Exam FX Test

An insured has a large dog. The first day he has to leave the dog home alone to go to work, the insured comes back to find his $400 couch torn apart, his $100 coffee table chewed up, his $50 window curtain shredded and his $200 window pane shattered where his dog jumped through. The insured has personal property coverage under a special form dwelling policy. How much of this loss will he policy cover?

$0

What is the maximum amount an insurer will pay under the equipment dealers pollution cleanup and removal extension of an inland marine policy

$10,000 for all expenses incurred during a 12-month period

In addition to income benefits, hw much will a dependent survivor receive a s a funeral benefit for a deceased employee covered under Workers Compensation?

$3,000

In the computer fraud crime coverage form, what limit is placed on each occurrence of the loss of manuscripts, drawings or records?

$5,000

What is the minimum amount of coverage that should be carried on an HO-2 on a home that was purchased four years ago for $75,000, which today has a replacement cost value of $100,000?

$80,000

For how long after the death of a named insured must basic property insurance continue coverae

180 days

For the purpose of examination by the department, insurers must keep a record of all financial files for at least?

5 years

A covered watercraft was damaged in an accident. The ACV of the damaged property was assessed at $10,000. The cost of repairs for the watercraft was assessed at $5,000. The insured's watercraft policy is written with a $25,000 limit. How much will the insurer pay for coverage to damage of the watercraft?

5,000

What is the civil penalty for the first violation of the Pennsylvania Insurance Fraud Prevention Act

5,000

If a liability policy had split limits of 50/100/30, what is the maximum amount that would be payable in the event of injury to a single person?

50,000

How much coverage is provided under a homeowners policy for theft or unauthorized use of a credit card?

500

A licensed producer moving to Pennsylvania may become licensed as a resident if the producer submits a completed application within how many days of establishing residence in Pennsylvania with proof of licensing from their prior home state?

90

Which of the following losses would NOT be covered by a homeowners policy?

A coin collection valued at $500 lost in a fire

An automobile that is owned by multiple induvial who are not spouses or otherwise in the same household may be insured under a personal auto policy if

A joint ownership coverage endorsement is added

A business owners policy is

A self-contained prepackaged policy.

An uninsured motor vehicle includes all the following EXCEPT

A vehicle owned and operated by a self-insurer

What is a Certificate of Insurance

A written document showing the types and amounts of insurance that have been issued to the insured

In a personal auto policy, the medical payments coverage is similar to

Accident insurance, because it pays medical expenses regardless of fault

Which of the following would be considered an unfair claims settlement practice?

Advising the insured that if the glam goes to arbitration, the insured would probably receive less than what is currently being offered

Which of these is defined as the maximum limit of coverage available under a liability policy during a policy year, regardless of the number of claims that may be made or the number of accidents that may occur?

Aggregate limit of liability

What is the civil penalty for the first violation of the Pennsylvania Automobile Insurance Plan?

All insurers authorized to write auto liability insurance in the state

Because an agent is using stationery with the logo of an insurance company, applicants for insurance assume that the agent is authorized to transact on behalf of that insurer. What type of agent authority does this describe?

Apparent

An installation floater is used to insure

Appliances intended to become a permanent part of the building

An insurer that holds a Certificate of Authority in the state in which it transacts business is considered a/an

Authorized Insurer

The Business Pursuits endorsement under Section II of a homeowners policy will cover all the following EXCEPT

Business liability

To legally transact insurance in this state, an insurer must obtain which of the following?

Certificate of Authority

Which of the following is an additional coverage that is covered by the broad causes of loss form?

Collapse

What are the two major sections of commercial crime policies?

Commercial entities and government entities

The state insurance code identifies all of the following as prohibited acts that can cause suspension, revocation or denial of an insurance producer license EXCEPT

Committing any misdemeanor

All of the following are classes of inland marine risks EXCEPT

Common carrier cargo liability

Which of the following property coverages would provide protection to contents damaged by fire?

Coverage C

Because an insured owns a lot of expensive jewelry, her insurance agent has advised her to purchase a scheduled personal property endorsement. If the insured adds this endorsement to her homeowners policy, which of the following statements would be correct?

Coverage C limits will no longer apply to the jewelry insured by the endorsement.

A unique feature in a bailee form is that it covers

Customers property whether or not he insured has been negligent

Which of the following dwelling policy forms primarily insures a structure on an actual cash value basis?

DP-1

All else being equal, which of the following will NOT be considered unfair discrimination by insurers?

Discriminating in benefits and coverages based on insureds habits and lifestyle

All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT

Dividends from a mutual insurer

What is the purpose of the coinsurance clause found in property insurance policies

Encourage the insured to insure the property closer to full value

The section of an insurance policy that details what perils are not insured against and what personas are not insured

Exclusions

Which of the following is true of a dwelling policy coverage?

Exclusions apply to all policy forms

All of the following are excluded in he equipment breakdown basic policy EXCEPT

Explosion of steam boilers

Which of the following is an example of an unfair claims settlement practice?

Failure to promptly settle a claim when liability has been clearly established

With regard to fire insurance premiums, structures with which of the following type of construction would most likely have the most favorable premium rate for the peril of fire?

Fire Resistive

Replacement cost is defied as

Full replacement of property at it's current cost, new and without reduction for depreciation

All of the following are parts of a personal auto policy EXCEPT

Garage coverage

The policy conditions define

How parties to the contract must act following a loss.

Which authority is NOT stated in an agent's contract but is required for the agent to conduct business?

Implied

The pro rata liability clause is designed to protect the principle of

Indemnity

Which insurance principle states that if a policy allows for greater compensation than the financial loss incurred, the insured may only receive benefits for the amount lost?

Indemnity

Under the Motor Vehicle Financial Responsibility Law, First Party Benefits would NOT be denied for which of the following injuries?

Injury incurred while the person was under the influence of drugs or alcohol

The Pennsylvania Property and Casualty Insurance Guaranty Association provides protection to insureds in the event of

Insurance company insolvency

The part of the insurance contract that describes the covered perils and the nature of coverage of the contractual agreement between the insurer and the insured is called the

Insuring agreement

Which of the following would be covered under the Broad Form (DP-2) policy's falling object peril?

Interior building damage if the exterior was damaged first

Which of the following best describes a misrepresentation?

Issuing sales material with exaggerated statements about policy benefits

Which of the following is NOT one of the 3 requirements for property to be eligible for FAIR plan coverage?

It must be valued at an amount under the maximum value amount set by the state

An insured is driving her automobile and strikes a large pothole that causes a flat tire. Which coverage of the insured's personal auto policy will pay for the repair?

Loss is not covered

To comply with requirements for insurance for public liability under the Motor Carrier Act of 1980, which endorsement is added to motor carrier coverage form?

MCS-90

Which of the following is the term used when a person is in a fiduciary position has used assets in manner for which they were not intended such as the wrongful taking or use of money belonging to another?

Misappropriation of Funds

Which of the following will be covered by the contractors equipment floater in an unified inland marine insurance?

Mobile equipment during transportation to and from the job site

According to the standard mortgage clause, who has the right to bring a suit in their own name to recover damages, pay policy premiums, and submit a proof of loss?

Mortgagee

A loss has occurred before the first report has been filed on a value reporting coverage form. Which is NOT true?

Never more than 75 percent of the loss is paid

Several insureds have become liable because of a sing loss. How will the policy's limit of liability be affected?

No more than the per occurrence limit applies, no matter how many insureds are involved

Damage to insured property caused by earth movement or earthquake is covered under which of the following homeowners forms?

None

When an insurer cancels an auto policy for an allowable reason, they must give notice to the named insured of possible eligibility for coverage through the Pennsylvania Auto Insurance Plan, unless the reason for cancellation is

Nonpayment of premium

An insured has a personal property replacement cost endorsement under her homeowners policy. If an expensive painting and an antique chair are stolen from the insured's home, what will the insured receive on the claim under that endorsement?

Nothing - excludes art and antiques

In a watercraft policy, which coverage part will respond to a claim for damages for bodily injury or property damage for which the insured becomes legally liable because of a watercraft accident

Part A

A participating insurance policy may do which of the following?

Pay dividends to the policyowner

Which surety bond guarantees that bills for labor and materials will be paid by the contactor as they are due

Payment bond

Which of the following limits, shown in the declarations of a policy, applies to medical expenses?

Per person

All of the following are additional liability coverages automatically provided in a homeowners policy EXCEPT

Personal injury

If a person is using an auto with the belief that he is entitled to do so, subrogation rights under a personal auto policy would apply to all coverages EXCEPT

Physical Damage

What is the term for the entity that an agent represents regarding contractual agreements with third parties?

Principal

The Limited Fungi, Wet or Dry Rot, or Bacteria Coverage Endorsement applies to which type of losses?

Property and Liability

Under the personal auto policy, liability for bodily injury resulting from the insured's use of a nonowned automobile is

Provided by the insureds policy on an excess basis

In property insurance, actual cash value is defined as which of the following?

Replacement cost at the time of the loss, less depreciation

At the time of loss insured against in a property and casualty policy, the insurer's claim settlement options include all of the following EXCEPT

Replacing the property with other property of a lesser kind or quality.

According to the BOP definitions, which of the following does NOT mean valuable papers and records?

Securities

Payment for medical expenses, loss of wages, funeral expenses, or the cost to repair or replace damaged property are known as what type of compensatory damages?

Special

Which of the following is NOT considered a residual market?

State property and Casualty Gurranty Association

The policy provision found in property insurance polices that prevents the insured from collecting twice for the same loss?

Subrogation

Which of the following perils is covered by the HO-2 and HO-3?

Sudden and accidental rupture of a heating system

Which one of the following symbols used in business auto coverage is correctly described?

Symbol 9- nonowner autos only

Under a dwelling policy, which of the following is NOT a factor in determining a loss?

The amount negotiated by the insured

What is the maximum amount of protection available to insureds under the Pennsylvania Property and Casualty Insurance Guaranty Association?

The amount of loss up to the amount of coverage in the original policy, not to exceed $300,000 per claimant

Which of the following would qualify as a competent party in an insurance contract?

The applicant has a prior felony conviction

Peril is most easily defined as

The cause of loss insured against

The claims-made trigger is based on which of the following?

The date claim is first made

When an umbrella policy is broader than underlying insurance and it pays a loss that is not covered by the underlying policy, it usually only pays

The excess over the self-insured retention

Negligence is defined as

The failure to do what a reasonable prudent person would do under given circumstances.

Under the provisions of the business income coverage form, all of the following are true EXCEPT

The insured is reimbursed for the loss from the date of the loss to the date of the restoration or policy expiration date, whoever comes first

If the underwriters direct a vessel to proceed to a particular port for repair, who pays he expenses, including wages and maintenance of doing so?

The insurer

All of the following are true regarding physical damage coverage EXCEPT

The limit of liability is the greater of the actual cash value of the vehicle at the time of loss or the amount necessary to repair or replace the vehicle.

In terms of parties to a contract, which of the following does NOT describe a competent party?

The person must have at least completed secondary education

Which of the following losses would most likely NOT be covered under Coverage A in the dwelling policy

Theft of a renter's lawnmower used to service the premises

All of the following are other coverages included in both the broad and special form dwelling policy EXCEPT

Theft of personal property

An individual was just caught acting as an exclusive general agents- even though he is not properly licensed. Assuming that this occurred in a single day, what is the maximum penalty he faces?

Third degree misdemeanor and a 1,000 dollar fine

Which of the following exposures is insured under Coverage I- Personal and Advertising Injury Liability

Unintentional acts arising from the operation of a farming business

Pete wants to have separate insurance coverage for separate acreages. What kind of insurance should Pete get?

Unit Insurance

The insurer must be able to rely on the statements in the application and the insured must be able to rely on the insurer to pay valid claims. In the forming of an insurance contact, this is referred to as

Utmost good faith

Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract?

Warrranty