Insurance Exam- Readiness

The HO-4 form designed for tenants covers losses on what basis? a)Broad peril b)Open peril c)Special peril d)Basic peril

A

What is the maximum aggregate penalty for a licensee unintentionally violating the insurance laws of Delaware? a)$5,000 b)$100,000 c)$50,000 d)$1,000

B

An insurance producer's license is suspended for an unfair trade practice. How much of the producer's commissions may be kept from the sale of insurance policies made while the license was in good standing? a)All of the commissions b)A percentage of commissions specified by the Commissioner c)One third of the commissions, until examination by the Commissioner d)None of the commissions

A

The Commissioner receives complaints from several policyholders of a particular insured. She needs to examine information included in their insurance contracts. Where will she find this information? a)Licensee's principal place of business b)State Insurance Board c)The Commissioner's Office d)A & B

A

An individual will receive 10 automatic credits every 2 years, to use toward fulfilling continuing education requirements, if he or she has been continuously licensed for at least a)20 years. b)25 years. c)30 years. d)15 years.

B

Eligibility requirements for obtaining property coverage in the FAIR Plan include all of the following EXCEPT a)Risk must be located in a specific area. b)Risk must be owner occupied. c)Risk must be insurable. d)The applicant must have made an unsuccessful effort to obtain coverage in the normal market.

B

Homeowners policies consider all of the following insured locations EXCEPT a)The hotel ballroom rented by the insured for a family reunion. b)A strawberry patch owned by the insured. c)Land owned by the insured on which his new home is under construction. d)An individual cemetery plot.

B

In Delaware, if an insured reaches age 65, which of the following will occur? a)Blanket health insurance will no longer cover a person over age 65 without proof of insurability. b)Hospital and medical expenses should continue in effect with benefits equal to those under the age of 65 covered by the same company. c)Rates are not allowed to increase or decrease after age 65, even if the insured's risk category changes. d)Health contracts may reduce benefits upon an insured reaching age 65.

B

Which of the following exclusions would specifically fall under Coverage E in Homeowners insurance? a)Land b)Contractual liability c)Bodily injury to a residence employee d)Falling objects

B

Which of the following risks would be eligible for coverage under a dwelling policy form? a)A single-family dwelling that is located on farm premises b)A duplex that is occupied by two families, each of which have a bedroom rented to a boarder c)A single-family dwelling occupied by a single person who operates a business of buying and selling firearms in the basement d)A single-family dwelling that contains a beauty shop that employs three full-time operators

B

If an agent follows the rules and terms of his agent contract, he is exercising his a)Contractual authority. b)Implied authority. c)Express authority. d)Apparent authority.

C

Which of the following is NOT a condition for procuring surplus lines? a)The full amount of insurance required must not be procurable from among the insurers authorized to transact that kind of insurance in Delaware. b)The insurance must not be so exported for the purpose of securing advantages either as to a lower premium rate than would be accepted by an authorized insurer. c)The policy must not contain a surplus lines clause prohibiting such a procurement from occurring. d)The insurance must be procured through a licensed surplus lines broker.

C

Which of the following statements does NOT describe endorsements? a)Endorsements are printed addenda to a policy. b)Endorsements must be signed by an executive officer. c)Endorsements may only add coverage to a current policy, not remove. d)Endorsements may be added during the policy term.

C

Which of the following statements is INCORRECT concerning the Privacy Act of 1974? a)The Act allows a citizen to learn how records are collected, maintained, used, and disseminated by the Federal Government. b)The Act permits an individual to gain access to most personal information maintained by Federal agencies. c)The Act allows the state government to punish persons suspected of identity fraud. d)The Act safeguards against an invasion of privacy through the misuse of records by Federal agencies.

C

Which of the following types of property would be covered under Coverage C - Personal Property in a dwelling policy? a)Any personal watercraft b)Motor vehicles c)Rowboats d)2-passenger aircraft

C

"This insurance contract is issued pursuant to the Delaware Insurance Laws by an insurer neither licensed by nor under the jurisdiction of the Delaware Insurance Department." This statement is best described as a)The entire contract. b)A summary of risk insured. c)A condition for procurement. d)An endorsement of the policy.

D

A couple has been married for 45 years. For their anniversary, they decide to take a trip to Europe. During their trip, one of them loses a watch. Which floater under their homeowners policy would cover the loss? a)Personal articles b)Personal property c)Special liability d)Personal effects

D

All of the following are true about the cancellation provision of a commercial insurance policy EXCEPT a)The insurer is required to give advance notice of its intended cancellation to the insured. b)The insurer may cancel the policy by mailing or delivering written notice of cancellation to the first named insured. c)The insured may cancel the policy at any time by mailing or delivering written notice of cancellation to the insurer. d)The insurer is required to provide proof that the insured received the cancellation notice prior to cancelling the policy.

D

In businessowners policies, how soon does the period of restoration for business income coverage begin after the direct loss? a)Immediately b)24 hours c)48 hours d)72 hours

D

In reference to insurable interest, which of the following is NOT an element of insurable risk? a)Blood b)Financial c)Business d)Personal

D

Loss valuation is best described as the process of a)Providing equal benefits for a wide array of covered properties. b)Defining the replacement costs of property in relation to other insurers' costs of the same type. c)Accepting or denying coverage based on historical evidence of an applicant's property losses. d)Determining the premium charged and the amount of insurance required on a specific property.

D

Under the common policy conditions of a policy, all of the following are TRUE about changes in a policy EXCEPT a)The policy can be changed only by a written endorsement issued by the company. b)Changes in the policy can be requested only by the first named insured. c)Changes can be made only with the insurance company's consent. d)The insurer must obtain permission from all named insureds to make a change.

D

When an insured feels their insurance was wrongly canceled or nonrenewed, they can file a complaint with the Commissioner, who may then hold a hearing. If the Commissioner determines that an insurer has violated insurance laws, the Commissioner may require the insurer to do any of the following EXCEPT a)Accept the application or written request for insurance coverage at a rate and on the same terms and conditions as available to other similar risks. b)Reinstate coverage to the end of the policy period. c)Continue coverage at a rate and on the same terms and conditions as available to other similar risks. d)Reinstate coverage to the end of the policy period with a reduced premium rate.

D

When surplus lines insurance goes into effect, the broker must execute an affidavit to the Commissioner a)Within 15 days. b)Immediately. c)Within 10 days. d)Within 30 days.

D

Which of the following would NOT be covered as a loss under Coverage D of a homeowners policy? a)An insured has an apartment in his home. The tenant's negligence started a fire, and the apartment was not fit to live in for 4 months while repairs were being completed. b)After a fire in a building next to the insured's home, the insured could not occupy his home, and had to stay at a motel for one week. c)An insured's home is damaged by fire. The insured incurs expenses for living in a motel and having meals in a restaurant while repairs are made. d)An insured leased a dwelling for 5 years. Two years later, the property owner died, and the new property owners wanted to make the property their principal residence, so the lease was canceled.

D