INSURANCE P&C

Which of the following best describes a misrepresentation?

Issuing sales material with exaggerated statements about policy benefits

An insured carries a property policy on her home in the amount of $250,000. A bank is shown as the mortgagor in the policy. Last month the insured made her final mortgage payment, but did not remove the bank from the policy. In the event of a covered loss to her home, how much will the bank receive?

Nothing

Duties of the insurer found in property policy conditions include all of the following EXCEPT

Notify the insured in the event of financial difficulty.

Which of the following lines of insurance is NOT included in the commercial package policy?

Ocean marine

Before an insurer will pay any loss under a policy, what is usually required from the insured?

PROOF OF LOSS

Which of the following is NOT true regarding consideration in a P&C policy?

Part of the company's consideration is the payment of a claim.

While Jake was towing a utility trailer with his auto, the trailer came loose and ran into a store front. What part of Jake's auto policy would pay for the damage to the store?

Property Damage Liability

For insurance purposes, when an insured loses property to another because the person used violence or threat of violence to gain the property, this is defined as

Robbery

In a personal umbrella policy, the amount paid by the insured for certain losses not covered under the primary coverage is called

Self-insured retention.

Which of the following perils is covered by flood insurance?

mudslide caused by accumulations of water underground

A binder is effective for a period of

90 days

An agent is acting ethically in all of the following situations EXCEPT

Always representing the insured.

Which of the following would NOT be an insured under the Business Auto Coverage Form?

An employee using his own car for another business

Which of the following is a method of claim settlement used when the insured and insurer cannot agree on how to settle a claim?

Arbitration

Which of the following policies does NOT contain an automatic reinstatement provision?

General liability written with an aggregate limit

All of the following are conditions commonly found in the insurance policy EXCEPT

Insuring agreement.

One advantage of claims-made liability forms from the insurer's point of view is that

It prevents stacking of limits.

You are hit by a Greyhound bus. This incident is

both an accident and an occurence

What is the standard deductible in an HO-3?

$250

An agent must be a resident of the state and be present in the state for at least how many months each year?

6

A businessowners policy is

A self-contained prepackaged policy.

With respect to the personal auto policy, which of the following vehicles could be classified as a nonowned auto?

A vehicle that is titled to another person, but is being used with permission by an insured

An insured intentionally did not disclose a material fact on an application for insurance. This would be considered

Concealment

When applying for an individual life insurance policy, an applicant states that he went to the doctor for nausea, but fails to mention that he was also having severe chest pains. This is an example of

Concealment.

An attached garage would be covered under

Coverage A

Which of the following is covered under the Mail floater of a Commercial Inland Marine policy ONLY if is sent by registered mail?

Currency and unsold travelers checks

What term includes damage where the insured peril was the proximate cause of loss?

Direct loss

All of the following are found in the declarations section of a policy EXCEPT the

EXCLUSIONS

Expenses that an organization would not have incurred if business interruption had not existed are known as

EXTRA EXPENSES

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

Explosion of Steam Boilers.

True or False? Under Stated Amount, the insured is guaranteed the limit on the Dec page following the loss

FALSE

An insurance company has published a brochure that inaccurately portrays the advantages of a particular insurance policy. What is this an example of?

False advertising

What do individuals use to transfer their risk of loss to a larger group?

Insurance

Which of the following is true concerning the Medical Payments section of a Liability contract?

It has rather dollar limits

All of the following are true regarding deposit premium EXCEPT

It is 50% of the actual premium.

Which of the following statements is true regarding physical damage coverage in a garage form?

No coverage is provided for autos stored for more than 45 days at a location not shown in the declarations.

hat insurance policy provision defines how the policy will respond if there is more than one insurance policy written on the same risk?

Other Insurance

What insurance policy provision defines how the policy will respond if there is more than one insurance policy written on the same risk?

Other insurance

Who would participate in a Write Your Own flood insurance Program?

Private insurers that wish to write and service National Flood Insurance policies on a no risk-bearing basis

A sworn written statement that must be furnished by the insured to the insurer before any loss under a policy can be paid is called

Proof of Loss

A date stipulated on the declaration page of a claims-made liability form as the first date on which an incident may occur and be covered by the policy is called

Retroactive date.

Prior to state-directed workers compensation statutes being enacted, employees had

To sue an employer for the "loss" and prove that the employer was at fault.

In forming an insurance contract, when does acceptance usually occur?

When an insurer's underwriter approves coverage

Under the additional living expenses coverage, if a civial authority prohibits the insured from using the dwelling because of direct damage to a neighboring location from a peril covered in the insured's policy, loss would be covered for up to

a dwelling policy will pay loss of use due to civil authority for a maximum of 2 weeks

Which of the following protects consumers against the circulation of inaccurate or obsolete personal or financial information?

The Fair Credit Reporting Act

What is the purpose of the Claims Made form?

To allow insurers to determine adequate rates for unknown losses claimed in the future

Which of the following is an example of apparent authority of an agent appointed by an insurer?

The agent accepts a premium payment after the end of the grace period.

John purchased a National Flood Insurance policy 10 days after his community entered an emergency program. When would his coverage be effective?

12:01am the day after the application and premium payment are mailed

What is the maximum horsepower allowed for a boat that you own to be covered under the Personal Liability section of a Homeowners policy?

25 horsepower

The removal coverage that is included in the broad form dwelling policy will cover property temporarily removed from the premises to protect it from damage for how long?

30 DAYS

Which of the following would NOT be a violation of state insurance regulations?

Agent C uses her license to write only business other than controlled.

Which would be considered a single accident in equipment breakdown coverage?

All accidents at single location at same time by same cause

The inspections and surveys condition in a businessowners policy

Allows the insurer the right to inspect the insured's premises.

Under the Special Cause of Loss form, the burden of proof following a claim is on the

COMPANY

Because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements EXCEPT

CONDITIONS

Any ambiguities in a P&C policy will be resolved in favor of the policyowner because the policy is a(n)

CONTRACT OF ADHESION

In purchasing an insurance contract, the applicant must accept the contract as written. This type of contract is referred to as a(n)

CONTRACT OF ADHESION

Insurance is a contract by which one seeks to protect another from

LOSS

Which of the following is eligible for a BusinessOwners Policy?

Maximum eligibility requirements for a businessowners policy (BOP) are 6 stories high, 25,000 square feet mercantile space in apartment building, 100,000 square feet for the office building and $3 million gross sales

What Personal Auto Coverage would pay for the insured's injuries sustained when struck by a hit-and-run driver while crossing a busy street?

Medical payments

The Physicians and Surgeons Equipment Floater in NOT intended for which of the following?

Medical supplies located in a hospital

On its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. The company is guilty of

Misrepresentation

Which policy consists of the declarations and conditions, endorsements, and other attachments applicable to a single line of insurance?

Monoline

When a regular bill of lading is issued, who will be responsible for the invoice cost of any damaged property?

The carrier

Which of the following statements would be correct if an insured failed to maintain the underlying limits as required by a personal umbrella policy?

The insured would be responsible for the amount required as underlying limits in the event of a claim.

With respect to commercial auto policies, the Garage Coverage Form provides liability protection for all of the following EXCEPT

The insured's business income losses due to personal injury.

Supplementary payments on a CGL provide all of the following EXCEPT

Up to $500 a day for lost earnings and $2,000 for the cost of bail bonds.

A pizza shop has a neon sign attached to its building. During a severe thunderstorm, the sign is damaged by wind and hail. What is the maximum amount the business's building and personal property policy will pay for the damage to the sign?

$2,500

Workers compensation benefits in Georgia are limited to

$575 a week.

After an insurer has filed an application for a certificate of authority, how long does the Commissioner have to approve the application?

90 days

Which of the following is covered under the Camera and Musical Instruments Dealers floater?

A customer's camera left at a camera shop for repair

In which of the following situations would the jewelers block extension cover a loss?

A jeweler fixes a necklace and sends it by registered mail to the owner. When the necklace arrives, it has been damaged.

An insured's business is damaged because of a fire, and he is forced to close the business temporarily for repairs. As a result, the insured lost income. What type of loss is this?

Consequential

Which of the following is a mandatory part of an insurance policy that varies with each individual policy?

Declaration

When the amount of insurance written in a property policy is not subject to any coinsurance provision and that amount is paid in the event of a covered loss, the coverage is said to be written as

Stated amount.

The policy provision found in property insurance policies that prevents the insured from collecting twice for the same loss is called

Subrogation

How are surety bonds different from insurance?

Surety bonds guarantee specific duties or obligations will be fulfilled; insurance pays for losses.

When a regular bill of lading is issued, who will be responsible for the invoice cost of any damaged property?

THE CARRIER

The cancellation provision in a businessowners policy specifies all of the following EXCEPT

The method of transferring the owner's rights.

Which of the following statements is true concerning a bonded contractor who defaults on a construction performance contract?

The obligee may engage another contractor and then seek reimbursement from the surety.

Which of the following terms indicates that an insurance contract contains the legally enforceable promises of only one party?

UNILATERAL