Oklahoma Insurance Licensing Exam
If the Commissioner has reason to believe that a person or insurer has violated the Insurance Code, the Commissioner may set a hearing. The notice of hearing must be given how many days in advance? 1) 10 days 2) 15 days 3) 30 days 4) 7 days
1) 10 days
If an insured is in the process of moving to a new location, his personal property coverage under the dwelling policy will apply on a pro rata basis at both locations for 1) 30 days 2) 60 days 3) 90 days 4) 5 days
1) 30 days
What state official is charged with the responsibility of the administration and enforcement of the Oklahoma insurance regulations? 1) Insurance Commissioner 2) State attorney general 3) governor 4) state legislature
1) Insurance Commissioner
What type of liability would a person who owns a swimming pool have? 1) absolute 2) vicarious 3) implied 4) direct
1) absolute
What term best describes the act of withholding material information that would be crucial to an underwriting decision? 1) concealment 2) withholding 3) leading 4) breach of warranty
1) concealment
A startup used car dealership buys cars at auto auctions in 30 states. It wants to be certain that damage coverage is provided when the cars are driven or transported from the auctions to the dealership. In regard to the business auto physical damage coverage, which is true? 1) coverage is provided if dealership employees are in possession of the subject automobile 2) coverage is provided at additional premium 3) coverage is provided for the wholesale amount only 4) coverage is not provided under the form
1) coverage is provided if dealership employees are in possession of the subject automobile
An insured has four separate but identical policies written by different insurers to cover her $100,000 building. Each policy is written for $100,000, and each has the pro rata liability other insurance clause. In the event of a total loss to the building, what would each insurer pay? 1) each policy will pay $25,000 of the loss 2) each policy will pay the total policy limits of $100,000 3) the first policy written will pay $75,000 and the other three will contribute proportionately to pay for the remaining $25,000 4) the policy with the earliest effective date will pay the entire loss, and the other policies will pay nothing
1) each policy will pay $25,000 of the loss
All of the following are true regarding deposit premium EXCEPT 1) it's 50% of the actual premium 2) it could be adjusted by the audit 3) it must be paid in advance 4) it's an estimated premium paid at the policy issue
1) it's 50% of the actual premium
Which of the following statements is true regarding workers compensation coverage for sole proprietors? 1) it's elective 2) it's not allowed 3) it's only allowed for sole proprietors involved in high risk occupations 4) it's mandatory
1) it's elective
Which of the following coverages in dwelling and homeowners policies is for indirect losses? 1) loss of use 2) dwelling 3) structures 4) contents
1) loss of use
An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy? 1) mutual 2) reciprocal 3) nonprofit service organization 4) stock
1) mutual
Which of the following commercial crime coverages would cover a loss resulting from theft of the company's money and securities from the armored vehicle making a delivery? 1) outside the premises 2) forgery/alteration 3) robbery and safe burglary 4) inside the premises
1) outside the premises
A tornado that destroys property would be an example of which of the following? 1) peril 2) pure risk 3) loss 4) physical hazard
1) peril
Who might receive dividends from a mutual insurer? 1) policy holders 2) subscribers 3) stockholders 4) agents
1) policy holders
While an insurance was towing a utility trailer with his auto, the trailer cam loose and ran into a store front. What part of the insured's auto policy would pay for the damage to the store? 1) property damage liability 2) collision coverage 3) comprehensive coverage 4) this loss would not be covered
1) property damage liability
The legal process that gives the insurer, after payment of a loss, the right to seek recovery from a third party that was responsible for the loss is known as 1) subrogation 2) adverse selection 3) right of rescission 4) principle of indemnity
1) subrogation
Which of the following symbols is available to an insured with vehicles subject to no-fault coverage? 1) symbol 5 2) symbol 6 3) symbol 7 4) symbol 9
1) symbol 5
Who is NOT considered an employee in a commercial general liability policy? 1) temporary worker 2) leased worker 3) full-time worker 4) part-time worker
1) temporary worker
All of the following situations would be covered under a professional liability policy EXCEPT 1) the failure of an attorney to properly defend a client due to his personal dislike of the client 2) failure of a doctor to render the quality of care that is customary in the medical field 3) an accountant's error that inflated a bid and caused a client to lose a major account 4) negligence of an architect who designed an unsafe building
1) the failure of an attorney to properly defend a client due to his personal dislike of the client
Negligence may be defined as 1) the failure to use reasonable and prudent care 2) a situation that creates a probability of loss 3) a latent defect or fault in property 4) the inability to meet the burden of proof
1) the failure to use reasonable and prudent care
A dealership loans a car to its customer to use while the dealership is repairing the customer's car. If the dealership has business auto physical damage coverage and a customer's automobile insurance does not cover damages to loaner cars, which of the following is true? 1) the loaner vehicle is covered by the business auto policy 2) no coverage is provided 3) only coverage for damage to a third party's vehicle is provided 4) the customer is personally liable
1) the loaner vehicle is covered by the business auto policy
What is NOT an insured liability on a BAP? 1) the owner of a car the insured borrows 2) anyone using a covered auto with permission 3) anyone liable for the conduct of the insured 4) the named insured in any covered auto
1) the owner of a car the insured borrows
All of the following are true statements regarding the supplementary payments of a commercial general liability policy EXCEPT 1) they pay defense cost even after the aggregate limit has been reached 2) they pay all expenses incurred by the insurer 3) they pay pre-judgment and post-judgment interest 4) they pay all reasonable costs incurred by the insured in helping to investigate or defend a claim
1) they pay defense cost even after the aggregate limit has been reached
Liability imposed on one party as a result of the actions of another person is known as 1) vicarious liability 2) comparative negligence 3) strict liability 4) absolute liability
1) vicarious liability
Tom's Truck Service's vehicle is stolen. The policyholder may obtain coverage for transportation expenses subject to which of the following limits? 1) $25/day; $450 maximum 2) $20/day; $600 maximum 3) $15/day; $300 maximum 4) $15/day; $450 maximum
2) $20/day; $600 maximum
An insured's building has an actual cash value of $200,000, and he has insured the property for $120,000 with an 80% coinsurance clause. A $40,000 loss occurs. How much will the policy pay? 1) $0 2) $30,000 3) $32,000 4) $40,000
2) $30,000 (This insured only carried 75% of the amount of insurance he had agreed to carry ($120,000 of the agreed $160,000), so the insurer will only pay 75% of the loss, or $30,000)
How long is waiting period upon purchase of flood coverage through NFIP? 1) 10 days 2) 30 days 3) 60 days 4) none
2) 30 days
The ABC Corporation has $100,000 of coverage on its building through insurance Company A, and $50,000 of identical coverage on the same building through insurance Company B. Assuming coinsurance is not an issue, when a $24,000 loss occurs and the pro rata method is used, how much will the insurer pay? 1) Company A will pay $24,000, Company B will pay $0 2) Company A will pay $16,000; Company B will pay $8,000 3) Company A will pay $20,000; Company B will pay $4,ooo 4) Company A will pay $12,000; Company B will pay $12,000
2) Company A will pay $16,000; Company B will pay $8,000 (each policy pays its pro rata share of the loss based upon each policy's share of the total amount of coverage)
Following a property loss that is covered under a business owners policy, if the insurer and insured cannot agree on the amount of the loss, what method is used to resolve the issue? 1) no-fault procedure 2) appraisal 3) arbitration 4) adjudication
2) appraisal
Which of the following is a method of claim settlement used in casualty insurance when the insured and insurer cannot agree on how to settle a claim? 1) appraisal 2) arbitration 3) proof of loss 4) restoration
2) arbitration
The garage coverage form is used to insure 1) owner-operators who use their own trucks to haul property for the motor carriers that hire them 2) auto businesses, such as auto dealers, service stations, and auto repair shops 3) businesses that use autos to transport property of others to their own property
2) auto businesses, such as auto dealers, service stations, and auto repair shops
An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated? 1) adhesion 2) consideration 3) good faith 4) representation
2) consideration
A beauty parlor burns to the ground. What type of loss is this to the owner? 1) consecutive 2) direct 3) consequential 4) specific
2) direct
Workers compensation coverage for sole proprietors is 1) not allowed, except for sole proprietors in high-risk occupations 2) elective 3) not allowed 4) mandatory
2) elective
The proof of loss statement must be 1) an oral statement 2) in writing 3) both oral and in writing 4) in a videotape format
2) in writing
The pro rata liability clause is designed to protect the principle of 1) waiver and estoppel 2) indemnity 3) subrogation 4) insurable interest
2) indemnity
All of the following are factors in the determination of actual cash value EXCEPT 1) replacement cost 2) insurance premium paid 3) type and quality of property 4) age of the property
2) insurance premium paid
In property insurance, who is responsible for completing the proof of loss form? 1) agent 2) insured 3) appraiser 4) insurer
2) insured
Who is entitled to the salvage of property after a total loss has been paid under the terms of an insurance policy? 1) beneficiary 2) insurer 3) agent 4) insured
2) insurer
According to the Nationwide Marine definitions, risks that may be the subject of inland marine insurance include all of the following EXCEPT 1) cargo transported by truck 2) large pleasure boats 3) property while stored at a warehouse 4) shipments made by a freight train
2) large pleasure boats
Auto policies issued in Oklahoma are required to provide uninsured and underinsured motorist coverage. Does the insured have to accept the coverage? 1) yes, the insured must accept coverage 2) no, the named insured may reject coverage in writing 3) yes, all policies must include this coverage 4) no, the insured may verbally refuse coverage
2) no, the named insured may reject coverage in writing
What insurance policy provision defines how the policy will respond if there is more than one insurance policy written on the same risk? 1) primary and excess 2) other insurance 3) valid insurance 4) non concurrency
2) other insurance
A participation insurance policy may do which of the following? 1) require 80% participation 2) pay dividends to the policy owner 3) provide group coverage 4) pay dividends to the stockholder
2) pay dividends to the policy owner
How are surety bonds different from insurance? 1) surety bonds are issued by the gov; insurance is issued by private companies 2) surety bonds guarantee specific duties/obligations will be fulfilled; insurance pays for losses 3) insurance guarantees specific duties/obligations will be fulfilled; surety bonds pay for losses 4) surety bonds guarantee that losses will be paid; insurance pays for obligations to be fulfilled
2) surety bonds guarantee specific duties/obligations will be fulfilled; insurance pays for losses
Which of the following would qualify as a competent party in an insurance contract? 1) the applicant is under the influence of a mind impairing medication at the time of application 2) the applicant has a prior felony conviction 3) the applicant is intoxicated at the time of application 4) the applicant is a 12-year-old student
2) the applicant has a prior felony conviction
Negligence may be defined as 1) the inability to meet the burden of proof 2) the failure to use reasonable and prudent care 3) a situation that creates a probability of loss 4) a latent defect or fault in property
2) the failure to use reasonable and prudent care
A homeowner sells his house to a friend. The friend wants to keep the homeowner's current policy in effect. Under the assignment provision, which of the following is most likely? 1) the friend will have to apply for coinsurance from another insurance company 2) the homeowner will need to get written consent from the insurer before the policy can be reassigned 3) the policy will have to be cancelled 4) the homeowner should let the friend take over the premium payments
2) the homeowner will need to get written consent from the insurer before the policy can be reassigned
All of the following conditions must exist for injury/damage to be included in the products and completed operations hazard of a commercial general liability policy EXCEPT: 1) the injury/damage must occur after the insured has released physical possession of the product to another 2) the injury/damage must occur within 90 days after the insured's work is completed 3) the injury/damage must occur away from the insured premises 4) the injury/damage must arise out of the insured's product or work
2) the injury/damage must occur within 90 days after the insured's work is completed (there is no time limit for an injury/damage)
What is the purpose of the Oklahoma Automobile Insurance Plan? 1) to ensure auto insurance rates remain affordable 2) to provide insurance for drivers who are eligible but couldn't obtain it through the normal market 3) to ensure no insurer creates a monopoly of insurance in the state 4) to provide supplemental insurance to Oklahoma drivers who are interested
2) to provide insurance for drivers who are eligible but couldn't obtain it through the normal market
All of the following are categories of a limited insurance license EXCEPT 1) crop insurance 2) variable life insurance 3) credit life insurance 4) travel insurance
2) variable life insurance
According to state workers compensation regulations, if an employee dies from an occupational illness, how much will the employer pay to the surviving spouse for funeral expenses? 1) $1,000 2) $5,000 3) $10,000 4) Nothing. Funeral expenses are not covered
3) $10,000
The insured purchased a $200,000 extra expense policy. If the percentages applying to the limit of insurance are 40%, 80%, and 100%, what would be the maximum payable for a 47-day loss? 1) $80,000 2) $120,000 3) $160,000 4) $200,000
3) $160,000
An auto dealer reported $500,000 worth of automobiles on its lot at the end of May to its insurer. On June 10, it received $200,000 worth of cars. By June 20, the dealership sold $100,000 worth of cars. A hail store on June 21 caused $50,000 worth of damage to the inventory. Without considering deductibles, how much will the insurer pay for damages? 1) $35,700 2) $40,000 3) $41,700 4) $50,000
3) $41,700 (Inventory at the time of the damage exceeded the reported inventory at the end of the month. Therefore, the insurer will pay only a portion of the total damages. Reported inventory = $500,000 + $200,000 = $700,000. Worth of cars sold = $700,000 - $100,000 = $600,000. Therefore, the insurer will pay $50,000 * (5/6) = $41,667 => $41,700)
An insured's roof cost $4,000 when installed 5 years ago. It has been damaged by hail and must be replaced. The new roof will cost $6,000 at today's prices. If the roof has been depreciating at $200 per year and his policy is ACV, how much will it pay toward the insured's new roof? 1) $1,000 2) $4,000 3) $5,000 4) $6,000
3) $5,000
An insured hits a deer and crashes his car into a tree. The total damage to the vehicle is $6,000. How will this loss be covered? 1) $6,000 will be paid under collision coverage 2) this will not be covered 3) $6,000 will be paid under comprehensive coverage 4) $3,000 will be paid under collision, $3,000 will be paid under comprehensive
3) $6,000 will be paid under comprehensive coverage (deer is proximate cause)
How many days from the issuance of an emergency cease and desist would the order be considered final? 1) 10 days 2) 14 days 3) 30 days 4) 31 days
3) 31 days
The Mail Coverage Form is always written on a reporting form basis; after the end of each reporting period shown in the declarations, reports are due within 1) 30 days 2) 31 days 3) 45 days 4) 15 days
3) 45 days
In the event of the death, disablement of a licensee, or other specific events, the Commissioner may issue temporary license to another to continue their business of insurance. A temporary license is issued for a period not to exceed 1) 12 months 2) 90 days 3) 6 months 4) 9 months
3) 6 months
Which of the following is NOT a necessary qualification in order for a person to serve as a Commissioner of Insurance in Oklahoma? 1) state residency for at least 5 years 2) minimum age of 25 3) a minimum of 5 years of experience as a director of an insurance company 4) minimum of 5 years of experience in the insurance industry
3) a minimum of 5 years of experience as a director of an insurance company
Which of the following definitions best defines the term "accident"? 1) physical damage to tangible property of others caused by the negligence of an insured 2) the negligent or purposeful act or omission by an insured that results in physical trauma or death to a person 3) a sudden, unplanned an unexpected event, not under the control of the insured, resulting in injury or damage neither expected nor intended 4) injury to the character of another person caused by libel, slander, false arrest, invasion of privacy and other acts
3) a sudden, unplanned an unexpected event, not under the control of the insured, resulting in injury or damage neither expected nor intended
Which of the following best describes liberalization clause in a policy? 1) the insured may assign the policy to any person without their written consent 2) the policy cannot be cancelled 3) changes adopted by the insurer that broaden coverage automatically apply to the policy at no additional premium 4) the insurer is relieved of its contractual obligation to the insured.
3) changes adopted by the insurer that broaden coverage automatically apply to the policy at no additional premium
An insured is driving her car through a residential area when she loses control and crashes into a neighbor's front porch. The neighbor, who was sitting on the porch, is injured. The insured's liability policy has a limit of $500,000. This amount applies to the total of damages for any bodily injury and property damage resulting from one accident. Which type of limit of liability does the insured have? 1) aggregate 2) per occurrence 3) combined single 4) split
3) combined single
What term best describes the act of withholding material information that would be crucial to an underwriting decision? 1) leading 2) breach of warranty 3) concealment 4) withholding
3) concealment
When a producer was reviewing a potential customer's coverage written by another company, the producer made several remarks that were maliciously critical of that other insurer. The producer could be found guilty of 1) discrimination 2) nothing, unless the remarks were in writing 3) defamation 4) misrepresentation
3) defamation
An insured is applying for a casualty insurance policy. One of the conditions of the policy allows the insurance company to inspect the insured's books at the end of the policy term to make sure sufficient premium has been collected for the exposure she plans to insure. Which condition is part of the insured's policy? 1) contract bond 2) errors and omissions insurance 3) deposit premium audit 4) excess liability coverage
3) deposit premium audit
Which of the following is NOT required of a business entity applying for its required insurance producer license? 1) submitting a uniform application to the Commissioner 2) paying state licensing fees 3) ensuring that all employees of the business have passed an insurance licensing exam 4) designating a licensed producer responsible for compliance with insurance laws
3) ensuring that all employees of the business have passed an insurance licensing exam
All of the following workers would be covered under the Workers Compensation Act, EXCEPT 1) computer technician 2) nurse at medical facility 3) independent real estate broker 4) manager for grocery store
3) independent real estate broker (both real estate brokers and salespersons are exempt from the Workers Comp Act)
For a contract to be enforced by law, the purpose of the contract must be 1) for the benefit of the general public 2) of pure intent 3) legal and not against public policy 4) for financial gain
3) legal and not against public policy
Insurance is a contract by which one seeks to protect another from 1) uncertainty 2) hazards 3) loss 4) exposure
3) loss
Which of the following is a common exclusion found in Part D: Coverage for Damage to Your Auto of a PAP? 1) riot or civil commotion 2) towing and labor 3) mechanical breakdown 4) glass breakage
3) mechanical breakdown (damage due to wear and tear, freezing, mechanical or electrical breakdown, and road damage to tires is a common exclusion to the physical damage covered section)
The Physicians and Surgeons Equipment Floater is NOT intended for which of the following? 1) waiting room furniture 2) office equipment located in a dentist's office 3) medical supplies located in a hospital 4) surgeon's supplies located in the surgeon's office
3) medical supplies located in a hospital
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? 1) standard minimum of 10% that is paid to lenders 2) all of the payment would be made to the mortgagor shown in the policy 3) nothing 4) up to the amount of debt that the insured has with the bank
3) nothing
What type of policy insures against all risks of loss that are not specifically excluded by the policy? 1) binder 2) named peril 3) open peril 4) specified peril
3) open peril
All of the following are considered parts of the policy structure EXCEPT 1) insuring clause 2) conditions 3) provisions 4) exclusions
3) provisions
An insurance application cannot ask about which of the following info about an applicant? 1) gender 2) address 3) sexual orientation 4) age
3) sexual orientation
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 1) actual cash value 2) specific insurance 3) stated amount 4) replacement cost
3) stated amount
Which of the following best defines the term "robbery" 1) property that disappears without the owner's knowledge of how or when it happened 2) breaking into one's home with felonious intent 3) taking another's property with violence or the threat of violence 4) stealing the property of another
3) taking another's property with violence or the threat of violence
Which of the following statements is true regarding the commercial general liability policies Coverage C - Medical Payments? 1) the coverage is liability insurance because it pays only if the insured is legally liable 2) the coverage provides high limits for insurance for bodily injury losses 3) the coverage is considered good will because payments are made without regard to fault 4) the coverage applies to bodily injury to the named insured
3) the coverage is considered good will because payments are made without regard to fault
The medical payments coverage is a personal auto policy will pay reasonable medical expenses for all of the following EXCEPT 1) the insured's child sustains injuries when the car she is in accidentally rolls down a hill 2) a friend is injured while driving the insured's vehicle with permission 3) the insured is injured while exiting a friend's mobile home 4) the insured is injured by a motor vehicle while crossing the street
3) the insured is injured while exiting a friend's mobile home
Which of the following is most likely to occur if it is determined by the audit that the deposit premium was too high? 1) the insurer will have to pay a fine 2) nothing; the premium cannot be adjusted 3) the insured will receive a return premium 4) additional premium will be collected
3) the insured will receive a return premium
Under the limits of insurance provision found in the Physical Damage Coverage Form in a Commercial Auto policy, how much will an insurer pay to repair or replace a covered auto? 1) the lesser of the replacement cost value of the cost to repair or replace a covered auto 2) the greater of the replacement cost value or the cost to repair or replace a covered auto 3) the lesser of the actual cash value or the cost to repair or replace a covered auto 4) the greater of the actual cash value or the cost to repair or replace a covered auto
3) the lesser of the actual cash value or the cost to repair or replace a covered auto
Liability imposed on one party as a result of the actions of another person is known as 1) strict liability 2) absolute liability 3) vicarious liability 4) comparative negligence
3) vicarious liability
Johanna purchased a National Flood Insurance policy 10 days after her community entered an emergency program. When would her coverage be effective? 1) 30 days after the application has been accepted 2) 12:01 pm on the 5th day after the endorsement request has been mailed 3) 5 days after the application and premium payment are mailed 4) 12:01 am the day after the application and premium payment are mailed
4) 12:01 am the day after the application and premium payment are mailed
An insured owns a building that is valued at $400,000. To comply with the 80% coinsurance provision of his insurance policy, how much should he insure the property for? 1) 100% of the market value 2) $400,000 3) $32,000 4) 80% of the property's replacement cost or more
4) 80% of the property's replacement cost or more
An insured works outside the home. The insured's sister lives with him and cares for his 4 children. When his home was severely damaged by fire, they move into an apartment while repairs are being made. The largest apartment available in the area has 2 bedrooms, so the insured's sister stays in a motel while the repairs are made. How much will the HO3 pay for their additional living expenses? 1) The cost of renting and apartment, but not the cost of the motel room 2) The cost of renting the apartment, and 50% of the cost of the motel 3) Nothing 4) All of the expense up to the Coverage D limit
4) All of the expense up to the Coverage D limit (Coverage D will pay the expenses incurred to maintain the same lifestyle as before the loss)
In return for a premium, an insurance company must 1) Provide the insured with coverage adequate for all potential losses 2) Use standardized tables of coverage for specific risks to be excluded from coverage 3) Give the insurer valuable consideration 4) Be fair in underwriting and pay covered losses.
4) Be fair in underwriting and pay covered losses.
Elaborate homes and those with detailed designs or decorative architecture with replacement costs greater than ACV or market value are insured on 1) HO-3 2) HO-3 with HO-15 endorsement 3) HO-8 4) HO-8 with an inflation guard endorsement
4) HO-8
Which of the following is covered under the Camera and Musical Instruments Dealers floater? 1) a musical instrument sold and delivered to a customer 2) furniture, fixtures and office supplies in a music store 3) money kept on premises of a camera shop 4) a customer's camera left at a camera shop for repair
4) a customer's camera left at a camera shop for repair
An insured couple owns a pontoon boat. Which situation would NOT be covered by their watercraft endorsement under their homeowners policy? 1) the insured's granddaughter slips on the boat and needs stitches 2) a friend borrows the boat and has an accident with another boater 3) one of the insureds is taking the boat out and injures her grandson 4) a friend rents their boat and runs it into a neighbor's dock
4) a friend rents their boat and runs it into a neighbor's dock
In a personal auto policy, the medical payments coverage is similar to 1) accident insurance, because it has the same limits 2) bodily injury coverage, because it pays the insured's doctor bills 3) bodily injury coverage, because it provides legal protection if the insured causes injuries to others 4) accident insurance, because it pays medical expenses regardless of fault.
4) accident insurance, because it pays medical expenses regardless of fault.
A plasterer has finished a job. What kind of liability coverage would protect him if the plaster falls and hurts someone because he did not do the job correctly? 1) medical payments 2) products 3) professional errors and omissions 4) completed operations
4) completed operations
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 1) misrepresentation 2) fraud 3) warranty 4) concealment
4) concealment
What term includes damage where the insured peril was the proximate cause of loss? 1) indirect loss 2) consequential loss 3) negligent loss 4) direct loss
4) direct loss
What is the purpose of the coinsurance clause found in property insurance policies? 1) encourage higher standards of care by requiring the insured to pay a portion of every loss 2) ensure that insureds do not over insure their property 3) prevent insureds from profiting from a loss 4) encourage the insured to insure the property closer to its full value
4) encourage the insured to insure the property closer to its full value
Which of the following would NOT constitute doing the business of insurance in this state? 1) investigating claims 2) holding an insurance license 3) delivering insurance contracts 4) examining insurer records
4) examining insurer records
Replacement cost is defined as 1) the market value of property of the like kind and quality 2) full replacement of property with like kind and quality, less an allowance for physical deterioration and depreciation 3) payment of the full policy limits in the event of a total loss 4) full replacement of property at its current cost, new and without reduction for depreciation
4) full replacement of property at its current cost, new and without reduction for depreciation
What does OAIP do? 1) it promotes uniformity in the provisions of various forms of property and auto insurance 2) it regulates minimum acceptable premium rates for various forms of property and auto insurance 3) it regulates the underwriting practices of insurers and reports possible infractions to the DOI 4) it provides auto insurance to people who are eligible for it but cannot procure it through the standard market
4) it provides auto insurance to people who are eligible for it but cannot procure it through the standard market
In case of a loss, the indemnity provision in insurance policies 1) allows the insured to collect 20% more than the actual loss 2) pays the insured a percentage of the loss above and beyond the loss 3) pays the insured as much as 95% of the loss 4) restores an insured person to the same financial state as before the loss
4) restores an insured person to the same financial state as before the loss
Insurance is the transfer of 1) loss 2) hazard 3) peril 4) risk
4) risk
A business owner has a building and personal property policy that covers a shed in which he stores extra parts. If he buys a second shed for the same purposes, this will be automatically covered for how long? 1) 15 days 2) 20 days 3) 30 days 4) 45 days
?3) 30 days