INSURANCE TEST 1

Two persons are involved in an auto accident on a West Virginia highway. Each person is 50% liable for damages to the other person. What amount of damages will each collect?

Each person will collect half of their damages.

A separate limit scheduled "per type of property" on a cause of loss form, is known as:

Insuring on a specific basis.

Which of the following would require bailee coverage?

TV Repair Shop

Steve has removed the rear seat in the company car and installed stereo equipment and two speakers. The maximum the physical damage coverage will pay for damage to the items in an accident is:

$1,000 because the equipment was permanently installed in a place where the auto maker would normally not have it put it minus deductible..

Under a Personal Articles Floater, the total amount that will be paid for loss or damage to an unscheduled coin collection is:

$1000

Roxanne has her home covered under a DP-2 policy. She regularly works on her laptop computer at the bar in her kitchen. One day she decided to go out for lunch, leaving her laptop plugged in and turned on. While she was out, the electrical cord attached to her laptop began to short out and create sparks. One of the sparks fell on a dish towel Roxanne had left on the bar and it caught fire. This led to a larger fire that caused extensive damage to Roxanne's kitchen. The damage caused to the kitchen came to $15,000. The laptop was destroyed and it's ACV was $1,800. The policy did not have a deductible form attached. How much will be paid on this claim?

$15,000..

Heather's house is fully insured with a DP-3 with a limit of $85,000. One day, the house is struck by lightning, and despite the fire department's efforts, burns to the ground. She still had a balance of $20,000 left on her mortgage at the time of the fire. What is the maximum indemnification that would go to Heather, the fire department, and her mortgage lender respectively?

$65,000; $500; $20,000

Under the West Virginia Automobile Insurance Plan, an insured may be eligible for coverage under a standard or preferred policy if, during the next ____ there are no traffic violations or accidents and continuous insurance coverage has been maintained.

3 years

An auto is described in the schedule of the Hired Autos endorsement to a Business Auto policy. For purposes of Business Auto coverage, this auto will be considered:

A covered auto owned by the named insured.

Brian owns a home that is covered by a DP-3 form. He rents this home to Taylor. Joe, the neighbor who lives next door to Brian's rental home, has been cooking methamphetamine for quite some time and selling it out of his house. One afternoon, Joe's "meth lab" exploded, spreading dangerous chemical to the houses around his. It also caused a fire that rendered the house unstable until it can be demolished. The civil authorities in the area have required that Taylor vacate her rental home, until the area next door can be cleaned up. Which of the following statements is true regarding how Brian will be compensated under his Dwelling policy for the loss of Taylor's rent during the time she must live elsewhere?

Brian will receive 10% of the Coverage B limit, for a maximum of 4 weeks.

The ACV settlement under a property insurance policy may be determined using "broad evidence rule", which means that the loss is valued:

By establishing the value of the property using any evidence a court finds relevant..

The Business Auto uses Symbol 7 to cover "specifically described autos" identified in the declarations. An auto acquired during the policy period will only be covered:

If the insured insures all of their vehicles with the company or it replaces a covered auto.

Agencies in West Virginia are required to have an agency producer license that renews annually on:

June 30. .

All of the following statements are true regarding the "Building Additions and Alterations" additional coverage of the Homeowners forms, EXCEPT:

Provides up to $2,500 to cover fixtures, installations and improvements made or acquired at the insured tenant's expense..

What type of insurance is usually provided or subsidized by the state or federal government because it is not ordinarily available from private insurers?

Residual market insurance

Which of the following statements regarding the supplementary payments of Section II of the standard Businessowners policy is NOT correct?

Supplementary payments do not cover expenses that the insurance company incurs..

Indemnify Insurance Company has been accused by a claimant in West Virginia of making settlement offer that is unreasonably low. The Commissioner will make a decision as to whether or not an unreasonably low settlement offer was made by considering all of the following, EXCEPT:

The amount of time the insurer took to complete the claims investigation..

What is "express authority" under the law of agency?

The authority given to the agent as specified in the contract..

An employer is involved in interstate commerce. It has an employee who works regularly in West Virginia. What is the status of the employee's workers compensation coverage?

The employee must be covered for the benefits provided by the West Virginia workers compensation code

An insurance company is given a C++ rating by A.M. Best. This means:

The financial health of the insurance company is good..

Which of the following is NOT TRUE regarding surety bonds?

They are an agreement that in exchange for a premium, the surety will indemnify the obligee..

An insured has a $1,000 insurance claim and is able to prove his loss and its value. The insurer's adjuster offers $500, knowing that the claimant would probably take the offer to avoid incurring the cost of an attorney to sue for the actual amount of the claim. The offer made by the adjuster is considered:

To be an unfair claims settlement practice.

The West Virginia Insurance Commissioner may call a hearing for any purpose he/she deems necessary following the procedures required by state insurance law. A hearing must be held within _____ days of a request with notice given at least ______ days before the hearing.

45/15

A print shop is insured under a Businessowners Policy with a separate policy covering the press. If a loss occurs that is covered under both policies, how will the Businessowners Policy respond?

In this situation, the BOP is considered "excess" coverage

Farmer Olivia makes apple butter from the apples she grows on her farm. She puts the apple butter in decorative jars and takes them to Grandma's Country Store to sell them. For Grandma's to be covered for any liability arising from the sale of Olivia's apple butter:

Olivia must add an "Additional Insured Farm Liability" endorsement to her Farm Liability policy.

Part D of the Personal Auto policy provides coverage for all of the following, EXCEPT:

Part D of the Personal Auto policy provides coverage for all of the following, EXCEPT:

All of the following would be advantages to an insured or an insurer for purchasing or writing a Commercial Package policy, EXCEPT:

Packaging monoline policies together can provide broader coverage under each coverage part than purchasing the policies separately.

"Pam's Pampered Pets" is reviewing their workers' compensation policy and would like to confirm the states in which their employees will be covered while working. Which section of the standardized policy form should they review?

Part Three..

Acme Corp. requested three bids from different contractors for the construction of its new office building. Acme accepted the lowest bid from Corbett's Contracting and entered into a contract to have the office building constructed. After construction was completed, Corbett's presented Acme with a bill for construction costs over and above the amount of the bid that was agreed to in the contract. Which of the following types of bonds would protect Acme from paying the additional costs?

Performance Bond

Which of the following would be covered under the personal property (contents) coverage of an NFIP policy?

The insured's riding lawn mower kept inside an attached garage..

When the triggering event threshold has been met under the Terrorism Risk Insurance Program Reauthorization Act of 2015 (TRIPRA), the insurer's deductible amount:

The insurer's deductible is calculated at 20% of the insurer's direct earned premiums for commercial insurance

One of the Unfair Claim Settlement Practices is "failing to affirm or deny coverage of claims within a reasonable time after having completed its investigation related to such claim or claims". How is the length of time that is considered "reasonable" decided?

The state legislatures set the reasonable time period by statute