, the value that each party gives the other is said to be the:

Consideration

In insurance, the insurer's promise to pay a covered loss and defend the insured in a lawsuit and the insured's payment of the first premium, are all examples of:

Consideration

In insurance, the insurer's promise to pay a covered loss and defend the insured in a lawsuit and the insured's payment of the first premium, are all examples of: A Acceptance B Legal Purpose C Consideration D Offer

Consideration

Which is true of Coverage C of the Dwelling Policy?

Coverage C contains a lengthy list of Property Not Covered. Many items in addition to those listed are listed as Property Not Covered.

Under the Homeowners Policy, which coverage provides indirect loss coverage?

Coverage D

Medical Payments under Section II of the Homeowners Policy would cover all of the following, except:

Coverage F (Medical Payments to Others), pays necessary medical expenses incurred within three years from the date of an accident. This may include surgical, dental, hospital, ambulance, professional nursing and similar expenses.--Loss of Income of an injured person

Part D of the Personal Auto Policy provides which of the following coverages?

Coverage for Damage to Your Auto

The Additional/Supplemental Coverages part of a property insurance policy provides:

Coverage that is beyond and supplements the Coverages set forth as basic Coverages

Crop/Hail Insurance is a specialized policy that:

Crop insurance is a specialized policy that protects the insured against reduced yield because of a covered loss to crops before they are harvested.---Protects against reduced yield because of a covered loss before they are harvested

How is Mobile Home insurance written?

Either by writing a separate Mobile Homeowners Policy or by adding an endorsement to a Homeowners Policy

Statutory Law Defenses are determined by which of the following?

Enactment of Legislatures

Which of the following is used to broaden or restrict coverage under a property policy?

Endorsement

Which of the following describes the purpose of the Gramm-Leach Bliley Act?

Established privacy protection for consumers

Of the Dwelling Policy forms, which one would cover an owned mobile home?

DP-1

Under the Dwelling policies, which is correct regarding coverage of trees, shrubs or plants?

Damage by wind, hail, weight of ice, snow or sleet is not covered

Under Liability Coverage of the Personal Auto policy, which of the following would be covered?

Damage to a parked car

Trees, shrubs and plants are included for coverage in a Homeowners Policy for all the following, except: A Loss due to lightning B A loss resulting from a windstorm C Loss due to vehicles not owned or operated by a resident D Loss due to fire

Damage to plants by windstorm or the weight of ice, snow, or sleet is considered so common as to be an uninsurable hazard.--A loss resulting from a windstorm

Property Damage in Liability Insurance includes:

Damage to tangible property, including loss of use of that property caused by the insured's negligence

The part of a property policy that gives basic information such as the named insured, a description of the property, the location of the property, and the amount of premium involved, is known as the:

Declarations

The part of an insurance policy that states where the risk is located is the:

Declarations

A producer is guilty of what unfair trade practice when making a derogatory statement about a competing insurer's financial condition? Intimidation Coercion Defamation Twisting

Defamation is making a false or maliciously critical statement regarding the financial condition of any person, with the intent to injure such person.

Defamation

Defamation is making a false or maliciously critical statement regarding the financial condition of any person, with the intent to injure such person.

Which Federal entity administers the Terrorism Risk Insurance Program Reauthorization Act?

Department of the Treasury

Within how many days must an insurer notify the Director of the appointment of an agent?

Each insurer must maintain a register of all producers it has appointed and notify the Director within 30 days of appointment.

If an insurer is incorporated in Rhode Island, but primarily does business in New York, what type of insurer is this considered in New York?

FOREIGN!!!

Coverage D of the Dwelling Policy includes: A Trees, Shrubs, and Other Plants B Other Structures C Fair Rental Value D Additional Living Expenses

Fair Rental Value

Under Missouri law, what standard of care and conduct is required of producers when receiving money from, or on behalf of, insurers or policyholders?

Fiduciary responsibility

First Aid Expenses under the Homeowners Policy would cover: A Members of the insured's family while on or off the premises B Nonfamily residents of the household while on the premises C A neighbor who gets injured while helping the insured install a carpet D The Named Insured while on or off the premises

First Aid Expenses coverage applies to first aid to others caused by Bodily Injury covered under the policy, but does not pay for first aid to an insured.--A neighbor who gets injured while helping the insured install a carpet

Larry owns a home covered under an HO-3 for $300,000 and asked his agent how much rent coverage does he have in case his basement apartment rented to a tenant becomes unlivable due to a fire, and his agent responded up to which of the following amounts?

For a covered loss, the Coverage D limit for additional living expense, fair rental value, and civil authority prohibited use is up to 30% of Coverage A

When a property is written with a replacement cost policy this means that losses will be paid: A For replacement with less costly property that is functionally equivalent B For full replacement cost, without any deduction for depreciation C For market value of the damaged property D For an amount previously agreed upon by the insured and insurer

For many years, damaged property was paid at its depreciated value (Principal of Indemnity). In recent years, insurance forms have been developed that pay replacement cost for many classes of property (new for old).--For full replacement cost, without any deduction for depreciation

Under property insurance, when the policy states that a loss to the property will be replaced with less costly property that performs the same function with similar efficiency, the policy is written on which of the following basis?

Functional Replacement Cost

The Limit of Liability of Coverage D, Damage to Your Auto, under the Personal Auto Policy states that:

Generally, the maximum Limit of Liability is equal to the actual cash value of the vehicle or vehicles insured. If the damage can be repaired, then the Limit of Liability is equal to the amount necessary to repair the vehicle or vehicles.--The Limit of Liability is the lesser of the actual cash value (ACV) of the vehicle or the amount necessary to repair or replace the vehicle with another of like kind and quality

Which of the following would not be included in coverage under a Personal Auto Policy? A Any trailer that the insured owns B An eight passenger van with a gross vehicle weight of 7,600 pounds C A pickup truck with a gross vehicle weight of 7,600 pounds D A motorcycle

Generally, vehicles that have fewer than 4 wheels are excluded from coverage.---A motorcycle

Oily rags stored by a furnace are considered which of the following?

Hazard

The Association's funds are divided into 4 separate accounts. Which of the following is NOT one of those accounts? A Workers' Compensation insurance account B Automobile insurance account C Missouri mutual and extended Missouri mutual insurance company account D Homeowner insurance account

Homeowner insurance account

Which of the following is true regarding the Musical Instrument Floater?

If coverage is desired for musical instruments played for hire, the policy must be endorsed for such usage and an additional premium paid.--On an unendorsed policy, none of the instruments will be played for remuneration during the policy term

Choose the false statement about the FAIR Plan policy. A The policy term is 12 months and renews automatically B The policy provides coverage up to $200,000 for a dwelling C An inspection of the property will be made D If the insured has 2 losses within a 12-month period, the policy will be non-renewed

If there are 2 losses within a 12-month period, a higher deductible will be imposed, and if there are no losses for 5 consecutive years, the deductible may be reduced.==If the insured has 2 losses within a 12-month period, the policy will be non-renewed

Which of the following is NOT considered proof of financial responsibility in Missouri?

In Missouri, acceptable proof of financial responsibility is an insurance certificate or ID card issued by an admitted insurer, a bond or certificate of deposit with the state, and a certificate of self-insurance.---An insurance agent's verbal statement

Under the Camera Floater, which of the following is true? A Automatic coverage is provided on newly acquired items for 90 days B Automatic coverage is provided on newly acquired items for 30 days, up to 25% of the policy amount C Automatic coverage is provided on newly acquired items for 60 days D Coverage is blanket on cameras and lenses

In the Camera Floater, coverage is scheduled on major items such as cameras and lenses, but blanket coverage is provided on accessory items such as lens shades, filters, lens brushes, etc.--Automatic coverage is provided on newly acquired items for 30 days, up to 25% of the policy amount

An agent that enters into agreements with more than one insurer is which of the following? The quiz is currently paused. Exclusive Captive Independent Direct

Independent

Bodily Injury in Liability Insurance is best described as: A Injuries that cause hospitalization, disability, or loss of income B Injuries that result in bleeding, bruising, bone fractures, or disfigurement C It includes physical injury to a person or death arising from the negligent or purposeful acts or omissions by an insured, including sickness, disease or death D All financial injuries directly sustained such as libel, slander, false arrest, invasion of privacy, and copyright infringement

Injuries that result in bleeding, bruising, bone fractures, or disfigurement

In Missouri, Inland marine policies cover which of the following? A.Automobiles B.Inherent defects C.Mobile articles, machinery, and equipment D.Buildings

Inland marine policies may cover mobile articles, machinery and equipment. The floater may not cover autos, and it may not cover auto homes, trailers, and semi-trailers unless they are being hauled by a tractor not designed for highway use.---Mobile articles, machinery, and equipment

Which part of a property insurance policy describes the perils? A Definitions B Additional Coverages C Declarations D Insuring Agreement

Insuring Agreement

Which of the following is true regarding Personal Inland Marine Insurance? A It can be attached to Homeowner Policies or can be written as stand-alone policies B It is used to insure personal property being shipped by ocean going vessels C It is used to insure personal property being shipped on inland waters D It is written only for policy terms of 3 years

It can be attached to Homeowner Policies or can be written as stand-alone policies

The Insuring Agreement in an insurance policy is best described as:

It determines the coverage that is provided

Bodily Injury in Liability Insurance is best described as: A Injuries that result in bleeding, bruising, bone fractures, or disfigurement B All financial injuries directly sustained such as libel, slander, false arrest, invasion of privacy, and copyright infringement C Injuries that cause hospitalization, disability, or loss of income D It includes physical injury to a person or death arising from the negligent or purposeful acts or omissions by an insured, including sickness, disease or death

It includes physical injury to a person or death arising from the negligent or purposeful acts or omissions by an insured, including sickness, disease or death

Which of the following describes the term Gross Negligence?

It is a willful wanton or reckless disregard of the consequences as affecting the life or property of another

Which of the following is true regarding the Yacht Policy? A Liability related exposure must be covered under a separate policy B The policy provides coverage only for damage to the yacht itself C It is an Ocean Marine Form and provides both property and liability coverage D The policy contains no navigational limits

It is an Ocean Marine Form and provides both property and liability coverage

All of the following are true of a Reciprocal Insurance Company, except: The quiz is currently paused. Each subscriber assumes part of the risk of all other subscribers If funds are insufficient to pay claims, the subscribers can be assessed for additional premium It is managed by an attorney-in-fact It is an incorporated entity, with a Board of Directors elected by policyholders

It is an incorporated entity, with a Board of Directors elected by policyholders--A reciprocal insurance company is not incorporated, which is why it must be managed by an 'attorney-in-fact'.

Which of the following is not an unfair property and casualty claim settlement practice? A.Failure to complete a claim investigation within 15 days if reasonable to do so B.Deny a claim because the insured would not give access to the claim adjuster C.Require the insured to release the insurer from total liability in exchange for a smaller settlement D.Require the first-party claimant to sign a release extending beyond the claim

It is an unfair property and casualty claim settlement practice to fail to complete a claim investigation within 30 days when it is reasonable to do so.--Failure to complete a claim investigation within 15 days if reasonable to do so

Which of the following is an example of Special Damages? A It is compensation to an injured party for actual medical expenses and loss of earnings B Special Damages are the damages of pain, suffering, and disfigurement C Special Damages are the damages assessed by the court as a penalty for gross negligence D Compensation to a husband or wife for the loss of companionship of a spouse

It is compensation to an injured party for actual medical expenses and loss of earnings

Which description applies to General Damages?

It is compensation to an injured party for pain, suffering, mental anguish, disfigurement and similar types of losses

Which of the following is not a function of insurance? A It is designed to be used to protect the insured from dishonest acts B It protects against uncertainty and reduces anxiety C It is the exchange of a small certain expense for a large uncertain loss D It transfers risk from the insured to the insurer

It is designed to be used to protect the insured from dishonest acts

Which of the following is true concerning the Personal Auto Policy? A It is designed to cover the use, by an individual and/or spouse only, of a personal automobile B It is designed to cover personal and commercial autos that are owned by an individual or family C It is designed to cover only the non-business use of a personal automobile D It is designed to cover an individual's or family's personal use of an auto

It is designed to cover an individual's or family's personal use of an auto--The Personal Auto Policy is designed for insuring individuals and families. A private passenger automobile used for business purposes is eligible, but commercial automobiles are not eligible.

The Difference in Conditions Policy is a special form used to fill in gaps of a property policy. Which of the following is true regarding this policy?

It is generally written on an open peril basis, excluding losses by perils that are covered under standard property forms

Which of the following is true regarding the Boatowners Policy?

It is similar in design to a Homeowners Policy and similar in coverage to the Personal Auto Policy

Which of the following is true regarding the Boatowners Policy? A It is similar in design to a Homeowners Policy and similar in coverage to the Personal Auto Policy B It provides Named Perils coverage for the boat and motor C Losses are settled on a replacement cost basis D It does not include liability coverage

It is similar in design to a Homeowners Policy and similar in coverage to the Personal Auto Policy---The Boatowners Policy provides Physical Damage (Section I) and Liability (Section II) coverages on boats of the size that can be towed by an automobile.

Which of the following best describes a Liability Policy that is written primary? A It is the policy that pays first with respect to other policies B It provided only basic coverage C It pays only after other insurance covering the same loss is exhausted D It shares the loss with other policies covering the same loss

It is the policy that pays first with respect to other policies

Which of the following is true regarding Personal Inland Marine Insurance?

It is used to insure movable property against direct loss--Personal Inland Marine Insurance is designed to cover personal property that moves about such as clothing, jewelry, cameras, furs, sporting equipment, etc., as contrasted to personal furniture, appliances and items that remain in the home.

Which of the following is true regarding the Boatowners Policy? A It has a standard deductible of $250 B It provides Open Perils Coverage, and losses are settled on an actual cash value basis C It provides Open Perils Coverage, and losses are settled on a Replacement Cost basis D It provides Named Perils Coverage, and losses are settled on an actual cash value basis

It provides Open Perils Coverage, and losses are settled on an actual cash value basis

Which of the following is the best definition of Actual Cash Value in property insurance?

Replacement cost minus depreciation

Which of the following is true regarding the Personal Liability Supplement? A The Limit of Liability is the same as the Coverage A amount B It covers the insured's personal autos C It covers Professional Services rendered by the insured D It provides coverage for claim expenses, first aid expenses and damage to property of others

It provides coverage for claim expenses, first aid expenses and damage to property of others

Which of the following best explains the Insuring Agreement of Part D under the Personal Auto Policy?

It states that the policy will pay for direct and accidental physical loss to the covered auto and that payment is made regardless of fault--The Insuring Agreement of Part D states that the insurer will pay for loss to the covered auto, including its equipment, minus any applicable deductible.

COMMON LAW Defenses are determined by which of the following?

JUDICIAL

Common Law Defenses are determined by which of the following?

Judicial decisions

Under Coverage A of a Dwelling Policy, all of the following are included, except:

Land, including the land on which the dwelling is located

Under Liability Insurance, Personal Injury Liability Coverage includes which of the following?

Legal liability arising from specific offenses committed by an insured that results in injury other than bodily injury or property damage. Examples of personal injury include libel, slander, false arrest, invasion of privacy, and copyright infringement.--Libel, slander, false arrest, invasion of privacy, etc.

If your dwelling insured under a DP-3 is damaged by a fire, which of the following would be used to pay the claim?

Replacement cost up to Coverage A

Which of the following can be added to a homeowner policy for bodily injury liability protection? A An inboard motorboat owned by an insured, except while in storage B Rented pontoon boat to entertain business clients C 20' sailing boat D An inboard motorboat with more than 50 horsepower, rented by an insured

Liability Coverage E and F excludes bodily injury for an inboard motorboat owned by an insured, except while in storage, an inboard motorboat with more than 50 horsepower, rented by an insured, an outboard motorboat with more than 25 horsepower, rented by an insured, and sailing vessels 26 feet or more in length, owned or rented by an insured.--20' sailing boat

Which of the following is NOT true about the Missouri FAIR Plan?

Licensed producers may bind coverage and accept premium payments--Producers are not contracted by the FAIR Plan and do not have the authority to bind coverage of accept premium payments on behalf of the FAIR Plan.

In Liability Insurance, Bodily Injury may include which of the following? A Slander B False Arrest C Invasion of Privacy D Loss of Earnings

Loss of Earnings

Coverage D of the Dwelling Policy includes:

Loss or Rental Income is an indirect loss sustained by the insured when the dwelling is rendered uninhabitable by a direct loss. Coverage D provides protection for this indirect loss. Additional Living expense is Coverage E.--Fair Rental Value

Part D - Coverage for Damage to Your Auto under the Personal Auto Policy will not pay for which of the following?

Losses to the covered auto caused by damage due to wear and tear, freezing, mechanical or electric breakdown, or road damage to tires

Any changes in a property insurance policy must be:

Made by the insurer's written endorsement

The Commissioner, Director, or Superintendent of insurance is responsible for all of the following, except: The quiz is currently paused. Examines insurance companies Approves premium rates Make insurance laws when appropriate Admits insurance companies to do business in the state

Make insurance laws when appropriate

Misrepresentation

Making any statement that misrepresent the benefits or true nature of a policy is misrepresentation, such as making a false or fraudulent statement on an application to obtain a fee, commission or other benefit.

Making a false statement about the benefits or the nature of an insurance policy is what unfair trade practice?

Misrepresentation--Making any false statement about the benefits or true nature of an insurance policy is misrepresentation.

Robert loves his hobbies and his agent advises him that only which of the following is covered under the homeowner policy? A State-of-the art speaker system installed in his car B Hovercraft C Model airplane D Beagle show dog named Buster

Model airplane--A model or hobby aircraft is covered unless it is designed to carry people or cargo.

Under classifications of construction, material having a fire-resistance rating between one and two hours for walls, floors and roofs, is classified as:

Modified fire-resistive

Under classifications of construction, material having a fire-resistance rating between one and two hours for walls, floors and roofs, is classified as: A Modified fire-resistive B Non-Combustible C Fire Resistive D Jointed Masonry

Modified fire-resistive

Which of the following is true about the Missouri insurance cease or desist order? A.It is the only recourse to stop an insurance unfair trade practice B.Violation may result in a minimum fine of $100,000 C.Any collected fine provides relief to mistreated consumers D.An alternative to a cease or desist order is federal court action

Money received from the Director's enforcement proceeding and imposition of penalties is placed in a 'Consumer Restitution Fund,' used to provide relief to aggrieved consumers.--Any collected fine provides relief to mistreated consumers

Under Coverage B of a Homeowners Policy, all of the following are included, except: A The insured's garage rented to a neighbor for private garaging B The renting of a garage to a neighbor for a woodworking business C A shop building containing the insured's hobby woodworking shop D The insured's garage rented to a neighbor solely for private garaging

Most private structures on the Residence Premises are covered under Coverage B if they are not used for business purposes.--The renting of a garage to a neighbor for a woodworking business

Multi-Peril crop insurance causes of loss include all of the following, except:

Multi-Peril causes of loss include: adverse weather conditions, fire, insects, plant disease, wildlife, earthquake, and volcanic eruption.--Pollution

Which of the following statements regarding Multi-Peril Crop Insurance is correct:

Multi-peril crop insurance is reinsured by the federal government by FCIC

A Board of Directors, elected by the policyholders, directs the company operations in which type of insurer?

Mutual

In insurance, any person, firm or corporation specifically designated by name as the insured in a policy, is said to be the:

Named Insured

After a lightning storm, the electrical transformer in Brenda's town failed and Brenda had no electricity for 3 days. Her adjuster advised her that damage caused by no electricity would be paid up to what amount in her DP-3?

No coverage--Damage from power failure that takes place away from the insured premises is excluded under the dwelling forms.

Under the Basic Dwelling Form, is damage caused by vandalism automatically included? A No, it must be added by endorsement B It is included as Basic Peril C It is included in the Extended Coverage Perils D It is not available in the Basic Dwelling Policy

No, it must be added by endorsement

Liability coverage is provided in which of the following situations?

Non-owned golf cart--Vehicles designed mainly for use off public roads are excluded, except for non-owned golf carts.

In property insurance, when coverage applies to a loss by all perils except those specifically excluded, the policy is said to be written on which of the following basis?

OPEN!!!

The Scheduled Articles Floater provides which of the following coverage's to described property?

Open Peril--The Scheduled Articles Floater is written on open perils basis, with very few exclusions.

A Homeowners Policy HO-3 provides:

Open Perils Coverage on the dwelling and Broad Form Coverage on the personal property

Which of the following best describes an assignment in the Conditions of a property policy?

Ownership of the policy may not be transferred without the insurer's written permission

Any private passenger auto, pickup, van, or trailer, not owned by or furnished for regular use by the named insured or a family member while being used by the named insured or a family member, under the Personal Auto Policy is defined as:

Part D of the Personal Auto Policy covers non-owned autos, as well as the insured's covered autos.--A non-owned auto--------Part D - Coverage for Damage to Your Auto pays for direct and accidental damage, regardless of fault, subject to the policy's exclusions - and those contained in this coverage part. Covered vehicles are Your Covered Auto and non-owned autos. Part D of the policy is the only section that defines non-owned auto. A deductible applies and will be the amounts shown on the Declarations for Collision coverage and Other Than Collision coverage, which is also known as comprehensive coverage. The deductibles for Collision and Other Than Collision coverages need not be the same. If this coverage pays for damage to a non-owned auto, the broadest coverage appearing on the Declarations will apply.

Which Limit of Liability applies to Medical Payments coverage? A Combined B Aggregate C Per occurrence D Per person

Per person

Which of the following endorsements to the Homeowners Policy adds coverage for injury resulting from libel, slander, false arrest, defamation, invasion of privacy and other such offenses that could result in a personal liability suit?

Personal Injury Endorsement

Under Section I of the Homeowners Policy, the following coverages are all found, except:

Personal Injury Liability--Section I of the Homeowners Policy contains the Property coverages. Liability coverages are set forth in Section II of the Policy.

Brenda is traveling to Europe for a month's vacation and her agent recommends which of the following coverages?

Personal effects floater--The Personal Effects floater provides worldwide open peril coverage for items worn or carried by tourists.

In states where insurance rates cannot be used until the Department or Division of Insurance approves them, the rates are referred to as:

Prior Approval rates

Bob insured his house for $200,000, and the mortgage company also insured his house for $100,000. Wind damaged Bob's roof resulting in $6,000 damage. How much will Bob's insurance company pay if loss conditions require payment on a pro rata basis? A $4,000 B $6,000 C None

Pro rata loss payment requires each policy to pay no more than its share of the loss. The amount Bob's insurance company pays is calculated as follows: $200,000 + $100,000 = $300,000 total insurance available. $200,000 / $300,000 = 2/3 * $6,000 = $4,000.

Which of the following is NOT true about the Missouri FAIR Plan?

Producers are not contracted by the FAIR Plan and do not have the authority to bind coverage of accept premium payments on behalf of the FAIR Plan.

Under Missouri law, what standard of care and conduct is required of producers when receiving money from, or on behalf of, insurers or policyholders?

Producers have fiduciary responsibilities to both their insurers and clients under Missouri insurance code.

Anyone who owns and operates an auto in Missouri must be able to show proof of financial responsibility by providing which of the following? A Insurance bill B Copy of the insurance policy C Bond D Insurance agent's name and phone number

Proof of financial responsibility includes a certificate of insurance, such as an insurance ID card provided by the insurer, a bond or certificate of deposit of money or securities, or a certificate of self-insurance.---Bond

Boatowners Policy?

Property Coverage,Hull,Medical Payments,Other coverages include watercraft liability coverage, uninsured boaters, and even towing is usually available.

Section I of the Homeowners Forms includes:

Property coverages

All of the following are covered under Section II of the Homeowners Policy, except: A Property of the insured B Medical expenses for an accident arising out of the premises or non-business activities of an insured C The insured's liability for bodily injury to others D The insured's liability for damages to property of others

Property of the insured

Under the National Flood Insurance Program, all of the following are incorrect, except:

Property removed to protect it from flood is covered for 45 days at other locations--Property removed to protect it from flood is covered at other locations for 45 days, but only for the peril of flood.

The Yacht policy includes

Protection and Indemnity coverage is for the insured's legal liability for the property of others.

Which of the following is true regarding the Fine Arts Floater?

Provides automatic coverage on newly acquired items for 90 days

Kevin owns several buildings at several locations. He has them insured each on a separate policy and with separate amounts. Kevin has them insured on which of the following methods of writing insurance?

Providing Specific insurance means providing a separate policy on each property. Scheduled and Blanket insurance covers more than one property per policy.--Specific Limit

A tornado is considered which of the following?

Pure Risk

Insurance is designed to provide protection against which of the following?

Pure Risk

Fire, wind and hail are all types of:

Pure Risks

If a producer offers any special favor in dividends or other benefits to an insured, the producer is guilty of which of the following marketing practices? A.Intimidation B.Rebating C.Defamation D.Twisting

Rebating is giving the insured a rebate of premium, special favors in benefits, or other inducement not otherwise specified in the policy.--Rebating

Under the Dwelling Broad Form, losses to a building are paid on a(n) ___________ basis.

Replacement Cost

Hannah was disappointed that her policy only covered her personal property for actual cash value, so her agent suggested an endorsement to change that actual cash value to which of the following?

Replacement cost

Where can Sam find insurance coverage after he was rejected by Insurer A due to his claims history?

Residual market

Where can you find insurance coverage after being rejected by your insurance company for too many claims in the past year?

Residual market

Self-insurance is an example of which of the following?

Retaining the risk

All of the following are considered restricted persons under Elements of a Legal Contract, except: A Retired Persons B People under the influence of drugs or alcohol C Mentally incompetent persons D Minors

Retired Persons

Which of the following is covered under the homeowner policy? A Ron injured a masked intruder in his home B Jack rents his lake lot C Mary is a teacher and tutors for a fee at home D Barbara teaches piano at a rented studio

Ron injured a masked intruder in his home

Direct writing companies normally market insurance through which of the following?

Salaried employees

Most of Hannah's jewelry is covered under the Coverage C special limits except for her $10,000 necklace inherited from her mother, so her agent added which of the following endorsements? A Scheduled Personal Property B Personal Property Replacement Cost C Increased Limits - Coverage C D Open Peril Personal Property

Scheduled Personal Property

Most of Hannah's jewelry is covered under the Coverage C special limits except for her $10,000 necklace inherited from her mother, so her agent added which of the following endorsements? A Open Peril Personal Property B Personal Property Replacement Cost C Increased Limits - Coverage C D Scheduled Personal Property

Scheduled Personal Property--The Scheduled Personal Property covers certain classes of property, such as jewelry, fine arts, and coins, for a specific amount on an open peril basis.

In respect to Section II of a Homeowners Policy, all of the following are true, except: A Individual and family cemetery plots qualify as an insured location B Damage to Property of Others pays up to $1,000 per occurrence C Section II losses are subject to a standard $250 deductible D Bodily injury or property damage arising from a vehicle used to assist the handicapped, such as a wheelchair, is covered

Section II losses are not subject to a deductible. All remaining responses are true.--Section II losses are subject to a standard $250 deductible

All of the following perils are included under the Dwelling Broad Form, except: A Volcanic Eruption B Burglary Damage C Falling Objects D Smoke damage from industrial operations

Smoke damage is a covered peril of the Dwelling Broad Form. However, the description of the peril specifically excludes smoke from agricultural smudging or industrial operations.--Smoke damage from industrial operations

In insurance, which of the following best describes an occurrence? A Someone takes blood pressure medicine and over time develops a rash B An accident, the cause of which cannot be determined C A sudden and unexpected event that causes damage or injury D An act of nature that causes damage or injury

Someone takes blood pressure medicine and over time develops a rash

Which of the following is an example of Special Damages? A Special Damages are the damages assessed by the court as a penalty for gross negligence B Special Damages are the damages of pain, suffering, and disfigurement C It is compensation to an injured party for actual medical expenses and loss of earnings D Compensation to a husband or wife for the loss of companionship of a spouse

Special damages are an award to an injured party for actual and known expenses such as bills, loss of earnings, and the costs of repairing or replacing damaged property. Special damages are paid for tangible loss or damage.--It is compensation to an injured party for actual medical expenses and loss of earnings

Specific Limit--Providing Specific insurance means providing a separate policy on each property. Scheduled and Blanket insurance covers more than one property per policy.

Which insurer's owner receives taxable corporate dividends as a return of profit?

Stock

When a claimant can prove that a product caused the injury, the fact that the manufacturer will be held liable regardless of whether the product was defective or not, is considered which of the following?

Strict Liability

The transfer to the insurer of the insured's right to recover damages from a third party is found in which of the following Conditions of a property policy?

Subrogation

Which of the following would be considered an Attractive Nuisance? A A candy store B A toy store C A well-tended flower bed D Swimming pools, ladders, refrigerators (with doors left on) and trampolines

Swimming pools, ladders, refrigerators (with doors left on) and trampolines

Limit of Liability

The Limit of Liability of the policy is the most the policy will pay in any one loss. However, if the insured's insurable interest is less than the limit of liability, the most the policy will pay is the insured's insurable interest.

All of the following are included in the definition of 'insured location', except: A A 1-4 family dwelling in which the insured lives in one of the units, including the structures and grounds B Any premises where the named insured resides temporarily C Vacant land, other than farm land, that is owned by the named insured D Land upon which a 1-4 family dwelling is being built as a residence for the named insured

The 1-4 family dwelling in which the insured lives in one of the units is the 'residence premises.'--A 1-4 family dwelling in which the insured lives in one of the units, including the structures and grounds

Additional/Supplemental Coverages

The Additional and Supplementary coverages are coverages for incidental expenses that often accompany the losses insured against.

n Liability Insurance, the maximum amount payable for loss (per location and/or per person) from all occurrences within a policy period regardless of the number of separate accidents (occurrences), is known as: A The Combined Single Limit B The Aggregate Limit C The Per Person Limit D The Per Occurrence Limit

The Aggregate Limit

The Basic (DP-1) Dwelling Form does not include: A World-Wide Coverage on Personal Property B Additional Living Expenses C Fair Rental Value D Property Removed to a Newly Acquired Residence

The Basic Dwelling Form (DP-1) provides coverage for Fair Rental Value. Coverage for Additional Living Expenses is available by endorsement.--Additional Living Expenses

All of the following are correct regarding the Theft Coverage Endorsement on a Dwelling policy, except: A Only on-premises coverage is available B It also includes vandalism resulting from theft C It may be added to any of the Dwelling forms D It applies only to owner-occupied structures

The Broad Form Theft endorsement is attached to owner-occupied Dwelling policies to provide theft coverage for the owner-occupant's Personal Property. On-premises and off-premises coverage is available.--Only on-premises coverage is available

Larry owns a dwelling and detached garage rented to tenants and insures it under a DP-3 with Coverage A of $100,000. How much is the detached garage insured for if damaged by a covered claim?

The Coverage B limit of insurance is 10% of the Coverage A limit.--$10,000

Larry insures his owner-occupied home on a dwelling property policy (DP-3) at a limit of $100,000. If the dwelling is damaged in a fire, what is the limit of insurance that will apply to Coverage E, Additional Living Expense?

The Coverage E is 20% of Coverage A.--$20,000

Which of the following is not true concerning Section II of the Homeowners Policy? A The coverage for Damage to Property of Others excludes property that is covered in Section I B Payment under Damage to Property of Others is made regardless of negligence C The coverage for Damage to Property of Others pays the replacement cost of the property damaged up to $1,000 per occurrence D The Damage to Property of Others duplicates coverage that is included in Section I

The Damage to Property of Others duplicates coverage that is included in Section I

Under the Dwelling Policy coverage extension of Debris Removal, which of the following is correct? A The limit for Debris Removal is 10% of the Coverage A Limit of Insurance B The limit for Debris Removal is an additional amount of insurance C The limit for Debris Removal is 5% of the Coverage A Limit of Insurance D The extension does not increase the amount of insurance under the policy

The Debris Removal expense is included in the Limit of Liability that applies to the damaged property. Therefore, it is not Additional Insurance.---The extension does not increase the amount of insurance under the policy

Under the Dwelling Policy coverage extension of Debris Removal, which of the following is correct?

The Debris Removal expense is included in the Limit of Liability that applies to the damaged property. Therefore, it is not Additional Insurance.--The extension does not increase the amount of insurance under the policy

Director of Insurance?

The Director of Insurance has the authority to make any rules necessary to enforce the insurance laws of this state. The laws are passed by the state legislature.

The following are all found on the Declarations Page, except: A The Exclusions B Location of the insured property C Amount of the deductible D Expiration date of the policy

The Exclusions

FAIR Plan

The Fair Access to Insurance Requirements program writes coverage for homeowners who cannot obtain coverage in the standard market or have been terminated in the voluntary market.

Functional Replacement Cost

The Functional Replacement Cost valuation method is used when the property insured has unique or obsolete craftsmanship, as in old elaborate homes.

In Liability Insurance, the restriction that the policy places on the dollar amount of coverage, is called:

The Limit of Liability may be set forth in several different ways, and there are often two or more limits on a policy that apply differently, depending upon the circumstances of the occurrence.--The Limit of Liability

Which of the following is true regarding Medical Payments of the Personal Auto Policy?

The Medical Payments limit is a per person limit that applies to each accident.==The liability limit shown in the Declarations is the maximum the policy will pay each person injured in any one accident

Mobile Home insurance protects all of the following, except: A There is no Actual Cash Value Settlement Endorsement B Coverage for collision, upset, stranding, or sinking for up to 30 days while the mobile home is being moved to a new location C You can add the Transportation/Permission to Move Endorsement D May be written on an open perils basis with losses to the mobile home valued on a replacement cost basis

The Mobile Home Actual Cash Value Settlement Endorsement may be used when the insured does not desire to insure the mobile home to 80% of replacement cost.---false, You can add the Transportation/Permission to Move Endorsement

The property in the Homeowners policies HO-4 and HO-6 are covered by which of the following?

The Named Broad Form Perils

In Liability Insurance, the most coverage will pay for a loss arising out of any one occurrence regardless of overall policy limits, is known as:

The Per Occurrence Limit

In Liability Insurance, the maximum amount that the coverage will pay for loss to any one person regardless of overall policy limits, is known as:

The Per Person Limit

Which of the following is true concerning the Personal Auto Policy?

The Personal Auto Policy is designed for insuring individuals and families. A private passenger automobile used for business purposes is eligible, but commercial automobiles are not eligible.==It is designed to cover an individual's or family's personal use of an auto

Brenda is traveling to Europe for a month's vacation and her agent recommends which of the following coverages?

The Personal Effects floater provides worldwide open peril coverage for items worn or carried by tourists.

Hannah was disappointed that her policy only covered her personal property for actual cash value, so her agent suggested an endorsement to change that actual cash value to which of the following? A Functional replacement cost B Agreed value C Stated Value D Replacement cost

The Personal Property Replacement Cost endorsement meets Hannah's needs, but does not pay replacement cost for antiques, fine arts, paintings, and any articles whose age or history affects the value.--Replacement cost

National Flood Insurance Program

The Regular Program allows coverage up to $250,000 due to flooding on a single family dwelling.,It provides coverage up to a stipulated amount to apply to the increased cost of compliance with flood plain management ordinances or laws that regulate the repair of a building damaged by flood. It provides coverage for direct and indirect losses to covered property as the result of flooding.

Under Section II of the Homeowners Policy, a one or two family dwelling where the insured resides in one of the units, including other structures and grounds at that location, is defined as:

The Residence Premises is either a 1, 2, 3, or 4 family dwelling in which the named insured resides. The residence premises also includes other structures and the grounds at that location, such as the 5 acres upon which the insured sits, including the barn, detached garage, and swimming pool.--The Residence Premises

Which of the following is true regarding Supplementary Payments under Part A of the Personal Auto Policy? A They are paid in addition to the liability limits of the policy B They are paid as supplementary benefits only after the Limit of Liability is exhausted C They are paid only once during the policy term D Any payments made reduce the liability limits by a like amount

The Supplementary Payments of the Personal Auto Policy provide payment, in addition to the Limit of Liability, of the incidental expenses commonly associated with Liability claims.--They are paid in addition to the liability limits of the policy

Which of the following is true regarding Supplementary Payments under Part A of the Personal Auto Policy?

The Supplementary Payments of the Personal Auto Policy provide payment, in addition to the Limit of Liability, of the incidental expenses commonly associated with Liability claims.==They are paid in addition to the liability limits of the policy

Which of the following is true regarding the Yacht Policy? A It is written on an Inland Marine form B It is designed for larger boats that can be towed by automobiles C Each policy has navigational limits that describe the area where the yacht is allowed to operate D It covers damage to the hull and fittings. Liability coverage may be attached by endorsement

The Yacht policy is designed for larger vessels such as yachts, excursion vessels, etc. It is written on an Ocean Marine Form and includes Hull, Protection and Indemnity, Medical Payments and Jones Act coverages.--Each policy has navigational limits that describe the area where the yacht is allowed to operate

Which of the following is NOT a penalty for refusing to testify in a Department hearing?

The circuit court may impose a civil penalty up to $50,000 for each violation.--Being assessed a civil penalty up to $5,000 per violation

Under a Dwelling Policy, the coverage extension of Debris Removal will cover:

The cost of removing debris caused by an insured peril

The doctrine of Strict Liability applies to products and their manufacturers. It holds that the manufacturer can be held responsible for an injury caused by a product, even if the product is not defective.=-Strict Liability

Who needs the Extended Non-Owned Coverage endorsement?

The endorsement covers non-owned autos furnished or available for the insured's regular use.--Ben who is furnished a company car

Which of the following is true concerning the Home Day Care Coverage Endorsement to the Homeowners Policy?

The endorsement extends Section II coverages to the insured's home day care business

Which is correct regarding the Automatic Increase in Insurance Endorsement?

The endorsement will automatically raise the limits of insurance at the policy renewal date

Which of the following is not true about a nonresident producer? A. A nonresident producer must be licensed for the same line of insurance in the home state B.The Department may check the NAIC Producer Database C.A letter from the home state's regulatory authority is valid if received within 6 months of approval of a nonresident license D.The home state is not obligated to insure nonresident producers licensed in Missouri

The home state must award nonresident producer licenses to Missouri residents on the same basis.--The home state is not obligated to insure nonresident producers licensed in Missouri

In property insurance, which of the following most accurately describes the abandonment condition?

The insured cannot abandon damaged property to the insurer

Assignment in the Conditions of a property policy is best described as: A The requirements placed upon the insured regarding legal action B The insured's responsibility to give prompt loss notice to the company C The naming of parties other than the insured on loss payment checks D The insured may not transfer ownership of the policy without the insurer's written permission

The insured may not transfer ownership of the policy without the insurer's written permission

Which of the following is considered the most accurate concerning Notice of Loss?

The insured must notify the insurer as soon as practical

Under the Musical Instrument Floater Policy, which of the following is true? A All of the insured's instruments are covered on a blanket basis B Instruments played for hire must be noted on the policy, but are insured at no additional premium C There is automatic coverage on newly acquired instruments for 30 days D There is automatic coverage on newly acquired instruments for 60 days

The insured must report newly acquired items within 30 days and pay an additional premium for coverage on the new items.

Which of the following is correct regarding pro rata cancellation? A The insured will receive back 90% of the unearned premium B The insured will receive back the entire unearned premium without any penalty C The insured will receive back 75% of the unearned premium D The premium is fully earned by the insurance company

The insured will receive back the entire unearned premium without any penalty

Which of the following best defines short rate cancellation? A The insured will receive 75% of the unearned premium B The premium is fully earned by the insurance company C The insured will receive less than the full amount of the unearned premium D The insured will receive 50% of the unearned premium

The insured will receive less than the full amount of the unearned premium

Which of the following is true if an owner of a warehouse has a Commercial Property Policy written on it for $300,000, and wants to transfer the policy when the property is sold to a new owner?

The insurer must give written consent before the policy can be transferred--Transfer of the policy may be made only with the insurer's written consent, in the form of an endorsement to the policy. The company wishes to underwrite the insured, as well as the risk.

Choose the statement about aftermarket parts regulation that is false. A.The insurer is not required to notify the insured beforehand if aftermarket parts will be used on a repair B.Warranties for aftermarket parts are provided by the manufacturer of the part C.Aftermarket parts are crash parts supplied by a source other than the car manufacturer D.Nonoriginal equipment manufacturers provide aftermarket parts

The insurer must notify the insured on the written estimate, before repairs, of each aftermarket part to be used in the repair.--The insurer is not required to notify the insured beforehand if aftermarket parts will be used on a repair

An example of Vicarious Liability might be: A Liability of a negligent party or parties, whose identity cannot be determined B The liability of a group of people, acting in concert C Liability of members of the clergy D The indirect or imputed liability for the acts of another

The liability assigned to one party for the conduct of another, based solely on a relationship between the two. Examples include employer/employee relationships and parent/child relationships. This is known as Vicarious Liability.-The indirect or imputed liability for the acts of another

Which of the following is true regarding Medical Payments of the Personal Auto Policy? A The liability limit shown in the Declarations is the maximum the policy will pay each person injured in any one accident B The liability limit shown in the Declarations is the maximum the policy will pay for each person during the policy term C The liability limit shown in the Declarations is the maximum the policy will pay for all persons injured in any one accident D The liability limit shown in the Declarations is the maximum the policy will pay for all claims during the policy term

The liability limit shown in the Declarations is the maximum the policy will pay each person injured in any one accident--The Medical Payments limit is a per person limit that applies to each accident.

Under the Dwelling Under Construction Endorsement of a Dwelling Policy, which of the following is true?

The limit of liability for Coverage A is provisional and is based on the building's value upon completion. The limit of insurance in place at any time prior to completion is a percentage of the Coverage A limit that equals the proportion the actual value bears to the value on the date of completion.=The premium is based upon the average amount of insurance during construction

What is Insurer B's company loss ratio for the past month with an earned premium of $600,000, written premium of $350,000, operating expenses of $75,000, and paid losses and reserves of $500,000?

The loss ratio is determined by dividing the paid losses and loss reserves by the total earned premium: $500,000 / $600,000 = .83 or 83%.

Which of the following is true regarding the Personal Auto Policy on out of state coverage?

While the covered auto is away from the state where it is licensed, the policy will increase the Limit of Liability insurance to comply with any compulsory insurance or financial responsibility law in the state where the covered auto is being used

All of the following would be considered a covered resident under the Homeowners Policy, except: A A 22-year-old exchange student B The insured's relatives who are residents of the household C A 22-year-old relative enrolled in school full time that was a resident of the household before moving out to attend school D A 20-year-old exchange student who is a resident of the household

The named insured and his or her resident spouse if the resident spouse is a member of the named insured's household. Other residents of the named insured's household who are: Relatives of the named insured, meaning they are related by blood, marriage, or adoption. Under the age of 21 and in the care of any insured. Full-time students living away at college if they: Are under age 24 and related to the named insured, Were a resident of the named insured's household before moving away to college, OR Are under age 21 and in the care of the named insured or a resident relative.=A 22-year-old exchange student

Elizabeth and Frank who have a personal umbrella policy with Insure+ notified them that a claim was filed against them for slander, and the insurer advised them that which of the following would be paid by the insured? A Self-insured retention B 5% of the total loss C Defense costs D Underlying coverage would pay it all

The only time the insured must pay a self-insured retention is when the umbrella drops down, meaning there is no underlying policy covering personal injury coverage and the insured must share the cost.---Self-insured retention

lizabeth and Frank who have a personal umbrella policy with Insure+ notified them that a claim was filed against them for slander, and the insurer advised them that which of the following would be paid by the insured?

Liability Insurance is a two-party contract with payments made to which of the following?

The parties to the Liability Insurance Contract are the insured and the insurer. Under the terms of the policy, the insurer will pay those sums owed by the insured to a third party, whom the insured may have negligently damaged by a tort.--A third party

William lives on an earthquake fault line and asks John about the earthquake endorsement, and John tells him it is fairly broad, but does not cover which of the following? A Sinkhole B Flood C Mudslide D Tremors

The peril of earthquake, or earth movement, is excluded on virtually all property policies. It may be added to most homeowners policies by endorsements and, in some jurisdictions, such as California, may also be purchased as a separate policy. Included in the peril of earthquake are earth movement, land shock waves or tremors, landslide, mudslide, mudflow, sinkhole, and the rising, sinking, or shifting of the earth. All earth movements occurring within a 72-hour period are considered a single occurrence of earth movement.===Flood

In liability insurance, which of the following is true regarding the term negligence? A In every accident there is one or more negligent parties B The uninjured party to an accident is presumed to be negligent C The person claiming damages, in almost every instance, must prove the actions of the insured were the direct or proximate cause of the injury or damages D An accident occurred, which resulted in bodily injury or property damag

The person claiming damages, in almost every instance, must prove the actions of the insured were the direct or proximate cause of the injury or damages

Which of the following are the Territorial Limits of the Personal Auto Policy? A The United States, Mexico, Canada, and while being transported between covered ports B The United States, its territories and possessions, Puerto Rico and Canada, and while being transported between covered ports C The United States, Puerto Rico, Canada, and Mexico D The United States, its territories and possessions, Canada, Mexico, and while being transported between covered ports

The policy covers only accidents and losses that occur within the Policy Territory. Mexico does not fall within the policy territory as the policy is written.--The United States, its territories and possessions, Puerto Rico and Canada, and while being transported between covered ports

Which of the following is true regarding Coverage A under the Dwelling Policy? A Outdoor equipment is not covered B The policy does not include coverage for wind loss of television antennas C Coverage on land is restricted to the land upon which the dwelling is sitting D Coverage A includes a detached carport

The policy does not include coverage for wind loss of television antennas--Wind loss of television antennas is so common the coverage is available only through attachment of an endorsement providing this coverage for an additional premium.

Homeowners policies contain a section called Additional Coverage, one of which is debris removal. Which of the following best describes the Debris Removal coverage?

The policy will pay the insured's removing debris from a covered loss--Debris removal provides payment of the named insured's reasonable expenses for the removal of debris of covered property if a covered loss occurs.

Homeowners policies contain a section called Additional Coverages, one of which is debris removal. Which of the following best describes the Debris Removal coverage?

The policy will pay the insured's removing debris from a covered loss==Debris removal provides payment of the named insured's reasonable expenses for the removal of debris of covered property if a covered loss occurs

Under the Dwelling Under Construction Endorsement of a Dwelling Policy, which of the following is true? A The amount of insurance at any time is the provisional amount stated in the Declarations B Insurance applies to the Dwelling under Coverage A and to other structures under Coverage B C The premium is based upon the average amount of insurance during construction D The insured had up to 90 days to notify the company that the dwelling is occupied

The premium is based upon the average amount of insurance during construction--The limit of liability for Coverage A is provisional and is based on the building's value upon completion. The limit of insurance in place at any time prior to completion is a percentage of the Coverage A limit that equals the proportion the actual value bears to the value on the date of completion.

All of the following are true about personal insurance transactions, except:

The producer may use any professional designation to instill confidence about the sale of insurance to seniors--It is a dishonest or unethical practice for a producer to use a professional designation that implies that the insurance producer has special certification in advising a client in connection with the solicitation, sale, or negotiation of an insurance product.

Vandalism and malicious mischief losses are excluded under the Homeowners Policy when:

The property has been vacant for 60 consecutive days

Which of the following is correct regarding Uninsured Motorists Coverage under the Personal Auto Policy?

The purpose of Uninsured Motorists Coverage is to provide coverage for an insured injured in an accident that is the fault of the operator of an uninsured motor vehicle.--It covers bodily injury (BI) of an insured due to an accident caused by the driver of an uninsured vehicle

Which of the following is correct regarding Uninsured Motorists Coverage under the Personal Auto Policy?

The purpose of Uninsured Motorists Coverage is to provide coverage for an insured injured in an accident that is the fault of the operator of an uninsured motor vehicle.==It covers bodily injury (BI) of an insured due to an accident caused by the driver of an uninsured vehicle

Where can Sam find insurance coverage after he was rejected by Insurer A due to his claims history?

The residual market is a private coverage source of last resort for businesses and individuals who have been rejected by voluntary market insurers.

Under Coinsurance, all of the following are true, except: A If the specified percentage of insurance is not carried, the insured will share in the loss B Higher coinsurance percentages result in a reduced premium rate C The value of the property at the time the policy was written determines the amount of insurance required at the time of loss D There is no penalty when the insured suffers a total loss

The value of the property at the time the policy was written determines the amount of insurance required at the time of loss

Under the Broad Form Dwelling Policy (DP-2), which peril is not included for coverage without an endorsement?

Theft

The Homeowners Policy would cover personal property, such as: A Property of the tenant of an apartment located in the insured's garage B A camera that is stolen while the insured is on vacation C Business data stored on the insured's laptop computer D The insured's registered pet dog

There is a lengthy list of property not covered under Coverage C in the Homeowners Policy, including animals, birds and fish; property of tenants; and business data, credit and electronic fund transfer cards.--A camera that is stolen while the insured is on vacation

Under the Musical Instrument Floater Policy, which of the following is true? A There is automatic coverage on newly acquired instruments for 60 days B All of the insured's instruments are covered on a blanket basis C There is automatic coverage on newly acquired instruments for 30 days D Instruments played for hire must be noted on the policy, but are insured at no additional premium

There is automatic coverage on newly acquired instruments for 30 days

Which of the following is true regarding the Difference in Conditions Policy?

There is no coinsurance clause or pro rata clause and it may be written for a different amount from the policy it complements--The DIC policy is not an excess layer of insurance. Rather, it provides coverage for perils not insured against under standard property policy forms.

ll of the following are false statements about Medical Payments under Liability Insurance, except: A They apply to all persons, including the insured on the premises for any reason B They apply to all expenses incurred within 5 years of the accident C These payments are made regardless of fault or negligence and payment is not an admission of fault D They apply to members of amateur athletic teams sponsored by the insured

These payments are made regardless of fault or negligence and payment is not an admission of fault

Which of the following is true regarding Supplementary Payments under Part A of the Personal Auto Policy?

They are paid in addition to the liability limits of the policy

Which of the following is true regarding HO-4 and HO-6 forms?

They are used to insure the personal property and personal liability of the insured, but do not include the structure itself

The Homeowners Policy is a package policy. Which of the following is the most accurate concerning package policies?

They offer fewer gaps in coverage, a savings in premium, and fewer policies are required

Which of the following is true regarding the Fine Arts Floater? A Coverage is worldwide, with some exceptions B Coverage is automatic on newly acquired items for 30 days C Provides automatic coverage on newly acquired items for 90 days D Coverage is primarily for stamps and coins

This policy, covering paintings, statuary, carvings, other works of art, rare manuscripts, and antiques, has automatic coverage on newly acquired items for 90 days from the date of their acquisition.--Provides automatic coverage on newly acquired items for 90 days

The provision that establishes the method by which coverage will be applied if other insurance applies to the loss, is sometimes called: A The Subrogation provision B The Claim Settlement provision C The Limit of Liability provision D The pro rata liability provision

This provision is found in the policy in the Other Insurance condition. It is sometimes known as the pro rata liability provision because it provides for claim settlement to be proportioned to the amount of other insurance.--The pro rata liability provision

Which of the following is not a factor that an underwriter considers in determining the eligibility of a person for property insurance? A Existence of any hazards such as a nearby gas station exposure B Whether the premium will be paid in full or billed to the mortgage company C The nature of the risk, such as the type of building and the number of families living in the building D The claims history showing when prior claims occurred and how much was paid to settle the claim

Whether the premium will be paid in full or billed to the mortgage company

The Personal Articles Floater Policy is written:

To provide coverage worldwide with some exceptions

Which of the following best describes the Towing and Labor Costs Coverage Endorsement to the Personal Auto Policy?

Towing and Labor Costs Coverage is available by endorsement to the policy to provide coverage for these costs when caused by a mechanical disablement.--It provides payment for towing to a garage, or for labor that is performed at the site of a mechanical disablement (not both at the same breakdown)

Umpire

Which of the following coverages under the Personal Auto Policy protects the insured against drivers who do not have adequate auto liability insurance limits? A Underinsured Motorist Coverage B Medical Payments Coverage C Uninsured Motorist Coverage D Liability Coverage

Underinsured Motorist Coverage--Uninsured Motorists Coverage applies only when the at-fault driver is uninsured. When the at-fault driver of the other vehicle has insurance, but the limits are insufficient to cover the insured's damages, then the insured may make a claim under Underinsured Motorists Coverage.

Under Aleatory contracts the exchange of values may be:

Unequal

A strong wind blew a mailbox into Stan's front picture window and he immediately went to the store and bought wood to cover the damaged window. Stan was happy that his insurance company paid for the window repairs and also the wood up to what amount? A $500 B 10% of Coverage A C $1,000 D Coverage A limit of insurance

When the insured's property is damaged by a covered peril, Reasonable Repairs coverage pays the reasonable costs by the named insured to take necessary measures to protect the property against further damage, and it is included in the coverage that applies to the damaged property.--Coverage A limit of insurance

When must a producer notify the Director of any change in legal address? A Within 15 days B Never C Within 90 days D Within 30 days

Within 30 days

When a building has physical contents but no occupants, the building is said to be:

Unoccupied

Choose the statement about automobile subrogation that is false. A An outside attorney may collect expenses from the recovery B Recovery is shared proportionately with the first-party claimant C The insured's deductible is not considered in the subrogation demands D Expenses cannot be deducted from a recovery

Upon the claimant's request, insurers will include the first-party claimant's deductible, if any, in subrogation demands.

Under Personal Inland Marine Insurance, the Personal Articles Floater (Scheduled Articles Floater) is: A Used to insure individual personal property on an itemized or scheduled basis B Used to provide replacement cost coverage on personal property C Used to insure personal property on a blanket basis D Used to replace Coverage C of the Homeowners Policy

Used to insure individual personal property on an itemized or scheduled basis

Which of the following best describes the situation when a property has neither contents nor occupants?

Vacancy

Sam's neighbor told Sam that which of the following vehicles is not considered an uninsured vehicle?

Vehicle is owned by the government

Liability coverage is provided in which of the following situations? A Uninsured owned vehicle B Non-owned golf cart C Company car D Motorcycle

Vehicles designed mainly for use off public roads are excluded, except for non-owned golf carts.--Non-owned golf cart

A breach under the Doctrine of Warranty may result in:

Voidance of the contract

Fraud is an intentional act of all of the following, except: The quiz is currently paused. Misrepresentation used to induce another to part with something of value Concealment Warranty Deceit

Warranty--A warranty is a statement in the application guaranteed true in all respects.

Jim lives in a no-fault state, and he was hit by a driver that ran a stop light and Jim was injured with a broken leg. Whose insurance company will pay for Jim's injury?

When a no-fault liability law, the injured party collects insurance benefits from his own insurance as if it were first-party coverage, eliminating the need to determine negligence or legal liability.--Jim's insurance company

Which of the following constitutes the acceptance of an offer?

When an insurer issues a binder

Which of the following best describes when one would purchase a HO-8?

When insuring an older home that might create a moral hazard when insurance is written at replacement cost

Coverage E of the Dwelling Policy includes:

When the dwelling is owner occupied, the policy will pay additional living expenses incurred after a covered direct loss

misrepresentation of policy provisions?

While an insurer cannot deny a claim based upon the insured's failure to submit a written notice of loss within a specified time following any loss, claim denial is acceptable if the failure prejudices the rights of the insurer.

Under the Personal Auto Policy, medical payments do not apply to persons while occupying which of the following?

Workers' Compensation coverage is intended to be an exclusive remedy for injuries incurred in the course of employment. Therefore, these injuries are excluded under Medical Payments coverage.--A vehicle used during the course of employment if Workers' Compensation benefits are required or available

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