Liberty Mutual Missed Questions

In order to get a non-resident license is this state a producer must

Apply and pay a fee to a non-resident state that reciprocates.

First aid costs for others injured on the insured's premises

Are paid in addition to the liability limit.

The difference in the contents coverage on an HO-3 and HO-5 is which of the following?

Contents are covered open peril on HO-5, and named peril on HO-3.

Which of the following property coverages would provide protection to contents damaged by fire?

Coverage C

In a personal auto policy, the medical payments coverage is similar to

Direct loss

All of the following are optional coverages that may be attached to an HO-3 policy EXCEPT

Dwelling replacement cost.

The policy conditions define

How parties to the contract must act following a loss.

An insurance company sends frequent email advertisements and coupons to its customers. One customer does not want to receive these emails anymore and requests to be excluded from the mailing list. The emails to the customer must stop within

10 business days.

Provided the reasoning isn't for nonpayment of premium, how many days of notice must an insured be provided if their automobile insurance policy is being canceled?

10 days

According to the loss payment condition in HO policies, losses must be paid within how many days of the insurer receiving proof of loss?

12:01 am the day after the application and premium payment are mailed

Johanna purchased a National Flood Insurance policy 10 days after her community entered an emergency program. When would her coverage be effective?

12:01 am the day after the application and premium payment are mailed

How many days after an initial pretrial hearing date, does an insurance producer have to report any criminal prosecution to the Director?

30

If a producer changes his or her residential address, the Director must be notified of the change within how many days?

30

Under the dwelling policy, if an insurer chooses to repair or replace damaged or lost property, it must inform the insured within how many days of receiving proof of loss?

30 days

An insured with a homeowners policy has removed property from the insured location to protect it from loss that could be caused by a covered peril. The removal coverage applies for

30 days.

If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply?

5 days

Under Coverage C of a homeowners policy, the amount of insurance provided to cover personal property of the insured is

50% of the amount provided as Coverage A.

According to the loss payment condition in HO policies, losses must be paid within how many days of the insurer receiving proof of loss?

60 days

Which of the following would NOT be accepted as a document showing that an applicant for a license is in the United States legally?

A valid credit card with a major United States credit company

Every producer must maintain a place of business in Arizona

Accessible to the public.

In a personal auto policy, the medical payments coverage is similar to

Accident insurance, because it pays medical expenses regardless of fault.

What documentation grants express authority to an agent?

Agent's contract with the principal

Which of the following types of valuation works best for property whose value does not fluctuate much?

Agreed value

How much is covered for debris removal under the HO property additional coverages?

All reasonable costs

What is reinsurance?

An agreement between a ceding insurer an assuming insurer

While an insured's covered auto is in the repair shop following damage caused by a collision, the insured would have coverage for which of the following vehicles under a personal auto policy?

Any vehicle not owned by the insured, but furnished for use while the covered auto is out of normal use because of repair

An insured was involved in an automobile accident for which the insured was at fault. Which of the following coverages would pay for damage to the insured's automobile?

Collision

Which of the following statements is true concerning the special form dwelling policy?

Coverage A is for all-risk perils, and Coverage C is for the broad form perils.

Which of the following would provide coverage for loss of income when an insured rental dwelling is rendered uninhabitable because of a covered loss?

Coverage D

Which of the following dwelling policy forms primarily insures a structure on an actual cash value basis?

DP-1

Which of the following is a mandatory part of an insurance policy that varies with each individual policy?

Declarations

The following are all causes for the Insurance Director to suspend or impose conditions upon the continuance of a producer's license EXCEPT

Evidence that the producer is a poor personal credit risk.

Compared with other drivers in his age group, a driver has had more minor accidents and traffic violations. Which of the following rating types would most accurately reflect the driver's true insurance risk?

Experience

The homeowners policy covers collapse caused by all of the following EXCEPT

Foundation cracks.

The main difference between an HO-4 and an HO-6 is

HO-6 provides limited dwelling coverage as well as contents coverage.

All of the following are conditions commonly found in the insurance policy EXCEPT

Insuring agreement.

Which of the following would be covered under the Broad Form (DP-2) policy's falling object peril?

Interior building damage if the exterior was damaged first

Every office that transacts surplus lines insurance must have on staff a person who

Is licensed as a surplus lines broker.

All of the following are true of Coverage B - Other Structures EXCEPT

It must be added by endorsement to a homeowners policy.

How much coverage can be available for watercraft damage in the homeowners policy?

It provides errors and omissions coverage for an agency.

Which of the following statements is NOT true regarding a personal umbrella liability policy?

It provides errors and omissions coverage for an agency.

A producer in New Mexico wants to become a producer in Arizona. The Department will waive certain examination requirements, provided that New Mexico would waive these same requirements if an Arizona producer sought licensure in New Mexico. What term is used to describe this phenomenon?

Reciprocity

Which of the following endorsements is used to insure Coverage C (personal property) for values beyond the limitations of the homeowners policy?

Scheduled personal property endorsement

Theft coverage under an HO-8 is restricted to

The actual cash value of what was stolen, with limits for certain classes of property.

An insured has a personal auto policy with both comprehensive (other-than-collision) and collision coverage. His car is stolen and recovered five days later. If the insured claims transportation expenses of $20 per day, how much will his policy pay?

$60

What is the grace period for payment of premium on an automobile policy?

7 days

A policy condition that stipulates how the amount of damaged or lost property will be determined if the insured and the principal do not agree is known as

Appraisal

What is the purpose of a certificate of authority?

To show the lines of insurance an insurer is authorized to transact

A premium payment is due on the Saturday before Memorial Day. What is the latest the insured can mail the payment for it to be considered on time?

Tuesday after the due date

In the personal auto policy, owned trailers being towed by an insured auto are automatically covered for

Uninsured motorist coverage.

An insured is a member of the neighborhood association, and has become liable for damage to a third party. Each member of the association has been assessed a portion of the loss equal to $2,000. How much will the Loss Assessment additional coverage of the insured's homeowners liability policy pay?

Up to $1,000

An insured decides to store some heavy boxes in the attic. While moving them around, he accidentally drops a heavy box that crashes through the ceiling, causing $1,000 of damage. The insured's HO-3 policy form will pay

$1,000 minus the deductible.

An insured has $5,000 of medical coverage on a personal auto policy at the time of a covered accident. The insured and two passengers are injured. Medical treatment costs $7,000 for the insured, $4,000 for the first passenger, and $8,000 for the second passenger. How much will the policy pay under medical payments coverage?

$14,000

Transportation expenses are covered under a personal auto policy for

$20 per day, for a maximum of $600.

What is the basic limit for costs incurred at the place a vehicle is disabled provided by the towing and labor costs endorsement?

$25

A $100,000 house insured on a policy with an 80% coinsurance requirement has a fire that caused $40,000 of damage; the owner has a policy with $60,000 coverage. How much can the owner collect for his loss?

$30,000

All of the following are special personal property limits under a homeowners policy EXCEPT

$500 for business personal property on the insured premises.

An insured hits a deer and crashes his car into a tree. The total damage to the vehicle is $6,000. How will this loss be covered?

$6,000 would be paid under other-than-collision coverage.

What is the maximum number of roomers or boarders for properties insured under the dwelling policy?

5

An insured couple owns a pontoon boat. Which situation would NOT be covered by their watercraft endorsement under their homeowners policy?

A friend rents their boat and runs it into a neighbor's dock.

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

A pickup or van titled to and used in the named insured's business.

You own a Harley Davidson motorcycle and also the black Ford F-150 pickup with the Harley Davidson trim package. Which could be insured on a PAP?

Both the pick up and the motorcycle

Which of the following other coverages is NOT included in the basic form dwelling policy?

Breakage of glass

Under the HO-4 and HO-6 homeowners policy forms, property is insured against

Broad form perils.

Because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements EXCEPT

Conditions

When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?

Consideration

Which of the following is a unit of measurement an underwriter uses when determining the premium rates for insurance?

Exposure

Which of the following regulatory authorities participated in creating the National Do Not Call Registry?

FTC

Which of the following losses would be covered by an unendorsed homeowners policy?

Fire or lightning

When would a misrepresentation on the insurance application be considered fraud?

If it is intentional and material

All of the following are major coverages included in the homeowners policy EXCEPT

Loss of income.

Which of the following is a common exclusion found in Part D: Coverage for Damage to Your Auto of a PAP?

Mechanical breakdown

Which of the following coverages is included in an unendorsed homeowners policy?

Medical payment to others

An insured who has coverage for all his personal property has his TV stolen from the shop of the repairman. The owner of the repair shop filed a claim under the insured's policy, but it paid nothing to the owner of the store. Which provision does the policy have?

No benefit to bailee clause

When a new insurance company wishes to transact business in the state, it must do all of the following EXCEPT

Obtain approval of each of its corporate officers and executives.

The HO-3 homeowners policy provides

Open peril coverage on the dwelling and broad form coverage on personal property.

Which of the following liability coverages must be added by endorsement to a homeowners policy in order to apply?

Personal injury

Section I of a boatowners policy covers

Physical damage.

Limited fungi, wet or dry rot, or bacteria endorsement in HO policies applies to

Property and liability losses

Under Section I, homeowners insurance must include

Property coverage.

Under the personal auto policy, liability for bodily injury resulting from the insured's use of a nonowned automobile is

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

The Federal Fair Credit Reporting Act

Regulates consumer reports.

Which of the following would NOT be considered a flood?

Sewer backup

Which of the following is NOT a limitation under Mexico Coverage?

Suits may be brought by either U.S or Mexican citizens.

Under a dwelling policy, which of the following is NOT a factor in determining a loss?

The amount negotiated by the insured

All of the following statements concerning coinsurance are true EXCEPT

The coinsurance formula will also be applied to total losses.

In comparison to consumer reports, which of the following describes a unique characteristic of investigative consumer reports?

The customer's associates, friends, and neighbors provide the report's data.

An individual applies for a life policy. Two years ago he suffered a head injury from an accident, so he cannot remember parts of his past, but is otherwise competent. He has also been hospitalized for drug abuse, but does not remember this when applying for insurance. The insurer issues the policy and learns of his history one year later. What will probably happen?

The policy will not be affected.

The insurer must be able to rely on the statements in the application, and the insured must be able to rely on the insurer to pay valid claims. In the forming of an insurance contract, this is referred to as

Utmost good faith.

When an umbrella policy is broader than underlying insurance and it pays a loss that is not covered by the underlying policy, it usually only pays

The excess over the self-insured retention.

Losses that result from the freezing of a plumbing system while the dwelling is vacant would be EXCLUDED under a homeowners policy UNLESS

The insured had drained the plumbing system.

Which of the following statements would be correct if an insured failed to maintain the underlying limits as required by a personal umbrella policy?

The insured would be responsible for the amount required as underlying limits in the event of a claim.

All of the following are true regarding physical damage coverage EXCEPT

The limit of liability is the greater of the actual cash value of the vehicle at the time of loss or the amount necessary to repair or replace the vehicle.

On a DP-3 Dwelling Property Special Form policy, the coverage provided for personal property is

The same as provided on the DP-2 Broad Form.

Which of the following losses would most likely NOT be covered under Coverage A in the dwelling policy?

Theft of a renter's lawnmower used to service the premises

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

This loss is not covered

Which of the following is NOT a goal of risk retention?

To minimize the insured's level of liability in the event of loss