Exam Test 2

The insured is covered under a Businessowners Policy. He has several computers and the electronic data is corrupted as a result of lightning. The loss is $20,000. How much will the policy pay for the damaged data?

$10,000.

Under a dwelling broad or special form, what is the maximum that would be paid for "loss of use" if Coverage A was $60,000?

$12,000

The insured carries a personal auto policy providing a bodily injury limit of $50,000 each person with a multiple injury limit of $100,000. He injures two occupants in another vehicle. Their injuries total $60,000 for Mr. Jones and $50,000 for Mrs. Jones. The insurance company spent $40,000 in defense and investigation costs. How much will the insured's policy pay?

$140,000

Under Coverage F - Unscheduled Farm Personal Property, the most that will be paid for a "head" of livestock (an adult animal, one year of age or older) is:

$2,000

An insured carries property insurance with a limit of $25,000 and an 80% coinsurance clause. The covered building, however, is worth $40,000. How much would she collect in the event of a total loss?

$25,000.

If the insured has to take time off work to help assist in the investigation of the claim, the policy will pay for actual loss of earnings up to:

$250 per day

Under the "emergency program" the National Flood Insurance Program will insure a single family residence for up to:

$35,000

Jim and Mary are celebrating their 50th wedding anniversary and are on a worldwide cruise. They carry a DP-3 dwelling policy with a personal property limit of $50,000. While off the coast of Africa the ship catches fire and their property is completely destroyed. How much, if anything, will they collect?

$5,000

Jim Johnson has an automobile policy with a combined single limit of $50,000. He has an at-fault accident and incurs the following expenses: $30,000 bodily injury judgment; $30,000 property damage judgment; $5,000 damage to traffic light; $6,000 attorney's fees for his defense; $300 in premiums for appeal bond; and $75 in bail bond premiums for related traffic violations. What is the maximum amount his insurance company will pay?

$56,375

At the time of fire damage to a covered auto under a business auto policy, the auto's actual cash value is $9,200. The cost to repair the damage fully would be $11,500. If the policy has a $250 comprehensive deductible, what amount will the insurer pay for the loss?

$9,200

When an insurance company voids an insurance policy because of fraud or concealment, how many days advance notice of cancellation must be sent to the insured?

10 days.

What type of liability is imposed by law without regard to fault on those participating in certain activities or owning certain things that are considered especially hazardous?

Absolute

Extra Expense coverage under the Commercial Property insurance:

All of the responses are correct.

"Garage operations" covered by a garage policy include:

All of the responses are correct..

An insurance broker is a person who represents:

An insured or prospective insured..

A valid contract must contain all of the following, EXCEPT:

Be a written instrument.

The form used to report the insured's actual and estimated business income under an Equipment Breakdown policy is called:

Business income—Report of Values .

"Personal injury" is best described in which of the following situations?

Calling a client a cheat and a fraud.

Which of the following is a necessary part of a complete commercial general liability policy?

Common policy conditions

Under the HO-5, if the insured carries insurance coverage that falls between 80 to 100% of the full value of the structure, which of the following would replacement cost coverage NOT cover?

Contents

All of the following bonds guarantee the payment of certain taxes, EXCEPT:

Contract surety bonds.

Which of the following statement is true of the jewelers block coverage form?

Coverage may be written for the stock for retail jewelers or the jewelry stock of department and discount stores.

Which of the following events, arising out of the use of a covered auto, is covered under the personal auto policy?

Damage to a private garage rented by the insured

Bob and Pete's Used Cars has purchased a garage policy with dealers physical damage on the cars owned by the dealership at its location. Pete goes to an auto auction 150 miles away, purchases vehicles and drives them back to the dealership. Which endorsement, if any, is necessary to cover this exposure?

Dealers Drive Away Collision.

The Commercial Building and Personal Property Coverage for

Describes the property to be insured.

A ship has negligently collided with another ship and caused severe damage. What coverage would apply to cover this claim?

Hull insurance with the "running down clause

When is it appropriate for an adjuster to secure a non-waiver agreement with the insured?

If there is a question of coverage.

All of the following may use a credit report under the Fair Credit Reporting Act, EXCEPT:

In a court case..

The insured owns a two family dwelling and is covered under a Homeowner policy. One of the units is rented. The insured also maintains a small incidental business in the structure. In case of a covered loss, which of the following would NOT be paid under Coverage D - Loss of Use?

Loss of income from the incidental business.

he National Flood Insurance Program will reimburse for loss of use of a home if it is flooded for:

Loss of use is not covered under the NFIP policy.

Which of the following statements is true regarding personal auto coverage?

Medical Payments Coverage pays the insured and others without regard to fault..

Under the "Discovery Condition" of the Loss Sustained form of a Crime insurance policy, how long is a loss covered when the loss occurred during the policy period, but was discovered after the policy expired?

One year

The property insurance term "improvements and betterment" applies to:

Real Property

The insured's vehicle has been involved in an accident with a third party who is at fault. The insured's insurance company pays the claim according to the terms of their policy. In subrogation proceedings against the negligent driver, what is required of the insurer?

Request payment of the insured's deductible.

A minor executing an application for insurance will result in:

The application being accepted or rejected according to state law..

An insurance agent represents the interest of:

The insurance company.

Which of the following losses may not be determined by an adjuster?

Use of a rental vehicle.

When would the personal auto policy respond to a loss with a three wheeler?

When used in an emergency situation.

In insurance terms, the phrase severability of insurance means:

he insurance applies separately to each insured

A common carrier has signed a contract to deliver goods of the seller. The goods are to be shipped "Free on Board Destination". When does the responsibility of the seller end?

ot until the goods are delivered to the buyer in accordance with the contract terms..