insurance exam

When do binders expire?

As soon as the policy is issued

For an additional premium, the extended coverages written on the basic form dwelling policy would cover which of the following?

Riot

Due to appreciation, the amount of insurance on a business is less than 80% of its actual value on the date of the loss. Which of the following is true?

The coinsurance penalty applies

If a mortgagee is named in a mortgagee clause, how would a property policy pay claims on a home damaged in a fire

The mortgagee would receive loss reimbursement

Which statement best describes agreement as it relates to insurance contracts?

one party accepts the exact terms of the other party's offer

What sublimit in a liability policy sets the maximum amount that will be paid for all claims arising from a single accident?

per occurrence

Answers to questions in an insurance application are called representations and, as such, they are

Believed to be true to the best of the applicants knowledge

Which of the following conditions allows the insurer to examine the insureds records at the end of a policy term to make sure an adequate fee is being collected for the exposure?

Deposit premium audit

According to the insured duties after a loss provision in homeowners policies, in the event of loss, the insured must do all of the following EXCEPT

Promptly hire an adjuster to evaluate the property damage

Which of the following is NOT a classification of a hazard?

Speculative

Which of the following is indicated on a certificate of insurance?

amounts and types of insurance

A personal umbrella policy may act as excess over any of the following insurance coverage policies EXCEPT

auto collision coverage

To be valid, an insurance policy must have all of the following EXCEPT

countersignature

Which of the following perils is NOT covered the DP-2

damage to pets, birds, or fish

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

limits of liability

Which of the following terms means termination of an insurance policy at its expiration date by not offering a policy continuation or replacement

nonrenewal

Which of the following would be considered a covered auto on your personal auto policy?

Your farm wagon being towed by your pick up truck

In a personal auto policy (PAP), a covered auto includes all of the following EXCEPT

a van used in the delivery business

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

insurance to value

A structure may be eligible for coverage under the National Flood Insurance Program if it meets all of the following requirements EXCEPT

is entirely over water

When insurance is written on a dwelling form, which of the following types of property would be insured under Coverage B (other structures)

A garage separated from the dwelling

An individual just applied for National Flood Insurance. How many days can she expect to wait before coverage is effective?

30

A couple noticed yesterday that several items of personal property were missing from their home. There has not been any apparent robbery committed, the items are merely missing and have seemingly disappeared mysteriously. The couple will

Not be able to make a claim for the property since it is considered to have mysteriously disappeared

An insured was judged at fault in an automobile accident. He has the 100/300 bodily injury liability coverage. Three other individuals were injured in the vehicle hit by the insured. They were awarded damages of $150,000, $75,000, and $75,000. What amount, if any was not covered by his insurance policy?

$50,000

Which of the following elements of an insurance contract requires payment of premium?

consideration

When an insured and her insurer could not agree on the amount of liability loss after her accident, the settlement was submitted to someone whose decision was then binding on both parties. What policy condition was applied?

Arbitration

The transfer of a legal right or interest in an insurance policy is called

Assignment

Which of the following is consideration on the part of an insurer?

Paying a claim

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

Personal