Practice Exam #6

The Homeowners policy provides a special limit for Damage to Property of Others in the Section II (liability) Additional Coverages of:

$1,000

What amount would be paid on a covered auto suffering a total loss? The retail value is $1,250 and the average trade in value is $1,000.

$1,250 (plus applicable taxes)

Under the TRIA Act (now known as TRIEA - Terrorism Risk Insurance Extension Act of 2015), the maximum limit for the Act for total claims paid under the Act by either private insurers or the government is still limited to?

$100 billion

When a homeowner policy is issued with $200,000 coverage on a dwelling, what is the automatic amount of insurance on personal property?

$100,000 (50%)

Under the BOP, the building limit of insurance is $100,000 and the deductible is $1,000. The building loss amount is $110,000. Which of the following is the correct loss payment?

$100,000 (The deductible is subtracted from the loss and not the limit of coverage. The loss exceeded the limit of coverage. Had the loss been less than the limit of the policy the deductible would still be deducted from the loss amount.)

The general penalty for any person or business entity properly found to have committed any unfair or deceptive practices for which no specific penalty is provided in the insurance code will be fined not more than _____ per violation.

$15,000

After a waiting period of 48 hours, PAP will pay how much per day up to a maximum of how much for a rental car?

$20 $600

Under the state's auto financial responsibility law, the minimum limit for bodily injury claims each accident to one person is?

$20,000

What is the penalty if a person knew or reasonably should have known that they had committed an unfair method of competition or an unfair or deceptive act?

$25,000

What are the three main coverages of a CGL?

1. Bodily Injury & Property damage Liability 2. Personal and Advertising Injury 3. Medical Payments to others

Under the BOP, how long is business income covered in case of an insured direct loss?

12 Months

What is the time limit for filing a law suit involving an automobile accident resulting in bodily injury in Connecticut?

2 Years

Under Homeowners insurance, "medical Payments to Others" coverage will cover necessary medical expenses incurred within how many years of the accident causing the injury?

3

If an enrollee has been admitted to an acute care facility, how long does the utilization review company have to respond to the attending physician's request for a review of a previous decision?

3 Hours

The reporting of actions against a licensee must be reported to the commissioner within _____ days

30

All Homeowner policies provide "Property removed" coverage for up to how many days?

30 Days

Whenever the Commissioner has reason to believe that any such person has been engaged or is engaging in any unfair method of competition or any unfair or deceptive act or practice he will issue and serve a statement of the charges and a notice of a hearing. That hearing must be held with in?

30 days

How many days does the liberalization clause provide for under the BOP prior to or during the policy?

45 days

Since the insurance company drafts the insurance contract and it is not negotiable, if it is found to be ambiguous the courts will interpret the contract against the party that prepared it. This is an example of?

A Contract of Adhesion

Supplementary payments on a the CGL would provide the paying of ______ on unpaid judgments?

Accrued Interest

In situations where the insured and the insurer may disagree on the value of an item, it would be best to insure that item as?

Agreed Value (An item insured with an "agreed value" eliminates the disagreements between the parties as to the value of an item at the time of a loss.)

The "coverage territory" of umbrella liability policies is usually?

Anywhere in the world

Which of the following would be an example of the use of designed providers to help control medical costs? I. Preferred provider organizations II. Health maintenance organizations

Both I and II

Which of the following would qualify for the Transportation Expense coverage: I. Car rental fees incurred by the insured due to physical damage to his covered auto. II. Loss of use expenses for which the insured is liable because of physical damage to his covered auto.

Both I and II

The forcible entry into locked premises and the carrying away of the property of others is a definition of?

Burglary

Structures connected by a fence or utility line would be covered under which section of a homeowners policy?

Coverage B

Making, directly, or indirectly, any oral or written statement which is false or maliciously critical of or derogatory to the financial condition of an insurer, and which is calculated to injure any person engaged in the business of insurance is an illegal practice known as?

Defamation

An innocent party relies on certain statements made by the adjuster and is damaged as result. The guilty party may be legally prohibited from asserting that the fact does not exist because of?

Estoppel

What legal principle states that an insurer would be prohibited from denying a claim that one of its adjusters said was covered?

Estoppel

An apartment dweller would need which homeowners form?

HO-4

The elements of negligence include: I. A duty of care existed. II. A duty of care was breached. III. Injury or damage resulted. IV. Criminal conduct.

I, II, and III only

In property and casualty insurance, what is the function called that serves to pay the expected future obligations of existing policies?

Loss Reserves

A _______ under the crime insurance form is a director of the limited liability company, an employee of the company and sits on the board of the company

Manager

A customer is injured on the insured's premises and the insured is not found legally liable. The insured carries a Commercial General Liability policy. Which CGL coverage would apply to cover the customer's injuries?

Medical Payments (Medical Payments coverage under the CGL policy pays regardless of legal liability on the part of the insured)

What is the legislation mandated that trucking operators must file proof of pollution liability insurance.

Motor Carrier Act of 1980

The bills presented are paid with no attempt to obtain a separate release is considered what kind of payment?

No Release or Walk Away

Someone licensed in his or her state and obtains a license in another state to solicit insurance business in that state is called?

Non-Resident Agent

What clause has the purpose of avoiding over payment of a claim?

Other Insurance Clause

What is it called when the loss valuations can be stated as "we agree to pay the cost to repair or replace without deduction for depreciation?

Replacement Cost

_______ are statements made by the insured that are assumed to be truthful to the best of the insured's knowledge?

Representations

What is applied when an umbrella policy covers a liability claim excluded by primary policies?

Self-Insured Retention

What does an insurer do when the insured has possibly waived his or her rights in a liability claim?

Send a "reservation of rights" letter

What symbol is used for a non-owned auto in a commercial automobile policy?

Symbol 9

The Connecticut Insurance Commissioner is appointed by?

The Governor

What part of the policy contains the promises made by the insurance company to the insured?

The Insuring Agreement

Under employment practices liability, the coverage territory is worldwide as long as the suit is brought in:

The United States

The policy territory in a CGL includes which 3 major territories?

The United States, Canada, Puerto Rico

Gordon's Carpentry built a garage for a client. Two weeks after the work was completed, the garage collapsed and damaged the client's car, equipment in the garage, and caused bodily injury to the client. Gordon's CGL policy would not apply to?

The damage to the garage

The manager of a grocery store has checked out the cash register and places the checks and money in a night depository bank bag. He places the bag on the desk and goes to the rear of the store to check the back door. When he returns the money bag is missing. This is an example of?

Theft

What is it called when an agent is persuading a policyholder to drop an existing permanent policy in one company to replace it in another to the detriment of the policyholder.

Twisting

Who are the three parties to an appraisal dispute?

Two appraisers and an umpire

What type of coverage is conversion coverage?

Underinsured Motorist Coverage

The giving up of a known right is called?

Waiver

What is considered to be a guarantee of truth throughout the duration of the policy?

Warranty