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DP-1

"Basic Form" of Dwelling Policy. Covers direct physical loss to property caused by only three perils: fire, lightning, and internal explosion (coverage for other perils can be added by endorsement).

DP-2

"Broad Form" of Dwelling Policy. A named peril policy that covers everything on the DP-1 Basic from, as well as 9 Extended Form perils and the Broad Form perils.

H0-5

"Comprehensive form" of homeowners insurance; provides all-peril coverage for both structures and contents.

DP-3

"Special Form" of Dwelling Policy. Unlike DP-1 and DP-2, DP-3 offers open-peril coverage for the property's structures (but named peril for personal property).

Melanie owns a set of 3 antique crystal vases that is worth $2,800, but during her most recent move, one of the vases was broken. Melanie and her insurer have been unable to find a replacement vase to complete the set and bring it back to its original value. Without the broken vase, the remainder of the set is only worth $1,000. What should Melanie receive from the insurer under the Pair and Set provision of her Personal Articles Floater?

$1,800

Bill carries $10,000 in PIP coverage with a $500 deductible. One day, he accidentally crashes into a car stopped at a red light. The driver of the stopped car is miraculously free from injury, but Bill's medical bills from the collision come to $14,000. How much will Bill's PIP pay for his injuries?

$10,000

Acme Construction, Inc. has one contractor and one receptionist. The contractor makes $25/hr, and the receptionist makes $10/hr. The contractor worked exactly 8 hours in 2010, so he made $200. The receptionist worked 10 hours, so she made $100. Therefore, Acme's entire payroll for 2010 was $300. Assume that, for every $100 of payroll, the WC rate for contractors is $50 and the rate for receptionists is $5. How much did Acme owe in WC premiums?

$105

Jacob is severely injured at work and receives $600 per week in Temporary Total Disability benefits under his Workers' Compensation insurance for 8 weeks. After 8 weeks, Jacob dies from his injury. What is the highest total amount that his dependents could receive in Death benefits?

$145,200

a cargo ship's hull policy has a franchise deductible of $100,000. the vessel sustains $150,000 worth of damage due to a fire. how much will the insurer be responsible for?

$150,000

Mark is driving along and looking for an address on the East side of Walker Street. As he squints to see the numbers posted on the buildings, he plows into the back of a car waiting at a stoplight. Both the driver and the passenger of the struck car are injured. The driver suffers $70,000 in bodily injury, the passenger suffers $65,000 in bodily injury, and the vehicle Mark hit sustains $30,000 in damage. Mark has liability coverage with split limits of 50/100/25, and both injured people carry the minimum PIP for Florida. How much will Mark be responsible for out-of-pocket after this accident?

$20,000

Wilson is a Florida resident who maintains a liability policy with limits of 10/20/10. Recently, he was visiting a friend in Georgia when he ran a red light and hit a BMW, causing $30,000 in property damage. The minimum liability requirement in Georgia is 25/50/25. How much will Wilson's liability insurance pay in this situation?

$25,000

During a strong storm, Missy's grain drill was mangled by a tornado, which rendered it useless. Before the damage, the grain drill was worth $25,000, but it would cost $45,000 to buy a new one today. Missy's farm policy has a replacement cost endorsement, and the grain drill is scheduled on a Mobile Agricultural Machinery and Equipment form with a $36,000 limit. Missy replaces her grain drill with one she found on sale for $40,000. How much total indemnification will she receive?

$36,000

sue owns a home and property valued at $600,000. in order to be considered "fully insured," sue would have to insure the home for at least

$480,000

Stephanie owns a house that she rents out for $2,500 a month. A massive kitchen fire forces her tenants to move out while the interior is overhauled. After two months, the repairs are complete, and Stephanie contacts her tenants, only to find that they've found a new place to live. It takes Stephanie another month and a half to find new tenants. Assuming that Stephanie had a $100,000 DP-2 policy, what is the maximum amount she could receive for lost rental income under Coverage D?

$5,000

Grace purchased a recliner from XYZ Furniture. After getting it home, she decided to try out the new chair. While leaning back, the chair breaks and Grace injures her neck. She sues XYZ Furniture and is awarded $300,000. The costs for the legal defense come to $45,000. XYZ Furniture's CGL policy has a Products-Completed Operations Aggregate limit of $750,000, with a per occurrence limit of $250,000. How much will XYZ Furniture have to pay out-of-pocket for this claim?

$50,000

Jennifer's PAP has a Comprehensive deductible of $100. Jennifer lets her sister Tina borrow her car, and Tina hits a llama worth $500. The llama's owner files a claim for the loss of his llama. How will that claim be settled?

$500 paid under Jennifer's liability coverage

Stan built a porch for his home three years ago at a cost of $10,000. The value of the porch has depreciated by $6,000, and it would cost $12,000 to replace it today. After Stan's porch burnt down during a BBQ today, how much would a Standard Fire Policy indemnify Stan for his porch?

$6,000

While Andrea was grocery shopping in BB Mart, the large Dairy sign fell off the wall and landed on her. Because of her extensive injuries, Andrea sued BB Mart and was awarded $375,000 in damages. BB Mart's Commercial General Liability policy has a general aggregate limit of $1,000,000 and a per occurrence limit of $300,000. What is BB Mart's general aggregate limit after the claim for Andrea's injuries is paid?

$700,000

BI

(Bodily Injury): Physical damage to someone's person.

law and ordinance

(a.k.a. Code Upgrade Coverage): covers the repair or upgradecost when new building codes, laws, or ordinances go into effect

Which of the following is NOT one of the differences between a BAP and a truckers policy?

. A BAP uses coverage symbols to designate covered autos

In which of the following cases would Mechanical Breakdown Insurance NOT apply?

. A rock strikes and shatters Horace's windshield

2. Tina has two policies (Policy X and Policy Y) that cover the same risk on a pro rata basis. Policy X has a limit of $100,000 and Policy Y has a limit of $25,000. When Tina suffers a loss totaling $75,000, how will the two policies respond?

. Policy X will pay $60,000 and Policy Y will pay $15,000 C. D.

"Sam, who has a typical HO-3 policy, is forced to evacuate his home by civil authorities due to rising flood waters in his neighborhood. It takes a month before Sam is allowed to come back to his home. During this time, he has spent $3,000 in hotel expenses, on top of his monthly mortgage payment of $850. When he files a claim, how much will Sam receive under Coverage D - Loss of Use? "

0

Grace purchased a recliner from XYZ Furniture. After getting it home, she decided to try out the new chair. While leaning back, the chair breaks and Grace injures her neck. She sues XYZ Furniture and is awarded $70,000. Assuming XYZ Furniture's CGL has a Products-Completed Operations limit of $500,000 with a per occurrence limit of $75,000, how much out-of-pocket expense will XYZ Furniture incur if the court costs total $85,000?

0

6 unique characteristics of insurance policy

1 Contracts of adhesion (court ez win) 2 Utmost good faith 3 aleatory 4 personal 5 Unilateral (only insurer has obligation) 6 Conditional

6 conditions of what can be insured

1 adequate premiums 2 Definable 3 Unexpected 4 substantial losses 5 Exclusions 6 Law of large numbers 1 adequate premiums 2 Definable 3 Unexpected 4 substantial losses 5 Exclusions 6 Law of large numbers 1 adequate premiums 2 Definable 3 Unexpected 4 substantial losses 5 Exclusions 6 Law of large numbers 1 adequate premiums 2 Definable 3 Unexpected 4 substantial losses 5 Exclusions 6 Law of large numbers unexpected Definable ​

"During a severe windstorm, a large tree in Jeff's yard was blown down and two large bushes were ripped from the ground. Jeff has an HO-3. What is the maximum amount that Jeff can receive for the replacement of the tree and bushes that were damaged by the windstorm? "

1,500

"Kevin has a homeowners policy with replacement cost valuation and a coverage limit of $90,000 for his personal property. Three years ago, Kevin purchased a sofa and loveseat for $1,000 and $500 respectively. Both pieces of furniture depreciate at $100 per year. A house fire damaged many of Kevin's belongings, including the sofa and loveseat, which now cost $1,200 and $700 to purchase today. Ignoring any deductibles, how much will Kevin's insurer give him for the damaged sofa and loveseat? "

1,900

Four Risk Management Techniques:

1. Risk Avoidance 2. Risk Reduction 3. Risk Transference 4. Risk Retention

d.i.c.e

1. declarations page 2. insuring agreement 3. conditions 4. exclusions

DICE

1.declerations page 2.insuring agreement 3.conditions 4exlusiins

What is the current minimum amount of liability coverage required by the state of Florida for a driver who is found to be at fault in an accident?

10/20/10

When a severe flood is imminent, Erica goes out and spends $600 on sandbags, $200 on plastic sheeting and lumber, and $500 on a pump. Then she works for 8 hours, applying the protective measures to her home. After the flood passes, Erica files a claim for these expenses. Assuming the federal minimum wage at that time is $10 per hour, how much will her flood policy indemnify her?

1000

"A flood inundates Howard's property, causing $100,000 of damage to the dwelling and $25,000 of damage to the detached garage. If Howard has a Dwelling Form flood policy with a $150,000 limit, how much will the policy pay for the damage to Howard's home and detached garage combined? (Ignore deductible amounts.)

115,000

A flood inundates Howard's property, causing $100,000 of damage to the dwelling and $25,000 of damage to the detached garage. If Howard has a Dwelling Form flood policy with a $150,000 limit, how much will the policy pay for the damage to Howard's home and detached garage combined? (Ignore deductible amounts.)

115,000

According to the Unfair Settlement Practices Act, how long does an insurer have to affirm or deny a claim?

15 Business Days

"According to the Unfair Settlement Practices Act, how long does an insurer have to affirm or deny a claim?

15 business days

In a homeowners policy, Coverage B - Other Structures provides insurance for which of the following?

15,000

Monica's husband, Sam, likes to buy her expensive jewelry, and she has amassed quite the collection over the years. What endorsement would Monica and Sam need to add to their homeowners policy to fully cover Monica's jewelry collection?

1500

"Kevin has a homeowners policy with replacement cost valuation and a coverage limit of $90,000 for his personal property. Three years ago, Kevin purchased a sofa and loveseat for $1,000 and $500 respectively. Both pieces of furniture depreciate at $100 per year. A house fire damaged many of Kevin's belongings, including the sofa and loveseat, which now cost $1,200 and $700 to purchase today. Ignoring any deductibles, how much will Kevin's insurer give him for the damaged sofa and loveseat? "

1900

McCarren-Ferguson Act

1945 US Law exempting insurance from most federal regulation, and placing it under theauthority of the individual states.

The HIPAA was enacted by the US Congress in _________.

1996

4 types of adjuster

1staff or company 1 insurer salary 2 Independent adjuster fee or bureau can be comission 3 public adjuster hired by claimant! Commission 10% 4 emergency adjuster is Catastrophe

In Florida, every driver must have $10,000 in property damage liability coverage and $10,000 in PIP in order to operate a motor vehicle. If the driver is in a wreck and is found to be at fault, how much liability coverage must the driver have for total bodily injury per accident?

20,000

"Scott lived in a mobile home before it was completely destroyed in a recent flood. The mobile home is large enough to qualify for a special loss settlement under his flood policy, which has a limit of $28,000. Before the flood, the mobile home was worth $15,000, but it would cost $25,700 to buy a new one today. How much indemnification will Scott receive for this loss? "

22,500

late planting period

25 days after the final planting date, during which the yield and/or revenue guarantee drops by one percent per day.

"Diana is insured under a DP-2 policy with the following coverage limits: Coverage A - $150,000, Coverage B - $15,000, and Coverage C - $25,000. She and her fiancé have planned a destination wedding, but their hotel catches fire shortly after their arrival. Smoke from the fire damages all of their belongings, including Diana's $4,000 wedding dress. Diana's loss totals $5,200. When she files a claim with her insurance company, how much can she expect to receive for this loss under her DP-2 (ignoring any deductible)? "

2500

The Newly Acquired Property extension in a commercial property policy provides ________ in coverage for buildings under construction at the insured premises, or for any newly acquired business property off the insured premises.

250000

In a BOP, Newly Acquired Properties coverage provides _____ of insurance for new buildings under construction or newly acquired business properties located off the insured premises.

30 days

BOP, Newly Acquired Properties

30days

"Jane's has a $150,000 homeowners policy with a 3% percentage deductible. One night, an oven fire destroys her kitchen, causing $50,000 in damage. How much of the damage falls under Jane's responsibility? "

4500

Jane's has a $150,000 homeowners policy with a 3% percentage deductible. One night, an oven fire destroys her kitchen, causing $50,000 in damage. How much of the damage falls under Jane's responsibility?

4500

1. The insured carries a BOP policy with protective systems such as a sprinkler system. If the system becomes inoperative, the insured must advise the insurance company of the problem within _______ if the system cannot be restored to working order

48 hours Your Answer

Marlene has been living in her $120,000 home for 31 years. Because she has paid off the mortgage, she decides to save some money on her monthly insurance premiums by reducing her homeowners coverage to $40,000. After a severe hailstorm totals her roof, her adjuster estimates the damage at $12,000. Assuming the insurer imposes the standard coinsurance penalty, and ignoring the deductible, how much will Marlene receive in the settlement?

5,000

Under the Longshore and Harbor Workers' Compensation Act, how much would the surviving spouse of a deceased worker receive in benefits?

50% of the deceased worker's Average Weekly Wage

"How much of a limit is included for Credit Card Fraud or Forgery, an additional coverage in a homeowners policy?

500

what is coverage for cc fraud or forgery

500$

A Discovery Form Commercial Crime policy can apply to losses discovered during the policy period, as well as up to how many days after its expiration date?

60

"Stan built a porch for his home three years ago at a cost of $10,000. The value of the porch has depreciated by $6,000, and it would cost $12,000 to replace it today. After Stan's porch burnt down during a BBQ today, how much would a Standard Fire Policy indemnify Stan for his porch? "

6000

Business and Personal Property Form of a commercial property policy, Coverage A - Buildings and Structures coverage would apply to

A 40-ton printing machine affixed to a factory floor

Which of the following is NOT one of the differences between a BAP and a truckers policy?

A BAP uses coverage symbols to designate covered autos.

For occurrences transpiring during the supplemental extended reporting period, what is the time limit in which a claim must be made in order to be covered by a claims-made CGL policy?

A CGL policy with a supplemental extended reporting period (or "supplemental tail") covers occurrences that happen within 60 days of the policy expiration, regardless of when the claim is filed. There is no time limit for filing a claim.

Which of the following statements regarding Commercial Package Policies (CPP) is TRUE?

A CPP is an elective-based policy.

CGL

A Commercial General Liability policy protects businesses against damages and injuries to thirdparties.

Bill and some friends went to Joe's Bar and Grill for a few drinks after work. On his way home, Bill struck and injured a pedestrian. Bill was ticketed and convicted of driving while intoxicated (driving under the influence). The pedestrian sued Joe's Bar and Grill for his injuries and was awarded damages. Which one of the following types of insurance is needed by Joe's Bar and Grill to cover these damages?

A Liquor Liability Coverage Form

A contractor was hired by a railroad to work on a bridge adjacent to railroad tracks. Which one of the following types of insurance coverage would best respond to claims against the railroad arising out of the contractor's work?

A Railroad Protective Liability Coverage Form purchased by the contractor

Reciprocal Insurers

A Reciprocal Insurer is an unincorporated organization of subscribers that operates through anattorney-in-fact to provide insurance benefits for its members.

Stock Insurance Company

A Stock Insurance Company is owned by stockholders, as opposed to its own policyholders (asis the case with Mutual Insurance Companies).

Which of the following is TRUE concerning a Business Owners Policy?

A business owners policy offers liability protection.

Agricultural Producer

A business that grows, harvests, and sells crops for profit.

inherent vice

A characteristic in a thing itself that causes gradual deterioration or self-destruction. Losses or damage related to inherent vice are not insurable.

Unilateral

A characteristic of insurance contracts. It means that only one of the parties (the insurer) makesa promise to perform. The insurer is obligated to fulfill this promise, whereas the insured is freeto void the contract at any time.

Utmost Good Faith

A characteristic of insurance contracts: 'utmost' meaning the 'highest degree' and 'good faith'meaning, act with honesty fair dealing and full disclosure." All parties to an insurance contractmust act with utmost good faith. It also applies to a fiduciary agent's responsibility towards theprincipal. "

Aleatory

A characteristic of insurance contracts; means depending on an unknown future event."

third party claim

A claim filed against an insurance policy by a third party not named on that policy. Used for liability claims

First-party claim

A claim that a policyholder files with her own insurer (as opposed to a third party claim, which the claimant files with someone else's insurer)

Mobile Agricultural Machinery and Equipment Coverage Form

A commercial property form that provides coverage for farm machinery and equipment when it is the only exposure, or when coverage must be written separately.

Insurance Policy

A contract wherein an insured pays premiums to an insurer in exchange for financial protectionin the event of a covered loss.

Bond

A contract wherein one party guarantees the performance of a third party. Bonds involve three parties: (1) the surety agrees to pay the second party (2) the obligee if the third party (3) the principal neglects to carry out an obligation it has to the obligee.

Mail Coverage

A controlled Inland Marine coverage form providing open peril coverage for property sent by registered mail. The shipper is responsible for reporting the value of property shipped with this coverage

Depreciation

A decline in value of property caused by wear or loss of usefulness usually measured by aspecific formula.

Deductible - percentage

A deductible that is calculated as a percentage of a covered loss.

Which one of the following is an example of injury or damage arising from an occurrence that would be covered by the products and completed operations liability portion of the Commercial General Liability (CGL) Coverage Form?

A defective gas range manufactured by the insured explodes causing injury

guaranteed renewable policy

A disability or life insurance policy that cannot be canceled by the insurer until the insured reaches a certain age. The insurer may increase the premiums over the life of the policy.

License

A document that shows that a person has been granted authority by the state to act as aninsurance agent, broker, or adjuster.

Which of the following is a hazard?

A driver's tendency to text while driving

risk management agency

A federal agency under the USDA that administers the Federal Crop Insurance Program

national resources conservation service

A federal agency within the USDA that works with private landowners and operators to help them protect their natural resources.

Insurance

A financial device used by people and organizations to protect themselves from unexpected,extraordinary financial losses.

Deductible - fixed

A fixed deductible is one specific, predetermined amount that a policyholder must pay out-of-pocket before he can be indemnified.

Farm Liability Coverage Form

A form added to a farm insurance policy that provides coverage for injury and damage to a third party.

farm property coverage form

A form added to a farm insurance policy that provides coverage for the dwelling, other structures, farm structures, and both household and farm personal property.

Cause of Loss

A form included in a Commercial Package Policy or a Commercial Property Policy that lists the causes of loss from which the insured property is covered.

Group Risk Income Protection(Crop Insurance)

A form of Crop Revenue Insurance that protects a whole county or area instead of individualfarmers. Automatically indemnifies if county income falls below a certain level.

Revenue Assurance (CropInsurance)

A form of Crop Revenue Insurance that provides a fixed revenue guarantee based on averagecounty prices

Income Protection (CropInsurance)

A form of Crop Revenue Insurance. One of the cheapest available; provides a fixed revenueguarantee based on early commodity prices for the crop type.

Crop Hail Insurance

A form of Crop Yield Insurance that is usually provided by private insurers without government subsidy. It offers named-peril protection on an acreage basis.

Multi Peril Crop Insurance

A form of Crop Yield insurance that offers broad coverage for a multitude of perils. Because it issubsidized by the government, MPCI is subject to federal regulation.

Farm Property Coverage Form

A form that is part of the Farm Coverage Part and provides seven separate property coverages designed specifically for farms.

Federal Crop Insurance Corporation (FCIC)

A government-owned corporation that manages the Federal crop insurance program.

risk retention group

A group in which the members insure each other, using their own capital to write insurance policies

Major Medical Coverage

A helath insurance plan that does not restrict the policyholder to a network, provides limited coverage but high medical coverage limits, and involves high deductibles and coninsurance rates.

Actual Production History

A history of a farmer's crop yields over a multi-year period, which is used to determine the normal production level of a farm.

Which one of the following statements is correct with respect to contractors equipment floaters?

A large contractor may obtain blanket coverage applying to all equipment, whether owned, rented, or borrowed by the contractor.

Fall Down Case

A lawsuit brought against a property owner by someone who has fallen down on the property.

Estoppel

A legal principle that bars a party from asserting something contrary to what has been impliedby his previous actions or statements.

Claims-made Form

A liability policy in which the insurer pays only those claims arising during the policy period (as opposed to those claims arising after the policy period is over, regardless of whether the incident took place during the policy period).

Third Party Administrator (TPA)

A licensed organization that collects premiums and processes claims for an insurer; basically, a company doing another company's outsourced administrative tasks. The risk of loss remains with the insurer, not the TPA

health maintnence organization HMO

A managed care organization that provides health insurance to individuals through a provider network. Provides a broad range of comprehensive medical care

Commercial Property Floater

A means of protecting a business' property that is not in one fixed location.

Mediation

A method of negotiation that utilizes a neutral third party adviser to reach a mutually-agreeablesolution. Mediation differs from Appraisal in that the decision is not binding to the opposingparties.

Mutual Insurance Company

A mutual insurance company is owned by its policyholders. They have no shareholders and arenot traded publicly.

Arbitration

A negotiation method in which the opposing parties each submit their evidence to a mutually-agreed-upon and neutral third party, called an arbitrator. The arbitrator reviews the positions ofeach opposing side, and makes a final and legally binding decision.

Appraisal

A negotiation method which allows the claimant and the insurer each to select an appraiser.The two appraisers in turn select an Umpire. The appraisers then work together to determine asettlement amount. If they cannot agree, the Umpire steps in. Agreement by any two of thethree is binding.

guarantee association

A non-profit association of insurers from similar markets that handle and pay claims for insurers that have been declared insolvent

National Association of State Departments of Agricultural Research Foundation

A non-profit association of public officials representing the Commissioners, Secretaries, and Directors of Agriculture in the fifty states and four territories.

National Association of Insurance Commissioners (NAIC)

A non-profit coalition of state insurance agencies that works to protect consumers and harmonize state laws and regulations.

National Crop Insurance Services (NCIS)

A non-profit international organization specializing in statistical data analysis and reporting related to crop insurance risk management.

Reservation of Rights

A notification that an insurer might give to an insured, informing him that a reported loss mightnot be covered under his insurance policy.

"A fire burns down Jenny's Hardware, leaving virtually nothing salvageable. Which of the following items would NOT be covered under Coverage B of the Building and Personal Property Coverage Form in her commercial property policy?

A paint mixer permanently affixed to the floor

A fire burns down Jenny's Hardware, leaving virtually nothing salvageable. Which of the following items would NOT be covered under Coverage B of the Building and Personal Property Coverage Form in her commercial property policy?

A paint mixer permanently affixed to the floor

Sudden and Accidental Tearing Apart

A peril covered in some property insurance policies. It refers to damage caused by rupture, cracking, burning, or bulging of a steam or hot water heating system, an air conditioning or automatic fire sprinkler system, or an appliance for heating water. Unlike Accidental Discharge, this peril includes coverage for the system or appliance itself.

Which of the following is NOT be considered a covered theft in a Commercial Crime policy?

A periodic assessment of inventory reveals that 4% of a store's inventory is inexplicably missing.

Insured

A person or entity who is covered under an insurance policy.

Policyholder

A person who has purchased an insurance policy - orcontract- from an insurer.

Valued policy

A policy in which the insurer and the insured agree to a specific value prior to the start of thepolicy. If the item is lost or destroyed, the insurer pays the amount agreed upon.

conditionally renewable policy

A policy that gives the insurer the option to cancel coverage only if certain stated conditions are met.

Tort - intentional

A premeditated wrongful act that causes intentional or intentional damages to another party.

Preponderance of Evidence

A preponderance of evidence is enough evidence to make it more likely that an argument is truethan that it is false. In a civil trial, the plaintiff needs to provide a preponderance of evidence inorder to win her case.

Farm

A property where a farmer or rancher both resides and conducts commercial business.

Settlement

A resolution of a dispute, or an agreement. Settlement allows an insurer and a claimant to resolve a case before it reaches a court of law.

Premium

A scheduled and affordable fee, paid by the policyholder to the insurer, in return for coverage.

Exclusions

A section of an insurance policy that reduces coverage by listing specific individuals, property,or perils that are NOT covered by the policy.

Intervening Cause

A separate occurrence that intervenes" between a defendant's actions and damage or loss toanother person. An intervening cause may decrease the defendant's liability if the defendantcan show that it was the intervening cause (rather than the defendant himself) that caused thedamage or loss.

Code of Ethics

A set of governing professional standards of conduct, usually created by regulatory bodies or government regulatory agencies. These standards may also be formally codified with statutes.

Advance Payment Settlement

A settlement option that lets the insurer offer some financial relief to the claimant before the claim has been fully settled. The insurer makes advance payments to the claimant, which are then subtracted from the final settlement amount. Often used when a claimant suffers bodily injury and is unable to work.

structured settlement

A settlement option whereby the insurer indemnifies the claimant in a series of smaller payments over a set period of time, instead of paying all at once. Typically reserved for claims involving a very large settlement amount, and the insurer often has to pay some of the amount in a lump sum up front

Partial release payment

A settlement option whereby the insurer pays a part of the claim before settling the entire claim. This kind of settlement is common when one part of a claim is still being negotiated or where the full amount of damages is as yet unknown (in the case of bodily injury, for example)

Full Release Settlement

A settlement option whereby the insurer pays all damages at once in an immediate "lump sum" and the claimant signs a "full release form" which releases the insurer from any further liability. This is the most common settlement option

No Release Settlement

A settlement option whereby the insurer simply pays the bills submitted by the claimant, but the claimant does not sign a release form to verify the payment. Usually, the checks issued to indemnify the claimant act as a substitute for a release form. Also known as "Walk-away" Settlement.

Common Crop Insurance Policy

A single uniform policy that combines crop revenue coverage, revenue assurance, income protection, and indexed income protection

Statute of Limitations

A statute based on the common law legal system that specifies the maximum period of time,after damages occur, that legal proceedings based on those damages may be initiated.

Stipulation

A stipulation is something specifically agreed to in a contract, such as an insurance contract.

Which one of the following claims would be covered under Coverage B - Personal and Advertising Injury Liability of the Commercial General Liability Coverage Form (CGL)?

A store manager accuses a young man of shoplifting, apprehends him, and locks him in a storage room until the police arrive. When it is discovered that the young man is innocent, he files a claim against the store.

hosital indemnity insurance

A supplemental coverage that provides a flat amount of indemnification per day for hospitalization

Binder

A temporary contract provided by an insurer that ensures coverage until the complete, permanent policy is issued.

Floater

A term for Inland Marine policies that cover mobile property.

Instrumentalities of Transportation and Communication

A term used in Inland Marine insurance that refers to property directly related to transportation and communication, including bridges, tunnels, roads, dams, piers and docks, oil pipelines, power transmission lines, and radio and TV towers.

free on board FOB destination point

A term used in Ocean Marine insurance. It means that the title to the property being shipped remains with the shipper until it arrives at the buyer's destination and the buyer accepts the property

Free on Board (FOB) Shipping Point

A term used in Ocean Marine insurance. It means that the title to the property being shipped transfers to the buyer as soon as the property leaves the shipping dock.

Anna's Rare Books in Birmingham needs to ship three F.Scott Fitzgerald first editions to a customer in Mobile. The combined value of the books is over $400,000. What type of Inland Marine insurance policy should Anna's Rare Books buy to cover this shipment?

A trip transit policy

Pure claims-made form

A type of claims-made policy where the insured must inform the insurer of a claim as quickly as possible, but not necessarily within the policy period.

Point of Service (POS)

A type of group health insurance plan that combines characteristics of the HMO and the PPO plans. Allows the insured to choose his own primary physician within the network and that physician becomes the insured's "point of service."

Aggregate Limit

A type of policy limit found in some health, liability, and property damage policies. It represents the total amount the insurer will pay for all losses.

stated value

A valuation method in which the insured simply assigns the risk a value at the outset of the policy. The insurer will pay this amount in case of a total covered loss

Actual Cash Value (ACV)

A valuation method used by insurers to reflect an item's current market value right before being damaged or destroyed. Formula: (Replacement cost - Accumulated Depreciation)

Agreed Value

A valued policy in which the insurer and the insured agree to a specific value for an item, appraised at the inception of the policy. Often used to insure items whose value is difficult to quantify, such as antiques or fine art. Also called a Guaranteed Value policy.

Commercial Lines

A variety of insurance coverages that protect those involved in the business of creating, selling,displaying, evaluating, or shipping, etc. Example include: Business Owner's Policy; CommercialProperty; Commercial General Liability; Workers Compensation; Professional Liability (D&O),Errors and Omissions (E&O) and Employment-Related Practices Liability.

Under the Commercial General Liability (CGL) Coverage Form, medical payments coverage applies to which one of the following?

A volunteer worker of the named insured.

Waiver

A waiver is a voluntary act of relinquishing a known right, claim or privilege. Either an insured oran insurer may waive rights.

Due to decreased demand, the market price of beets dropped dramatically during the recent growing season. Consequently, Michelle's crop of beets did not make as much money as she was expecting this year, based on her production history and the harvest-time futures price. However, Michelle is insured for this type of situation. What kind of insurance does she have?

A. B. C. Crop-Revenue D.

Jane has a $150,000 homeowners policy with a 3% percentage deductible. One night, an oven fire destroys her kitchen, causing $50,000 in damage. How much of the damage falls under Jane's responsibility?

A. B. $4,500 C. D.

Six Stars Development Company has just purchased several large properties in Las Vegas. As a result of this large purchase, they are a little short on money and decide to save money by not purchasing insurance on their new properties. Six Stars is practicing:

A. B. risk retention. C.

Sam, who has a typical HO-3 policy, is forced to evacuate his home by civil authorities due to rising flood waters in his neighborhood. It takes a month before Sam is allowed to come back to his home. During this time, he has spent $3,000 in hotel expenses, on top of his monthly mortgage payment of $850. When he files a claim, how much will Sam receive under Coverage D - Loss of Use?

A. D. $0

jesse's home is worth $200,000 and he has a homeowners policy with a $160,000 limit. after a covered loss, jesse is left with a total of $10,000 in damages. assuming the insurer requires the standard 80% level of insurance for coinsurance purposes, and ignoring any deductibles, how much will jesse receive in indemnification?

A. $10,000

extended coverage under a commercial policy often provides for damage to outdoor trees, plants, and shrubs. when covered, what is the maximum per-plant amount?

A. $250

Victoria makes $950 per week before she suffers an injury at work and is wheel chair bound for 8 months. During those 8 months, she is transferred to the accounting department and makes $325 per week. How much will Victoria's Temporary Partial disability benefits pay per week until she can get back to her regular job?

A. $417

What is the penalty for an adjuster who fails to report a change of address within the required time?

A. $50

As an adjuster for KLM Insurance, Chrystal has the important role of fiduciary agent. While acting in this capacity, Chrystal's primary responsibility is to:

A. . C. protect the financial and property interests of KLM Insurance. D. .

If an Alabama insurer wants to cancel a HO policy because the policyholder isn't paying premiums, it needs to give the policyholder ____ days advance notice.

A. 10 B.

The BOP provides loss of income on an "actual loss" sustained basis for up to:

A. 12 months

the HIPAA was enacted by the us congress in _______.

A. 1996

florida's department of financial services was created in:

A. 2003

under the longshore and harbor workers' compensation act, how much would the surviving spouse of a deceased worker receive in benefits?

A. 50% of the deceased workers average weekly wage

Sue decides to get a valued insurance policy on her antique car. She and her insurance company agree to a value of $85,000. Three years later, the car is destroyed when a tree falls on it in a parking lot. The car depreciates at $2,000 a year, and its replacement cost is $100,000. Ignoring any deductible, how much can Sue expect her insurer to indemnify her?

A. 85,000 - ACV C.

Which of the following would be considered an insurable risk?

A. A football stadium

Which of the following claims may be covered under an Equipment Breakdown Protection Coverage Form?

A. A self-propelled machine used to transport heavy objects within the factory experienced a malfunction in its computer program, causing it to run into a wall, which damaged it to the point of needing repair. B. While adjusting a pressurized boiler, an employee accidentally set the calibrations to incorrect levels, which damaged the boiler to the point of needing repair. C. Hazardous material remediation was needed after a mechanical breakdown of the exhaust system's turbine caused ammonia to be released into the factory, contaminating the entire area.

Andrew's friend Mario asked for a ride from Detroit to Cleveland, and Andrew decided to take Mario in his plane. Getting out of the plane, Mario trips and falls into the propeller and ends up losing 3 fingers on his right hand. Mario also signed a form agreeing to release Andrew from further liability in exchange for a sum of money. Which of the following is FALSE?

A. After Mario has received his monetary sum to indemnify him for the loss of his fingers, he can sue Andrew because of recurring back pain. B.

Bill has experienced a loss covered under the Business Income and Extra Expense coverage in his Equipment Breakdown Protection Coverage Form. When does the period of restoration begin?

A. After a length of time in which Bill should have reasonably been able to repair or replace the damaged equipment

Kevin plays in a brass band using two rare antique Alexander tubas. Since they are no longer produced, the value of the tubas is difficult to determine. Which type of policy would best indemnify Kevin in the event that his tubas were ever damaged, lost, or stolen?

A. Agreed value policy B.

A man wanders onto the runway of a small airport and is injured by a taxiing plane. Which insurance policy would pay for his injuries?

A. Airport Liability insurance Your Answer C.

Which of these statements is true?

A. All flood insurance policies are settled on an ACV basis. C.

Who is NOT eligible for a homeowners policy?

A. An owner of a house in which he does not live, but rents to a tenant

Which of the following statements about the negotiation process is FALSE?

A. Apologizing for minor mistakes can weaken the adjuster's power in the negotiations. B. Failing to address minor clerical issues can stall the negotiations. Your Answer C. If an adjuster can rectify minor issues with the claimant right away, the negotiation process may quickly take care of itself. D. In negotiations, a seemingly trivial matter can prevent a successful outcome.

Which of the following is NOT one of the requirements that adjusters must meet in order to handle NFIP claims?

A. Attending a NFIP claims presentation every 3 months in order to adjust NFIP claims

Which of the following lines of coverage could be found in a Commercial Package Policy?

A. Business Auto insurance

Flora is driving in the rain when she skids off the road and slams into Cam's billboard, totalling her car and causing $2,000 in damage to the billboard. Flora has an auto policy with ABC Insurance. Cam files a third-party claim and ABC Insurance pays him $1,500 for the billboard. Which of the following is TRUE?

A. Cam may sue Flora for $500.

On January 27, 2004, Ryan was using an exercise bike from NusquamCycle when the chain broke, causing him to fall and bruise his knee. Seven years later, on January 25, 2011, Ryan's knee gave out while jogging. His doctor told him that he'll need surgery and that this deterioration was probably caused by his bruise from the exercise bike. Assuming NusquamCycle is no longer in business, which CGL policy would cover Ryan's claim filed on January 25, 2011?

A. Claims-Made policy from Jan 1 2003-Jan 1 2004 with a supplemental extended tail

Sarah is playing with a basketball on the stairs at Bob's house. In doing so, she trips, falls, and breaks her leg. She files a claim against Bob's insurance company for her injuries. The adjuster determines that Sarah was 50% partially responsible for her own injuries, and therefore should only receive indemnification for 50% of her medical bills. What defense of the claim is the adjuster using?

A. Comparative negligence B.

Honey's Bakery is a local coffee shop run by two sisters. In a rush to leave one afternoon, their new employee forgets to turn off the gas stove. The leaking gas causes an explosion, destroying the kitchen. Which condition in their commercial property policy could help the sisters cover the cost of the damage?

A. Control of Property

A dryer fire scorches the interior of Bill's home, forcing him to move out while repairs are made. In addition to paying for temporary housing, he also loses the rental income he received from his roommate Frank. Which two Dwelling policy coverages could help Bill with the lost rental income AND his additional living expenses?

A. Coverage D & Coverage E

Which of the following statements about Electronic Data Processing (EDP) insurance coverage is FALSE?

A. EDP excludes coverage for all "intangible" electronic data.

Jerry is an adjuster and has signed a contract with ABC Insurance to adjust claims in an area recently devastated by a hurricane. Jerry receives the claims from ABC Insurance, completes the inspections, and settles claims on behalf of ABC Insurance according to his contract. What type of authority has ABC Insurance given Jerry?

A. Express authority

Several cases of listeria have been traced back to Aaron's crop of soybeans that he recently sold at market. What type of coverage will pay for the claims filed by those sickened by Aaron's soybeans?

A. Farm Product Liability

Farmer Bob would like to sell his recent harvest of lettuce to a local wholesaler. The wholesaler agrees, but only if Bob can prove he has insurance protection in the event that his lettuce causes people to become ill. What type of insurance does Bob need in this situation?

A. Farm Product Liability insurance

When Phyllis passed away, she left an inheritance for her three children, including ten ounces of gold for each of them. To execute her will, her lawyer hires another attorney, Williams, to oversee the careful distribution of the gold. The court requires a bond to assure Williams will conduct himself honestly. Which type of bond has the court required?

A. Fiduciary bond B. C. D.

Driving home from work one night, Judy is pulled over by a state trooper. When she asks why she was stopped, the trooper informs Judy that her auto insurance has lapsed. This is her first offense. What penalty will Judy face, if any?

A. Fine of $500 and suspension of her driver's license for six months B. . D.

John moved out of his house and put it up for sale three months ago. While he was waiting for the house to sell, John's plumbing pipes froze and burst in the icy temperatures, which eventually led to water damaging the cabinetry and hardwood floors. Which of the following statements would most likely be TRUE?

A. Freezing is not a covered peril in a HO-3, so this loss would not be covered. B. Although John's house was still covered under an HO-3, the damage would not be covered because he didn't shut off the water supply. C. Although John's house was still covered under an HO-3, the surface water resulting from the damaged pipes is not a covered peril. Your Answer D. Because John's house was still covered under an HO-3, the damage would be covered.

which ISO homeowners form is designed for renters and covers personal property only?

A. HO-4 contents broad form

Which of the following statements best explains why residual market insurance programs exist?

A. High-risk consumers need insurance, yet no private insurer wants to issue high-risk policies.

Which of the following insurance packages will indemnify a policyholder for a variety of hospital-related expenses such as nursing care, supplies, and rooming charges?

A. Hospitalization Expense insurance

under which law is an insurer required to explain its reasons for denying coverage?

A. IIPPA

Under which law is an insurer required to explain its reasons for denying coverage?

A. IIPPA C.

Which of the following statements about the Standard Fire Policy is TRUE?

A. It is no longer used in its original format. D.

Which of the following statements is TRUE regarding Mechanical Breakdown Insurance?

A. It will not cover the cost of repairs that exceed the value of a vehicle.

Farmer Jane had an MPCI policy in place when her wheat field was ruined by a hail storm. Jane promptly plowed up the wheat and planted a cover crop. Two days later she filed a claim with her insurer. The claim was denied. What might be the reason for the denial?

A. Jane did not leave samples of the destroyed crop for the adjuster to examine.

Which of the following is an example of a moral hazard?

A. Ken lights a candle, sets it right next to the window draperies and leaves the house to go to work.

Which of these perils is NOT excluded from coverage in a homeowners policy?

A. Lightning

Which of the following is NOT one of the requirements that a "Fast Food Restaurant" business must meet in order to qualify for a BOP?

A. Liquor must not account for more than 25% of total annual sales.

Which of the following statements about MPCI is FALSE?

A. MPCI is a form of crop-revenue insurance. B.

Which of the following statements about insurable interest is FALSE?

A. Maintaining property values allows your neighbor to have an insurable interest in your house.

When Zach purposefully burned down Matt's restaurant, Matt's insurer paid the claim and then went after Zach for the damages. Matt is furious about what Zach did and wants to sue him as well. Why is it NOT possible for Matt to sue Zach?

A. Matt has already received indemnification from his insurer.

Cindy and her insurer cannot reach an agreement for her property claim, and have gone back and forth for weeks without coming within $10,000 of each other. At this point, since both believe they are offering a fair settlement, a third party is needed to help facilitate the negotiation. Both parties still want to retain their ability to "walk-away" if they cannot reach an agreement. What is the next best step for Cindy and her insurer?

A. Mediation D.

Gail's restaurant is doing more business than ever, so Gail decides to add more dining space. Three weeks into the project, a hurricane blows through town, reducing the new construction to rubble. Gail maintains commercial property insurance coverage valued at 70% of her property's replacement cost, although her policy says she must maintain at least 80% to be fully insured. Which coverage on her policy could pay to rebuild her restaurant at replacement cost?

A. None

What must an insurer do if unable to affirm or deny a claim within a reasonable time frame?

A. Notify the claimant of the delay and explain why extra time is needed to come to a decision.

which of the following is NOT true of personal injury protection?

A. PIP is usually secondary coverage.

When Acme Paper Mill was struck by lightning, the resulting damage included a burst waste pipe, which began leaking chemical-laden waste water into the county aquifer. Acme Paper Mill discovered the leak 2 weeks later and reported it to their insurer immediately. Which additional coverage could help Acme with the expense of cleaning up the contaminated water?

A. Pollutant Cleanup and Removal Insurance

Which of the following would be most likely to purchase an Errors and Omissions policy?

A. Real Estate Agent

Which endorsement to the Commercial Crime policy would protect a bank against its legal liability for burglary, robbery, destruction, or damage to customers' belongings kept in safe deposit at the bank?

A. Safe Depository C.

Which of the following is an example of a hazard?

A. Sandra's home is in an area of Los Angeles that is often hit by earthquakes.

Veronica owns a pottery business and is insured under a commercial property policy. She was in the process of building an extra structure for the sole purpose of kiln firing her pottery when a massive storm came through and blew down all the scaffolding, which added additional cost to the construction project. Which coverage extension of the Builder's Risk Coverage Form would cover the scaffolding?

A. Scaffolding, Construction Forms, and Temporary Structures B.

Which financial institution bond is designed for all types of insurance companies?

A. Standard Form 25

Frank purchases an automobile policy from publicly-traded XYZ Insurance. He pays regular monthly premiums, and also purchases stock in XYZ and receives dividends when the company turns a profit. From which type of company has Frank purchased insurance?

A. Stock insurer

Which of the following statements best describes a part of the appraisal process?

A. The claimant and the insurer each select an appraiser, and those two select an umpire. B.

ABC Masonry, Inc. has an aggregate liability policy with limits of 100,000/300,000. One day, an accident at a construction site leads to $150,000 in damage to public property. Assuming the cause of loss is covered under ABC Masonry's liability policy, how will this claim be paid?

A. The insurer pays $100,000; the aggregate limit is now $200,000; and ABC Masonry must pay $50,000.

After a rain storm, Nancy realizes that she left her bedroom windows open the entire time. Now there is extensive water damage to her area rug and furniture, and the laptop that had been sitting on her desk is ruined. Nancy has a Broad Form homeowners policy, so she calls her insurance company and files a claim. What is the likely result of Nancy's claim?

A. The insurer will not cover any of the damage, since Nancy left the windows open. - maybe B. The insurer will pay for the furniture and the laptop, but not the area rug. C. The insurer will only cover the area rug. Your Answer D. The insurer will cover the all the damaged property.

Which of the following statements is TRUE of a claim dispute litigated in a state that follows the doctrine of Contributory Negligence?

A. The settlement amount will be reduced by the percentage of the defendant's negligence. B. If the plaintiff if found to be at all negligent, she will receive no settlement. D. The settlement amount will be reduced by the percentage of the plaintiff's negligence.

Greg, an agent for ABC Insurance Brokers, is trying to sell a new policy to Sally. Sally, however, is perfectly happy with her current policy and has no intention of cancelling it. Greg tells Sally that upcoming legislation is set to increase the minimum requirements for insurance, and that her current policy will not be available once the bill passes. He fails to tell her that if her policy is already in effect, this legislation won't affect her insurance. Which unlawful or unfair practice is Greg guilty of?

A. Twisting

Generally speaking, which of the following has the broadest coverage?

A. Umbrella coverage

Lance runs a staffing service in which his main job is transporting workers to and from various jobsites. His van can carry up to 12 people at a time, and he is worried about getting hit by a driver who does not have enough liability insurance to cover all of his passengers. Which additional coverage could help pay for injuries to his passengers if this were to happen?

A. Uninsured/Underinsured Motorist Coverage

Which of the following statements about Alabama's approach to Workers' Comp insurance is true?

A. WC is compulsory, and Alabama has no state WC fund. B.

Insurers often protect themselves from providing insurance to people who are already ill by inserting which type of clause into a health insurance contract?

A. Waiting period B.

When would a default judgment occur?

A. When a defendant does not answer a complaint

During a storm, lightning strikes a tree in Harry's yard and starts a fire that spreads to his shed where he keeps all his equipment for his landscaping business. In addition to the shed, Harry has to purchase all new equipment to stay in business. The cost to replace the equipment would be considered:

A. a direct loss.

An insurance company might consider any of the following a risk, EXCEPT:

A. a high crime neighborhood. B.

what is a reserve, in insurance terms?

A. a pool of collected premiums that the insurer sets aside to pay claims

three weeks after susan bought a DP-3 from acme insurance, the insurer decides to attract more customers by broadening the coverage offered by their DP-3, at no additional cost. which of the following is TRUE?

A. acme insurance must automatically apply the broader coverage to susan's policy.

driving home after a 14-hour shift, sam falls asleep at the wheel and plows into sandra's home, causing extensive damage to the east wall and roof. as a result, sandra and her family must move into a hotel until the repairs are completed. the cost of staying in a hotel is:

A. an indirect loss.

an item's replacement cost divided by the number of years of its expected or useful life is its:

A. annual depreciation

which of the following BEST describes a "kickback"?

A. any compensation given as a reward for a favorable treatment in an insurance transaction or interaction.

coverage c- personal property can apply to losses that occur:

A. anywhere in the world.

an injured employee's PPI rating (or impairment rating) is NOT:

A. awarded before the employee reaches his maximum medical improvement.

When Sally applies for an auto policy, her agent issues her a ________ so that she can benefit from insurance protection while he underwrites the policy.

A. binder B.

"permanently installed fixtures" would fall under which coverage of a commercial property policy?

A. building and structures

tom is looking for a job in the insurance industry. he wants to work for only one insurance company, selling policies on commission basis. which type of insurance agent position best fits what tom is looking for?

A. captive agent

in what part of a commercial property policy would you look to see if flood damage to your factory is covered?

A. causes of loss forms

which of the following is NOT a benefit of a co-insurance clause?

A. co-insurance reduces the risk of damage to a home

if insured cargo can be salvaged from a damaged vessel, but the cargo is damaged beyond repair and the repair costs would exceed the cost to replace , an insurer would consider the cargo a/an:

A. constructive total loss.

in a dwelling policy, coverage for a stand-alone lamp post in the front yard would fall under:

A. coverage B

the severability of interests condition states that:

A. coverage applies to each insured separately, as if no other insured existed.

which of the following statements about scheduled farm personal property coverage is true?

A. each item has a separate cause of loss form.

if a building and personal property form has a cause of loss - basic form attached, which damages are NOT covered by this commercial property policy?

A. earthquake damage

abc markets is concerned about declining revenues. through business seems to have increased, abc can't quite figure out the source of the poor sales performance.....

A. employee theft - all employees

susan owns a convenience store and wants to protect her business from employees dishonesty or theft....

A. employee theft: all employees

tina owns peachtree savings and loan, which has many different jobs with varying levels of security and risk. for the tellers and customer service....

A. employee theft:schedules positions

this agent works for only one insurer and us paid commission.

A. exclusive agent

farm insurance policies can include all of the following except:

A. farm insurance for raising show animals.

in a typical commercial property policy, an insured building is considered "vacant" when:

A. for 60 days, the building is either closed or has less than 31% of its available square footage occupied.

Julie is a hand model. A month ago, she got into a car accident. As a result of her accident, she suffered a small, permanent scar across her hand, causing her to be unable to perform her job. Julie's damages for the loss of future employment opportunities would be classified as:

A. general damages

mental anguish would be an example of:

A. general damages

each insurance coverage in a commercial property policy will contain a cause of loss form. which of the following is NOT an example of a cause of loss form?

A. general form

A kickback involves:

A. giving someone compensation in order to gain favorable treatment in an insurance transaction.

loggers, roofers, and coal miners fall into which of the following categories?

A. high-risk employees

which of the following would not be covered under employers' liability insurance?

A. injuries caused by an employer's physical abuse of an employee

according to the workers' compensation policy conditions, the insurer has the right to:

A. inspect the workplace at any time.

guaranty associations are funded by:

A. insurers

in florida, uninsured/underinsured motorist coverage:

A. is required in every auto policy, unless the insured declines it in writing.

a homeowner's policy is called a "package" policy because:

A. it bundles property and liability insurance into one policy.

a company that wishes to obtain workers compensation insurance through FWCJUA must prove that:

A. it has been denied coverage by at least two insurers in the voluntary market.

joe's homeowners policy has a single limit of $150,000 for bodily injury liability coverage. one day, joe's friend was injured in an accident on joe's property, and the medical bills came to $15,000, which were covered by joe's homeowner's policy. which of the following is TRUE?

A. joe's policy still has $1540,000 available for bodily injury liability coverage.

randy runs a business where he takes on the possessions of others and transports then from one location to another for a fee.....

A. motor carrier

In Florida, once an insurer has received all pertinent information about a claim, it must accept or deny the claim within 90 days. If the insurer needs more time to come to a decision, it must:

A. notify the claimant as to why it needs more time.

Insurance policies are unilateral contracts. This means:

A. only one party has an obligation to perform.

when stephen bundles his personal auto liability coverage with another auto insurance coverage, what can his policy be called?

A. personal auto policy (PAP)

Lee was watching out his kitchen window and saw his neighbor, Sam, reach across the fence with a pole saw and cut down one of Lee's trees. When the tree fell, it landed on Lee's gazebo and damaged it. Lee is furious and sues Sam for the damages. When they go to court, LEE is considered the:

A. plaintiff

dennis was injured when ruby rear-ended his car while he was stopped at a red light. which of the following would NOT be a duty that ruby's liability insurer may require of dennis?

A. promptly report the occurrence to his insurer

according to the "definitions" section of a personal auto policy, which of the following is NOT "occupying" her vehicle?

A. rachel leaves her cat in her car, with the windows cracked, while she goes into the drugstore to fill a prescription.

in a commercial property policy, the monthly limit of indemnity coverage option for business income insurance:

A. requires an insured to parcel the stated policy limit into a fractional maximum amount of coverage available per month during the period of restoration.

Six Stars Development Company has just been offered a great deal on ten large properties in Las Vegas. The economy in Las Vegas has been declining recently, but the CEO of Six Stars expects it to recover soon. This could be an exceptional opportunity for Six Stars, but it's also pretty risky. Ultimately, the Six Stars executive team decides not to purchase the properties. This is an example of:

A. risk avoidance.

which of the following statements is TRUE about coverage under a DP-2 or DP-3?

A. rowboats and canoes are covered, but only while on the premises.

jim has a liability insurance policy with three limits: one for the maximum amount of bodily injury per person, one for the maximum amount of bodily injury for all persons, and one for the maximum amount of property damage. each of these limits apply to any one occurrence. what type of limits does jim's policy have?

A. split limits

A _____________ is a law set forth by a governing body such as a state or city.

A. statutory law

in which state(s) is workers' compensation insurance elective?

A. texas only

in which of the following situations is an insurer justified in waiting more than 90 days after receiving proof of loss forms to pay a claim?

A. the claimant has been unwilling to cooperate in the settlement process.

which of the following is NOT a rating factor for a personal auto liability policy?

A. the condition of the vehicle

PIP coverage will pay for injuries to all of the following persons, except:

A. the driver you struck.

sovereign immunity restricts an individual's ability to file a lawsuit against:

A. the government

how can insurance companies afford to pay for an individual's catastrophic loss?

A. the insurer collects premium from all policyholders and pools them to pay the claims of the few.

a terrible storm blew through wyatt's farm last night , causing extensive damage. which of the following would NOT be covered under wyatt's farm policy?

A. the pier on wyatts 10-acre pond

If a claimant has a history of similar claims, that could mean:

A. the policy should be amended. B. it is important to investigate for fraud. C. the policy coverage should be increased. Your Answer D. it will be necessary to take a safety class.

greg plays trombone in his school band during football games. during a rally song in the stands one day, greg annoys one of the opposing team's fans, who grabs his $400 trombone and hurls it down the bleachers, completely destroying it. greg's insurance pays him $400 to replace the trombone, but then the opposing team's coach also offers to replace the instruments, at whatever the cost. so greg orders a new $3,200 trombone and has the opposing team's athletic department absorb the cost. which principle has greg violated?

A. the principle of indemnity

Steve has just purchased a wedding ring for his new bride. If something were to happen to the ring, he'd be out a lot of money, so he purchases an insurance policy. He is able to do this because:

A. the ring is a pure risk.

in the DP-2 and DP-3, what is the time-based limit for coverage d- fair rental value?

A. the shortest time required to make repairs or replacements needed to return the property to rentable condition.

When Emma is found guilty of arson for burning down her $175,000 home, her insurance policy is voided and she receives no indemnification for the loss. Emma still had $155,000 left on her mortgage at the time of the fire. Under the mortgagee clause, Emma's mortgage lender can recoup:

A. the total amount left on the loan - $155,000.

losses caused by __________ are always exluded in garage-keepers policies.

A. theft by employees

theft is covered peril under a homeowner's policy, but not all theft losses are covered. which of the following theft losses IS covered?

A. theft of the insured's property while the insured is on vacation.

if an applicant for the customer representative license already has six months of full-time experience at an insurance company:

A. they can skip the pre-licensing course and just pass the exam

Jim is out turkey hunting on a private ranch when he hears some movement in the brush. Assuming it's a turkey, Jim raises his shotgun and fires. Unfortunately for Jim, he has not taken a turkey, but instead severely injured one of the landowner's calves. The landowner decides to sue Jim for the cost of the calf. In the civil lawsuit that follows, JIM

A. tortfeasor

Mark has an ocean marine insurance policy with cargo coverage. The type and value of his cargo varies from one shipment to the next, so rather than having a set value for this coverage, the amount of his settlement is only determined after a covered loss. Mark's cargo coverage is written on a/an ________ basis.

A. unvalued

an insurer may not:

A. wait 60 days before paying an undisputed PIP claim.

removal of debris coverage would pay for the cleanup of which of the following occurrence?

A. windstorm blows shingles from the policyholder's roof all over the policyholder's front yard

which of the following is considered an unfair claims settlement practice in florida?

A. withholding payment on a legitimate claim, or delaying payment beyond 90 days.

after an insurance claim has been filed in florida, how soon must the insurer respond to the claim?

A. within 14 days

which of the following is NOT a reason to buy more insurance than the minimum amount required by florida?

A. your premium will be lower when you purchase more coverage.

Which of the following best describes how losses are valued under a Commercial Crime policy?

A.Money is valued at face value; securities are set at their value on the day the loss is discovered; and other property is valued at the lesser of the cost to repair or replace.

A fire burns down Jenny's Hardware, leaving virtually nothing salvageable. Which of the following items would NOT be covered under Coverage A of the Building and Personal Property Coverage Form in her commercial property policy?

A.The lumber storage shed, listed on the dec page

which of the following would definitely NOT qualify for a homeowners policy?

A.a six-unit apartment building

paul lives in an area where property values are appreciating rapidly. he would like his homeowner's policy to reflect the increase in the value of his home. which endorsement might paul purchase to accomplish this?

A.inflation guard

John owes a lot more on his car than it is worth. He figures he would be better off if he burned the car and collected an insurance settlement. He has someone set fire to his garage to destroy the car. John's behavior would be considered a:

A.moral hazard. C.

which of the following is NOT a duty of a captive agent?

A.negotiating settlements

nina is deep in debt and files bankruptcy after crashing her car into ben's luxury sedan and can't afford to pay the portion of damage that exceeds her policy limit. which of the following statements is true?

A.nina's insurer will still pay the claim, up to the limit of her liability coverage.

according to the inspection and surverys provision:

A.the insured must allow the insurer to inspect the insured premises at any time.

Good faith

Acting honestly and fairly, with good intentions and full disclosure.

inducments

Actions, items, or promises made to someone in order to motivate them to act in a certain way. Examples of inducements include kickbacks, gifts and bribes.

Adam is shopping for a car in a local automobile dealership. While visiting the showroom, he trips over a rug that has folded over and breaks his arm in the fall. Which of the following is true?

Adam may file a third party claim with the dealership's insurance company.

Ethical

Adhering to moral laws and to principles of fairness.

Which insurance professional is responsible for investigating and negotiating claims?

Adjuster

Adjuster - Emergency

Adjusters who are temporarily licensed by the insurance commissioner to handle claims during catastrophes or emergencies that produce an overwhelming number of claims in a short period of time.

Which settlement option is most often used when a claimant misses work because of bodily injury, but a settlement has not yet been reached?

Advance payment settlement

the three slants

Aggregate 1. Max per occurrence 2. Max per term

Eric works in Texas for Gemutlich Insurance. His company is licensed to sell insurance in Texas, but is based out of Munich, Germany. Gemutlich Insurance was formed under German law, but follows all applicable Texas laws and possesses a Texas certificate of authority. Which type of insurer does Eric work for?

Alien Insurer

All of the following are types of Cargo Coverage in Ocean Marine insurance, EXCEPT:

All Risk Form.

insurable acreage

All of the acreage of the insured crop, for which a premium rate is provided in the actuarial documents, in which the insured has a financial interest, and which is planted in the county listed on the application

Allen is adjusting an auto claim on behalf of ABC Insurance, which has given Allen $5,000 in draft authority. The total damages in the auto claim come to $7,200. Which of the following is true?

Allen can adjust the claim, but ABC Insurance must write the settlement check.

Artificially Generated Current

Also called "artificial current." A peril covered in some property insurance policies. It includes sudden and accidental damage from any electrical current, except currents that are naturally generated, such as lightning or static electricity.

Revenue Protection (CropInsurance)

Also called Yield Protection, this is the most comprehensive form of Crop Revenue Insurance,offering higher coverage amounts than other types. The revenue guarantee is based on thehigher of: harvest-market price or early market price. Previously called Crop Revenue Coverage(CRC)

Which of the following is NOT eligible for Dwelling coverage?

An 8-unit apartment building in which the owner resides

transportations form

An Inland Marine form designed to cover businesses that ship or receive merchandise, as well as cargo while in transit. This can include travel by truck, train, ship, mail, or plane.

Litigation

An action brought in court. Litigation takes place when an insurer and a policyholder disagreeabout a settlement amount and cannot resolve their differences through any sort of negotiation.

disclosure

An adjuster must disclose all financial interests in any direct or indirect aspect of an adjusting transaction. For example, an adjuster cannot refer a claimant to his brother's auto repair business without first telling the claimant that the business is owned by a relative

Diligence and dispatch

An adjuster should act with speed and care in completing the adjusting process. Failure to settle a claim in a timely manner can result in disciplinary action by the insurance commissioner, including a fine or loss of license.

Adjuster - Public

An adjuster who is hired to represent the claimant and help determine a fair indemnification.Usually specializes in appraisals and negotiation. Paid commission, usually a percentage of final settlement.

Adjuster

An agent who, for compensation, processes insurance claims. Can represent either the insured or the insurer.

Contract

An agreement entered into voluntarily by two parties or more with the intention of creating a legal obligation.

non-waiver agreement

An agreement that the insurer asks the claimant to sign which states that the insurer's investigation of the loss can't be used later on as proof that the loss is covered under the policy.

Which one of the following would be covered under the filed inland marine Valuable Papers and Records Coverage Form?

An architect's blueprints and plans

capitation

An arrangement in which an insurer pays a certain healthcare provider up front, and in return, the healthcare provider agrees to treat all of that insurer's members.

Indirect Loss

An economic loss that results from the direct, or physical, loss.

Loss - Indirect A

An economic loss that results from the direct, or physical, loss.

electronic data processing (EDP)

An endorsement that covers the loss of computer equipment, data systems, information storage media, and expenses or lost income related to EDP losses.

electronic data processing

An endorsement that covers the loss of computer equipment, data systems, information storage media, and expenses or lost income related to EDP losses

Trigger

An event that "triggers" the coverage provided under a CGL policy: in claims-made, it is a claim, in occurrence form, it is the "occurrence."

Waiver - Express

An explicit relinquishment of a right.

Which of these businesses would be LEAST likely to need a bailee's customer floater?

An ice cream shop

Waiver - Implied

An implicit relinquishment of a right through behavior that seems to assume that the right doesnot exist.

Bailee

An individual or company that receives the property of someone else for a special purpose, and returns the product after use.

"In which of the following scenarios is the insurance company NOT engaging in an unfair settlement practice?

An insurance agent fails to verbally review each provision of the insurance policy in the presence of the insured before accepting the first premium payment.

Homeowner's Policy

An insurance policy that combines property coverage with liability coverage for a person'shome.

Government Insurance

An insurance program where risks are transferred to a government agency. Also known as social insurance. Government insurance usually exists in situations where the exposure to loss is too high for private insurers to reliably insure risks.

Limit - Split

An insurance provision that specifies different coverage limits for different parts of a claim. The most common example is split limits in a personal auto policy, which includes 3 different limits of liability: (1) maximum limit for bodily injury for any one individual, (2) maximum limit for bodily injury to multiple people in any one accident or occurrence, and (3) maximum limit for property damage in any one accident or occurrence.

severability of interests

An insurance provision that states that coverage applies to each insured separately, as if no other insured existed. Each individual insured is protected as a separate entity, even against other insureds (if one insured were to file a claim against another insured), but the limits of the policy still apply to all insureds collectively. Also known as "Separation of Insureds."

Risk Reduction

An insurer practices risk reduction when it takes precautions in order to reduce its exposure; forexample, requiring that all homes insured by a homeowners policy have fire alarms installed.

Risk Retention

An insurer practices risk retention when it chooses to insure a risk instead of denying coverage.

A fiduciary agent must regularly report to the principal. Which of the following is the BEST example of a principal in the context of insurance?

An insurer that employs an insurance adjuster to investigate damage claims.

Annual Depreciation

An item's Replacement cost divided by the number of years in its expected lifespan.

Liability

An obligation to do or not to do something; responsibility for an action.

Catastrophe

An occurrence or a sequence of occurrences that causes enormous property losses; normally uninsurable by private insurers.

Crime

An offense against the State or Federal Government, or a breach of law, for which the offender shall make satisfaction to the public.

Judgement

An official court ruling forming a final decision resolving a dispute or forming a final decree.

Certificate of Insurance

An official document that contains the details of an insurance policy. It typically lists the insurance company, the named insured, what is covered, and the dates of the policy period, among other things. Policyholders may be required to present their certificate as proof that insurance coverage is in effect.

Warranty

An ongoing assurance made by the insured that certain conditions in an insurance contract willbe met (for example, that the insured will maintain functional fire alarms).

An adjuster has a duty to provide which of the following to the claimant?

An open line of communication

open peril

An open perils policy covers all causes of loss except for those explicitly excluded. Also known as "All Peril.

Endorsement(s)

An optional provision that can be added to a policy to increase, reduce, or modify coverage forspecific property types or perils.

Flood

An overflow of inland or tidal waters; an unusual or rapid accumulation of runoff or surfacewaters from any source; mud flows; collapse or subsidence of land along the shore of a lake orother body of water.

trip transit

An uncontrolled Inland Marine coverage form which insures a single shipment. Coverage applies from the trip origination point to its destination.

Equipment floater

An uncontrolled form that covers heavy machinery and equipment needed to conduct business. Protection on this form includes loss by fire, landslide, theft, and other perils to equipment that is being stored, on its way to the job site, or at the job site itself. Coverage is available on an open peril or named peril basis for all equipment, whether rented, owned, or borrowed

equipment floater

An uncontrolled form that covers heavy machinery and equipment needed to conduct business. Protection on this form includes loss by fire, landslide, theft, and other perils to equipment that is being stored, on its way to the job site, or at the job site itself. Coverage is available on an open peril or named peril basis for all equipment, whether rented, owned, or borrowed.

Motor Truck Cargo

An uncontrolled inland marine coverage form that protects the carrier of shipped goods while the shipment is in transit

Occurence

An unexpected event or circumstance that causes injury or damage.

Umbrella Liability Policy

An unmbrella policy provides liability coverage over and above the normal or base limits ofliability in a policy. An umbrella policy is a type of Excess Liability.

tort

Any civil wrongdoing, whether intentional or unintentional

Tort

Any civil wrongdoing, whether intentional or unintentional, resulting in a court action to remedy.

Misrepresentation

Any false or misleading statement.

hazzard--legal

Any legal action that increases the chance of a loss.

Hazard Physical

Any physical condition that increases the chance of a loss.

Kickbacks

Any sort of reward or remuneration for referrals or favors; for example, a body shop givingmoney to an adjuster for referring customers.

Hazard

Anything that increases the chance of loss.

Declaratory Judgement action

As an alternative dispute resolution before litigation, the court can clarify the legal relationship and the rights of both parties: the claimant and the principal. Does NOT decide how to resolve the case.

uncontrolled line floaters

As opposed to controlled line floaters, which are standard forms, uncontrolled line floaters are nonstandard forms tailored to meet the needs of the insured. They are not filed with state departments of insurance. They cover movable property and are typically used in Inland Marine insurance

Bob has been in the construction business a long time and is ready to retire. He sells the company to his friend Scott and then lets the insurer know that any claims against his policy should be paid to Scott from now on. The insurer informs Bob that they cannot do this due to which condition?

Assignment

Agency Authority - apparent

Authority that an agent possesses based on the appearance of representing an insurer.

Aency Authority - implied

Authority that an agent possesses by implication of his behavior, regardless of whether this authority is expressly granted in writing.

Agency Authority - express

Authority that is expressly given to the agent in writing. Allows agent to act on behalf of the principal.

Aviation

Aviation insurance combines hull insurance for the aircraft and liability insurance for any damage to others' property or to people who are not passengers.

lightning destroys a $5,000 satellite dish that farmer carla recently installed. assuming carla meets the 80% coinsurance requirement, how much would farm policy pay for the damages to the satellite dish?

B. $1,000 - the policy covers only satellites and antennas at $1,000 per occurrence

how much property damage liability coverage must you carry in order to register to register or drive a car in florida?

B. $10,000

what is the minimum amount of PIP coverage required by the state of florida?

B. $10,000

Both Steve and his wife, Arlene, carry DP-2 policies on their $135,000 home. Steve's policy has a limit of $108,000 and Arlene's has a $27,000 limit, and both policies pay on a pro rata basis. After a hailstorm causes $13,000 in damage to their roof, how much of the damage will be covered by Steve's policy (ignoring any deductible)?

B. $10,400

Eloise borrows Uriah's car so she can run to the grocery store to pick up a few things. While out, she rear-ends a minivan, injuring the driver and 3 other passengers. Each of the passengers suffers $45,000 in injuries, and the driver suffers $40,000. Uriah has a liability policy with limits of 50/100/50, while Eloise carries the minimum liability coverage for Alabama. How much will the primary policy pay for this occurrence?

B. $100,000

how much would her policy pay lost income if wilma had a monthly limit of 1/4 in place?

B. $113,000

Lightning strikes one of Christy's trees in her backyard and starts a fire that spreads to two other trees before firefighters are able to put it out. The fire department charges her $600 for responding to her call. Christy's DP-2 policy has a Coverage A limit of $95,000. What is the maximum amount of indemnification that Christy can expect to receive for this loss (ignoring any deductible)?

B. $2,000

Diana is insured under a DP-2 policy with the following coverage limits: Coverage A - $150,000, Coverage B - $15,000, and Coverage C - $25,000. She and her fiancé have planned a destination wedding, but their hotel catches fire shortly after their arrival. Smoke from the fire damages all of their belongings, including Diana's $4,000 wedding dress. Diana's loss totals $5,200. When she files a claim with her insurance company, how much can she expect to receive for this loss under her DP-2 (ignoring any deductible)?

B. $2,500

In a farm policy, what is the limit of coverage for the theft of furs, jewelry, precious stones, and wristwatches?

B. $2,500

Kelly took her eyes off the road and ended up smashing into the back of a passenger van. All five passengers were injured, and each one ended up with $25,000 in medical costs. Assuming Kelly has liability coverage with limits of 50/100/50, how much will she have to pay out of pocket?

B. $25,000

Jerome was shopping at ABC Imports when a light fixture fell from the ceiling and hit him on the head. Jerome's injuries resulted in an extended hospital stay, so he sued ABC Imports and was awarded $400,000. Assuming ABC Imports carries a CGL with a General Aggregate of $750,000 and a per occurrence limit of $250,000, what is the maximum that ABC's insurer will pay for Jerome's injuries?

B. $250,000

Norris borrows Arnold's truck to pick up some lumber from the hardware store. On the way to the store, Norris collides with a car, injuring the three people inside. The driver suffers $15,000 in injuries, one passenger suffers $25,000, and the other passenger suffers $20,000. Norris has a PAP with liability limits of 50/100/50, and Arnold's policy has liability limits of 25/50/10. Everyone involved in the accident has minimum PIP coverage for Florida. How much will the primary policy pay for the injuries?

B. $30,000

While Andrea was grocery shopping in BB Mart, the large Dairy sign fell off the wall and landed on her. Because of her extensive injuries, Andrea sued BB Mart and was awarded $375,000 in damages. BB Mart's Commercial General Liability policy has a general aggregate limit of $1,000,000 and a per occurrence limit of $300,000. What is the per occurrence limit after this claim is settled?

B. $300,000

jerry is using an expensive video recorder near the family pool when he slips and falls in, destroying the camera. jerry bought the camera three years ago for $4,000, and it depreciates at $500 per year. a new, similar camera costs $5,000 today. assuming the loss is covered, if jerry had a replacement cost policy, how much would jerry's insurer indemnify jerry for the destroyed camera?

B. $5,000

Norris borrows Arnold's truck to pick up some lumber from the hardware store. On the way to the store, Norris collides with a car, injuring the three people inside. The driver suffers $15,000 in injuries, one passenger suffers $25,000, and the other passenger suffers $20,000. Norris has a PAP with liability limits of 50/100/50, and Arnold's policy has liability limits of 25/50/10. How much will the primary policy pay for the injuries?

B. $50,000

What is the standard deductible on an Equipment Breakdown Protection Coverage Form?

B. $500

how much would her policy pay for lost income?

B. $60,000

john has purchased a homeowners insurance policy with a percentage deductible based on the total limit of insurance for his home. john insurers his home for $60,000, and the policy includes a 3% deductible. a huge thunderstorm passes through one night and blows the roof off his house. the insurance company estimates that covered damage totals $80,000. how much indemnification should john expect for the losses to his roof?

B. $62,000

customer representatives are required to have ____ of continuing education on premium discounts every _____.

B. 1 hour; 2 years

The insured carries a BOP policy with protective systems such as a sprinkler system. If the system becomes inoperative, the insured must advise the insurance company of the problem within _______ if the system cannot be restored to working order.

B. 48 hours

The AIUA offers coverage for residential homes up to a maximum of __________ for combined dwelling and contents.

B. 500,000 .

An employee receiving income benefits under Workers Compensation insurance cannot receive more than:

B. 66 2/3% of the State Average Weekly Wage.

Dr. Smith has a claims-made malpractice insurance policy with a policy period from June 30, 2006 to June 30, 2007. Which claim would trigger this policy?

B. A claim filed on January 13, 2007 for surgery performed on June 28, 2005.

On January 27, 2008, Ryan was using an exercise bike purchased from NusquamCycle when the chain broke, causing him to fall and severely bruise his knee. It seemed to heal just fine, but three years later, on January 25, 2011, Ryan's knee gave out while jogging. His doctor told him that he'll need surgery and that this deterioration most likely resulted from the earlier accident with the exercise bike. Which of the following CGL policies would cover Ryan's claim filed January 25, 2011?

B. A claims-made policy from Jan 31 2010 -Jan 31 2011 with a retroactive date of Jan 1 2008

Which of the following does NOT apply to commercial property insurance?

B. Because of their complexity, commercial policies only offer named-peril coverage.

In a DP-2 Broad Form, which of the following would be covered under the peril of Theft?

B. Broken windows caused by a burglar breaking in.

Which of the following is NOT true about Citizens Insurance?

B. Citizens does not insure any type of commercial property.

Robert applies for an auto loan from his local bank. He meets with a loan officer, who goes over Robert's paperwork. The loan officer tells Robert: "I'll give you a loan as long as you insure the car with ABC Insurance." This is an example of:

B. Coercion

Dr. Adams is in the middle of a malpractice lawsuit. Her insurer decides it will be more cost effective to simply settle the suit rather than draw the process out over several months. Assuming Dr. Adams holds a Professional Liability Policy, which of the following statements is TRUE in regards to settling the claim?

B. Dr. Adams' insurer must seek her consent before settling the claim.

Which statement BEST describes Umbrella coverage?

B. Excess liability insurance that can also provide additional coverages not provided by the base policy

Jane owns an aquarium supplies store and purchases a Business Owners Policy to protect her assets. Which of the following protections can Jane expect from her standard BOP with no endorsements?

B. Extra expense coverage

RWW Insurance creates a radio promotion where they advertise that they will insure any car for $200 a year. They don't actually offer such a plan, but they figure they will be able to sell hundreds of policies to people who show up looking for the bargain. What type of unfair insurance trade practice does this behavior exemplify?

B. False information and advertising

Hank has collision coverage with a $2,000 deductible on his 2010 truck. One dark, rainy night, Hank's truck slips off the road and rolls over down the embankment. The truck sustains $45,000 in damages, but the actual cash value of the vehicle is only $25,000. Which of the following statements is TRUE?

B. Hank will be indemnified by his insurer for $23,000.

One morning, Jill arrives to open the bank, only to find the door already unlocked. Upon entering the bank, she sees the vault door has been blown open and a large amount of money has been burned when an explosive charge went off. Which commercial crime insurance coverage might cover the loss?

B. Inside the Premises: Theft of Money and Securities

All of the following are covered under Coverage A of a Business Owners Policy, except:

B. Leased business personal property that must be insured

After Tony, the owner of XYZ Cleaners, accidentally starts a fire, XYZ Cleaners burns to the ground, taking all the garments with it. Afterwards, Tony has to rent a new building and purchase new equipment and supplies. He is also responsible for all the clothing that was in his care. Which type of coverage in his commercial property policy could help Tony with the cost of paying for his customers' destroyed clothing?

B. Legal Liability Coverage

Mark is on vacation in Italy when his luggage is stolen, including a $2,000 laptop, a $500 suitcase, and $400 in clothes. Mark has an HO-3 homeowners policy. Excluding any applicable deductible, which of the following statements is TRUE?

B. Mark's homeowners policy will cover $2,400 of this loss.

Which of the following is NOT a division within the Department of Financial Services?

B. Parks and Recreation

Which of the following would be considered an Instrumentality of Transportation and Communication?

B. Pipeline

Rachel is filling out an application for a homeowners policy. She is truthfully answering the questions regarding her home's location, size, age, etc. Which of the following is a true statement?

B. Rachel is providing representations.

Which of the following are eligible for a Fortified Home Hurricane designation?

B. Single family homes with permanent foundations

While driving, Ben was struck by another driver, Roxanne. Ben then filed a claim with Roxanne's insurer. In essence, what was Ben doing when he filed this claim?

B. Submitting a formal request to settle the damages with Roxanne's insurer

Which of the following events would trigger the end to a commercial property Builders Risk Coverage Form?

B. The building is accepted by the purchaser.

Jared recently purchased a 25 foot watercraft with a 250 horsepower motor. While cruising on the lake, he accidentally runs into Gary's boat, causing $2,500 in damage to Gary's hull. How will Jared's insurer respond when Gary files a claim against Jared's homeowners policy for the damage he caused?

B. The insurer will deny the claim because Jared's boat is excluded from his liability coverage.

A power surge sparks a small electrical fire in an office building. The electrical fire triggers the automatic sprinkler system. The water from the sprinklers soak the carpets and short-out all the computers, causing thousands of dollars in damage. What is the proximate cause of the loss?

B. The power surge

Greg plays trombone in his school band during football games. During a rally song in the stands one day, Greg annoys one of the opposing team's fans, who grabs his $400 trombone and hurls it down the bleachers, completely destroying it. Greg's insurance pays him $400 to replace the trombone, but then the opposing team's coach also offers to replace the instrument, at whatever the cost. So Greg orders a new $3,200 trombone and has the opposing team's athletic department absorb the cost. Which principle has Greg violated?

B. The principle of indemnity

Adam has a treacherous drive to work every day. Not only does he have to drive down the pothole-strewn access road to the highway, but he also must traverse several icy bridges on the way to work. Why does the insurance company call these hazards "physical hazards"?

B. The roads present a physical condition that increases the chance of a loss.

Which statement BEST describes the additional coverages available for both commercial and residential policies?

B. They add coverage for very specific losses or expenses.

Craig has a poor driving record. He lives in Florida, has a valid driver license, and has registered his car, but due to his history, he is unable to obtain auto insurance through the private market. According to state law, Craig must have liability insurance in order to drive on public roads. How will Craig be able to purchase coverage?

B. Through the Florida Automobile Joint Underwriting Association

Which of the following losses may be covered by Mechanical Breakdown Insurance?

B. Tina's clutch failed at 100,000 miles. C. Harry's power steering system failed at 55,000 miles.

In a dwelling policy, how much will the Fire Department Service Charge coverage pay?

B. Up to $500 if the fire department charges for responding to a covered peril

Susan is insured with a homeowners policy. After someone destroyed her late husband's gravestone with a vehicle, Susan filed a claim against her homeowners policy. Which of the following statements is TRUE?

B. With Grave Marker coverage, Susan can receive a maximum of $5,000 to pay for the damaged gravestone.

A typical workers' compensation policy combines two basic forms of coverage. They are:

B. Workers' Compensation and Employers Liability

Kate has a Personal Auto Policy through XYZ Insurance. In which of the following scenarios would XYZ Insurance NOT be allowed immediately to increase Kate's policy premium?

B. XYZ Insurance expands coverage for all policies - a change which automatically applies to Kate's policy, as well.

Sally has an HO-3 policy on her $150,000 home in the country. One day, a bear breaks down Sally's back door to get into her kitchen for a snack. When Sally comes home to find the damage, she files a claim with her insurance company. Will the damage to Sally's home be covered, and why or why not?

B. Yes. The HO-3 is an open-peril policy, without an exclusion for wildlife.

in the business and personal property policy, coverage a - buildings and structures coverage would apply to which of the following features of a commercial enterprise?

B. a 40-ton printing machine affixed to a factory floor.

which of the following properties would NOT qualify for a dwelling policy?

B. a 5-family dwelling

which if the following statements about a personal articles floater (PAF) policy is false?

B. a PAF always pay cash value for damaged property.

Edward is a member of the Knights of Columbus, a religious group dedicated to voluntary service to the benefit of society. He also recently purchased a $100,000 life insurance policy from the organization. This was possible because the Knights of Columbus is:

B. a fraternal benefit society.

james and eric want to play a prank on bob for halloween. they dress up like handless horsemen and throw ignited jack o'lanterns at his house. unfortunately, one of the inflamed pumpkins catches the porch on fire, causing $3,500 in damages. bob doesn't find this tomfoolery very entertaining and sues both james and eric for the cost of the repairs. in court, james and eric would be:

B. a joint tortfeasor

janine is in a car accident that is covered by her personal auto policy. what information does janine not have to submit to her insurer?

B. a list of the witnesses of the accident.

which of the following incidents would a liability insurance policy cover?

B. a man slips inside a grocery store and injures himself.

dr.jones' current occurrence malpractice policy is in effect from july 1, 2005 through july 1, 2006. which lawsuit would trigger this malpractice insurance policy?

B. a man sues dr. jones on july 26, 2009 for a damaging knee surgery performed on march 3, 3006.

which of the following losses would NOT be covered under the hull coverage of an ocean marine policy?

B. a ship wanders into a war zone, is fired upon, and is struck by a missile.

which of the following applicants would NOT be eligible for a homeowner's policy?

B. a small business that makes less than $70,000 per year.

which of the following would NOT be considered an instrumentally of transportation and communication?

B. a truck

under a BAP, a total loss is settled according to:

B. actual cash value

which of the following expenses would NOT be covered under a homeowners policy additional coverage called claims expenses?

B. administrative costs related to renewing the insured's policy.

Frank owns a bakery specializing in authentic French bread. He uses two specialty ovens for his daily production of French bread. If one of these giant ovens were to break down, it would cost Frank's bakery a lot of money to repair, not to mention the loss of revenue caused by lower production. On his Equipment Breakdown Protection Form, each of Frank's ovens would be considered:

B. an "object."

which of the following would NOT be covered under a personal auto policy?

B. an 18-wheeler with a driver and a passenger

A fidelity bond covers:

B. an insured business for loss resulting from any dishonest acts committed by its bonded employees.

sam was tired if the neighbor's trees along the fence line poking through the fence and dropping leaves in his yard, so he reached across the fence with his pole saw and cut down the neighbor's tree. sam's neighbor was upset and sues him for the damages. sam's actions could be classified as:

B. an international tort

A reciprocal insurer is:

B. an unincorporated organization of subscribers that operates through an attorney-in-fact to provide insurance benefits for its members.

After her business suffered damage in a fire, Jane filed a claim with Acme Insurance, which dispatched Bob to adjust it, even though he was not allowed to adjust commercial claims. He investigated Jane's losses and submitted his estimate to Acme Insurance, which issued her a settlement check based on that estimate. Bob had _______ because Acme Insurance accepted his estimate and paid Jane's claim.

B. apparent authority

kyle operates an auto body repair shop, where customers sometimes leave their cars in his care......

B. bailment

According to the state of Florida, the term "wind mitigation" most closely refers to:

B. building materials, techniques, and tools used to reduce the damage from a major hurricane.

When Louise goes online and fills out phony applications with XYZ Auto Insurance in order to print the temporary insurance cards and sell them for a profit on the black market, she is:

B. committing hard fraud.

which coverage in BAP would indemnify the insured for damage caused by a tree branch falling onto a company car?

B. comprehensive coverage

in which section of the policy might you find the following statement? "Damage to insured property must be reported within 15 days of the damaging occurrence."

B. conditions

sam is a claimant seeking damages from XYZ insurance. the XYZ adjuster comes to meet with sam to hear the circumstances of her injury. the adjuster determines that sam played an active role in her own injuries, and therefore XYZ insurance will pay her nothing at all for her injuries. what defense is the adjuster using?

B. contributory negligence.

Jane has a small business and has a Business Owners Policy. To save money, Jane has insured her business at 60% coinsurance. When a fire erupts inside of the store, destroying most of Jane's merchandise, her insurer:

B. covers the structure and contents on an ACV basis.

PPI impirment rating

B. determined by a doctor. C. paid weekly at 75% of the average weekly Temporary Total Disability benefit the employee was receiving before. D. stated as a percentage of loss of use.

florida's chief financial officer is:

B. elected by popular vote

Risk avoidance is a risk management technique that:

B. eliminates risk.

sam works on commission only, selling only insurance products from XYZ insurance. what type of agent is sam?

B. exclusive agent

Ricky was watching a baseball game at XYZ Stadium, when the railing on which he was leaning gave way and he fell two stories. As a result of his fall, Ricky broke his back and is now paralyzed from the waist down. Ricky sued the owners of XYZ Stadium and was awarded $150,000 to cover his medical bills and $2.5 million in __________ because of the permanent nature of his injury.

B. general damages

UM/UIM coverage excludes:

B. government vehicles.

Risk retention groups do NOT:

B. have the support of state Guaranty Funds.

which of the following ISO forms is most commonly used?

B. homeowners 3

William is wearing an ABC Insurance jacket and has an ABC Insurance sign over his rented office. The walk-in customer could reasonably believe that he has the authority to write an insurance contract because of his:

B. implied authority.

susan calls herself an insurance broker. she sells multiple lines of insurance from a variety of insurance companies. what type of agent i susan?

B. independent sales agent

which of the following is NOT one of the advantages of no-fault insurance?

B. it helps to eliminate insurance fraud.

which statement is FALSE about coverage for trees, shrubs, and other plants in the DP-2 and DP-3?

B. it includes the perils of windstorm and hail.

which of the following is NOT true of the company's options provision in the standard fire policy?

B. it requires the insurer to settle the claim, in whichever manner it chooses, within 30n days of receiving notice of the claim.

which of the following occurrences would be covered under other than collision coverage?

B. janes windshield is cracked when she hits a bird.

farmer jim crashes his truck while moving some cattle from one pasture to another. jim had insured the cattle under his scheduled farm personal property, but his claim, won't be covered because:

B. jim's cattle were in the process of being transported

Joe (the principal) is handling the disbursement of a deceased executive's estate, and he is required to carry a bond guaranteeing such work. The surety company requires one of its accountants to be a second signer on the disbursement checks that Joe writes. In this case, the surety has established:

B. joint control.

while working on a customer's industrial copier in the repair facility, an employee at RZJ electronics repair accidentally destroys the copier, causing $3,00 in damage. what commercial property coverage might apply?

B. legal liability coverage

lemon insurance co. decides not to renew hugh's personal auto policy, which is set to expire on may 31. which of the following statements is TRUE?

B. lemon insurance must notify hugh at least 45 days before the policy expires.

the homeowners 6 policy would likely NOT cover which of the following?

B. light fixtures on the buildings exterior

"defamation" means

B. making false or derogatory statements about other insurers or their representatives

PAP insurance coverage only applies in the "policy territory." which of the following is NOT part of the policy territory?

B. mexico city

stan has a personal auto policy to cover his two vehicles, but he recently purchased a custom built motorcycle as well. which type of endorsement will stan need to cover the motorcycle?

B. miscellaneous vehicle endorsement

which of the following best describes how losses are valued under a commercial crime policy?

B. money is valued at face value; securities are set at their value on the day the loss is discovered; and other property is valued at the lesser of the cost to repair or replace.

states that have special legislation that requires workers' compensation coverage to be provided exclusively by the states workers' comp program are:

B. monopolistic

States that have special legislation that requires workers' compensation coverage to be provided exclusively by the state's workers' comp program are:

B. monopolistic.

Lucy has insurance on an expensive necklace she likes to wear to work every day. After work, she takes it off and leaves it in her car's cupholder so she can put it back on in the morning on her way to work. Lucy's behavior would be considered a:

B. morale hazard.

Jim is out turkey hunting on a private ranch when he hears some movement in the brush. Assuming it's a turkey, Jim raises his shotgun and fires. Unfortunately for Jim, he has not taken a turkey, but has severely injured one of the landowner's calves instead. Jim is responsible for the cost of the calf because he acted with:

B. negligence

during a heavy rainstorm, ben's basement flooded and suffered extensive water damage. which section of ben's homeowners 3 policy will cover this damage?

B. none

In Alabama, once an insurer has received all pertinent information about a claim, it must accept or deny the claim within a specified period of time. If the insurer needs more time to come to a decision, it must:

B. notify the claimant as to why it needs more time.

Indemnification may include all of the following except

B. payment for pain and suffering.

Indemnification may include all of the following except:

B. payment for pain and suffering.

which of the following terms refers to the time elapsed between a covered loss to a commercial building and the return to full business operations of the same building?

B. period of restoration

In a BOP, all of the following losses are excluded from liability coverage, EXCEPT:

B. property damage to premises rented by the insured.

which of the following is NOT one of the typical duties of the insured after a loss?

B. provide a loss estimate from an appraiser

which of the following does NOT count as "bodily injury" according to a personal auto policy?

B. psychological trauma

eileen has been the victim of libel & slander. she decides to take the culprit to court and is awarded damages. which type of damages best describes those awarded to eileen?

B. punitive damages

which of the following coverage option does NOT waive the coinsurance requirement in a commercial property policy?

B. replacement cost

which of the following coverage options does NOT waive the coinsurance requirement in a commercial property policy?

B. replacement cost

The Employee Retirement Income Security Act (ERISA):

B. requires that every fiduciary of an employee benefit plan and every person who handles funds or other property of those plans must be bonded.

sam's neighbor, lee, is suing him for intentionally cutting down lee's tree and damaging his gazebo when the tree fell on it. when sam notifies his insurer of the lawsuit, the insurer issues sam _________, which gives him fair warning that he may need to prepare his own defense if the insurer finds this case is not covered.

B. reservation of rights

"take-out credits"

B. reward private insurers who take risks out of the residual market.

in an insurance policy, the abandonment clause:

B. states that the insured is prohibited from forcing the insurer to take possession of damaged property.

in florida, the claims activities of insurance companies are overseen by:

B. the division of insurance agent and agency services

Disability payments through workers' compensation insurance are primarily based on:

B. the employee's average weekly wage.

which of the following losses might qualify for coverage under coverage f 0 medical payments?

B. the insured invites Mr. and Mrs. saxon over for tea. mrs. saxon spills her hot tea and severly burns herself.

in insurance terms, which of the following statements about salvage is FALSE?

B. the insured may compel the insurer to take the damaged property to keep the salvage value from being dedcuted from the claim settlement.

which of the following is an implied warranty in ocean marine insurance policies?

B. the route of the voyage must be clearly stated prior to departure, and the vessel must not deviate from that route.

which of the following does not describe one of the implied warranties of ocean marine insurance?

B. the vessel must not travel in stormy or otherwise dangerous weather conditions.

the primary purpose behind garagekeepers insurance is:

B. to provide insurance protection against damages to customers' auto while in the care and custody for the insured party.

vicarious liability ______ negligence.

B. tranfers

no-fault insurance in a personal auto policy:

B. typically only provides coverage for bodily injury.

john and lucy both apply for policies with acme insurance at the same time. they are exposed to similar hazards and would presents essentially the same amount of risk to acme insurance. acme insurance offers lucy a premium policy at excellent rates, but restricts john to a very limited policy with high premiums. acme insurance may be guilty of:

B. unfair discrimination

when would a default judgment occur?

B. when a defendant does not answer a complaint

Lucille owns her own woodworking business, building custom items such as dressers, wooden trunks, and mantelpieces. A fire destroys her entire operation and Lucille files a claim with her insurer. Which of the following would be covered under Coverage A of the Building and Personal Property Coverage Form in her commercial property policy?

B.. A bandsaw permanently affixed to the floor D.

according to the mortgagee clause, what is NOT one of the rights of the mortgagee?

B.the mortgagee may change the coverage amount.

"Kyle operates a collision repair garage and has many vehicles in his care, some for extended periods of time. Which type of coverage protects Kyle from any liability claims which may arise if one of the cars is further damaged or destroyed while in his possession? "

Bailee Coverage

Kyle operates a collision repair garage and has many vehicles in his care, some for extended periods of time. Which type of coverage protects Kyle from any liability claims which may arise if one of the cars is further damaged or destroyed while in his possession?

Bailee Coverage

Common Law

Based on court decisions and customs when statutory law does not provide an answer; creates precedent.

Francis owns a small shoe store. Since his business isn't particularly risky, he has a commercial property policy that provides named-peril coverage to his building and personal property, without any additional coverages. Which Causes of Loss form does Francis have attached to his coverage form?

Basic Form

"Ken is getting his certification to adjust large commercial claims for the NFIP. Which of the following is NOT required of Ken in order to qualify for this certification?

Be able to accurately adjust RCBAP losses of $1,000,000 or more.

Ken is getting his certification to adjust large commercial claims for the NFIP. Which of the following is NOT required of Ken in order to qualify for this certification?

Be able to accurately adjust RCBAP losses of $1,000,000 or more.

Jordan is moving from San Francisco to Philadelphia, and he is bringing his private plane along with him. While it's being transported, the plane is damaged in a minor accident. Which of the following is true?

Because the damage took place while the plane was being transported, the deductible won't apply to this loss.

Amanda is walking her dog in a rural area when a small plane suddenly crashes only 15 feet in front of her. Amanda is not hurt, but she is so distressed that she files an insurance claim for mental anguish. Which aviation coverage would pay this claim?

Bodily Injury Excluding Passengers

Loss

Bodily injury, property damage, or damage caused by the insured's negligent acts; loss is thethe basis for an insurance claim. Loss can also mean the sum the insurer will have to pay.

utmost good faith

Both parties must act honestly and openly in order for the contract to be valid

"Which of the following is NOT excluded from coverage under a Mechanical Breakdown Insurance policy?

Breakdown covered by regular auto insurance

Which of the following may be covered under a Mechanical Breakdown Insurance policy?

Breakdown due to electrical system malfunction

Which of the following is NOT excluded from coverage under a Mechanical Breakdown Insurance policy?

Breakdown due to the cracking of an engine block

A short circuit in one of the refrigeration units in the Ice Queen ice cream shop sparked a fire that severely damaged the shop, and it had to shut down for two months while repairs were made. What type of additional coverage would indemnify the Ice Queen for the lost income during these two months?

Business Interruption Coverage

What is the most common type of Time Element Insurance?

Business Interruption Insurance

acme construction, inc has one contractor and one receptionist. the contractor makes $25/hr, and the receptionist makes $10/hr. the contractor worked exactly 8 hours in 2010, so he made $200......

C. $105

elizabeth has a personal laptop worth $1,400. one night, elizabeth is out, a thief breaks into her home and steals her laptop. how much can elizabeth expect to be indemnified by her insurer for the loss of her laptop (ignoring any deductibles)?

C. $1400

Craig has an HO-3 policy covering his primary residence with a Coverage A limit of $250,000, Coverage B limit of $25,000, and a Coverage C limit of $150,000. Craig also has a cabin on the lake, which was burglarized. The thieves stole much of the cabin's contents, for a total loss of $18,500. Ignoring any deductibles, how much will Craig's HO-3 policy pay for this claim?

C. $15,000

Sherrie's roof and fence are damaged in a violent windstorm. Sherrie has a typical HO-3 policy with a $150,000 limit for Coverage A - Dwelling. Assuming she has no endorsements, how much coverage does she have available for the damage to her fence?

C. $15,000

james owns a masonry business and has a commercial liability policy with the following limits: $150,000 per occurrence / $500,000 per policy term. while at a job site, his cement truck's chute cannot reach the pour site, so the operator adds two extra chutes, extending its length. the chute collapses under the weight of the concrete, causing $35,000 bodily injury to one of the workers. the loss is covered by the policy, and james' insurer pays the claim. what will the new limits be for the remainder if the policy term?

C. $150,000/$465,000

James is walking down the street when Andrea, an uninsured motorist, strikes him with her car. James suffers $12,000 in injuries from the accident. He has personal injury protection of $10,000 from his own automobile insurance policy, which immediately pays him the full amount. By accepting $10,000 from his own insurance company, James has waived the right to sue Andrea for more than _____ for personal injury.

C. $2,000

When a severe flood is imminent, Erica goes out and spends $1,200 on sandbags, $760 on plastic sheeting and lumber, and $1,500 on a pump. Then she hires two neighbors to help her flood-proof her house with these materials. She and her neighbors work together for 16 hours, and she pays them the federal minimum wage for their labor. After the flood passes, Erica files a claim for these expenses. Assuming the federal minimum wage at that time is $7.00 per hour, how much will her flood policy indemnify her?

C. $2,872

How much property damage liability coverage must a driver carry in Alabama?

C. $25,000

A processing and servicing company would qualify for a BOP only if they have less than _____ in annual revenues.

C. $3 million

to meet the 80% level of co-insurance required by his lender, tom discovers he must insure his home for at least $320,000. what is the value of tom's home?

C. $400,000

How much of a limit is included for Credit Card Fraud or Forgery, an additional coverage in a homeowners policy?

C. $500

how much money might acme boats be indemnified for the loss of business income?

C. $70,000

sue decides to get a valued insurance policy to her antique car. she and her insurance company agree to a value of $85,000. three years later, the car is destroyed when a tree falls on it in a parking lot. the car depreciates at $2,000 a year, and its replacement costs is $100,000. ignoring any deductible, how much can sue expect her insurer to indemnify her?

C. $85,000

What requirements must Wholesalers and Distributors meet in order to be eligible for a BOP?

C. 25% or less of floor space is available to the general public, and less than 25% of gross income may come from retail sales.

According to the commercial property policy, a commercial building is considered vacant if less than ____ of the available square footage is occupied for ____ consecutive days.

C. 31%, 60

an individual has ___________________ to file a lawsuit for false arrest in florida.

C. 4 years

a disability income insurance policy usually covers ______ of a disabled person's income.

C. 45% to 65%

in a standard farm policy, the limit for coverage c- household personal property coverage is:

C. 50% of the coverage A limit.

Which of the following people would be ineligible for coverage under the Florida Automobile Joint Underwriting Association?

C. A college student from Alabama with two DUIs on his record who is staying with his grandmother in Florida for 2 months over the summer.

Martin works as an accountant for Smith Manufacturing. Smith Manufacturing has tasked Martin with finding an insurance provider to meet the company's needs, so Martin interviews several insurers. At the end of one interview with PRO Insurance, the insurance representative hands Martin an envelope containing $5,000 in cash, on the condition that Smith Manufacturing selects PRO Insurance as its insurance provider. What would we call the $5,000 in cash?

C. A kickback

Which of the following is NOT considered a covered theft in a Commercial Crime policy?

C. A periodic assessment of inventory reveals that 4% of a store's inventory is inexplicably missing.

Which of the following is most likely a third party claim?

C. A woman files an insurance claim when she is injured by an employee at a local bar.

Peter works as a real estate agent and uses the internet extensively for sales leads and advertising. One day, he finds another realtor's ad online and copies it, using his own information as the contact info. This generates a lot of business for Peter, but unfortunately Peter gets a call one day and is informed that he is being sued for copyright infringement. This is an example of what type of claim covered under Peter's Commercial General Liability policy?

C. Advertising Injury

Eric works in Florida for Gemutlich Insurance. His company is licensed to sell insurance in Florida, but is based out of Munich, Germany. Gemutlich Insurance was formed under German law, but follows all applicable Florida laws and possesses a Florida Certificate of Authority to sell their product. Which type of insurer does Eric work for?

C. Alien Insurer

Which of the following would NOT be covered under Errors and Omissions insurance?

C. Bodily injury claim

Acme Insurance Group agrees to act as a surety to Willis Construction in the development and construction of a new shopping mall. As a condition of the agreement, Acme Insurance Group requires Willis Construction to post $500,000 in a bank account controlled by Acme Insurance Group. If Willis Construction completes their obligation, Acme Insurance Group will return the cash to Willis Construction. What would we call the $500,000 in the bank account?

C. Collateral

Which of these is NOT a party to a surety bond?

C. Collateral

In Ocean Marine insurance, this term of sale states that the seller of goods is responsible for damage to the cargo during shipment:

C. Cost, Insurance, and Freight (CIF)

Which of the following individuals is NOT considered a "custodian" in commercial crime insurance?

C. Customer

Workers' compensation insurance is designed to provide employees financial protection against injuries that occur because of, or during the course of, employment related activities. Which of the following would NOT qualify as an "injury" under workers' compensation insurance?

C. Depression due to job dissatisfaction

Which of the following was NOT a major benefit of The My Safe Florida Home Program?

C. Disaster preparedness education

Which of the following may be covered under an Equipment Breakdown Protection Coverage Form?

C. Equipment built to operate under internal pressure or vacuum

Jane's Bakery has Equipment Breakdown Protection coverage on a large industrial oven used in producing several hundred loaves of bread a day. One day, the oven malfunctions and catches fire, rendering her business inoperable for four days. In order to fill bread orders, Jane must ship her dough to a warehouse where she found another oven to rent while her oven is repaired. Under which coverage would Jane be indemnified for the shipping and oven rental costs?

C. Extra Expense Coverage

Randy owns a clothing store. One day, he notices a shady character with a backpack who is hanging around acting nervous. Randy becomes suspicious and approaches the young man. As the boy makes an effort to avoid him, Randy grabs his arm and detains him until the police arrive. Not finding any stolen merchandise, the police let the boy go. Two weeks later Randy is notified that he will be sued for violation of the young man's civil rights. This is an example of what type of personal injury covered under Randy's Commercial General Liability policy?

C. False Arrest, Detention, or Imprisonment.

mike is wanting to upgrade his homeowner's insurance so he will have the best coverage possible. "you get what you pay for;" says mike, "and, i'm purchasing total peace of mind." which policy is mike referring to?

C. HO-5

which homeowners policy is the most basic, only providing coverage on a named-peril basis and only paying actual cash value for all covered damages?

C. HO-8

Residual market insurance programs are primarily designed to meet the needs of which type of consumer?

C. High-risk consumers

Which of the following insurance packages will indemnify a policyholder for a variety of hospital-related expenses such as nursing care, supplies, and rooming charges?

C. Hospitalization Expense insurance

Paula is hoping to become a customer representative; under what circumstances might she be able to skip the pre-licensing course and exam?

C. If she has earned nine hours of college credit in property and casualty courses.

Which of the following is NOT true about Alabama and Fortified properties?

C. Insurers must offer Fortified discounts on all properties.

Which of the following is TRUE about workers' compensation insurance?

C. It benefits both the employee and the employer.

Which statement about the Federal Employers Liability Act is TRUE?

C. It protects only interstate railroad workers and their families.

Which statement about the Federal Employees Compensation Act is TRUE?

C. It provides federal government insurance for civilian employees.

Which of the following is NOT true of the no-release settlement?

C. It's also called an "advance payment settlement."

When discussing farm insurance, which of the following most accurately describes "scheduled property"?

C. Itemized property

Which of the following statements about MPCI insurance is FALSE?

C. Its coverage applies per acre, not per "unit."

Joshua, a customer representative, is discussing policy details with his client, Barbara. While reviewing the current policy, Joshua notices an important gap in Barbara's coverage that could leave her open to significant financial loss. However, because Barbara does not mention it, he decides not to bring it up for discussion. Which of the following is TRUE?

C. Joshua's action is unethical because he is not using his knowledge and skill to provide the best service to meet Barbara's needs.

Which of the following professionals would be most likely to purchase malpractice insurance?

C. Lawyer

DEC Construction was hired to completely renovate Randall's department store . DEC Construction is in charge of the project, but hires Mac Electric (an independent contractor) to complete the electrical portion, and requires Mac to have Owners & Contractors Protective Liability coverage for the job. Who is responsible for paying the premiums for this policy?

C. Mac Electric

Nick has a comprehensive individual health insurance policy that he purchased through an HMO, and Charity has a PPO plan through her employer. Which of the following statements is TRUE?

C. Nick was assigned a primary care physician who must coordinate his health care within a network, but Charity may choose a primary physician outside the network.

Which of the following statements regarding primary care physicians is FALSE?

C. Preferred Provider Organizations do not allow policyholders to choose a primary care physician.

Don works as an adjuster for ABC Insurance. Which of the following is most likely NOT one of Don's responsibilities?

C. Represent the insured if a claim goes to court

Which of the following is NOT a risk management technique?

C. Risk equality

If an injured worker is receiving Medical benefits under workers' compensation insurance, but is unhappy with her doctor, what are her options?

C. She can choose a new doctor from a list of four doctors provided by her employer.

Which of the following is NOT a characteristic of social insurance programs?

C. Social insurance programs are for-profit programs.

According to the "Definitions" section of a Personal Auto Policy, which of the following would NOT qualify as a "family member"?

C. The insured's ex-wife who moved out of the house 4 months ago

Jason's auto policy states that the insurer may cancel coverage if a premium is more than 30 days late. However, Jason is currently more than 30 days late, and has been so five times in the last year, and his insurer has done nothing about it. When Jason gets into an accident and files a claim, which of the following is most likely to happen?

C. The insurer will pay the claim because of the implied waiver they have made by not canceling Jason's policy the previous times he was late with his payments.

When a faulty electrode in a children's toy is recalled by ABC Toymakers Inc., it is a costly endeavor. Especially since ABC Toymakers Inc.'s base insurance policy doesn't cover product recalls. Which excess liability coverage could help pay for losses associated with the recall?

C. Umbrella Policy

Craig must close his business for three months after being injured in an auto accident. When Craig recovers, he returns to his shop where he finds broken glass and notices some of his supplies have been pilfered. Under what condition in his commercial property policy might the insurer deny coverage?

C. Vacancy

Which of the following perils is excluded from coverage in a National Flood Insurance Program policy?

C. Water-main breakage

When is a self-insured retention applied in an umbrella policy?

C. When the umbrella policy covers a loss that is excluded by primary policies

Five years ago, when Rosamund was one year old, she had an expensive procedure done to remove what a doctor said was a cancerous tumor behind her knee. Her parents have recently discovered, upon the return of her condition, that the growth was merely a harmless cyst and not a dangerous tumor. Will the Statute of Limitations allow her parents to file a suit against the doctor?

C. Yes; suits for Medical Malpractice are allowed until the child's 8th birthday if occurrence happened when child was under 4.

during a storm, lightning strikes a tree in harry's yard and starts a fire that spreads to his shed where he keeps all his equipment for his landscaping business. in addition to the shed, harry has to purchase all new equipment to stay in business. the cost to replace the equipment would be considered:

C. a direct loss

all of the following are included in the wind-mitigation inspections required by insurers to give premium discounts on homeowners policies, EXCEPT:

C. a list of contractors authorized by the florida department of financial services to make wind mitigation upgrades to the home.

Florida law requires all Medigap insurance policies to have a "Free Look Period," which means that:

C. a policyholder may return the policy for a full refund anytime during the first 30 days of coverage.

which of the following businesses would NOT need bailee coverage?

C. a record store

ethics can best be defined as:

C. a system of moral values

which of the following items would NOT be covered against loss or damage under coverage c - personal property of a homeowners insurance policy?

C. a television that belongs to the insured's tenant staying in the guest house.

which of the following statements is FALSE?

C. an agent always has a fiduciary duty to defend the claimant.

nick is watching a high-stakes football game at his local sports bar. after the referees make a disputable call, a fight breaks out and amid the fans at the bar. nick eagerly joins the fray and smashes a beer stein over the head of a rival fan, who suffers severe cuts and a concussion as a result. nick's action might be described as:

C. an international tort

An "occurrence" is defined as:

C. an unexpected event that causes loss.

joan files a lawsuit against andy because his dog escaped and caused her to fall on an icy sidewalk. which of the following statements is FALSE?

C. andy insurer will send joan a reservation of rights

the liberalization clause in a homeowners policy:

C. applies not only to changes made during the policy period, but also to any changed made up to 60 days before the policy went into effect.

joes restaurant business has been steadily losing money from the moment it started. joe decides to stage a fire in the kitchen after dismantling the fire-safety equipment, so he can collect the insurance money for the place. this course of action is known as:

C. arson

which of the following is not a requirement for the customer representative license?

C. be 21 or older

in the business and personal property form of a commercial property policy coverage b - business personal property coverage applies to all of the following except:

C. commercial flooring

sarah is playing with a basketball on the stairs at bob's house. in doing so, she trips, falls, and breaks her leg. she files a claim against bob's insurance company for her injuries. the adjuster determines that sarah was 50% partially responsible for her own injuries, and therefore, should only receive indemnification for 50% of her medical bills. what defense of the claim is the adjuster using?

C. comparative negligence

states that allow private insurers to offer workers' comp coverage as an alternative to the state workers' comp fund are called:

C. competitive

in a commercial property policy, the building and personal property form contains three coverages. which of the following coverages is NOT a part if thus form?

C. coverage D - loss of use

which of the following would NOT be covered under a part a of a personal auto policy?

C. damage the insured causes to his own garage.

which of the following section of a homeowners policy lists the facts that are particular to the homeowner and the insured property?

C. declarations page

the florida department of financial services was created by combining which organizations into one department?

C. department of insurance, treasury, fire marshal, and banking and finance

which of the following represent the four most common endorsements for dwelling policies?

C. dwelling under construction, theft (limited or broad), automatic increase, and liability coverage

which statement BEST describes umbrella coverage?

C. excess liability insurance that can also provide additional coverages not provided by the base policy.

all of the following are examples of wind mitigation features that could qualify a florida homeowner for premium discounts, EXCEPT:

C. foundation fortification

in a commercial property policy, extra expense coverage provides indemnification to the policyholder for additional expenses incurred during which of the following time frame?

C. from the point of initial damage until the moment the business is up and running again.

in 1945 congress passed the Mccarran-ferguson act. what does that act do?

C. gives the states the authority to regulate the business of insurance

When a car stops short in front of Mike's car, he manages to hit the brakes in time and avoids a collision. To Mike's surprise, the other driver then throws the car into reverse and backs into Mike's car! The other driver's actions are an example of:

C. hard fraud.

risk retention groups do NOT:

C. have the support of state guaranty funds

florida's chief financial officer holds all of these positions EXCEPT:

C. head of the school board

customer representation may do all of the following EXCEPT:

C. help customers select life insurance policies.

the amount of permanent partial impairment benefits that an injured employee might receive is based on:

C. her impairment rating

which homeowners policy form is intended for renters?

C. homeowners 4

a few weeks ago, frank ran a red light and caused an accidents. he didn't worry too much about it since he had liability insurance. but yesterday, frank received a notice that he is named as the defendant in a lawsuit involving the accidents. frank's next course of action is to:

C. immediately notify his insurer

Jackie lives in an area recently devastated by a hurricane and has filed a claim with her insurance company, ABC Insurance. Jerry, an adjuster contracted by ABC Insurance, pulls up to Jackie's house in a truck with the ABC Insurance logo on the side, and wearing a shirt with the ABC Insurance logo on the front. Although Jackie doesn't know that Jerry is contracted by ABC Insurance, she has reason to believe he has the authority to adjust her claim. This is an example of:

C. implied authority.

which of the following statements about inland marine insurance is FALSE?

C. inland marine insurance only covers goods that travel over inland waters.

A few weeks ago Christopher's garage was destroyed by an out-of-control motorist. Fortunately, the motorist had sufficient liability insurance to cover the damages. However, the insurer insists that Christopher's garage is worth far less than the appraisals he has received from contractors. Christopher and the insurer have gone back and forth in negotiations for weeks, making little headway. Christopher decides it's time to:

C. issue a complaint against the policyholder.

When an insurer in Alabama becomes insolvent or financially troubled:

C. it may be placed in receivership with the Department of Insurance.

which statement about the federal employees compensation act is TRUE?

C. it provides federal government insurance for civilian employees.

which of the following is TRUE regarding loss settlement in a jewelers block?

C. it will pay the least of ACV, the cost to restore, the cost to replace, or the lowest amount listed on the company's books.

nancy and drew borrow joe's car so they can have a picnic at the old water tower . on their way to the picnic, drew accidentally rear-ends Mr. jackley, causing $2,900 in damage.whose liability insurance will pay first for the damages?

C. joe's

All of the following people may be allowed to perform official wind mitigation inspections that meet the requirements for insurance premium discounts, except a:

C. licensed commercial contractor.

in a homeowner's policy, coverage D provides coverage for:

C. loss of use

which of the following people would NOT be eligible for a farm insurance policy?

C. mica owns a farm where raises racehorses.

coast-to-coast trucking is in the business of transporting fresh produce from farmers to markets all across the us. which type of inland marine policy would best protect coast-to-coast trucking's interest in the produce that it ships?

C. motor truck cargo policy

which of the following is NOT an eligibility requirement for receiving an insurance premium discount for wind mitigation features?

C. must be a single-story structure.

Customer representatives:

C. must be licensed by the Florida Department of Financial Services.

for occurrence transpiring during the supplemental extended reporting period, what is the time limit in which a claim must be made in order to be covered by a claims-made cgl policy?

C. none

A plane was damaged while being towed by another vehicle. By policy definition, this damage is considered to have occurred while the aircraft was:

C. not in motion.

what is an insurer required to do when it needs further information to a process claim?

C. notify the claimant that additional information is needed.

when a gas line explodes close to georgia's business, it destroys most of her landscaping, leveling trees and uprooting shrubs. which coverage extension could help cover the cost of replacing these plants?

C. outdoor property

barbette crosses the street and is struck by a car, causing her to sustain injuries in the amount of $45,000. the driver has minimum coverage. which coverage section of barbettes auto policy could help pay for her medical costs?

C. part b: medical payments

The fee paid by the insured in exchange for an insurance policy is called a:

C. premium.

an overhead projector is taken to a conference room at a local hotel for a week. sometime during the week, the projector falls off its stand and is destroyed. assuming it is covered loss, what commercial property coverage might cover the projector?

C. property off-premises

which of the following is not one of the employer's duties if injury occurs?

C. remain with the injury employee until emergency assistance or a family member arrives.

in a commercial property policy, business income coverage would pay for which of the following expenses?

C. rent

the statue of limitation is intended to:

C. restrict the amount of time a claimint has to file a lawsuit.

The Write Your Own program allows private insurers to:

C. sell standardized NFIP policies.

cost, insurance, and freight (CIF) coverage would be purchased by the _______ of goods.

C. seller

in which case would the insured be indemnified by her auto liability coverage?

C. she has to pay a fee to retrieve relevant court documents.

the liberalization clause in an insurance policy:

C. states that any change to a policy form that broadens coverage without increasing the premium will automatically apply to existing policies.

in order for customers of a home to qualify for flood insurance protection , which of the following conditions must be met?

C. the contents must be located in a fully enclosed building.

which of the following is NOT a nearly universal condition of a PAP policy?

C. the insured must actively avoid parking in high crime areas.

according to the "definitions" section of a personal auto policy , which of the following would NOT qualify as a "family member"?

C. the insured's ex-wife who moved out the house 4 months ago

in a commercial property policy, builders risk coverage is sold based on which of the following value?

C. the value of the completed building

janes husband was killed when an improperly pressurized gas container exploded as he was transporting it. jane can collect damages under:

C. the wrongful death act.

which of the following is not true of customer representatives?

C. they file reports on ongoing claims

in tort law, a person or entity that commits an act of wrongdoing or negligence that leads to damages to a third party is known as a(n):

C. tortfeasor

Commercial Package Policies (CPP)

CPP is an elective-based policy.

Discoverable

Capable of being demanded and handed over as evidence in a court of law; during litigationproceedings, the adjuster's claims file is discoverable.

This type of agent works for only one insurer and is paid on commission.

Captive Agent

Which of the following endorsements is mandatory for all Florida residential property policies?

Catastrophic ground cover collapse

Categories of Harm

Categories of harm: ● Physical ● Financial ● Physical & financial ● Emotional or reputational Two main types of damages: ● Compensatory ● Punitive

spill coffe hit pole what coverage

Collision Coverage

Which one of the following ocean marine insurance policies or clauses covers a shipowner's liability for damage to the cargo on another ship if the insured ship runs into the other ship?

Collision liability clause

Which one of the following inland marine forms is designed to cover photographic equipment and musical instruments used commercially by photographers, motion picture producers, professional musicians, and others?

Commercial Articles Coverage Form

Reinsurers

Companies which sell insurance to insurers to reduce the insurer's exposure to loss.

Insurance Company

Company which sells insurance policies to individuals or to other companies.

Vicarious liability is when store is responsible for employee

Comparative negligence is when its % their fault

Wendy hires Jim to build an addition to her house. Jim takes the job and finishes it in good time. Unfortunately, as Wendy is walking across the threshold of the new addition, a floorboard gives way and Wendy falls into the crawl-space below, injuring her leg and back. Which commercial general liability coverage could help cover the cost of Wendy's injuries?

Completed Operations Liability

Assuming Ernie holds a BOP with a Selected Per Occurrence limit of $300,000, what would Ernie's Completed Operations and General Aggregate limits equal?

Completed Operations: $600,000; General Aggregate: $600,000

HO Forms 6

Condo" or "unit owner's form"; named-peril homeowners policy covering personal property andthe surface structure of a condominium. "

HO Forms 4

Contents broad form"; named-peril renter's policy covering only personal property and anystructural improvements made at tenant's own expense. "

Jay's Chip Factory makes potato chips, and it gets chip bags from Bags, Inc. One day, the bag-making machine at Bags, Inc. broke down, and thus, Jay's Chip Factory couldn't get the bags it needed to bag its potato chips. Jay's Chip Factory had to shut down production temporarily while waiting on Bags, Inc. to fix their machine. Jay's lost business income may be covered under what coverage in its Equipment Breakdown Protection Coverage Form?

Contingent Business Income and Extra Expense

chinavusa

Contingent Business Interruption coverage indemnifies a business when it loses income because of covered losses to its key suppliers or key customers.

Sam is a claimant seeking damages from XYZ Insurance. The XYZ adjuster comes to meet with Sam to hear the circumstances of her injury. The adjuster determines that Sam played an active role in her own injuries, and therefore XYZ Insurance will pay her nothing at all for her injuries. What defense is the adjuster using?

Contributory negligence

Larry owns a restaurant downtown and employs his cousin Vinny as one of the line cooks. Vinny is a rather careless individual, and one night he leaves the stove on, leaking gas throughout the kitchen. When the ice machine turns on, it sparks a massive explosion. Which condition in Larry's commercial property policy indicates that he may be covered for this loss?

Control of Property

Control of Property

Control of Property. Landlord reserves all rights respecting the Property and Premises not specifically granted to Tenant under this Lease, including, without limitation, the right to: (a) change the name of the Building; (b) designate and approve all types of signs, window coverings, internal lighting and other aspects of the Premises and its contents that may be visible from the exterior of the Premises; (c) grant any party the exclusive right to conduct any business or render any service in the Building, provided such exclusive right to conduct any business or render any service in the Building does not materially and adversely limit Tenant's ability to use the Premises for the Permitted Use; (d) close the Building after regular business hours, except that Tenant and its employees and invitees may access the Premises after regular business hours in accordance with such rules and regulations as Landlord may prescribe from time to time for security purposes; (e) install, operate and maintain security systems that monitor, by closed circuit television or otherwise, all persons entering or leaving the Building; (f) install and maintain pipes, ducts, conduits, wires and structural elements in the Premises that serve other parts or other tenants of the Building; (g) change the regular business hours of the Property; and (h) retain and receive master keys or pass keys to the Premises and all doors in the Premises. Notwithstanding the foregoing, or the provision of any security-related services by Landlord, Landlord is not responsible for the security of persons or property in the Premises or otherwise on the Property, and Landlord is not and will not be liable in any way whatsoever for any breach of security not solely and directly caused by the willful misconduct of Landlord, its agents or employees.

Which of the following does NOT fall under the classification of "small grains"?

Corn

"Jones' Auto in Dallas, Texas buys 50 cars from ABC Auto in Tokyo, Japan. They sign a contract whereby Jones' Auto assumes the risk of any damages to the cars until they are delivered. What term of sale have they agreed to?

Cost and Freight

transitional yield

County 10-year yield average as determined by the National Agricultural Statistical Service. Used when issuing a crop insurance policy to a farmer who lacks four years of yield records on which to base coverage and premium amounts.

John Smith owns a bookstore that is covered under an unendorsed Commercial General Liability (CGL) Coverage Form. A customer falls in the store resulting in a covered lawsuit against Smith. Smith is asked to testify in court by the defense attorney; Smith incurs $500 in lost earnings for the one day trial. The supplementary payments section of Smith's CGL policy will

Cover the lost earnings up to $250.

When a fire breaks out inside XYZ Printing, it damages the building structure, and two of the printing presses, which were bolted to the floor. What coverage within the BOP policy would cover the printing presses?

Coverage A

Cameron is fully insured by a DP-2 on his $130,000 home. His monthly mortgage payment is $775 per month, and he usually pays $400 per month in groceries. When a kitchen fire damages his house, causing $61,000 in damage, he forced to move out for a month while the repairs can be made. Cameron's hotel bill for the month comes to $1,250 and he spends $600 eating at restaurants. Based only on this information, how much indemnification can Cameron expect to receive for this claim?

Coverage A - $61,000; Coverage E - $1,450

Cameron is fully insured by a DP-2 on his $130,000 home. His monthly mortgage payment is $775 per month, and he usually pays $400 per month in groceries. When a kitchen fire damages his house, causing $61,000 in damage, he is forced to move out for a month while the repairs can be made. Cameron's hotel bill for the month comes to $1,250 and he spends $600 eating at restaurants. Based only on this information, how much indemnification can Cameron expect to receive for this claim?

Coverage A - $61,000; Coverage E - $1,450

Valuable papers business coverage

Coverage Provides indemnification when a business experiences a loss of vital business records.

John, a store owner, has an unendorsed Commercial General Liability (CGL) Coverage Form. A customer has sued John alleging he was injured when John restrained him and a scuffle ensued. John claims he used reasonable force to restrain the customer from damaging a display of merchandise in the store. Which one of the following is true regarding coverage for this lawsuit under John's CGL policy?

Coverage and defense applies as John was using reasonable force to protect his property

An insured plumbing contractor is installing copper water lines in a new building for a general contractor. While soldering a connection, the plumber causes a fire that damages the building, including the copper water lines. The plumber is covered under an unendorsed Commercial General Liability (CGL) Coverage Form. Which one of the following best explains how the plumber's CGL Coverage Form applies to a claim for the building damage, including damage to the copper water lines?

Coverage applies to the building damage but excludes the damage to the copper water lines being installed by the plumber.

Personal Articles Floater (PAF)

Coverage for several types of property combined into a single policy; intended for property that does not have a sufficient coverage limit in a homeowners policy. This form will specify the coverage and premium amounts of each type of property listed. Personal Articles Floaters always provide open peril coverage, their coverage applies anywhere in the world, and they do not have deductibles.

Time Element Insurance

Covers an indirect loss if it can be proven that it resulted from a direct loss *Usually purchased within a commercial package policy

Accident Insurance

Covers expenses associated with a covered accident and can extend to ambulance and emergency room expenses, intensive care, and hospital costs. Accident insurance also provides for loss of income, and a death benefit if injuries prove fatal.

accident insurance

Covers expenses associated with a covered accident and can extend to ambulance and emergency room expenses, intensive care, and hospital costs. Accident insurance also provides for loss of income, and a death benefit if injuries prove fatal.

law and ordinance coverage

Covers the repair or upgrade cost when new building codes, laws, or ordinances go into effect. A common endorsement in both residential and commercial policy packages. Also known as Code Upgrade Coverage

Yield Protection

Crop Insurance

Crop Revenue Insurance

Crop insurance that combines crop-yield insurance and price insurance to protect against losses to crop value.

Crop Yield Insurance

Crop insurance that covers losses to actual crops.

private crop insurance

Crop insurance that does not fall under the Federal Crop Insurance Program and is provided directly to farmers by private insurers

Christine's spinach field was partially destroyed by fire that resulted from a lightning strike during a recent storm. She lost 23 of her 150 acres. The adjuster writes her a check for the value of the damaged 23 acres, even though the yield from the rest of the field is doing exceptionally well and may make up for the damaged portion. What type of insurance policy does Christine have?

Crop-Hail

"Due to decreased demand, the market price of beets dropped dramatically during the recent growing season. Consequently, Michelle's crop of beets did not make as much money as she was expecting this year, based on her production history and the harvest-time futures price. However, Michelle is insured for this type of situation. What kind of insurance does she have? "

Crop-Revenue

During a severe windstorm, a large tree in Jeff's yard was blown down and two large bushes were ripped from the ground. Jeff has an HO-3. What is the maximum amount that Jeff can receive for the replacement of the tree and bushes that were damaged by the windstorm?

D. $0

Tim's $2,500 boat trailer was stolen from his driveway. Ignoring any deductibles, how much can Tim receive for his stolen trailer when he files a claim against his homeowners policy?

D. $1,500

kevin has a homeowners policy with replacement cost valuation and a coverage limit of $90,000 for his personal property. three years ago, kevin purchased a sofa and loveseat for $1,000 and $500 respectively. both pieces of furniture depreciate at $100 per year. a house fire damaged many of kevin's belongings, including the sofa and loveseat, which now cost $1,200 and $700 to purchase today. ignoring any deductibles, how much will kevin's insurer give him for the damaged sofa and loveseat?

D. $1,900

roxanne's house is struck by lightning during a thunderstorm, which results in $10,000 in covered damage to the structure and $2,800 in covered damage to her personal property. roxanne's homeowners policy has a fixed deductible of $1,200. how much can she expect to receive in her settlement from her insurer for this claim?

D. $11,600

a dryer fire scorches the interior of bill's home, and he is billed $627 by the fire department. assuming bill has the fire department service charge additional coverage, how much will bill have to pay out of pocket?

D. $127

jacob is severely injured at work and receives $600 per week in temporary total disability benefits under his workers' compensation insurance for 8 weeks....

D. $145,200

Scott lived in a mobile home before it was completely destroyed in a recent flood. The mobile home is large enough to qualify for a special loss settlement under his flood policy, which has a limit of $28,000. Before the flood, the mobile home was worth $15,000, but it would cost $25,700 to buy a new one today. How much indemnification will Scott receive for this loss?

D. $22,500

To meet the 80% level of co-insurance required by his lender, Tom discovers he must insure his home for at least $320,000. What is the value of Tom's home?

D. $400,000

Jerry is using an expensive video recorder near the family pool when he slips and falls in, destroying the camera. Jerry bought the camera three years ago for $4,000, and it depreciates at $500 per year. A new, similar camera costs $5,000 today. Assuming the loss is covered, if Jerry had a replacement cost policy, how much would Jerry's insurer indemnify Jerry for the destroyed camera?

D. $5,000

Noreen is a professional photographer, and she has a Personal Articles Floater that covers her best camera for up to $6,000. While she is working a wedding, the camera gets knocked into a pool and is ruined. Before the accident, her camera was worth $5,000, but a new, comparable one would cost her $7,000. How much will Noreen's PAF pay her for this loss?

D. $5,000

A fire in Sarah's factory causes her to shut the factory doors for 50 days. To limit her loss of income and keep production going, Sarah spends $125,000 renting equipment and another building. Sarah's commercial property policy doesn't have Business Income Coverage, but it does include Extra Expense Coverage. The limit on her Extra Expense coverage is $100,000 and she has Limits of Loss Payment of 40%/80%/100% during her period of restoration. How much indemnification will Sarah receive for her extra expenses?

D. $80,000

what is the current minimum amount of liability coverage required by the state of florida for a driver who is found to be at fault in an accident?

D. 10/20/10

Resident Alabama insurance adjusters are required to complete ________ hours of continuing education every _____ years.

D. 24, 2

In a cgl policy, the basic extended period provides extended coverage for an "occurrence" transpiring within ___ days of the end of the policy period.

D. 60

The open enrollment period for a Medicare Supplement policy starts when a person turns ____ and enrolls in Medicare, and lasts for ____.

D. 65; 6 months

On January 27, 2008, Ryan was using an exercise bike purchased from NusquamCycle when the chain broke, causing him to fall and severely bruise his knee. It seemed to heal just fine, but three years later, on January 25, 2011, Ryan's knee gave out while jogging. His doctor told him that he'll need surgery and that this deterioration resulted from the earlier accident with the exercise bike. Which of the following CGL policies may cover Ryan's claim filed January 25, 2011?

D. A claims-made policy from Jan 31 2009-Jan 31 2011

Jack has been appointed to manage Margaret's financial estate, but Margaret requires Jack to be bonded. What kind of bond might Jack seek?

D. A fiduciary bond

Which of these statements about foreign insurers in Florida is TRUE?

D. A foreign insurer can usually only issue insurance to someone who was denied coverage by domestic insurers.

Which of the following best describes a Fraternal Benefit Society?

D. A fraternal benefit society is a social organization based around common interests and beliefs.

Which of the following incidents would a liability insurance policy cover?

D. A man slips inside a grocery store and injures himself.

Allen works as an adjuster for Insurer B. Which of the following is FALSE?

D. Allen is a salaried employee who only sells Insurer B's products.

In the Business Auto Policy, what does the symbol #2 mean?

D. Any Owned Vehicle

Bonnie's PAP includes Comprehensive coverage. Which of the following losses could this coverage pay for?

D. Bonnie's car catches fire.

D'Anton spills coffee in his lap while driving, causing him to veer off the road and smash into a telephone pole. Which part of his Auto Insurance Policy will help him pay for the repairs to his car?

D. Collision Coverage

If an adjuster needs to find clarification about what actually constitutes a collision, in which section of an insurance policy would she find that information?

D. Definitions

Which of the following oversees continuing education classes for customer representatives?

D. Division of Insurance Agent and Agency Services

David just opened his own consulting business, and has taken on several new clients. He's having difficulty managing his schedule on top of all the other responsibilities related to owning his own business, so he hires Tina via contract to work as his full-time office manager for $15 per hour. According to the definitions in David's Commercial General Liability policy, which of the following best describes Tina?

D. Employee

Robert is delivery driver for Acme Surplus. On his last stop of the day, he runs a stop sign and broadsides Daryl's car, causing $14,000 in damage to Daryl's car, as well as $21,000 in damage to his company truck. Which type of coverage would help protect Acme Surplus from these losses?

D. Employer liability insurance

Which of the following statements about the principle of estoppel is TRUE?

D. Estoppel protects the insured party from an insurer who initially approves coverage, but then later denies coverage after the insured pays for repairs.

Which statement BEST describes the "Follow Form" in excess liability coverage?

D. Excess liability insurance that "follows" the base insurance policy to the letter

james has just purchased a single-family home and wants to purchase a open-peril homeowner's policy to protect his financial interest in the property. from which policies should james choose to get the amount of coverage he's looking for?

D. HO-3 & HO-5

lewis has a guest house on his property which he rents to a tenant. as part of the rental agreement, lewis requires the tenant to purchase "renter's insurance." which policy would best fulfill this requirement?

D. HO-4

Loggers, roofers, and coal miners would fall into which of the following categories?

D. High-risk employees

Which of the following is NOT a form of insurance fraud?

D. Increasing your insurance coverage when you think a loss is likely.

Which of the following refers to being restored to the financial condition you were in before a loss?

D. Indemnification

Which of the following is an Unfair Claims Settlement Practice?

D. Insurer offers a settlement for significantly less than is reasonable for the claim, forcing the claimant to sue to recover his losses

Which of the following situations does NOT involve an instance of "pure risk?"

D. Loss of money invested in the stock market

Which of the following situations WOULD be covered under a workers' compensation policy?

D. Lydia is overtired as she finishes up a 16 hour shift. While performing one last duty, she trips on a rug and gets a concussion.

which of the following statements about protection and indemnity (P&I) insurance is TRUE?

D. P&I insurance provides liability coverage against damages or injuries caused by the ship.

According to the "Definitions" section of a Personal Auto Policy, which of the following is NOT "occupying" her vehicle?

D. Rachel leaves her cat in her car, with the windows cracked, while she goes into the drugstore to fill a prescription.

The DP-3 is known as the:

D. Special Form.

According to the Mortgagee Clause, what is NOT one of the rights of the mortgagee?

D. The mortgagee may change the coverage amount.

Which of the following would NOT be covered under a typical Ocean Marine policy?

D. The owner sustains a financial loss when her vessel is confiscated by the government.

Which of the following statements regarding health insurance is TRUE?

D. To be covered, members of an HMO must receive treatment for their medical conditions within the established network of healthcare providers.

Which of the following is NOT a feature of a typical Business Owners Policy?

D. Usually Actual Cost Valuation

Farmer Steve barely escapes a massive tornado, but the storm does completely destroy one of the barns on his property. Luckily, Steve has an insurance policy on his barn with a replacement cost endorsement, and the barn was fully insured. At the time of the loss, the actual cash value of the barn was $65,000, and its replacement cost is currently $85,000. When will Steve receive full indemnification for his losses on the barn?

D. When he replaces the barn and submits receipts to the insurer

Phil owns a public pool. One day, Phil has an altercation with a woman visiting the pool. Phil doesn't like the way she looks, so he tells her that she has to leave the premises right away. The woman takes Phil to court for violating her civil rights. This is an example of what type of personal injury covered under Phil's Commercial General Liability policy?

D. Wrongful Eviction

dwelling coverage would provide indemnification for damaged to all of the following EXCEPT:

D. a car parked in a detached garage.

which of the following is NOT considered a covered theft in a commercial crime policy?

D. a periodic assessment of inventory reveals that 4% of store's inventory is inexplicably missing.

which of the following losses to livestock would be covered by the causes of lose - broad form, but not by the causes of loss - basic form?

D. accidental shooting of livestock

which of the following statements regarding actual cash value is FALSE?

D. actual cash value is always most beneficial to a policyholder.

actual losses incurred for increased expenses over and above what you normally would spend for food, shelter, or related items is called:

D. additional living expenses.

which of the following statements is NOT true of an insurance adjuster?

D. an insurance adjuster receives her authority to sell products on behalf of the insurer through a written contract.

The Insurance Guaranty Association is a mechanism that covers claims in the event of:

D. an insurer's insolvency.

Driving home after a 14-hour shift, Sam falls asleep at the wheel and plows into Sandra's home, causing extensive damage to the East wall and roof. As a result, Sandra and her family must move into a hotel until the repairs are completed. The cost of staying in a hotel is:

D. an occurrence

in order to be eligible to be a customer representative you must first:

D. be 18 or older

why is it important to define terms in an insurance policy?

D. because any ambiguity in the language of the policy will favor the insured.

which of the following personal property items does NOT have a special limit of liability homeowners forms?

D. books

a government crime policy:

D. can provide primary or excess coverage

bill works for an alien insurer operating in florida. his company began business overseas and follows all applicable florida laws. in order to operate his business in florida, in addition to following all the state's insurance laws, bill's company must also possess:

D. certificate of authority

after a fire burns through XYZ condominiums, they have to replace most of the interior. which of the following WILL be covered under the condominium coverage form of the condo association's commercial property policy?

D. computers used by the condo as a whole

ron works from home. after a kitchen fire renders his home uninhabitable, he is forced to rent an apartments in town while the repairs are made. which type of coverage could help ron pay the cost of renting the apartment?

D. coverage d- loss of use

which fidelity bond form provide coverage against public employee dishonesty?

D. coverage form O

which of the following will NOT appear on the declarations page of a commercial property policy?

D. covered perils.

A CGL can provide liability insurance coverage for all of the following persons, EXCEPT:

D. customers.

third party administrators:

D. do not assume any risk for the policies they handle.

dwelling policies and homeowners policies provide a variety of insurance protections for consumers. what is the primary difference between a typical homeowners policy and a dwelling policy?

D. dwelling policies do not provide liability insurance.

phil is moving to a new town, but he's having a new house built. he hires a home builder and purchases a DP-3 policy to cover the new home. which endorsement will help insure his house, even before it is finished?

D. dwelling under construction

which of the following perils is NOT covered under the HO-2 broad form?

D. earthquake

A captive insurance company:

D. exists solely to provide insurance for its parent company.

All of the following are typical exclusions in an insurance policy, EXCEPT:

D. explosion.

james signed a contract with XYZ insurance that enables him to sell insurance policies and collect premiums on their behalf. what authority has james been granted?

D. express authority

after a heavy hailstorm cut the power ti julia's bakery she had to rent generators to keep her business going for a few days. which of the following coverages in her commercial property policy would protect julia the MOST in thus situation?

D. extra expense coverage

in a commercial property policy, the business income coverage form provides indemnification to the policyholder for the loss of income during which of the following time frames?

D. from 72 hours after the initial damage until the business is up and running again.

A customer representative's duties include:

D. giving customers information about their policies.

Barry lives in Texas, but wants to obtain an independent adjuster license in Alabama. He can get this license without passing the Alabama adjuster licensing exam if:

D. he has passed the Texas exam and received an all-lines adjuster license in Texas.

thomas runs a computer repair shop. one morning he arrives to find the front glass window broken and a number of his customers computers stolen. thomas' legal liability coverage form would pay for:

D. his clients computers.

An insurer in Alabama sends a partial payment to a claimant and states that payment is final, even though the policy limit has not been met and no compromise has been reached with the claimant. This act is:

D. illegal

________ authority is what the public reasonably believes the agent has, based on the agents representations.

D. implied

which of the following is TRUE of the vacancy condition in a typical insurance policy?

D. it establishes the parameters for considering a building vacant for the purpose of coverage.

which of the following statements about the livestock floater if false?

D. it would provide open peril for coverage for dale's horses, cattle, and sheep.

ABC Renovations has negotiated a deal with Tim: if he is involved in settling a claim needing interior or exterior renovations, Tim will steer business towards ABC Renovations. ABC Renovations will pay Tim $50 per referral. In participating in this deal, Tim is accepting:

D. kickbacks.

which of the following is NOT a universal commercial property policy exclusion?

D. lightning

a recent flood caused %5,000 in damages to maxwell's outdoor furniture and professional grade barbecue grill that he keeps on his patio. if maxwell has a flood insurance policy with $25,000, of personal property coverage, which of the following statements is true?

D. maxwell's insurer will pay nothing for his loss, because the damaged property was not inside a building

after a covered accident, your PIP will provide for all of the following, except:

D. medical costs for the driver you struck.

which of the following coverages would need to be added by endorsement to a DP-3?

D. medical payments

which if these statements about the jewelers block is FLASE?

D. merchandise that is still in the jeweler's custody is not covered if it has already been sold.

When the dollar amount difference between an adjuster and a claimant is very large, the adjuster should:

D. move to dispute resolution. - maybe

Cindy holds an insurance policy from Sine Nomine Insurance. This is not a publicly traded company, and Cindy can participate in the election of the board, receiving dividends if the company does well. Sine Nomine Insurance could be best described as a:

D. mutual insurance company.

If an insurer is unwilling to pay what the claimant is asking, the adjuster must:

D. negotiate a settlement

Jim is out turkey hunting on a private ranch when he hears some movement in the brush. Assuming it's a turkey, Jim raises his shotgun and fires. Unfortunately for Jim, he has not taken a turkey, but instead severely injured one of the landowner's calves. The landowner decides to sue Jim for the cost of the calf. In the civil lawsuit that follows, the LANDOWNER would be the:

D. plaintiff

once a claimant files a complaint to the court, the claimant will become the:

D. plaintiff

which of the following is NOT considered an "out-of-pocket expense" in health insurance?

D. policy premiums

in florida, the employer of which of the following employees do not need to purchase workers; compensation insurance for them?

D. professional athletes

a florida company that is assigned to "tier 2" for coverage under FWCJUA must pay:

D. rates that are 50% higher than voluntary market rates.

josephine has purchased a business owners policy. she insures both real and personal property at 80% under the policy. assuming no endorsements apply, the losses will be adjusted on a(n) _____________ basis.

D. replacement cost

don works as an adjustor for ABC insurance. which of the following is most likely NOT one of don's responsibilities?

D. represent the insured id a claim goes to court.

The factual statements of the insured upon which an insurance policy is based are called:

D. representations.

"sue and labor" is a provision in ocean marine insurance that:

D. requires the insured party to attempt to minimize or prevent further losses if damage is caused by an insured peril.

the cancellation/nonrenewal provision:

D. requires the insurer to provide notice before cancelling the policy.

the valuable papers and records floater can cover losses to all of the following, EXCEPT:

D. securities

A "hazard" is defined as:

D. something that increases the chance of a loss.

tim is the plaintiff in a cade involving an auto accident. to recover monies he feels are due him, tim produces documents to prove he had to pay over $55,000 in medical bills. if the court were to award tim $55,000, the damages would be classified as:

D. special damages.

which commercial property causes of loss form offers open-peril (also called "all risks") coverage?

D. special form

which financial institution bond is designed for all types of insurance companies?

D. standard form 25

when shawn purposefully set fire to jim's restaurant, jim was covered under his commercial property policy. which condition allows jim's insurer to attempt to reclaim those damages from shawn?

D. subrogation

while driving, sue looks down to adjust the radio and crashes the car into jane's car, damaging both cars and injuring herself. which of the following statements applies to sue?

D. sue is legally liable for the damages to jane's car.

in florida, the treasury is overseen by:

D. the department of financial services

which of the following best defines premium?

D. the fee paid by the insured in exchange for an insurance policy

jamie is hauling a load of hay from the market to her farm when a strong gust of wind tips over the trailer on the highway and scatters her hay everywhere. if jamie has scheduled farm personal property coverage, why won't the insurer pay for her loss?

D. the hay was being transported.

the insuring agreement for part a-liability in a personal auto policy states that:

D. the insurer has the right to settle liability cases out of court

The insuring agreement for Part A-Liability in a personal auto policy states that:

D. the insurer has the right to settle liability cases out of court.

in a personal auto policy, the term "family member" would include:

D. the named insured's 26-year-old sin who lives at home.

Mark incurred $8,000 damage to his car in an accident. He received $8,000 from his insurance company and $4,000 from the other driver. By receiving a profit from the loss, Mark could be in violation of:

D. the principle of indemnity.

Veronica owns a pottery business and is insured under a commercial property policy. She was in the process of building an extra structure for the sole purpose of kiln firing her pottery, but after 40 days of waiting for it to be completed, she moved her business to a new location without any intention of moving back. Her Builder's Risk Coverage Form was terminated because:

D. the property is abandoned.

while traveling abroad, christopher's belongings are stolen out of his hotel room. he is fortunate enough to have planned ahead for this by maintaining a DP-3 policy with which additional coverage?

D. theft: broad form

which of the following is NOT a reason to purchase umbrella liability coverage?

D. to reduce your insurance costs

Lee was watching out his kitchen window and saw his neighbor, Sam, reach across the fence with a pole saw and cut down one of Lee's trees. When the tree fell, it landed on Lee's gazebo and damaged it. Lee is furious and sues Sam for the damages. When they go to court, SAM is considered the:

D. tortfeasor

Jim adjusts auto damage claims. He supplements his paycheck with kickbacks from a local body shop that he recommends to claimants involved in these accidents. In accepting monetary gifts for business referrals, Jim is acting:

D. unethically.

in a farm policy, which form provides blanket coverage to all farm personal property?

D. unschedules farm personal property

after a fire burns through XYZ condominiums, they have to replace most of the interior. which of the following will NOT be covered under the condominium coverage form of the condo association's commercial property policy?

D. upgrades within individual condos.

following a covered loss, which of these expenses would NOT be covered under coverage f - medical payments in a homeowners policy?

D. weight loss surgery

under which circumstance would it be legal for an insurer to charge one insured more than another insured for the same coverage?

D. when the insured is statically more likely to experience a loss

when is a self-insured retention applied in an umbrella policy?

D. when the umbrella policy covers a loss that is excluded by primary policies.

an unendorsed DP-1 basic forma covers what three perils?

D.fire, lightning, internal explosion

peggy is visiting her friend laura at laura's home. during the visit, peggy trips over laura's dog and takes a nasty fall down the stairs. which homeowners coverage would pay for peggy's injuries?

D.laura's ;iability coverage

"DEC Construction was hired to completely renovate Randall's department store. DEC Construction is in charge of the project, but hires Mac Electric (an independent contractor) to complete the electrical portion of the job and requires Mac to buy Owners & Contractors Protective Liability coverage as a condition of the contract. Who would be listed as the named insured(s) for this coverage?

DEC Construction

DEC Construction was hired to completely renovate Randall's department store. DEC Construction is in charge of the project, but hires Mac Electric (an independent contractor) to complete the electrical portion of the job and requires Mac to buy Owners & Contractors Protective Liability coverage as a condition of the contract. Who would be listed as the named insured(s) for this coverage?

DEC Construction

Which of the following situations does NOT involve an insurable risk?

Dale just bought 30 shares of a hot new startup company online.

Which of the following would NOT be covered under Part A of a Personal Auto Policy?

Damage the insured causes to his own garage

Carl's Cabinets sells and installs cabinets in apartment buildings. After installation but before an apartment is occupied, two of the cabinets are damaged when they fall from the wall as a result of improper installation. Carl's Commercial General Liability (CGL) Coverage Form excludes coverage for the damage to the cabinets because of which one of the following exclusions?

Damage to Your Work

libel

Damage to another's name or reputation in print

Slander

Damage to another's name or reputation, whether by libel (which is in print) or by slander (which is in speech).

Defamation

Damage to another's name or reputation, whether by libel, which is in print or by slander, which is in speech.

Personal Injury

Damages to a third party's character, reputation, or standing in the community.

Retroactive date

Date preceding a policy period before which the policy will not cover occurrences.

John works for ABC Insurance. He is paid on a commission basis and needs to meet certain sales goals in order to draw a reasonable salary. To help in this endeavor, John regularly tells potential clients that XYZ Insurance and Integritas Insurance often fail to pay claims, and that they charge unreasonably high premiums. In speaking falsely of his competition, John has indulged in which unethical practice?

Defamation

Default Judgement

Default Judgement is entered by the court against the party who failed to defend against a claim brought on by another party. In other words, if the person fails to show up and answer the claimthe court will find in favor of the other party.

Fraud, Hard

Deliberately faking or causing an incident in order to collect money.

"In a homeowners policy, Coverage B - Other Structures provides insurance for which of the following? "

Detached garages

In a homeowners policy, Coverage B - Other Structures provides insurance for which of the following?

Detached garages

Jim drops his car off at ABC Garage to have his exhaust system repaired and takes the train to work. When he returns, he finds that his car has been vandalized. Jim has comprehensive coverage, but feels the garage is responsible for the damage since Jim entrusted the car to ABC Garage. Which coverage type under ABC's garagekeepers policy would cover any part of the loss that Jim's policy does not cover?

Direct Excess Coverage

Jim drops his car off at ABC Garage to have his exhaust system repaired and takes the train to work. When he returns, he finds that his car has been vandalized. Jim has comprehensive coverage, but feels the garage is responsible for the damage since Jim entrusted the car to ABC Garage. Which coverage type under ABC's garagekeepers policy would split the cost of the loss with Jim's own insurer without placing blame on ABC Garage?

Direct Primary Coverage

"This agent is a salaried employee who sells insurance products for only one insurer.

Direct Writer

This agent is a salaried employee who sells insurance products for only one insurer.

Direct Writer

Interest

Direct financial interest in protecting a unit.

Unfair Claim Settlement Practices

Dishonest or unfair behavior related to settling insurance claims which is specifically proscribedby state law.

Which one of the following statements is true about judgment rating in ocean marine insurance?

Each insurer writing ocean marine insurance develops its own ocean marine rates, guided by the judgment of its underwriters

contribution by equal shares

Each policy pays an equal share of the loss up to the lowest policy limit. If the loss is not fully covered, the process is repeated among the remaining insurers with available coverage. As each policy limit is reached, the remaining portion of the loss is split equally between the insurers with available coverage until the loss is either fully covered or all of the policy limits have been reached.

For the owners of oceangoing cargo, the possibility of loss to the cargo while it is in the course of transit exists

Either aboard the vessel or on land between the vessel and the cargo's point of origin or destination.

Internet blogger Tom operates a public interest group on the Internet. In posting his opinions, Tom falsely accused the governor of his state of criminal behavior. Tom's Commercial General Liability (CGL) Coverage Form will most likely exclude coverage for any resulting damage based on which one of the following exclusions?

Electronic chatrooms or bulletin boards exclusion

Eligiblity

Eligibility Requirements are found in some insurance policies. They identify the conditions thatmust be met by the policyholder in order to qualify for coverage under a policy.

Which Business Auto Policy endorsement covers employees while using their personal cars for business purposes?

Employee as Additional Insured

Tim, taking advantage of the economic downturn, started a business buying gold and silver from people who needed cash. Tim and one employee negotiated deals with sellers in the front of the shop, while another employee worked in the back of the shop, where she counted the money and kept the books. Which commercial crime coverage would protect Tim from losses resulting from theft, specifically by either his current money counter or any other money counter he may employee after her?

Employee theft: scheduled positions

Cliff receives a letter from the IRS, informing him that he has severely underestimated his Adjusted Gross Income for the past year. Cliff was oblivious to this fact because XYZ Accounting has filed his taxes for him for the past 15 years. Now, Cliff owes $15,000 in back taxes. He sues XYZ Accounting for this mistake. Which of the following would cover the cost of the lawsuit for XYZ Accounting?

Errors and Omissions Insurance

limit-single

Establishes 1 maximum limit for liability damages caused by the policyholder. Contrast with split limits

cancellation and nonrenewable condition

Establishes when and how the insurer or the insured can terminate an active insurance contract. The policyholder can cancel at any time by giving a written notice. Typically, the insurer may only cancel the policy for a few specific reasons, and it must give written notice of the cancellation or non-renewal anywhere between 10 and 60 days in advance

Evaluation

Evaluation, determining the approximate value of damages relevant to a claim i.e. total ofmedical bills, costs of repair & replacement of damaged property and the consideration of thefinancial provisions of the insurance policy.

An insurance adjuster is obliged to inform claimants of their rights under the insurance contract in which of the following situations?

Every claim the adjuster handles

Which statement BEST describes a stand alone excess liability policy?

Excess liability insurance that "follows" the base policy, but includes its own set of limitations and exclusions

Which section of an insurance policy is designed to OMIT certain risks from coverage?

Exclusions

Martin regularly travels much of the state for work, so his employer has given him a company car. Which endorsement to Martin's PAP would provide him with liability coverage for the company car?

Extended Non-Owner

Coverage F

F is voluntary coverage, even if claim paid its not admissionof insurred

The Commercial General Liability (CGL) Coverage B—Personal and Advertising Injury Liability provides coverage for which one of the following?

False arrest

Farmer Scott owns a farm and raises goats, producing a lot of manure. Occasionally, after a strong rain, some of the waste washes into a nearby river. Which insurance coverage can protect Scott from any liability caused by the goat waste runoff?

Farm Pollution Liability

Which Farm policy would cover animal waste overflow and chemical spills?

Farm Pollution Liability

FEMA

Federal Emergency Management Agency - a branch of homeland security that coordinatesrelief programs when disaster strikes an entire community.

US enviornmental protection agency

Federal agency primarily responsible for the implementation of most federal laws designed to protect, enhance, and conserve the nation's natural resources.

Fair Credit Reporting Act

Federal legislation that gives an applicant for insurance the right to investigate the reasons hisinsurance application was denied.

Longshore and Harbor Workers' Compensation Act

Federal program that provides compensation and medical care to employees who are injured while on the job on navigable waters of the United States.

Federal Employees Compensation Act (FECA)

Federal program that provides insurance for civilian employees of the federal government. As a workers' compensation program, FECA covers disability or death sustained while the employee is on the job. Pays medical expenses and two-thirds of normal monthly salary while the employee is unable to work. Additional payments may be made for permanent injuries or to dependents.

Black Lung Benefits Act

Federal program that provides monthly payments and medical treatments to coal miners who become totally disabled from black lung disease or pneumoconiosis.

unendorsed dp-1 basic form covers

Fire, Lightning, Internal exposure

Dec Page

First page of a policy, which provides a summary of the contract; includes names of insured, addresses, coverage limits, policy period, etc.

Which one of the following filed inland marine policies covers merchandise that is being held for sale and can be used to cover the dealer's interest and/or a lender's interest?

Floor Plan Coverage Form

FL sell auto insurance u need

Florida auto joint underwriting assoy

Freight insurance is vessal owne ​

Freight insurance is vessal owne Carge 3 types 1 single risk for single shipment 2. Floating open or long term multiple trips in specific time 3. Warehouse to warehouse

Which of the following would be covered under Coverage A in a dwelling policy?

Gas furnace in the basement

This provision in Ocean Marine insurance obligates insurers of various interests to share the cost of losses associated with a captain's decision to voluntarily sacrifice a part of the ship or its cargo.

General Average

An explosion takes place at Acme manufacturing plant. Four employees are injured. Gina broke her leg and has third degree burns on 10% of her body. George's left leg is hurt so seriously that it later needs to be amputated. Taylor is permanently blind in one eye, and Jason has third degree burns on 15% of his body. Which of these employees is eligible for Permanent Total disability benefits?

George

In 1945 Congress passed the McCarran-Ferguson Act. What does that act do?

Gives the states the authority to regulate the insurance industry

Risk Purchasing Groups

Groups of people with similar insurance needs who form an organization to buy insurance as a group.

Risk Retention Groups

Groups where the members insure each other, using their own capital to write insurancepolicies.

Bill is going to switch employers, and therefore switch healthcare providers. Which federal law ensures that he won't be denied coverage when he switches health plans?

HIPAA

"Which of the following homeowners policies provide coverage on an open-peril basis for personal property without endorsement? "

HO-5

Anton is purchasing homeowner's insurance for his new house. He wants to make sure his policy offers the BEST coverage available. Which policy should Anton choose?

HO-5

Which of the following homeowners policies provide coverage on an open-peril basis for personal property without endorsement?

HO-5

Rates for the traditionally nonfiled classes of inland marine insurance

Have become standardized to an extent for policies that are widely written.

Commercial

Having to do with commerce or business activity in general.

Hazard, Moral

Hazard caused by insured persons deliberately engaging in risky behavior because they knowthat insurance will indemnify them for the losses.

HIPAA

Health Insurance Portability and Accountability Act, 1996 US law protecting consumer privacy,regulating collection, use and storage of private information.

Bill's new home is in the final stages of construction, and he has purchased an HO-2 policy to insure his financial interest in the property. This morning, Bill's contractor calls to tell him that an electrical fire has destroyed his new kitchen, and all of the crown molding that was supposed to be installed today has been stolen. It will be $15,000 to rebuild the kitchen and another $4,200 to replace the trim. How will Bill's insurer respond when he files a claim?

His insurer will pay $15,000 to rebuild the kitchen and nothing for the stolen trim.

Ho5 most expensive and most coverage

Ho3 is most used today

Strict Liability

Holds a party 100% liable for damages when the activity or instrument they are performing isinherently dangerous.

"Maria was in the hospital for five days, recovering from a stroke. The bill she received for her hospital stay broke down the charges for room, lab fees, meals, and nursing care. However, her insurer paid a flat daily rate and she was left responsible for paying the remaining charges. What type of insurance does Maria have?

Hospital Expense insurance

Maria was in the hospital for five days, recovering from a stroke. The bill she received for her hospital stay broke down the charges for room, lab fees, meals, and nursing care. However, her insurer paid a flat daily rate and she was left responsible for paying the remaining charges. What type of insurance does Maria have?

Hospital Indemnity insurance

What ocean marine insurance policy or clause covers the damage to an insured's ship if the insured ship collides with an object in the harbor?

Hull insurance policy

What ocean marine insurance policy or clause, if any, covers damage to the insured vessel caused by serious misconduct by the members of the crew contrary to the owner's interest?

Hull insurance policy

Mervyn is from Kansas, a state that does not license insurance adjusters. Which of the following is TRUE?

If Mervyn wants to be licensed in Texas, he can designate Texas as his home state, and he must meet all the same requirements as a Texas adjuster.

Coarse Grains

In Crop Insurance, a provision that covers reduction in crop quality, as well as crop-yield losses.Coarse grains are corn, grain sorghum, and soybeans. See also "Small Grains".

Small Grains

In Crop Insurance, a provision that covers reduction in crop quality, as well as crop-yield losses.Small grains are wheat, barley, and oats. See also Coarse Grains" "

Automobile

In Insurance policies, Automobile generally means any vehicle designed for use on publicroads.

Final planting date

In crop insurance, the last day to plant crops in order to receive the full insurance yield and/or revenue guarantee selected.

Privacy

In insurance, the right of consumers to have their personal information protected.

Answer

In liability cases, the defendant's response to a complaint. There are three possible answers: 1)accept complaint and pay for damages, 2) deny the complaint, or 3) accept the complaint with a right to insert evidence into the case.

Risk

In the insurance industry, risk can have two meanings: 1) the potential for financial loss; beingexposed or open to damage, 2) an insured item.

settlement padding

Increasing the settlement amount dishonestly in order to increase one's commission. This is unethical and criminal behavior.

national center for agricultural law research and information

Independent agricultural and food law research and information center created to address the complex legal issues affecting American agriculture.

Fraud, Soft

Inflating the gravity or the extent of claims in order to receive a higher indemnification.

"Which of the following is a feature typically found in a Business Owners Policy?

Inflation Guard for buildings and structures

Complaint

Initiates a civil lawsuit by a claimant requesting financial relief from damages caused by a policyholder.

Agnes purchased a home ten years ago in an upcoming neighborhood for $75,000. The home's value has since tripled to $225,000! Agnes still has $25,000 left on her mortgage, but has increased her dwelling coverage to $225,000 to keep up with the home's appreciation. When it burns to the ground in a fire, her mortgage company wants to be indemnified $75,000 because the value of the home has tripled. Which policy condition protects against this claim?

Insurable Interest

Crop Insurance

Insurance coverage designed to protect a farmer's financial investment in his or her crops; covers losses to a crop's profitability.

Boiler & Machinery

Insurance designed to indemnify a business for damages to, and damages by, boilers, machinery, motors, generators and a variety of other electrical devices and appliances.

Which of the following best describes inland marine insurance?

Insurance designed to protect property being transported on land and property related to transportation

Ocean Marine

Insurance designed to protect property being transported overseas.

Auto Policy

Insurance policy designed to protect the policyholder while owning, occupying, or operating avehicle. Usually combines liability coverage and property coverage into one policy.

Commercial Crime Insurance

Insurance that covers employee dishonesty and theft by employees or others.

Automobile No-fault Laws

Insurance that indemnifies the insured regardless of who was at fault in an accident; also restrict the insured's right to sue the at-fault party.

Indemnity Insurance

Insurance that indemnify's loss as opposed to liability

Inland Marine Insurance

Insurance that protects property being transported over land

"Herb owns a processing plant outside of town that services all the local farmers. He's been using over-the-road transportation but wants to streamline his business by using the railroads. He contacts ABC Railway Transport and the two come to an agreement: ABC Railway will run a sidetrack onto Herb's business premises, if Herb agrees not to hold ABC Railway responsible for certain liabilities that could result from the sidetrack's use. This agreement would fall under __________ in Herb's Commercial General Liability policy.

Insured Contacts

Risk Avoidance

Insurers' practice of denying insurance applications that they believe would involve aninordinate amount of risk.

Punitive Damages

Intangible damages awarded to the plaintiff when the defendant's actions show intentionalheinous, antisocial behavior or extreme indifference to harm. They are determined by the court.

Damages - general

Intangible losses such as pain and suffering, or mental anguish.

Which of the following is TRUE of the vacancy condition in a typical insurance policy?

It establishes the parameters for considering a building vacant for the purpose of coverage.

Which one of the following statements about interest that accrues on the amount of a judgment before the actual entry of the judgment by the court is true?

It is called prejudgment interest.

Which of the following statements about the Standard Flood Insurance Policy is FALSE?

It is subject to state courts.

Which of the following statements about Crop-Hail insurance is FALSE?

It is subsidized by the FCIC.

How is the power to bind transferred to an adjuster?

It is transferred through a written contract.

Which one of the following is a purpose for buying difference in conditions (DIC) insurance?

It provides coverage for flood and earthquake exposures not covered by basic policies.

Accounts Receivable coverage extension in a BOP

It provides coverage for money the insured expects to collect, but cannot because of damage to accounting records caused by a covered peril.

Which of the following is NOT true of the Company's Options provision in the standard fire policy?

It requires the insurer to settle the claim, in whichever manner it chooses, within 30 days of receiving notice of the claim.

Which of the following statements about the original Standard Fire Policy is FALSE?

It was the first multi-line policy, combining both Physical Damage and Liability coverages.

Strong winds have torn a hole in Janet's roof. On top of that, heavy rain is expected in her area in the next few days. Figuring it would simply be too much effort to put a tarp over the hole in her roof, Janet elects to do nothing. The rains come and destroy several of her possessions inside her home. Janet files a claim with her insurer for the losses, but it comes back denied. This is because:

Janet failed to make a reasonable effort to protect the property from further damages.

Which of the following does NOT have an insurable interest in Big Ed's Steak House, a local restaurant?

Jim, who regularly eats at Big Ed's Steak House because it's his favorite restaurant.

Which one of the following statements is true regarding the rating of ocean marine insurance?

Judgment rating for ocean marine insurance is influenced by many factors, including the product being shipped and the type of packing.

"After her water heater leaked and damaged her hardwood floors, Clarice filed a claim with her insurer, KLM Insurance, who sent their adjuster, Bob, to inspect the loss. Clarice also hired a public adjuster, Jose, to represent her in her claim. Bob has the responsibility to report to which principal? "

KLM Insurance

ABC Roofing has two CGL policies that cover the same losses. Both policies are occurrence forms, thus pay out on a pro rata basis. The first policy is through KLM Insurance and has a limit of $300,000. The second is through XYZ Mutual, with a limit of $600,000. One day, ABC Roofing suffers an occurrence resulting in a $150,000 covered loss. How will this loss be indemnified?

KLM Insurance will pay $50,000; XYZ Mutual will pay $100,000

When the high-pressure feeder malfunctioned at the ACME Paper Mill, the resulting explosion severely damaged the mill and shut down operations for almost two months. Once the repairs are finished, the city inspector comes out to inspect the work and finds that the repaired scrubber needs to be replaced in order to meet current industry safety standards. Which coverage could help ACME with this added expense?

Law and Ordinance Coverage

Federal Crop Insurance Act

Legislation passed by Congress that established the federal crop insurance program

Lemon Insurance Co. decides not to renew Hugh's Personal Auto policy, which is set to expire on May 31. Which of the following statements is TRUE?

Lemon Insurance must notify Hugh at least 45 days before the policy expires.

Liability Insurance

Liability insurance indemnifies a third party for damages caused by the insured's negligence.

errors and omissions (E&O)

Liability insurance that indemnifies professionals for errors or oversights on the part of the insured that caused harm to their clients

Errors and Omissions

Liability insurance that indemnifies professionals for errors or oversights on the part of theinsured that caused harm to their clients.

joint liability

Liability shared by two or more persons.

preferred provider organanization PPO

Like an HMO, this group insurance plan provides insurance by contracting a network of physicians, hospitals and medical care providers. Differs from an HMO in that members have more freedom to go outside of the network to choose their own physician.

Bob's home was severely damaged by a thunderstorm and he claims it will cost $74,000 to repair. His insurer has investigated the claim, found the repairs could be done for $49,000, and has offered Bob this amount of indemnification. Negotiation between Bob and his insurer seems to be failing. Due to the unpredictability of the result, which of the following options should be avoided by the insurer if possible?

Litigation

Logan has a small plane that he enjoys flying on the weekends, but he never takes friends or passengers with him. Which of the following is TRUE?

Logan should buy Bodily Injury Excluding Passengers and Property Damage Liability, but he doesn't need to spend the money on Passenger Bodily Injury Liability.

Which of the following BEST describes how covered losses are settled under a typical Equipment Breakdown Protection Coverage Form?

Losses are normally paid at replacement cost, but an insured may change this with an Actual Cash Value endorsement.

Which of the following would be covered under the peril of "theft" in an homeowners policy?

Losses caused by attempted theft

Machinery

Machines or the parts of a machine.

"Which of the following statements about insurable interest is FALSE? "

Maintaining property values allows your neighbor to have an insurable interest in your house.

During a routine tooth extraction, Dr. Dentem administers too much laughing gas and causes brain damage to his client. The family sues Dr. Dentem for failing to follow procedure. Which kind of insurance would cover the cost of the lawsuit?

Malpractice Insurance

Which one of the following statements is correct with respect to electronic data processing equipment floaters?

Many cover special perils such as mechanical or electrical breakdown, and they may also insure covered property while it is in transit or at unlisted locations.

marine insurance

Marine insurance covers items that are being transported, as well as the vehicles used fortransportation.

"Mark is on vacation in Italy when his luggage is stolen, including a $2,000 laptop, a $500 suitcase, and $400 in clothes. Mark has an HO-3 homeowners policy. Excluding any applicable deductible, which of the following statements is TRUE? "

Mark's homeowners policy will cover $2,400 of this loss.

Chuckie's chicken distributor researches the benefits of consuming chicken versus consuming beef. In November 2011, Chuckie's publishes a brochure outlining the potential health hazards of consuming beef and explaining why chicken is a healthier alternative. Chuckie continues to publish and distribute the same brochure for six months. In March 2012, several beef distributors file a suit against Chuckie's for personal and advertising injury. Which one of the following exclusions would apply to this claim under Coverage B of Chuckie's Commercial General Liability Coverage Form (CGL) with a policy period of January 2012 - January 2013?

Material published prior to the policy period

Matthew works for Barry John Coal Company. One day, when all the work trucks are busy, Matthew's boss asks him to use his own truck to deliver a load of coal to a customer. On the way, Matt gets distracted looking at directions and swerves into oncoming traffic, causing a serious accident. Why might Matt's PAP liability insurer deny coverage for the damage Matt caused?

Matt's accident occurred during employment-related activities, so it will be covered by the employer's liability policy.

Rating Systems

Measure hazards of individual risk in a given area, and sets premiums accordingly.

Risk Management

Measures taken by an insurance company to ensure that their exposure is not too high and tocontrol the effect of a loss; for example, an insurer might charge higher premiums to drivers whohave received speeding tickets.

Mechanical Breakdown Insurance

Mechanical Breakdown Insurance (MBI) covers losses due to breakdown of motor vehicles.

Which one of the following statements is true regarding Coverage C—Medical Payments of the Commercial General Liability policy?

Medical payments coverage is a means of making prompt settlements.

Insurance Rating Systems

Methods of evaluating the risk involved in insuring a person, property, or a corporation. Insurersuse rating systems to calculate premiums.

Stan has a personal auto policy to cover his two vehicles, but he recently purchased a custom built motorcycle as well. Which type of endorsement will Stan need to cover the motorcycle?

Miscellaneous Vehicle Endorsement

"Which unfair claims settlement practice involves an adjuster making false statements about policy coverage in order to reduce the settlement?

Misrepresentation

Which unfair claims settlement practice involves an adjuster making false statements about policy coverage in order to reduce the settlement?

Misrepresentation

HO Forms 8

Modified coverage form" of Homeowners Insurance; named-peril coverage for structures andcontents fewer perils covered; form for buildings with low value.

"Grant works at ABC Convenience. One day, a man pulls up in an expensive car and pays cash for his gas with a hundred dollar bill. Grant accepts the bill without checking its validity. When Grant's manager checks the bill later, he discovers it is a fake. Which commercial crime coverage could protect ABC Convenience from financial loss associated with accepting the fake hundred dollar bill? "

Money Orders and Counterfeit paper currency

Compensatory damages -General

Money awarded for the emotional losses of the plaintiff that will continue after the trial date; subjective value determined by the court.

Compensatory damages -Special

Money awarded for the exact value of the physical damage caused to the plaintiff up to the trial date; objective value determined by receipts and medical bills.

Compensatory Damages

Money awarded in civil court for tangible and intangible damages caused by a policyholder

Stu has a collection of rare comic books. He wants to purchase theft insurance for his collection, separate from his home and other property. What term most accurately describes the type of policy Stu would purchase?

Monoline Policy

Insurance Comissioner

Most states have an insurance commissioner who is responsible for regulating many aspects of the insurance industry (especially those concerning the financial solvency of the insurers doing business in the state). The commissioner oversees the financial stability of insurers and regulates the rates that insurers charge

Which policy is used as an alternative to the Trucker's Policy to cover companies that offer transportation services to the public on a regular basis, rather than for hire?

Motor Carrier policy

Business Personal Property

Moveable property used for business

Which of the following perils is excluded from coverage in a National Flood Insurance Program policy?

Mudslides

Walter works for a shipping company, delivering packages and picking up orders. He lives very close to work and the grocery store is only a few blocks away, so he can live conveniently without owning a car. However, he would like to have some Personal Injury Protection, just in case he ever gets injured in an accident. Which BAP endorsement could his employer use to give him this coverage?

Named Individuals Broadened PIP

Adjusted Gross Revenue (CropInsurance)

Narrowest (and least expensive) form of Crop Revenue Insurance. Insures farm revenue as a whole instead of individual crops. Guarantees a percentage of the insured farm's average revenue.

NFIP

National Flood Insurance Program - a program that provides insurance for communities thatsuffer flood damage and are willing to participate in the FEMA's floodplain management system.

Malpractice

Negligent or improper actions on the part of doctors, lawyers, and accountants etc., resulting indamage, injuries, or losses to the person receiving their services.

Which of the following steps would occur LAST in the processing of a claim?

Negotiate a settlement with the claimant

Negotiations

Negotiations take place when the insurer and the claimant do not agree about anindemnification amount. The insurance adjuster is often the one who will carry out thenegotiations.

Northern Company (Northern) uses a large forklift in its operations. The forklift is subject to the state compulsory auto insurance law and has a license tag. In the process of moving some items on Northern's premises, the operator loses control of the forklift and runs into a car owned by a customer. Which one of the following statements is true regarding coverage for this loss under Northern's Commercial General Liability (CGL) Coverage Form?

No coverage applies under the CGL Coverage Form because the forklift is considered to be an "auto," and coverage would be provided by a commercial auto policy

Nathan's Furniture Store delivers a sofa to a customer. While placing the sofa in the living room, the delivery person breaks the customer's coffee table. The delivery person admits that the accident was his fault and the customer requests that a claim be submitted for damage to his personal property. Would the claim be covered under Coverage B - Personal and Advertising Injury Liability of the Commercial General Liability Coverage Form (CGL)?

No, because Coverage B does not respond to liability claims for property damage

Betty's Birdhouses constructs and sells birdhouses. Betty discovered a fungus in the wood used to construct the birdhouses that would kill birds. Betty withdrew her entire stock of birdhouses to avoid any claims from environmental organizations for loss to wildlife. Does Betty's Commercial General Liability (CGL) Coverage Form cover the cost to withdraw the birdhouses and feeders?

No, because the cost to withdraw Betty's product is excluded

Lucy, the owner of Lucy's Flower Shop, was delivering a vase of flowers to a customer, Mrs. White. When Mrs. White opened her front door, her dog ran outside, knocking the flowers from Lucy's hands, and causing the vase to shatter and injure Mrs. White. Although the customer insisted that she would be fine, Lucy received a medical bill for injuries to Mrs. White two years later. The medical treatment had been received one week before Lucy received the bill. Lucy explains the situation to her insurer and requests coverage under her Commercial General Liability Coverage Form (CGL). Will the medical expenses be covered under Coverage C - Medical Payments of the CGL?

No, because the medical expenses must be incurred and reported to the insurer within one year after the date of the accident.

Non Commercial

Non-Commercial insurers are not-for-profit insurance companies that return profits topolicyholders by reducing premiums or expanding benefits.

"Mark is a college student and frequently needs to either rent a car or borrow his friend's car. Although he doesn't own a car of his own, he wants to buy himself some liability coverage that would apply whenever he drives someone else's car. Which coverage should Mark get? "

Non-Owner Coverage

Mark is a college student and frequently needs to either rent a car or borrow his friend's car. Although he doesn't own a car of his own, he wants to buy himself some liability coverage that would apply whenever he drives someone else's car. Which coverage should Mark get?

Non-Owner Coverage

Helen's business is growing rapidly, so she decided to add an annex onto her office and hire another worker. While under construction, a storm blows down most of the annex structure, forcing Helen to restart from scratch. Her commercial policy provides insurance coverage equal to 75% of the property value, despite the fact that her policy requires 80% coverage to be fully insured. Which coverage extension could help Helen rebuild at replacement cost?

None - Extensions are only available if the policyholder maintains the minimum level of insurance of 80% to value

Which one of the following best describes an advantage to insurers of nonfiled compared with filed classes of inland marine insurance?

Nonfiled classes allow for the customization of policy provisions and rates for individual insureds.

Underinsured

Not sufficiently insured against particular losses. For example, any home insured at less than80% of its value is considered underinsured.

Civil Law

Observes court cases of one citizen charging another citizen for damages caused by tort; it differs from criminal law.

Surestep Insurance Co. calculates that it needs to charge Elwood a higher premium for his auto policy. Which of the following statements is TRUE?

Once Elwood receives notice of this change from his insurer, he may keep his policy in force by paying the extra premium within 10 days.

Power to bind

One manifestation of the authority given to insurance agents by the principal. The principal isbound by, or must adhere to, the guarantees and statements made by its agent.

Reporting

One of the adjuster's duties is to report to the principal. The adjuster must give the principal frequent updates of her progress on any given claim.

Adhesion

One of the characteristics of an insurance contract. Means that one party (the insurer) sets the terms, and the other (the insured) can 'take it or leave it.'

Competence

One of the four qualifications of a legally binding contract. All parties must be competent, with the necessary legal and mental capacity.

Consideration

One of the four qualifications of a legally binding contract. All parties must bring something of value to the contract.

Legal Purpose

One of the four qualifications of a legally binding contract. The purpose of the contract must belegal (e.g. no contracts for illicit drug deals)

Agreement

One of the four requirements of a legally binding contract. All parties involved must agree to the terms of the contract. Can also refer to a binder, which is the preliminary substance of a contract.

Fiduciary

One of the terms that describes the adjuster's relationship with the principal (the insurer). AsFiduciary Agent, the adjuster acts for the benefit of the principal, rather than for his own benefit.

Occurrence Form Policy

One of two forms of CGL: triggered by occurrence, so that if a loss occurred during the policyperiod, it is covered even if the claim is made much later.

Claimant

One who files a claim with an insurer for a loss.

Landlord

One who has leased property to a tenant.

Judgment rating is used to rate

One-of-a-kind risks.

The Business Auto Coverage form has no provision for what is known as "bobtailing." The motor carrier's coverage form does provide coverage for bobtailing. Which of the following activities is considered "bobtailing" as it relates to an owner-operator's liability coverage?

Operating a power unit without a trailer

Livestock Floater

Optional Farm Insurance coverage. Provides stand-alone protection for six kinds ofdomesticated animals on a scheduled or unscheduled basis. Includes coverage for animalswhile in transit.

Overinsurance

Overinsurance means having insurance on a risk for more than the risk is worth. If a policyholder is overinsured, the insurer will only indemnify a loss up to the insurable value. If the insured purposefully overinsured the risk with the intent to commit insurance fraud, the insurer is not bound by the policy to pay anything.

Which of the following is NOT true of Personal Injury Protection?

PIP is usually secondary coverage.

Definitions

Page in policy that gives specific limited meaning to terms used in policy.

Supplementary payments

Payments by the insurer to the insured that exceed the insurance policy's limits of liability.

Excess Policy

Pays for a loss only after the primary policy's limits have been exhausted. See also: "Primary Policy."

PIP

Personal Injury Protection: a form of no-fault auto insurance utilized in some states.

Personal

Personal Lines insurance protects the personal and real property of an individual. A PersonalAuto Policy and a Homeowners Policy are examples of Personal Lines of insurance, asopposed to Commercial Lines.

Which of the following insurance protections is NOT offered by a garagekeeper's insurance policy?

Personal injury protection

Direct Loss

Physical harm to tangible property caused by a peril.

Loss - direct

Physical loss or damage to property directly due to an incident; i.e. fire, wind, etc..

The filed classes of inland marine business are those for which the

Policy forms and/or rates must be filed with the state insurance department.

Morgan Company is involved in a lawsuit that is covered under its unendorsed Commercial General Liability (CGL) Coverage Form. Which one of the following would be covered under the supplementary payments section of the CGL policy?

Post judgment interest awarded by the judge

Shelly has been suffering from chronic headaches for over a year. She is sure that there is something medically wrong, despite what the doctors in her network have told her. So, she decides to visit a doctor that her friend recommended, even though he charges more and is not in Shelly's approved network. Shelly's insurer paid for the cost of the appointment up to the amount she would have reasonably been charged by an in-network physician, and Shelly was responsible for paying the remaining balance. Which type of health insurance plan does Shelly have?

Preferred Provider Organization

Fancy Dress Shop is a small specialty clothing boutique for women. Liability claims against Fancy Dress Shop would most likely arise from its

Premises and operations exposure

XYZ contractor, covered under an unendorsed Commercial General Liability (CGL) Coverage Form, is installing kitchen cabinets in a customer's home. The contractor manufactured the cabinets. While the contractor is fastening a cabinet, it falls and injures the customer. Which one of the following best explains how coverage under the contractor's CGL Coverage Form applies in this case?

Premises and operations liability applies because the contractor was in the process of installing the cabinets

"What is the last step in the claim settlement process?

Preparing the final adjustment reports

False Advertising

Presenting something in a deceptive or untrue manner to the consumer; misrepresentations inadvertisements.

primary insurance

Primary insurance pays first, before other policies that apply to the same loss. See also: "Excess Insurance."

Private insurance

Private insurance is the term for any insurance other than social insurance. Social insuranceprograms are run by the government instead of by private individuals.

Professional Liability

Professional Liability Coverage is insurance that protects practitioners such as doctors, lawyers,engineers, architects, etc.. It includes two types of coverage: malpractice insurance and errorsand omissions insurance.

liability- professional

Professional Liability Coverage protects professionals such as doctors, lawyers, engineers, architects, etc. It includes two types of coverage: malpractice insurance and errors and omissions insurance.

PD

Property Damage: damage or loss of use of personal property.

Dwelling policy

Property coverage for people and businesses who are not eligible for homeowners insurance or do not need the extensive coverage of the homeowners policies

Dwelling Policy (DP)

Property coverage for people and businesses who are not eligible for homeowners insurance or do not need the extensive coverage of the homeowners policies.

Impaired Property

Property that is defective because the insured's deficient or incomplete additions or work.

The basic types of ocean marine insurance include which one of the following?

Protection and indemnity (P&I) insurance

What ocean marine insurance policy or clause covers an insured shipowner's liability for damage to cargo of others being transported by the insured on the ship?

Protection and indemnity (P&I) insurance

Which one of the following ocean marine insurance policies or clauses covers an insured shipowner's liability for injuries to the passengers on board a ship into which the insured ship collided?

Protection and indemnity (P&I) insurance

Which one of the following ocean marine policies or clauses covers an insured shipowner's liability for damage to a docking pier struck by the insured vessel?

Protection and indemnity (P&I) insurance

Which one of the following ocean marine insurance policies or clauses covers the insured shipowner's liability for injuries to crew members of the insured ship in the event it collides with another vessel?

Protection and indemnity (P&I) policy

Jimmy owns a pawn shop which brings with it a certain amount of risk. He decides to hire a security guard, and install a surveillance system and an alarm system to reduce his monthly premiums on his commercial property policy through the:

Protective Safeguard endorsement.

Liability - product

Protects a policyholder from legal liability for damages to third parties caused by themanufacturing, merchandising, distributing, or operation of a product.

Liability - employer

Protects employers from damages and bodily injury caused to employees or by employeeswhile performing under the scope of their employment.

Liability - public

Protects individuals and commercial venues from any property damage or personal injury theymay cause to the general public

Jones Act ("Merchant Marine Act")

Protects injured seamen by allowing them to sue for damages and to choose a jury trial. Seamen are covered by the Jones act instead of by workers' compensation insurance.

Personal Property Floater

Protects property owners from damage or losses to personal articles while in the process of transport.

Personal Lines Insurance

Protects the personal and real property of an individual. A personal auto policy and a homeowners policy are examples of personal lines of insurance, as opposed to commercial lines.

hospital expense insurance

Provides coverage for a variety of hospital expenses, including room and board, medical expenses, lab fees, and nursing care

Time element coverage

Provides coverage for an indirect loss that occurs as the result of a direct loss, when covered property can't be used and therefore causes an indirect loss. Usually an endorsement within a commercial package policy

Pullutant cleanup and removal coverage

Provides coverage in cases of accidental pollutant damage that results from a covered loss.

surgical expense insurance

Provides indemnification for physician costs associated with surgical procedures.

RC

RC: Replacement Cost, It refers to the cost of repairing or replacing an insured item, based onthe item's value at the time of the loss.

Rachel has tried to obtain insurance coverage for her home, but its location, age, and condition have made it difficult to find an insurer that is willing to insure it. Which of the following is TRUE?

Rachel can't apply directly to the Texas FAIR Plan Association for coverage, but an authorized insurance producer can file an application on her behalf.

Which of the following people committed soft fraud?

Rafael accidentally slipped on a wet floor at the supermarket. Although his only injury was a sprained ankle, he claimed he had back and neck pain when he sued the supermarket in an effort to get more money in the settlement.

Rebates

Refunding of part of the premium, due to the creation of a new contract or change to an existing contract.

Insurance Information and Privacy Protection Act (IIPPA)

Regulates how an insurance company can use consumers' private information. Deals specifically with how insurance companies collect, use and share personal information about their policyholders and gives the consumer the opportunity to prevent certain information from being shared. Requires that insurers tell consumers why insurance coverage was declined or why insurance claims were denied.

Bailee Coverage

Reimburses a bailee's customer for damage to the customer's property while in the bailee's control.

Which of the following is not one of the employer's duties if injury occurs?

Remain with the injured employee until emergency assistance or a family member arrives

Which of the following activities could be a useful negotiation technique?

Reviewing video footage with the claimant that contradicts the claimant's position

Rise & Shine Light Bulb Co. has a claims-made & reported policy that is about to expire, but a customer just filed a liability claim against the company. If Rise & Shine wants to have insurance pay for the damages, it must do which of the following?

Rise & Shine must report the claim before its policy expires.

Jared hopes to purchase a new insurance policy for his car, but he has an extremely poor driving record. The insurance company decides to issue Jared an insurance policy, but charges him a premium much higher than the average driver. The insurance company is practicing:

Risk Reduction

"Which of the following is FALSE about risk retention groups in Texas?

Risk Retention groups must participate in the residual market programs in the state

Risk, Pure

Risk that does not entail the possibility of gain; the only possible outcomes are a loss or no loss.

Risk, Speculative

Risk that might result in gain, loss, or no change in circumstance (as opposed to pure risk,which does not include the possibility of gain).

Uninsurable

Risks are said to be uninsurable when they do not meet certain qualifications. For example, aninsurable risk cannot involve a loss that the insured deliberately causes. Again, certain perilsare too catastrophic to be insurable (like war or nuclear events).

Which of the following would NOT be covered under the Comprehensive section of a PAP?

Rollover

Ron's truck experiences a mechanical breakdown and he has it towed to an auto repair facility. Upon further examination of Ron's claim, his Mechanical Breakdown Insurance provider denies coverage. Which of the following would be a valid reason for this denial?

Ron had been hauling a large boat, which overloaded the vehicle and caused the breakdown.

continuing education

Ryan will have to send a written request for an extension to the Department of Financial Services.

Adjuster - Staff

Salaried employee of one insurance company who can work locally, regionally, or nationally. Also called: Company Adjuster

Salvage

Salvage is damaged property that has cash value. In HO the policyholder has the option ofkeeping the salvage and accepting a smaller settlement from the insurer. The insurer has theoption of keeping the salvage if they have fully indeminified the insured, but in no case can theinsured insist the insurer keep the salvage.

city of Hillsdale passed a law

Satutory

Monica's husband, Sam, likes to buy her expensive jewelry, and she has amassed quite the collection over the years. What endorsement would Monica and Sam need to add to their homeowners policy to fully cover Monica's jewelry collection?

Scheduled Personal Property

Policy

See Insurance Policy.

Full and legal purpose

See also Legal Purpose." One of the four qualifications of a legally binding contract. Thepurpose of the contract must be legal (e.g. no contracts for illicit drug deals). "

Adjuster - Independent

Self-employed adjusters who contract with multiple insurers at the same time. Paid on a commission or fee-plus-expenses basis for each claim. Also called: Fee Adjuster, Bureau Adjuster

Ocean marine hull insurance policies usually cover on a specified perils basis rather than an "all-risks" basis. One of the specified causes of loss is "barratry." Which one of the following best describes the meaning of the term "barratry"?

Serious misconduct by the vessel's master or crew that is contrary to the owner's interest, such as a fraudulent or criminal act that causes damage to the vessel

Agnes purchased a home ten years ago in an upcoming neighborhood for $75,000. The home's value has since tripled to $225,000! Agnes still has $25,000 left on her mortgage, but has increased her dwelling coverage to $225,000 to keep up with the home's appreciation. When it burns to the ground in a fire, her mortgage company wants to be indemnified $75,000 because the value of the home has tripled. Which policy condition protects against this claim?

Severability of Interests

Kyle operates a collision repair garage and has many vehicles in his care, some for extended periods of time. Which type of coverage protects Kyle from any liability claims which may arise if one of the cars is further damaged or destroyed while in his possession?

She has to pay a fee to retrieve relevant court documents.

When freight is guaranteed, the party primarily exposed to the loss of freight is the

Shipper

A filed jewelers block coverage form is designed to meet the needs of

Small retail jewelers

Which one of the following can be added to a builders risk policy to cover various incidental expenses that might result from a physical loss to a building project, such as additional interest, advertising expenses, or real estate taxes?

Soft costs coverage

When Emma's house was burglarized, the thieves stole several pieces from her art collection. Although the pieces were only prints, Emma files a claim stating that they were originals, and therefore worth a good deal more than they really are. What has Emma committed?

Soft fraud

Which one of the following statements is correct with respect to motor truck cargo liability insurance?

Some policies limit coverage to losses caused by specified perils

Farmer

Someone in the business of growing, harvesting, and selling crops for profit. In Farm insurance,a farmer must reside and do business on the same premises.

Criminal

Someone who has been convicted of a criminal act in a court of law.

Agent

Someone who has received authority from an insurer to sell or service insurance policies.

Scheduled payment release

Sometimes called open-ended release" or "rehabilitation settlement." The insurer agrees to payall of the special damages and general damages that have accumulated so far and agrees topay special damages in the future.

Waiver of Sovereign Immunity

Sovereign Immunity disallows an individual to sue a governmental entity; the waiver ofsovereign immunity allows individuals to sue governmental entities under specificcircumstances.

Under a Commercial General Liability (CGL) policy, an insured is found to be legally liable to pay medical expenses as well as loss of earnings to a claimant. This describes which one of the following types of damages?

Special damages

HO Forms 3

Special form" of Homeowners Insurance; all-peril coverage for structures named-perilcoverage for contents.

The supplementary payments section of the Commercial General Liability (CGL) Coverage Form describes which one of the following?

Specific items to be paid in addition to damages.

Florida Insurance Code states the qualifications required to become a licensed insurance adjuster in the state of Florida. Which of the following is NOT one of the requirements for applicants?

Spend 20 hours in the field working with a licensed insurance adjuster

controlled line floaters

Standardized forms provided by a bureau and filed with the state. These forms disclose the rates being charged and can be used as both general property floaters (such as "personal effects" or "personal property") and specific property floaters that break down covered property by type.

Residual Market

State run, or state subsidized, program that provides insurance coverage to high-risk individuals. Residual market programs collect and maintain large premium pools made of required contributions from other insurers. Also known as "Shared Markets" or "Involuntary Markets."

Dangerous Instrumentality Doctrine

States that anyone involved in the use of inherently dangerous products or machines is held100% liable for their own damages.

Deductible - franchise

States that the policyholder only pays for damages that are less than his deductible. If the cost of damages equals or exceeds his deductible, the insurer pays the full amount and the policyholder pays nothing.

Which settlement option is usually reserved for the largest claims?

Structured settlement

"Which of the following conditions is frequently included in Mechanical Breakdown Insurance policies?

Subrogation

Which of the following conditions is frequently included in Mechanical Breakdown Insurance policies?

Subrogation

Declined Coverage

Takes place when an insurance company rejects an application for coverage.

Damages - special

Tangible, financial losses that can be documented.

HO Forms 2

The "broad" or "cheap" form of Homeowners Insurance; a basic, named-peril HO form that

Claim

The "offer of settlement" that the policyholder files with an insurer after she experiences a loss.

Offer

The 'Offer' is a claim submitted to the insurance company for compensation due to a loss orlosses the claimant believes are covered by the insurance policy and is legally considered an'offer to settle' the claim.

Agency Authority

The Agent's authority to act on behalf of someone else, usually an insurer. This authority is derived from the agent's contract with the insurer.

BAP

The Business Auto Policy provides property damage and liability insurance for automobiles used by a business.

IIPPA

The Insurance Information and Privacy Protection Act regulates how an insurance companycan use consumers' private information.

Who sets the critical production dates and assigns commodity market prices for MPCI policies?

The Risk Management Agency

Commercial Crime policy

The Valuation provision states that money is valued at its face value; securities are set at their value on the day the loss is discovered; and other property is valued at the lesser of the cost to repair or replace.

Fraud

The act of deceiving an insurance company in order to collect more money than one is legallyentitled to.

Concealment

The act of withholding relevant material facts from an insurer.

Peril

The actual cause of loss or damage, such as lightning, fire, or theft.

Coppayment

The amount a policyholder must pay each time she accesses the benefits of a health insurance policy

Coverages

The amount and extent of protection provided by an insurance policy.

coverages

The amount and extent of protection provided by an insurance policy.

Deductible

The amount the policyholder must pay out-of-pocket before the insurance company will pay the remaining costs.

Average weekly wage

The average amount of income that an employee earns each week while able to perform normal job duties. When an employee is injured on the job, his workers' compensation income benefits will depend on his AWW before the injury

Average Weekly Wage (AWW)

The average amount of income that an employee earns each week while able to perform normal job duties. When an employee is injured on the job, his workers' compensation income benefits will depend on his AWW before the injury.

Standard Fire Policy

The basic foundation for all homeowners and commercial property policies issued today. Developed in 1918 to provide insurance protection for both homeowners and commercial property owners, it was typically a named peril policy, but it only protected against losses from fire and lightning on an Actual Cash Value basis

Policy Period

The beginning and end dates of coverage. Found on declarations page.

Tort law

The body of law that addresses and provides remedies for any civil wrongdoing performed onanother party.

Which of the following is NOT a condition for payment on a Mechanical Breakdown Insurance claim?

The cause of the breakdown cannot be associated with the front-end suspension.

Subrogation

The ceding of the insured rights to the insurer to seek reimbursement from liable parties.

Replacement Cost (RC)

The cost of repairing or replacing an insured item, based on the item's value at the time of theloss.

"Law and Ordinance, also known as Code Upgrade Coverage, covers which of the following expenses

The cost of repairs or upgrades done to meet new building codes

Law and Ordinance, also known as Code Upgrade Coverage, covers which of the following expenses?

The cost of repairs or upgrades done to meet new building codes

Insured crop

The crop in the county for which coverage is available as specified by the policy.

Tortfeasor

The defendant in a court case who committed the tort.

Which one of the following types of commercial property would most likely be insured using a "nonfiled" class of inland marine business?

The equipment used by a contractor

Commerce

The exchange or transport of goods or property.

Exposure

The extent to which an item is open to damage or loss. More exposure means a loss is morelikely.

Breach of Product Warranty

The failure or falsehood of a stated promise of a product stipulation.

Negligence

The failure to exercise a reasonable degree of care in a particular situation.

First Named Insured

The first person or entity named as insured on the declarations page of a policy.

Proof of Loss

The form or statement that the policyholder is required to submit to the insurer before she canbe indemnified for a loss.

The Random Bookstore (Random) is covered by an unendorsed Commercial General Liability (CGL) Coverage Form. A customer in the store tripped over her untied shoelace and fell, breaking her right arm. Which one of the following is a reason Random's insurer might refuse to pay any damages under Random's CGL policy?

The insured must be legally obligated before the insurer has the duty of paying

optionally renewable policy

The insurer retains the option to continue coverage for the insured upon expiration of the current policy period. The insurer may renew coverage or cancel coverage for any reason

Sales closing date

The last date on which an insurance application for a particular crop can be completed and signed.

Necessary Elements of a Reservation of Rights

The letter must: ● Include the insurer's name, the policy number, and the event or loss ● Clearly and concisely explain the situation, especially that the policyholder may not receive compensation or may have to defend himself in court ● Inform the policyholder about potential consequences (

Liberalization

The liberalization clause in an insurance contract is a condition that states that the insurer can add or broaden coverage at any time without writing up a new contract. This clause guaranteesthat, in the case of legislative action that broadens insurance coverage without any increase inpremiums, this additional coverage must take effect in existing policies as well as in newpolicies.

Limits

The limits of an insurance policy represent the highest amount an insurer will pay. Any costabove the limits of insurance is the responsibility of the policyholder.

While shopping at Acme, Mark slips and falls on a wet floor, knocking over some shelves, smashing a window, and injuring his knee. The medical costs for Mark's knee surgery total $8,000, and he will live the rest of his life with a limp since his knee may never fully heal. Which of these costs will be most difficult for Acme's insurer and Mark to negotiate?

The mental anguish associated with never fully recovering

Arbitrator

The mutually-agreed-upon and neutral third party in an arbitration who reviews the positions ofeach opposing side, and makes a final and legally binding decision.

Which one of the following is true of the supplementary payments in the Commercial General Liability (CGL) Coverage Form?

The obligation to pay these supplementary payments ends when the limit of insurance is exhausted

Proximate Cause

The original occurrence, the source, of all the subsequent damages.

Obligee

The party in a "surety bond" that wants a guarantee that the principal will perform as promised, and is the recipient of the contractual obligation. See also: "Principal" and "Surety (Guarantor)."

Insurer

The person or entity providing coverage to one or more insureds.

Plaintiff

The person who brings a case against another person in court.

Which of these is NOT an essential detail for an adjuster to include in a loss report?

The policy premium (as long as it has been paid according to the contract) has no bearing on how the policy will respond to a claim, so it is not an important detail for an adjuster to include in a loss report. By contrast, the policy deductible has a direct impact on how much the policy will pay for any given los

Coinsurance

The portion of a covered claim that the insured is responsible for paying out-of-pocket after the deductible has been paid.

Coercion

The practice of forcing another party to behave in an involuntary manner (whether through action or inaction) by use of threats or intimidation or some other form of pressure or force.

Claims Management

The practice of the insurance adjuster of managing a claim by processing it in a prompt and effective manner from the time the claim is filed until a settlement is reached, while adhering to all local and federal laws.

Which of the following factors holds the LEAST relevance when an adjuster is evaluating an insurance claim?

The premium

Market Value

The price something will sell for in the open market, or fair market value." "

Principal

The principal refers to an agent's employer (usually an insurance company, but it could alsomean anyone who contracts the agent to work on their behalf and gives her the authority to doso).

Principle of Indemnity

The principle behind all insurance contracts. It states that, when a loss occurs, the insuredshould be restored to his or her financial condition before the loss occurred, no better, no worse. The insured cannot profit from a loss.

Valuation

The processes of estimating what an item is worth.

Conditions

The section of a policy that qualifies or limits an insurer's promise to pay or perform.

Body Language

The signals we give through posture, behaviour, apparel, etc., which are involved in communication.

Nonconcurrency / Nonconcurrent

The situation in which 2 or more policies covering the same risk have different inception and expiration dates. Since the policies operate on different calendars, losses on the base policy may not count toward the limit which triggers the excess policy's coverage.

Which one of the following best describes the property covered by the filed inland marine Equipment Dealers Coverage Form?

The stock in trade of dealers that sell agricultural or construction equipment and customers' equipment in the insured's care, custody, or control

limit-aggregate

The total amount the insurer will pay for all losses during the policy period. Often appears preceded by an occurrence limit (e.g. 100,000/1,000,000). The first number indicates the maximum payout for covered losses in any single occurrence, and the second number indicates the total amount the insurer will pay for all covered occurrences during the policy term.

Accumulated Depreciation

The total decrease in an item's value over a period of time. Formula: (Annual Depreciation x Number of years used)

In appraisal, who chooses the umpire?

The two appraisers

Trustworthiness

The virtue of carrying out responsibilities reliably, worthy of being trusted. A necessary attributeof insurance adjusters.

BBC Manufacturing (BBC) has an unendorsed Commercial General Liability (CGL) Coverage Form. BBC has expanded its sales outside the United States. Due to injuries from alleged defective products of BBC, lawsuits are brought in Europe, Mexico, Canada and Puerto Rico. Which one of the following statements describes the extent for which BBC's insurer will provide coverage or defense in these jurisdictions?

There is coverage and defense for Canada and Puerto Rico, since these are covered territories.

Which statement about Personal Article Floaters is FALSE?

They have a $500 deductible.

Which of the following would NOT affect the rating for comprehensive and collision coverage on a vehicle?

Time of day the vehicle is driven

Which of the following automobile components is NOT covered by a Mechanical Breakdown Insurance policy?

Tires

Indemnify

To restore by payment, repair, or replacement

"Anna's Rare Books in Birmingham needs to ship three F.Scott Fitzgerald first editions to a customer in Mobile. The combined value of the books is over $400,000. What type of Inland Marine insurance policy should Anna's Rare Books buy to cover this shipment? "

Trip Transit Policy

Randy runs a business where he takes on the possessions of others and transports them from one location to another in exchange for a fee. What type of occupation does Randy have?

Trucker

Which of the following is similar to a Business Auto Policy, but adds several policy provisions and protections specific to the trucking industry?

Truckers policy

"Greg, an agent for ABC Insurance Brokers, is trying to sell a new policy to Sally. Sally, however, is perfectly happy with her current policy and has no intention of cancelling it. Greg tells Sally that upcoming legislation is set to increase the minimum requirements for insurance, and that her current policy will not be available once the bill passes. He fails to tell her that if her policy is already in effect, this legislation won't affect her insurance. Which unlawful or unfair practice is Greg guilty of? "

Twisting

Hazard morale

Unconscious tendency of insured people to engage in riskier behavior.

Which of the following statements applies to replacement cost valuation?

Under replacement cost valuation, insurers may safeguard the principle of indemnity by requiring policyholders to replace insured items before making full reparations.

In the CGL coverage for Damage to Premises Rented by You, how is the coverage for fire damage different than for other perils

Under the coverage Damage to Premises Rented by You, only fire damage to the rented premises is covered, not fire damage to personal property.

John and Lucy both apply for policies with Acme Insurance at the same time. They are exposed to similar hazards and would present essentially the same amount of risk to Acme Insurance. Acme Insurance offers Lucy a premium policy at excellent rates, but restricts John to a very limited policy with high premiums. Acme Insurance may be guilty of:

Unfair discrimination.

Unscheduled

Unscheduled property is property covered under an insurance contract that is not listed item byitem (as Scheduled" property would be listed). "

insurance fraud

Using insurance to obtain money unlawfully. This can be done by a policyholder, or by an insurer or an insurer's employees. There are two kinds of insurance fraud: soft fraud and hard fraud.

Which of the following BEST describes the insurance provided by residual market insurance programs?

Usually a "last resort" form of insurance

out-of-pocket expenses

Usually refers to any deductibles, coinsurance, or copayments that the policyholder pays as part of a health insurance program.

1 actual cash value replacement cost minus depreciation 2replacement cost 3stated amount 4Agreed value 1 actual cash value replacement cost minus depreciation 2replacement cost 3stated amount 4Agreed value 1 actual cash value replacement cost minus depreciation 2replacement cost 3stated amount 4Agreed value 1 actual cash value replacement cost minus depreciation 2replacement cost 3stated amount 4Agreed value ​

Valuation is

An importer needs protection for its cargo not only while on board an oceangoing vessel, but also while it's being shipped by truck both to the vessel from the point of origin and from the vessel to the final destination. Which one of the following ocean marine clauses accommodates the importer's needs for continuous coverage during the entire course of transit, including the land transportation?

Warehouse to warehouse clause

Pro Rata Apportionment

When a loss is covered by more than one policy, the policies split the loss, based on the percentage of coverage each policy provided. For example, if a couple has 2 dwelling policies, one for $100,000 and the other for $50,000, and a loss occurs, the first policy will pay 2/3 of the loss, and the other policy will pay 1/3.

Tort - negligent

When a negligent act causes unintentional damages to another party.

Vicarious Liability

When an act of negligence is transferred from one party to another, such as from employee toemployer or from child to parent.

Misappropriating Salvaged Property

When an adjuster takes possession of salvaged property for his own use or the use of another. This is unethical behavior. See also: "Salvaged Property."

Under which circumstance would it be legal for an insurer to charge one insured more than another insured for the same coverage?

When the insured is statistically more likely to experience a loss

Jane's shed burns to the ground during a tornado, when the high winds break a wall of the shed, knocking over a lantern inside. What is the proximate cause of the loss?

Wind

Surety (Guarantor)

With regard to a surety bond, the surety is the party (often an insurance or bonding company) that guarantees the obligee that the principal will fulfill its contractual obligations. If the principal fails to perform, the surety will pay the bond amount to the obligee and then go after the principal to recover their losses. See also: "Principal" and "Obligee."

After an insurance claim has been filed in Florida, how soon must the insurer respond to the claim?

Within 14 days

Leased worker

Worker hired through a labor leasing firm.

Shady Stories, a tabloid newspaper, prints a false story about a local politician. Shady knows the story is false but thinks it will sell a lot of papers. The politician claims damages from Shady. Shady's Commercial General Liability (CGL) Coverage Form excludes coverage for this loss because the claim arose out of which one of the following?

Written material that was known to be false

"Phil owns a public pool. One day, Phil has an altercation with a woman visiting the pool. Phil doesn't like the way she looks, so he tells her that she has to leave the premises right away. The woman takes Phil to court for violating her civil rights. This is an example of what type of personal injury covered under Phil's Commercial General Liability policy?

Wrongful Eviction

Which of the following states takes a "monopolistic" approach to workers' compensation insurance?

Wyoming

XYZ Insurance is a private insurer that sells flood insurance policies. Which of the following statements is FALSE?

XYZ Insurance participates in the NFIP Direct Program.

International Toys (IT) manufactures toys in South Carolina and sells them to stores around the world. A customer in Europe is injured when one of the toys malfunctions and severs the customer's hand. The customer files suit in the United States. If IT is found liable, does its Commercial General Liability (CGL) Coverage Form cover the customer's claim?

Yes, because the toys were manufactured in the United States

Dale's Dive Shop rents a twenty-foot boat for an employee outing. While Dale is driving the boat on a lake, he accidentally injures a swimmer. Does Dale's Commercial General Liability (CGL) Coverage Form cover the swimmer's bodily injury?

Yes, because this watercraft qualifies as an exception to the watercraft exclusion

With respect to Inland Marine insurance, a "Block" policy (such as a Jewelers Block policy, or a Furriers Block policy) is an example of:

a Commercial Floater.

Francis has many employees who go out and market his product in the streets on a daily basis. This "go get 'em" approach seems to work well for business, but it does increase the risk of an auto accident. To curb the financial risk of a hospital stay resulting from an accident, Francis adds _____________ to his BAP.

a Medical Payments/PIP endorsement

"The ""Consent to Settle"" clause in the Professional Liability policy is best described as:

a clause that requires the insurance company to get approval from the insured before settling a claim.

The "Consent to Settle" clause in the Professional Liability policy is best described as:

a clause that requires the insurance company to get approval from the insured before settling a claim.

"During a storm, lightning strikes a tree in Harry's yard and starts a fire that spreads to his shed where he keeps all his equipment for his landscaping business. In addition to the shed, Harry has to purchase all new equipment to stay in business. The cost to replace the equipment would be considered: "

a direct loss

"During a storm, lightning strikes a tree in Harry's yard and starts a fire that spreads to his shed where he keeps all his equipment for his landscaping business. In addition to the shed, Harry has to purchase all new equipment to stay in business. The cost to replace the equipment would be considered:

a direct loss.

SureTrust Insurance was founded and operates in Texas. In Texas, SureTrust is considered:

a domestic insurer.

insurance claim is

a formal requestto settle the damage

James and Eric want to play a prank on Bob for Halloween. They dress up like headless horsemen and throw ignited Jack O'Lanterns at his house. Unfortunately, one of the inflamed pumpkins catches the porch on fire, causing $3,500 in damages. Bob doesn't find this tomfoolery very entertaining and sues both James and Eric for the cost of the repairs. In court, James and Eric would be:

a joint tortfeasor.

A dwelling policy would NOT be appropriate for:

a motorhome owned by an individual

common law

a system of law based on precedent and customs

a cause of loss - special form provides open peril coverage for direct losses to physical property. the special form excludes all of the following except:

accident

Res Ipsa Loquitur

accident can be negligence

"In order to set a yield guarantee for Maren's policy, Maren's agent will need a record of the last four years of her crop yields. This record is called:

actual production history

endorsements

add, reduce, or change the coverage of the policy in some way

representations

address size and description of home

Participation in the Florida Automobile Joint Underwriting Association is mandatory for:

all insurers who can sell auto insurance in Florida.

Wrongful Death Act

allows the individuals who are associated with a deceased person who was killed because of anegligent act to sue the responsible party.

The Peak Season endorsement

allows the insured party to temporarily increase coverage limits at specified intervals over the course of the year in order to account for increased inventories.

Fraternal Benefit Societies

also called fraternal associations non-profit, mutual aid organizations engage in charitable activities provide some types of insurance to members

Stock Insurance Companies

always for profit usually publicly-traded stockholders provide capital and participate in profits or losses non-participating insurers: no dividends go to policyholders

One day, a customer at Jim's Tire Sales was severely injured when a rack of tires collapsed and fell on her. Later, the customer filed a lawsuit against Jim for $750,000. Jim has a commercial general liability policy, but the limit for this type of loss is only $500,000. Not wanting to use his entire limit on this one claim, Jim tries to use his excess liability policy first, which has a limit of $1,000,000, so he can retain most of the aggregate limit in his base policy. Unfortunately for Jim, this is not possible because:

an excess liability policy pays only after the base policy's limit has been exhausted.

"Driving home after a 14-hour shift, Sam falls asleep at the wheel and plows into Sandra's home, causing extensive damage to the East wall and roof. As a result, Sandra and her family must move into a hotel until the repairs are completed. The cost of staying in a hotel is:

an indirect loss.

re-insurer

an insurer that provides insurance for other insurers the insurer buys insurance to reduce its exposure to loss. the re-insurer pays a percentage of the insurer's losses, or any losses over a certain amount

Driving home after a 14-hour shift, Sam falls asleep at the wheel and plows into Sandra's home, causing extensive damage to the East wall and roof. As a result, Sandra and her family must move into a hotel until the repairs are completed. Sam's car crashing into the house would be considered:

an occurrence.

"An adjuster has a duty to provide which of the following to the claimant?

an open line of communication

"After her business suffered damage in a fire, Jane filed a claim with Acme Insurance, which dispatched Bob to adjust it, even though he was not allowed to adjust commercial claims. He investigated Jane's losses and submitted his estimate to Acme Insurance, which issued her a settlement check based on that estimate. Bob had _______ because Acme Insurance accepted his estimate and paid Jane's claim.

apparent authority

While a claim remains open, an insurer may require the adjuster to submit an interim report:

at regular set intervals, which lists any new or important information about the claim.

In a garagekeepers policy, PIP coverage is:

available with an endorsement.

which of the following statements about freight insurance is TRUE?

b. FREIGHT INSURANCE PROTECTS THE VESSEL OWNER IN THE EVENT FREIGHT COSTS ARE NOT PAID.

Statutory Law stipulation

based on laws set forth by a governing authority; i.e. state legislature

"Alan owns a commercial landscaping business and does most of his work during the summer months. One day, he arrives at work to find an enormous hole in the middle of the yard where he stored his lawn mowers. Under which Causes of Loss form(s) would the mowers, which were consumed by the sinkhole, be covered by his commercial property policy?

basic, broad, and special forms

Patricia is a new adjuster whose primary goal is her employer's financial benefit. This goal makes Patricia susceptible to the ethical challenge of:

bias for the insurer.

not covered in eo

bodily injury

PAP includes comprhensive coverage like

car catch on fire

exclusions

causes of loss or items of property that are not covered by the policy

medical malpractice suits until

child is 8years old

paying ,%

coinsurance

hmo cant see outside doctors?

coinsurance is a %

fcra

collect data properly

PAP

combo of liability, personal injury(PIP) ,medical payments, uninsured or underinsured,physical damage coverages , location not in use

block policy's are

commercial floater

insured must advise insurance of broke sprinkler within 48 hours that is

commercial floater

Dr. Nelson routinely schedules her patients for lab tests that they don't need so she can charge their insurers for more money. Dr. Nelson is:

committing health insurance fraud.

States that require all businesses to purchase workers' compensation insurance are called:

compulsory.

The Severability of Interests condition states that:

coverage applies to each insured separately, as if no other insured existed

Coverage D: Loss of Use

covers losses incurred as a result of your home being uninhabitable

CGLwithtail

covers occurrences that happen within 60 days of the policy

Law and Ordinance (a.k.a. Code Upgrade Coverage)

covers the repair or upgrade cost when new building codes, laws, or ordinances go into effec

"Errors and Omissions coverage in an Equipment Breakdown Protection policy provides coverage for: "

damage that would not otherwise be covered because the insured made a mistake or unintentionally omitted information required by the insurer.

Conditions of the policy

damage to insured policy must be reported within 15 days

coverage b other structures

detached garagesp

"Phil heads over to visit his friend Josh, who is sick with the flu. While at the house, Josh fails to cover his mouth when he coughs and Phil ends up contacting the flu. Phil files a claim with Josh's insurer for medical expenses and lost income while Phil is out sick from work. The insurer denies the claim because:

disease transmitted from the insured to a third party is excluded

dp1 without endorsement

doesnt coer damage to vehicle dont if dp1 with no endorsement

section 3 of BAP

doesnt cover CDs

"A large corporation owns a small hunting cabin in the woods, that it uses for occasional weekend getaways. The corporation can insure the cabin against property damage with a:

dwelling policy

A large corporation owns a small hunting cabin in the woods, that it uses for occasional weekend getaways. The corporation can insure the cabin against property damage with a:

dwelling policy.

acerage reporting date

e deadline for providing the insurer with an acreage report, which is used to determine the amount of coverage needed and the premium charged for a particular crop.

As an insurance adjuster, Heather is responsible for updating and maintaining an accurate record of all the information pertinent to an individual's insurance claim, including copies of all written documentation, photos and property sketches, witness statements, and copies of medical bills. What is this record called?

evaluation report

In the Standard Fire Policy, "intentional losses" and "extreme perils that cause catastrophic damage to a large number of policyholders" would be considered examples of:

exclusions.

captive insurance

exists slowly to provide insurance for it's parent company

premium

fee paid by insured in exchange for insurance policy

nfip

fema flood in surance

When Jeanette shows up to handle a claim on behalf of ABC Insurance, she evaluates the claim and negotiates a settlement. Maintaining her integrity and acting ethically, Jeanette is fulfilling her:

fiduciary duty.

Coverage C - Personal Property of a homeowners policy typically excludes:

fish.

"A stand alone excess liability policy:

follows a base policy, but may have different exclusions and limitations.

A stand alone excess liability policy:

follows a base policy, but may have different exclusions and limitations.

An insurer that adheres to the laws of a state but is located outside of that state is called a(n) ___________ insurer.

foreign

Workers Compensation

form of insurance that covers medical costs and lost wages in the event of injury, disease, ordisability sustained by an employee in the course of his work/ Purchased by employers.

outdoorrpropertyextension

forshrubs

how many years to file lawsuit for false arrest in florid

four ****ing years

statuary law

given by courts

Legal Hazard

giving money unecessairly

kickback

giving someone compensation in order to gain favorable treatment in an insurance transpection

Federal Employees Compensation Act

govt insurance for civillians

reciprocal insurer

group of people or organizations that insure each other

Haley takes a bottle of water into a store, pours some of it on the floor when no one is looking, and then pretends to slip and fall. She cries out for help in apparent pain until someone comes to her aid. She then sues the store for her fake injury in an effort to collect an insurance settlement. What has Haley committed?

hard fraud

Florida insurer

has 90days to pay or deny a claim

A carrier that is prevented by an accident from delivering the cargo aboard its ship may face an exposure called loss of freight, which is

he compensation the carrier receives for transporting cargo

contributory negligence

if plaintiff is negligent den no settlement

After a loss covered under a dwelling policy, Ordinance or Law coverage pays for:

increased repair costs due to laws or codes.

XYZ Films is getting ready to shoot a new Western film. As with most film productions, XYZ Films uses a surety bond from ABC Bonds to help protect the distributor's financial investment in the movie. Because of the magnitude of the budget for the film, ABC Bonds has XYZ Films secure a/an _____________ to act as a co-signer.

indemnitor

As Jonathan was driving through an intersection, another driver ran a red light and crashed into the side of Jonathan's car, which caused significant physical damage to both vehicles. Jonathan must now rent a car while his is being repaired. The rental car expense would be considered a:

indirect loss.

declarations

information that makes the policy unique to a specific insured

"Herb owns a processing plant outside of town that services all the local farmers. He's been using over-the-road transportation but wants to streamline his business by using the railroads. He contacts ABC Railway Transport and the two come to an agreement: ABC Railway will run a sidetrack onto Herb's business premises, if Herb agrees not to hold ABC Railway responsible for certain liabilities that could result from the sidetrack's use. This agreement would fall under __________ in Herb's Commercial General Liability policy. "

insured contracts

Herb owns a processing plant outside of town that services all the local farmers. He's been using over-the-road transportation but wants to streamline his business by using the railroads. He contacts ABC Railway Transport and the two come to an agreement: ABC Railway will run a sidetrack onto Herb's business premises, if Herb agrees not to hold ABC Railway responsible for certain liabilities that could result from the sidetrack's use. This agreement would fall under __________ in Herb's Commercial General Liability policy.

insured contracts

FL foreign surplus insurers

insured must be denied frim dimestic to join

Residual market insurance programs are funded by:

insurers and their policyholders.

Guaranty Associations are funded by:

insurers.

citizens insurance:

is available to certain people whoa re not residents of florida

citizens insurance

is availabletothose not residents of florida

"Which of the following people is eligible for coverage under the Texas FAIR plan?

kate owns one side of a duplex

As a staff adjuster, one of Abigail's most important responsibilities is reporting to the principal. This would include all of the following except:

keeping the claimant up-to-date on the progress and status of the claim.

Cost and freight

legal term used in contracts for international trade that specifies that the seller of the goods is required to arrange for the carriage of goods by sea to a port of destination and provide the buyer with the documents necessary to obtain the items from the carrier.

Medical payments coverage in a Farm policy includes all of the following EXCEPT:

libel or slander.

conditions

lists requirements that the insured must meet for coverage to apply

Workers' compensation insurance can provide compensation for all of the following, EXCEPT:

lost vacation time.

HIPPA ​

makes sure you can switch employees and health plans

Floodplain Management

maps out areas with high risk of flood, so that communities will avoid building in these areas

special damages

monies awardes to injured party for tangible

Time Element Insurance — a property insurance term referring to coverage for loss resulting from the inability to put damaged property to its normal use. This type of coverage is called "time element" insurance because the amount of loss depends on how long it takes to repair or replace the damaged propert

most common type Business interruption insurance is insurance coverage that replaces income lost in the event that business is halted due to direct physical loss or damage, such as might be caused by a fire or a natural disaster. ... Even some all-risk insurance plans have specific exclusions for losses due to viruses or bacteria.

mpci

multi pay crop insurance

Annual Transit

n uncontrolled inland marine form that covers loss of goods in transit. It applies to all of the insured's shipments during the year.

Oedinance of law

new code requirements new balcony

liability insurance only covers

no cvr intentional

government insurers

non- profit mandatory participation benefits prescribed by law designed ti meet needs of general public government has monopoly

plane wheels on the ground

not in motion

cpp

not include workers comp! IT IS A ELECTIVE BASED POLICY

policy premiums

not out of pocket

adhesion

one party sets the terms of the contract; the other may simply agree or not agree.

unilateral

only the insurer makes a promise to act; the insured can void contract at any time.

ho3

open peril dwelling and named peril for personal

HO5

open peril for structure AND personal

Private commercial insurers

operate for profit collect premiums for policyholders a portion of premiums is reserved to pay claims excess premiums become profit

Mutual Insurance Companies

owned by policyholders (no shareholders) policyholders elect board of directors participating insurers: policyholders participate in dividends

For loss settlement purposes, most homeowners policies:

pay for damages to personal property at actual cash value, and damages to structures at replacement cost.

In a Personal Auto Policy, deductibles are applied on a/an ________ basis.

per claim

In a commercial property policy, Coverage C of the Building and Personal Property Coverage Form provides coverage for:

personal prperties of others

reserve

pool of collected premiums that the insurer sets aside to pay claims

exposure

possibility of damage or loss

jury makes their decision

preponderance of evidence

Inland Marine insurance protects:

property being transported.

After an earthquake, Jake's home is still standing, but it is a little shaken. The damage is not extensive, but Jake wants to cash in on the situation, so he takes a sledgehammer to some of his extra belongings and adds them to his claim. Jake has committed:

property insurance fraud.

FELA (Federal Employer's Liability Act)

protects only trailroad workers

Hospital expense insurance

protects policyholders against losses associated with being treated in a hospital for a medical issue. ... Some people buy this type of insurance rather than rely solely on their health insurance policy to cover every cost.

federal employee compensation actually 11

provides federal govt insurance for civillian employees

Valuable papers business insurance:

provides indemnification when a business experiences a loss of vital business records Covers written, printed, or otherwise inscribed documents and records including: ● Books ● Maps ● Films ● Drawings ● Abstracts ● Deeds ● Mortgages ● Manuscripts Excludes: ● Money or securities ● Converted data ● Programs or instructions used in data processing operations

Flood Insurance

provides relief following flood damage to communities who participate in the NFIP floodplainmanagement system; covers damages to the building and its contents

BOP

provides until 12 months

A Florida company that is assigned to "Tier 2" for coverage under FWCJUA must pay:

rates that are 50% higher than voluntary market rates.

Josephine has purchased a Business Owners Policy. She insures both the real and personal property at 80% under the policy. Assuming no endorsements apply, the losses will be adjusted on a(n) _______________ basis.

replacement cost

how 2 calculate ACV?

replacement cost minus total depreciation

Public adjuster

represents insured not insurer

Indemnification

restored to the financial condition before loss

Moral Hazard

result of conscious behavior

Which of the following is FALSE about risk retention groups in Texas?

risk retention groups are considered an insurer of last resort

"Six Stars Development Company has just purchased several large properties in Las Vegas. As a result of this large purchase, they are a little short on money and decide to save money by not purchasing insurance on their new properties. Six Stars is practicing: "

risk retention.

Contributory negligence

s when insurer doesnt pay anything

A staff adjuster is a:

salaried employee working for only one insurer.

Private Insurers

sell insurance based in consumer preferences offer a wide variety of insurance products typically exist to generate a profit or benefit a group insured party voluntarily participates

"Tim is the plaintiff in a case involving an auto accident. To recover monies he feels are due him, Tim produces documents to prove he had to pay over $55,000 in medical bills. If the court were to award Tim $55,000, the damages would be classified as: "

special damages

Risk Retention Group

subject to FL for unfair claims settlement, form of self insurance,can provide commercial liability insurance

In a Commercial General Liability policy, the basic extended reporting period is also known as a(n):

tail

When an adjuster is engaging in salvage misappropriation, he is:

taking possession of salvaged property for his own use or benefit.

An adjuster might deny a claim for all of the following reasons, except:

the adjuster has a conflict of interest.

The retroactive date in the claims-made version of the CGL policy is:

the earliest date an injury can occur for coverage to apply

Insuring Agreement

the essence of the contract. often only a single sentence.

aleatory

the execution of the contract depends on an unknown future event

personal

the insured person is protected from losses, not the covered property

conditional

the insurer must only honor the contract if the insured meets certain conditions.

"In an insurance policy, the summary of what the insurer will do in the event of a covered loss is called: "

the insuring agreement.

In a Personal Auto Policy, the term "family member" would include:

the named insured's 26-year-old son who lives at home.

The purpose of a fidelity bond is to guarantee that:

the principal will not perform certain acts.

"Veronica owns a pottery business and is insured under a commercial property policy. She was in the process of building an extra structure for the sole purpose of kiln firing her pottery, but after 40 days of waiting for it to be completed, she moved her business to a new location without any intention of moving back. Her Builder's Risk Coverage Form was terminated because:

the property is abandoned

In the case of condominiums:

the unit owner and condo association share responsibility for insuring the property.

All of the following are universal exclusions in a Commercial Crime policy, EXCEPT:

theft of money or securities outside the insured premises in the care of a messenger.

"The purpose of the principle of indemnity is:

to prevent an insured from making a profit on a loss

INDEMNITY

to prevent an insured from making a profit on a loss

In a BOP, the General Aggregate Limit is:

twice the per occurrence limit.

Model regulation that defines six categories of eligible marine risks: 1. Imports 2. Exports 3. Domestic Shipments 4. Instrumentalities of Transportation or Communication 5. Personal Property Floater Risks 6. Commercial Property Floater Risks ​

twisting is

In a __________, only one party is legally obligated to perform.

unilateral contract

Non-waiver agreement is used for

when an independent adjuster is investigating a claim in catastrophe situation

FWCJUA

workers comp in FL

newer vehicle MBI Policies cover the breakdown of

● engines. ● transmissions. ● drive trains. ● steering mechanisms. ● electrical and electronic systems. ● a/c systems. ● front suspension