Final for Casualty Insurance
Which of the following exposures is not covered under the garage liability coverage form? A. Products and completed operations liability B. Auto liability C. Contractual liability D. Premises and operation liability
C. Contractual liability
The commercial crime coverage that would cover losses resulting from the theft of money, securities, and other property by employees is A. Inside the premises - theft of money and securities B. Employee theft C. Funds transfer fraud D. Forgery or alteration
B. Employee theft
After a binder for property insurance is issued, when must the policy be either granted for denied? A. As soon as reasonably possible B. Within 30 days C. Within 60 days D. Within 90 days
A. As soon as reasonably possible
What types of injuries could incur additional penalties and/or increased benefits paid by the employer? A. The employer's willful failure to provide required safety goggles B. Loss of a limb while following safety procedures C. An injury that occurred while on a dangerous site D. A fall that is a result of a slippery workplace floor
A. The employer's willful failure to provide required safety goggles
An insured has a personal umbrella with a $2,000 self-insured retention (SIR). Assuming no other policy is involved, how much would the umbrella pay after a $12,000 personal injury liability claim? A. $1,000 B. $10,000 C. $12,000 D. $2,000
B. $10,000
A pharmacy offers a delivery service to its customers. When the delivery driver parked his truck in front of a customer's home, someone broke into the delivery truck and stole the money inside the vehicle. Which crime coverage will cover the loss of the money? A. Outside the premises (theft, disappearance or destruction) B. Vandalism and malicious mischief C. Inside the premises - theft of money and securities D. Inside the premises - robbery or safe burglary of other property
A. Outside the premises (theft, disappearance or destruction)
All of the following are true regarding a producer's fiduciary responsibilities EXCEPT A. Producers may commingle personal funds with company funds B. A producer who receives money for the sale or negotiation of an insurance contract must keep the funds in a separate trust account C. All monies must be accounted for and paid to the proper party D. A producer who fails to pay trust funds to the company representative is guilty of theft
A. Producers may commingle personal funds with company funds
All of the following are true regarding the federal Fair Credit Reporting Act EXCEPT A. Insurers are not required to give customers a copy of the report B. It applies to the credit reports ordered in connection with insurance, banking and employment C. The customer must be notified if advance action is taken as a result of a report D. Reports may be sent to anyone who requests one
A. Reports may be sent to anyone who requests one
If an applicant submits the initial premium with an application, which action constitutes acceptance? A. The producer delivers the policy B. The insurance company receives the application and initial premium C. The underwriters approve the application D. The applicant submits a statement of good health
C. The underwriters approve the application
An applicant may challenge information discovered as a result of an investigative consumer report under which of the following Acts? A. Fair Credit Reporting Act B. Privacy Protection Act C. Consumer Credit Protection Act D. HIPAA
A. Fair Credit Reporting Act
According to the Fair Credit Reporting Act, all of the following statements are true EXCEPT A. If an applicant is declined for an insurance policy, he or she has no right to know what was in the report B. It protects consumers against the circulation of inaccurate information C. It ensures that consumer reporting agencies are fair in their treatment of consumers D. Investigative consumer reports can be used to obtain information on the applicants character and reputation
A. If an applicant is declined for an insurance policy, he or she has no right to know what was in the report
Which of the following injuries may be covered under Coverage C - Medical Payments of a commercial liability policy? A. Injuries to a member of the general public that occurs on the premises B. Injuries to an employee due to participation in an athletic event C. Injuries to an employee during performance of his or her job D. Injuries to an independent contractor on the premises
A. Injuries to a member of the general public that occurs on the premises
The principle of immunity in cancellation or insurance policies applies to which of the following? A. Insurers and their agents B. The insured C. The Department D. Beneficiaries
A. Insurers and their agents
Every auto liability insurance policy issued in Wisconsin must include Uninsured Motorist coverage in limits of at least A. $10,000 B. $25,000 per person and $50,000 per accident C. $60,000 D. $100,000 per person and $100,000 per accident
B. $25,000 per person and $50,000 per accident
A producer born in 1973 received a license in 2014. When will the producer's license need to be renewed? A. 2015 B. 2016 C. 2017 D. 2024
B. 2016
Intermediaries must maintain records for A. 1 year B. 3 years C. 5 years D. 10 years
B. 3 years
The Commissioner issued an order without holding a hearing. The person aggrieved by this order sent a demand for a hearing 20 days ago. The hearing must be held within the next A. 10 days B. 40 days C. 60 days D. 90 days
B. 40 days
A policy is issued for an indefinite term. IF the insurer decides to cancel the policy on its anniversary date, how much notice must the policy owner be given? A. 30 days B. 60 days C. 90 days D. 100 days
B. 60 days
The businessowners liability coverage form would respond to a claim arising from which of the following events? A. An injury arising out of the sale of alcoholic beverages B. An injury arising out of a customer falling because of a wet floor C. An injury to an employee while performing his or her job D. Damages sought by a third party as a result of an accounting error
B. An injury arising out of a customer falling because of a wet floor
To which of the following may the Commissioner issue a surplus lines license? A. Anyone deemed eligible by the Commissioner B. Any licensed agent or broker C. Any authorized insurer D. Agents licensed in states other than Wisconsin
B. Any licensed agent or broker
Answers to questions in an insurance application are called representations and, as such, they are A. Warranties B. Believed to be true to the best of the applicant's knowledge C. Absolutely true D. Not true
B. Believed to be true to the best of the applicant's knowledge
A lender who conditions approval of a loan on a condition that the borrower purchase insurance from that lender may be guilty of A. Illegal inducement B. Coercion C. Misrespresentation D. Unfair discrimination
B. Coercion
Who belongs to the Wisconsin Compensation Rating and Inspection Bureau? A. Every insurer in Wisconsin writing auto liability insurance B. Every insurer in Wisconsin writing Workers Compensation or Employers Liability Insurance C. Every insurer in Wisconsin writing property and casualty insurance D. Every insurer in Wisconsin writing basic property insurance
B. Every insurer in Wisconsin writing Compensation or Employers Liability Insurance
In insurance, the agents have authorization to represent the company and may exercise this relationship through A. Reciprocal authority, risk retention and reinsurance B. Express authority, implied authority, and apparent authority C. Domestic authority, foreign authority, and alien authority D. Underwriting department, actuarial department and claims department
B. Express authority, implied authority, and apparent authority
The federal act that provided more favorable benefits for interstate railroad workers by allowing the injured worker to sue the employer for negligence in the A. Jones Act B. Federal Employers Liability Act (FELA) C. U.S. Longshore and Harbor Workers Compensation Act D. Federal Black Lung Compensation Act
B. Federal Employers Liability Act (FELA)
To have insurable interest in the person or property covered by a property insurance policy, with of the following potential risks must the policyowner face? A. Illness B. Financial loss C. Physical loss D. Property damage
B. Financial loss
Which of the following is NOT true of the agent's implied authority? A. It is given to an agent by the insurance company that is not specifically communicated B. It is specifically stated in the contract C. It is assumed by the agent in order to transact the business of insurance D. It is incidental to express authority
B. It is specifically stated in the contract
An insured was injured while visiting a farm 5 years ago. He discovers today that he has medical problems caused by that injury. Will the insured's new medical expenses be covered by Coverage J - Medical Payments on the farm's policy? A. Yes, all expenses must be incurred and reported to the insurer within the policy period B. No, all expenses must be incurred and reported to the insurer within 3 years of the accident date C. Yes, all expenses must be incurred and reported to the insurer within 6 years of the accident date D. No, all expenses must be incurred and reported to the insurer within 4 years of the accident date
B. No, all expenses must be incurred and reported tot he insurer within 3 years of the accident date
Insurance contracts are unilateral in nature. What does that mean? A. A promise is made only at the time of the policy application B. Only one party makes a promise C. The insured must make a promise to pay the premium D. All parties to the contract exchange something of value
B. Only one party makes a promise
The extended nonowned coverage provides protection to A. Anyone who is given permission to drive by the named insured B. Only the person(s) named on the policy C. The person named on the policy and all residence family members D. The person named and his or her spouse only
B. Only the person(s) named on the policy
An insured recently had a new home built and insisted on having smoke detectors installed in multiple places in the house. What method of handling risk is the insured using? A. Sharing B. Reduction C. Retention D. Avoidance
B. Reduction
An insured was backing his car out of the driveway and hit a fire hydrant. The automobile sustained $1300 of damage to the bumper. The insured's auto policy has a $500 deductible. Which of the following is true? A. The insured will pay all but $500 of any claims he makes on his policy B. The insured is responsible for the first $500 of any claim that he makes on his policy C. The insured is responsible for the total of $500 on claims for the calendar year on the policy D. The insured will receive a $500 discount on all repair work that is contracted by his insurer
B. The insured is responsible for the first $500 of any claim that he makes on his policy
Medical benefits under workers compensation statutes are provided A. For up to $100,000 per injury or disease B. Without limit C. For up to $500,000 per injury or disease D. For a certain percentage fo the worker's annual income
B. Without limit
The Commissioner may issue a temporary license for an intermediary for a maximum of A. 90 Days B. 180 Days C. 1 Year D. 2 Years
C. 1 Year
Which of the following is NOT an allowable reason for policy cancellation prior to its expiration date? A. Substantial change in the risk assumed by the insurer B. Nonpayment of premium C. Any misrepresentation by the insured D. Attainment of the limiting age
C. Any misrepresentation by the insured
If an agent follows the rules and terms of his agent contract, he is exercising his A. Contractual authority B. Implied authority C. Express authority D. Apparent authority
C. Express Authority
An insurer has received some information regarding a newly issued policy that provides sufficient grounds for policy rescission. What should the insurer do? A. Rescind the policy immediately B. Notify the Department of Insurance C. Notify the insured within 60 days of acquiring that information D. Nothing. Issued policies cannot be rescinded
C. Notify the insured within 60 days of acquiring that information
Among people in the same class and life expectancy, which of the following factors can be used to influence premium rates? A. Ancestry B. Marital status C. Occupation D. Race
C. Occupation
The Commissioner issues an order without having conducted a hearing. What may the person aggrieved by the order do? A. Report the Commissioner to the state government for violating the Insurance Code B. Report the Commissioner to the federal government for violating the Insurance Code C. Request a hearing D. Nothing
C. Request a hearing
Which of the following is FALSE concerning liability coverage of a business auto policy? A. The company will pay an interest accruing between time of judgement and payment B. The company will defend any suit alleging bodily injury (BI) or property damage (PD) covered by the policy C. The company will reimburse the insured for all loss of earnings D. The company will pay the premium on any appeal bond
C. The company will reimburse the insured for all loss of earnings
Although a businessowners policy (BOP) will cover fire damage legal liability, which of the following statements is true? A. There is a limit of $500 set on fire damage legal liability in all cases B. The general aggregate applies to fire damage legal liability C. The general aggregate does not apply to fire damage legal liability D. Pollution caused by fire will be covered because pollution is covered in a BOP
C. The general aggregate does not apply to fire damage legal liability
Which of the following best depicts the law of large numbers? A. Large groups offer less opportunity for loss B. The larger the group is, the more likely it will be to get a good choice C. The larger the pool of risks under study, the more accurate the predictions will be D. Larger groups product healthier applicants
C. The larger the pool of risks under study, the more accurate the predictions will be
A truck company's truck is out of service for repairs. While making the delivery in a borrowed truck, the driver is responsible for an accident that causes $55,000 in property damage to other vehicles and injuries to 2 individuals. Under the commercial auto liability policy conditions, which policy pays for this loss? A. Only the insurance company for the borrower of the truck will pay for damages and injuries B. The policy for the titled owner of the truck will be primary, and the borrower's insurance will be excess C. The policy for the company that borrowed the truck will be primary, and the titled owner of the truck will be excess D. The insurance companies will share int he settlement based on the other insurance condition
C. The policy for the company that borrowed the truck will be primary, and the titled owner of the truck will be excess
The Commissioner revokes an intermediary's license because the agent ignored an order of restraint. How much time must pass before the intermediary can reapply for a license? A. 90 days B. 6 months C. 1 year D. 5 years
D. 5 years
If the commissioner disapproves a form used by an insurer, the use of the form must be discontinued within the maximum of how many days? A. Immediately B. 10 days C. 30 days D. 90 days
D. 90 days
An insured intentionally did not disclose a material fact on an application for insurance. This would be considered A. Coercion B. Avoidance C. Misrepresentation D. Concealment
D. Concealment
Which type of authority is found in the agent's contract? A. Apparent B. Implied C. Assumed D. Express
D. Express
When Symbol 7 is provided, which of the following statements is true with regards to newly acquired autos? a) they are covered only until the end of the policy term b) they are not covered until the insurer is notified c) they are automatically covered only for 30 days d) they are covered if they are used to replace previously owned autos with that coverage
D. They are covered if they are used to replace previously owned autos with that coverage
Insurance provides a means to A. Retain a loss B. Avoid a loss C. Eliminate a loss D. Transfer a loss
D. Transfer a loss