Insurance Guaranteed Exam

an insured has an automobile policy with limits of 100/300/50 and a deductible of $1,000. he is involved in an accident and crashes into another drivers auto. the other driver is awarded $125,000 for his injuries and $25,000 for the damage to his car. the insureds vehicle has damages in the amount of $1,200. the total payment made under the insureds policy is

$125,200 (from subtracting the deductible from the total loss)

mitchell earns $1,200 a week. if he is out of work for 14 days because of a job-related accident, how much can he recover for lost wages?

$800(can receive 2/3)

business auto coverage apply only to those autos that are identified as covered autos in the declarations by entry of the appropriate numerical symbol. which symbol affords the broadest coverage?

1

if an insurer chooses to cancel a personal property insurance policy that has been in effect for more than 60 days, how much notice must the insurer provide the insured?

20 days

what is the waiting period for transportation expenses coverage for a loss other than theft of a covered auto?

24 hours

which of the following is NOT an accepted method of demonstrating an individuals financial responsibility? A. a cash deposit(delivered to the department) B. a motor vehicle liability policy(written with the required limits) C. a bond (issued o behalf of the state of indiana) D. a certificate of self-insurance

A. a cash deposit(delivered to the department)

which of the following statements is NOT true? A. a licensed consultant may hold a producer license. B. a consultant is licensed to give advice for a fee. C. a consultant may not be compensated by a producer. D. a producer may act as a consultant.

A. a licensed consultant may hold a producers license.

under a commercial general liability policy, which of the following is NOT considered mobile equipment? A. an automobile used as a company car by a real estate company. B. a combine used on a farm. C. the department of transportations resurfacing equipment. D. the bulldozer used by an excavating company.

A. an automobile used as a company car by a real estate company.

some accidents are not covered even if they happen while the employee is engaged in a covered employment. which of the following accidents would NOT be covered by the Indiana Workers Compensation law? A. an employee becomes intoxicated at his employers christmas party and is injured after falling down a flight of stairs. B. an employee is injured while delivering a package that was negligently packed by his employer. C. an employee cleaning a fuel tank is injured when he lights a match to see if the fuel tank is empty. D. a mechanic is injured while test-driving a customers auto at a high speed.

A. an employee is intoxicated at his employers christmas party and is injured after falling down a flight of stairs.

which of the following is NOT true regarding a cease and desist order? A. it applies only to individual producers. B. a producer violating the order may be subject to a fine up to $25,000. C. the commissioner may rule to revoke a producers license for violating the order. D. it requires the producer to stop committing the action in violation of the insurance law.

A. it applies only to individual producers

if a producer changes his or her email address, which of the following needs to happen? A. the producer must notify the commissioner within 30 days. B. nothing, an email address does not need to be disclosed. C. the producer must file the change of email address form with the NAIC. D. the producer must notify his/her insurance company within 3 business days.

A. the producer must notify the commissioner within 30 days.

what term is used for insurance companies that have a certificate of authority to transact insurance?

Admitted

which of the following would be added for coverage under a property policy by endorsement? A. first named insured B. additional insureds C. all insureds D. named insured

B. additional insureds

which of the following is most likely INELIGIBLE for coverage under the businessowners policy? A. an office with total floor area of 5,000 square feet. B. an auto mechanic shop. C. a fast-food restaurant. D. a retailer with gross annual sales of $100,000

B. an auto mechanic shop

which of the following perils is NOT covered the DP-2? A. damage caused by falling objects. B. damage to pets, birds, or fish. C. damage caused by burglars. D. damage caused by the weight of ice and snow.

B. damage to pets, birds, or fish.

which of the following is covered under a dwelling policy? A. structures used for commercial manufacturing. B. fire caused by an earthquake. C. freezing plumbing systems. D. flood or surface water.

B. fire caused by an earthquake.

which of the following exposures is NOT covered under a homeowners policy? A. personal liability B. medical payments to an insured C. unscheduled personal property damages D. bodily injury to others

B. medical payments to an insured

which of the following exclusions applies to both personal injury and advertising injury in the businessowners policy? A. the wrong description of the price of goods, products, or services. B. willful violation of a penal statute or ordinance committed by the insured. C. breach of contract under an implied contract. D. an offense committed by an insured whose business is advertising.

B. willful violation of a penal statute or ordinance committed by the insured.

which of the following would NOT be eligible for coverage under a personal auto policy? A. a nonowned temporary substitute vehicle. B. a trailer owned by the insured. C. a vehicle purchased 90 days ago. D. a vehicle listed on the declerations page.

C. a vehicle purchased 90 days ago(newly owned autos only covered for 30 days)

which of the following is NOT one of the 3 accounts that is used by the indiana property and casualty insurance guarantee association for the purpose of administration and assessment? A. workers compensation B. automobile insurance C. mortgage guarantee insurance D. all other classes of insurance

C. mortgage guarantee insurance

all of the following may obtain a limited insurance license in Indiana without an examination EXCEPT A. a person selling travel accident insurance in a transportation terminal. B. a person selling insurance on baggage. C. a person selling title insurance. D. a person acting as a funeral director selling funeral policies.

D. a person acting as a funeral director selling funeral policies.

which of the following is covered by auto other-than-collision(comprehensive) coverage? A. radar detector B. portable cd player C. awning attached to car for camping D. electric equipment required for the normal operation of the car

D. electric equipment required for the normal operation of the car

Space Age Rockets makes model rocket supplies and has 12 employees. the company is located in Atlanta, GA. Georgia has compulsory workers compensation laws. Space Age's owner thinks that his company is too small and unprofitable to carry the workers comp plan mandated by the state. Possible consequences of noncompliance include all of the following EXCEPT A. closure of the business as a public nuisance by state officials. B. payment for injuries in monetary amounts stipulated by the state with respect to workers compensation plans. C. payment of fines and penalties as dictated by state compliance authorities. D. forced payment of billing for services rendered by any private insurer that binds coverage based on an employee's request for coverage.

D. forced payment of billing for services rendered by any private insurer that binds coverage based on an employee's request for coverage.

which of the following statements is true regarding advertisement of the fact that the insurance guarantee association would assure payment of benefits in the event of insurer insolvency? A. insurers may choose whether to mention the association in advertisements, but if they choose to do so, they must first pay a fee to the department of insurance. B. if insureds join the insurance guarantee association, they will be protected financially, even if their insurers become insolvent. C. all advertisements of an insurer must mention coverage by the association. D. it is illegal to mention the association in advertisements.

D. it is illegal to mention the association in advertisements.

which of the following describes an insurer's responsibility for payment under a policy, as stated in the common policy provisions? A. consideration B. utmost good faith C. premiums D. limits of liability

D. limits of liability

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. personal

which of the following statements is correct regarding the debris removal coverage under the businessowners policy? A. it pays for cleanup or removal of pollutants from land or water. B. it pays for removal of the debris of the insured's damaged automobile. C. the debris of covered property must be reported in writing within 270 days of the loss. D. the insured's limit of liability is 25% of the sum of the direct loss payment plus the deductible amount.

D. the insured's limit of liability is 25% of the sum of the direct loss payment plus the deductible amount.

when symbol 7 is provided, which of the following statements is true with regards to newly acquired autos? A. they are covered only until the end of the policy term. B. they are not covered until the insurer is notified. C. they are automatically covered for 30 days. D. they are covered if they are used to replace previously owned autos with that coverage.

D. they are covered if they are used to replace previously owned autos with that coverage.

which homeowners form provides open peril coverage for dwelling (coverage A) and contents(coverage C)?

HO-5

john had a disagreement with his insurer on the value of his damaged property. after making a written demand, both john and the insurer each selected an appraiser. the appraiser then agreed on a fair value without having to select an umpire. what condition did john use?

appraisal

the HO-4 form designed for tenants covers losses on what basis?

broad peril

when dealing with workers compensation, if a minor is participating in a school to work program, he or she is

eligible for limited workers compensation benefits

an insured was involved in an accident that was caused by a tire blowing out. the insured was severely injured and incurred expenses of $100,000. the insured brought a recovery action against the manufacturers of the auto and the tire. the court held that the tire was the cause of the accident. who is required to pay for this loss?

manufacturer of the tire

a producer may act as a consultant if he/she

meets the compensation disclosure requirements

guaranteeing future dividends is considered to be an unfair or deceptive act known as

misrepresentation

an insured has standard coverage on her dwelling that includes coverage for vandalism and malicious mischief. one evening she is sitting in her living room when she hears a crash and the sound of glass breaking. she runs to the door and discovers a brick has been thrown through her glass door. to inform her insurer of a possible claim, she fills out a form detailing the events leading to the loss. what is the name of the form?

notice of claim form

prior to paying a claimant under a professional liability policy, the insurer must

obtain the consent of the insured

the other states insurance section of a workers compensation policy provides coverage

only for those states listed in the policy.

uninsured motorist or underinsured motorist coverage may be rejected by

only the named insured

the defendant being released on a surety bond is the

principal

a policy contains a consent to settle a loss provision, which requires the insurer to obtain the consent of an insured before the settlement of a claim. with this in mind, what kind of liability policy does the insured most likely have?

professional liability

the exact, direct, uninterrupted cause of loss is the

proximate cause

an insured was having a new home built. while digging for the footings for the foundation, the contractor struck a solid rock formation and found that was necessary to blast the formation in order to remove the rocks. the force of the blast broke several windows and some chinaware in a neighbor's home several blocks away. who pays for the damages?

the contractor

the owners of a rental dwelling, insured under a DP-2 turns off the heat in the insured dwelling during the winter months because the dwelling is not occupied. the buildings water pipes freeze and break, causing damage. how will the policy react to this loss?

this loss is excluded from coverage.

the broad cause of loss form in the commercial property policy contains perils in addition to the basic form perils. which of the following is NOT one of those three perils? A. falling objects. B. utility services. C. water damage. D. weight of snow, ice, or sleet

utility service

when does the insurers duty to defend a suit or claim end in a commercial general liability policy?

when loss payments equal applicable limit of insurance.

if a car is stolen and left in a snow bank and the radiator freezes and does a lot of damage, is the damage covered by the auto policy?

yes, freezing exclusion is removed if the car is stolen