Questions you've gotten wrong on insurance test

what is the maximum amount an insurer will pay under the equipment dealers pollution cleanup and removal extension of an inland marine policy

$10,000 for all expenses incurred during a 12 month period

The maximum monetary penalty for an agent who violates and insurance law, rule or order is

$25,000

which of the dwelling policy forms primarily insures a structure on an actual cash value basis

DP-1

In which of the following types of property valuation will the policy pay the full value as specified on the policy schedule, regardless of the insured property's appreciation or depreciation

agree value

In which of the following types of property valuation will the policy pay the full value as specified on the policy schedule, regardless of the insured property's appreciation or depreciation

agreed value

With respect to auto insurance, the term autos includes all of the following

any private passenger auto leased to the named insured for a period of more than 6 months; any private passenger auto titled to the named insured; a pickup or van acquired by the named insured during the policy period

in texas, how is the commissioner of insurance placed in office

appointed by the govenor for a term of 2 years

In addition to the common policy conditions, all of the following conditions apply to liability coverage

bankruptcy, duties in event of occurrence, claim or suit, legal action against the insurer, and separation of insured. Employers liability is an exclusion.

an employee is injured while visiting the employer's out of state site. how will the workers compensation benefits be determined

benefits will be provided if the state was listed on the policy information page

What is not true about earthquake coverage

coverage is commonly provided through a federally funded program

Which commercial crime form would provide coverage for a loss that did not necessarily happen during the policy period but was revealed during the policy period

discovery form

in insurance transactions, fiduciary responsibility means

handling insurer funds in a trust capacity

which endorsement adds coverage for employee use of automobiles in the insured's business and the insured's use of rented autos if no coverage is provided on a business auto policy

hired and non owned auto liability

What is true regarding the fire department service charge under the builders risk form

it is an additional coverage

All of the following statements concerning coinsurance are true

it is used to help adequacy and equity in rates; the insured agrees to maintain insurance equal to some specified percentage of the value of the property; if the insurance carried is less than requires, the insurance may not cover the whole loss

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

ordinance or law coverage; business interruption; and loss of power, lights, heat, steam, or refigeration.

property insurance that provides 100,000 coverage for a building and 50,000 coverage for personal property at a single location is called

specific coverage

In contrasting stock insurers with mutual insurers, which statement is true

stock insurers are owned by the shareholders and issue nonparticipating policies (since the insureds do not share in the divisible surplus/dividends)

an insured is driving her auto and strikes a large pothole, causing a flat tire. which coverage of the insured's personal auto policy will pay for the repair

this loss is not covered

Homeland housing corp holds a mortgage on a property that John and Carol Thomas purchased. john and carol have a homeowners policy with home protection insurance which has a mortgagee clause naming homeland as a loss payee. if john and carol suffer a fire to their home

the Thomas's and homeland will be considered co-claimants and receive loss reimbursement from home protection insurance

who might receive dividends from a mutual insurer

policyholders. since they may receive a dividend (not guaranteed) such policies are known as participating policies. dividends received by policyholders of a mutual insurer are not taxable

an insurance service representative cannot perform what duty in the office of a property and casualty agent

solicit applications for insurance

an insured owns several buildings, each at a different location and insured on a separate policy. what type of coverage does the insured have

specific

crime insurance is usually written on what basis

all risk

What is NOT covered under accounts receivable coverage form

any loans required to offset uncollectible amounts

when agents, brokers, or solicitors handle premiums for an insurer, they are acting in which capacity

as a fiduciary, because a fiduciary is a person acting in a position of trust; for example, the agents may have been trusted with the funds or property of another person (handling premiums for the insurance company)

A builder's risk form is most often written as which of the following

completed value form

The texas windstorm insurance association provides windstorm and hail insurance

in the seacoast territory of this state only

All of the following are true regarding deposit premium

it must be paid in advance; it is an estimated premium paid at the policy issue; it could be adjusted by the audit

payment for medical expenses, loss of wages, funeral expenses, or the cost to repair or replace damaged property are know as what type of compensatory damages

special

which of the following symbols in a business auto policy indicates that coverage for newly acquired vehicles applies if the insurer already covers all autos owned by the insured

symbol 7

what best expresses the purpose of a states value contract

to pre-establish the amount of coverage available for property items that are difficult to value

what percentage of continuing education hours must be in a classroom setting

50%

which of the following homeowners forms is designed to provided named peril coverage for personal property to individuals who rents an apartment

H0-4

In reference to insurable interest, which of the following is NOT an element of insurable risk

Personal. The three insurable interests include financial, blood, and business

what type of losses is covered by the personal injury protection (PIP) in auto policies

essential services, medical, funeral, loss of income, and rehabilitation losses

Which of the following is the basic auto liability limit required for bodily injury or death to any one person in any one accident

$30,000 because the limits of liability are 30/60/25

A commercial property special form covers property in transit up to

$5,000

A premium discount is the term that describes when an insured owes a total standard premium greater than

$5,000

the business owners liability coverage form will cover medical expenses incurred and reported within what maximum time period after an accident

1 year

The broad theft coverage endorsement on the dwelling form specifies the following limitations for jewelry, silverware, money, and securities

1,500 for jewelry; 2,500 for silverware; 200 for money; 1,500 for securities

under business personal property limit - seasonal increase, if no percentage is specified in the declarations, seasonal fluctuations will automatically increase the limit for business personal property by

25%, this increase is only applicable if the insured carries insurance equal to 100% of the average monthly values for the past 12 months

How long is a waiting period upon purchase of flood coverage through NFIP

30 days

The employee theft crime policy includes a coverage that applies to employees temporarily outside the coverage territory for up to

90 days

Which federal act provides benefits to injured civilians who are employed by the federal government

Federal employees compensation act; no private insurers are involved

after a covered loss on a homeowners policy, the insured must do all of the following EXCEPT

abandon the property involved to the insurer

An insured works outside the home. The insured's sister lives with him and cares for his four children. When the insured's home is severely damaged by fire, the family moves into an apartment while repairs are being made. The largest apartment available in the area has two bedrooms, so the insured's sister has to stay at a motel. How much will the HO-3 form pay for these additional living expense

all of the expenses up to the coverage D limit

after a covered loss on a homeowners policy, the insured must do all of the following

allow the insurer to inspect the property as often as reasonably necessary; if requested, submit to an examination under oath; prepare an inventory of damaged and undamaged property, including bills, receipts, and related documentation

what would not be covered under the liability section of a personal auto policy

bodily injury is caused by the insured's negligence while driving a three-wheel all-terrain vehicle

Directors and officers liability insurance defends actions against a corporation or its officers and directors alleging wrongful acts. With regard to the coverage provided, wrongful acts include any of the following EXCEPT

embezzlement. Does include misstatements, neglect, and breach of duty

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

explosion of steam boilers

which of the following provisions is usually found in homeowners policies and provides a replacement cost settlement to policyholders who carry adequate insurance

insurance to value

What is covered under accounts receivable coverage form

interest on loans required to offset uncollectible amounts pending payment of the insurance proceeds; sums due the insured that are uncollectible due to a covered loss; and expenses to reestablish the record, if possible, and collection expense that are in excess of normal costs

pertaining to insurance, what is the definition of a fiduciary responsibility

promptly forwarding premiums to the insurance company

while an insured was towing a utility trailer with his auto, the trailer came loose and ran into a store front. what part of the insured's auto policy would pay for the damage to the store

property damage liability

under the personal auto policy, liability for bodily injury resulting from the insured's use of a non owned automobile is

provided by the insured's policy on an excess basis.

What must exist for there to be negligent liability

proximate cause between the wrong and the injury or damage; a breach of the legal duty which results in injury or damage to another person; a legal duty to act, or not to act, under the circumstances

the amount of loss the insured is willing to absorb without insurance protection is known as

self-insured retention

A small appliance manufacturer in this state provides products around the globe. a customer in Switzerland is injured using one of it products. if the appliance manufacturer is found liable for the damages, why would its CGL policy cover the customers claim for bodily injury

the appliance was manufactured in the united states

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

Which of the following best expresses the purpose of a stated value contract

to pre-establish the amount of coverage available for property items that are difficult to value (determined at the time the policy is written, not at the time of loss).

if the death of an employee results from a compensable injury, the insurance carrier will pay

up to $10,000 for the cost of burial, or the the actual cost of burial, whichever is less

When does the federal emergency flood insurance program go into effect

when a community applies for the program

which of the following entities is considered the principal

the insurer issuing the policy

which of the following homeowners policies covers those who rent their dwelling

H0-4

Which of the following statement is true regarding personal injury protection (PIP) coverage in auto liability policies issued in this state

The insured may reject this coverage in writing, and there is a minimum amount of coverage of $2,500. PIP covers medical, rehabilitation, and funeral expenses among others

Under the Texas property and casualty insurance guaranty association, what is the maximum amount that a claimant may recover from an occurrence under a policy issued by an insolvent insurer

The lesser of: the amount of loss, the amount of insurance provided by the policy, or $300,000

What is the business auto coverage territory for

United States and its territories, Canada, or worldwide for private passenger hired autos

Which of the following is NOT settled on an ACV basis while covered under the business property coverage form

Valuable papers and records, they are valued at the cost of blank materials for reproducing the records and labor to copy the records

What statement is true regarding garage physical damage coverage

collision coverage is not for any specific risk; autos held for sale are covered when auto designation symbol 31 is shown on the declarations page. the "specific causes of of loss" coverage is available for physical damage coverage; no coverage is provided for any auto stored for more than 45 days at a location not shown in the declarations

all of the following statements are true regarding employee dishonesty optional coverage under the business owners policy EXCEPT

it provides coverage for all employees, even those employees who were terminated in the past 90 days.

Under the dwelling policy, coverage C - personal property is

limited to covering property owned by a guest or servant while the property is at the insured location.

which of the following describes an insurer's responsibility for payment under a policy, as stated in the common policy provisions

limits of liability

The process of determine the premium charged and how much insurance is required for a particular loss is called

loss valuation

Which of the following is settled on an ACV basis while covered under the business property coverage form

manuscripts, works of art of antiques, and property of others

Insures must file all rates and forms for commissioner's approval within how many days prior to use

60 days

What type of liability would a person who owns wild animals have

Absolute: any conduct that is inherently dangerous, such as using explosives or keeping wild animals, imposes absolute liability. The claimant does not have to prove anything

which of the following exclusions would specifically fall under coverage E

Contractual liability, damage to property owned by or in the care of the insured, liability for any assessment charged against the insured as a member of an association, bodily injury to any person eligible for workers compensation, and bodily injury to the named insured/relative/or minor residing in the household

how much is the premium for the dwelling under construction endorsement under the dwelling policy

the average value of the house and building materials from the first day of construction until completion. aka the average amount of insurance during construction

which of the following statements is correct regarding business income coverage under the business owners policy (BOP)

the business income losses are payable for 12 consecutive months following the occurrence

Under the provisions of the business income coverage form, all of the following are true

the insured is reimbursed for payroll that continues after the loss begins; if the insured and insurer are unable to come to agreement as to the value of the loss, either party may make a written demand for an appraisal; and business income will pay beyond the expiration date of a policy, it will pay until the business is restored or the limits of coverage are exhausted

the insured with a claims-made commercial general liability policy may request in writing claim and occurrence information from the insurer at any time up to 60 days after the policy period ends. the insurer must provide the information

within 45 days

what type of losses is NOT covered by the personal injury protection (PIP) in auto policies

workers compensation

All of the following are types of adjuster's licenses available in this state

workers compensation and employer's liability adjuster; all lines adjuster; property and casualty adjuster... life an health claims adjuster IS NOT one of the licenses available in this state

For there to be negligent liability, all of the following must exist except

a reasonable expectation that the act may cause injury or damage

an insurance producer fails to obtain automobile insurance for a client after agreeing to do so. the client is involved in an automobile accident after running a red light and is found to be at fault. the damage to the other vehicle totals 5,000. which statement regarding the producer's errors and omissions liability policy is true

It will provide coverage because the damage to the client resulted from the producers negligence

The limit theft endorsement designed for a landlord excludes all of the following except

a lawnmower the landlord owns and keep at rented premises