Missed Questions
A builder's risk form is most often written as which of the following? a. completed value form b. scheduled form c. reporting form d. specific value form
a
A liability policy that covers all claims arising out of incident occurring during the policy period, regardless of whether the policy is still in effect at the time of the claim, is known as a. an occurrence policy b. claims-made policy c. limited
a
A passenger in a friend's car is injured while getting into the car. Which of the following statements would apply if both the passenger and the driver had medical payments coverage under a personal auto policy? a. the driver's policy would be primary b. the driver's policy would act in excess of the passenger's policy c. the passenger's policy would be primary d. both policies will share equally in the loss
a
An agent is acting ethically in all of the following situations EXCEPT a. always representing the insured b. working within the conditions of his/her contract c. representing the insurer, not the insured d. keeping the customer's best interest in mind
a
Because an insured owns a lot of expensive jewelry, her insurance agent has advised her to purchase a scheduled personal property endorsement. If the insured adds this endorsement to her homeowners policy, which of the following statements would be correct? a. Coverage C limits will no longer apply to the jewelry insured by the endorsement b. the amount of coverage will be doubled c. the endorsement becomes excess coverage d. the endorsement becomes primary coverage and the HO contract is secondary
a
In a commercial package policy the business owner may select from all of the following types of coverage EXCEPT a. general liability coverage b. crime c. worker's compensation d. equipment breakdown
a
Professional photographers and musicians may insure their equipment with a. a commercial articles floater b. a theatrical property coverage form c. a contractors equipment floater d. an installation floater
a
The Declarations section of a PAP identifies all of the following except a. definition of covered auto b. loss payees c. mailing address d. named insured
a
The crime of forced entry into the premises of another by a person or persons with felonious intent is defined as a a. theft b. burglary c. breaking and entering d. robbery
a
The crime of forced entry into the premises of another person by a person or persons with felonious intent is defined as a. burglary b. breaking and entering c. theft d. robbery
a
The inspections and surveys condition in a businessowners policy a. allows the insurer the right to inspect the insured's premises b. validates the insured is in compliance with state and federal guidelines c. obligates the insurer to make annual safety inspections d. guarantees that all working conditions are safe and healthful
a
The legal concept that requires that worker's compensation coverage benefits be accepted by an injured employee as the only recourse an employee has in the settlement of injury claims is called a. the exclusive remedy program b. the omnibus resolution provision c. the unilateral recourse provision d. the exclusive authority provision
a
Under a dwelling policy, which of the following is NOT a factor in determining a loss? a. the amount negotiated by the insured b. the policy limit c. the amount of the insured's interest in the property at the time of loss d. the amount necessary to repair or replace the property
a
What type of ocean marine insurance provides physical damage coverage for the ship while it is in transit? a. hull b. freight c. protection & indemnity d. cargo
a
Which of the following coverages is included in an unendorsed homeowners policy? a. medical payment to others b. personal property replacement coverage c. fungi, wet or dry rot, or bacteria d. earthquake
a
Which of the following would NOT be covered by medical payments to others in Section II of your HO policy? a. you cut your leg while whacking weeds in your backyard with your neighbor's weed whacker b. your child's nanny falls while walking down your steps c. you are walking your neighbor's dog and it bites someone d. you allow the neighborhood kids to play flag football in your yard; one is injured
a
Which of the following would NOT be eligible for coverage under a Personal Auto policy? a. a vehicle purchased 90 days ago b. a nonowned temporary substitute vehichle c. a trailer owned by the insured d. a vehicle listed on the declarations page
a
Within how many days of requesting an investigative consumer report must an insurer notify the customer that the report will be obtained? a. 3 days b. 5 days c. 10 days d. 14 days
a
According to the conditions of a workers compensation policy, the insurer has the right to inspect the insured workplace a. with at least 5 days' notice b. at any time c. with at least 10 days notice d. with the consent of the insured
b
According to the loss payment condition in HO policies, losses must be paid within how many days of the insurer receiving proof of loss? a. 30 days b. 60 days c. 90 days d. 120 days
b
All of the following are conditions commonly found in the insurance policy EXCEPT a. cancellation and nonrenewal b. insuring agreement c. subrogation d. appraisal
b
All of the following are examples of risk retention EXCEPT a. self-insurance b. premiums c. deductibles d. copayments
b
All of the following are special personal property limits under a homeowners policy EXCEPT a. $2,500 for theft of firearms b. $500 for business personal property on the insured premises c. $1,500 for securities, accounts, deeds, and evidences of debt d. $1,500 for trailers not used with watercraft
b
An insurance policy is a legal contract, and as such, it must include all of the following elements except a. legal purpose b. conditions c. offer and acceptance d. consideration
b
Both the broad theft and limited theft endorsements on the dwelling program exclude all of the following types of property EXCEPT a. aircraft b. watercraft c. credit cards d. motor vehicles licensed for the road
b
FAIR plans are provided by a. the state b. private insurers c. the Guaranty Association d. the federal government
b
If an insured purchases an insurance policy with a large deductible, what risk management technique is the insured exercising? a. avoidance b. retention c. reduction d. sharing
b
In which of the following situations would off-premises coverage in a broad theft endorsement of the insured's dwelling policy apply? a. insured's vacuum cleaner is stolen from her apartment b. insured's camera is stolen from his suitcase while he is on vacation c. the insured's live-in maid's quarters are burglarized d. The insured's china set is stolen from her home while she's traveling on business
b
Professional liability coverage protects the insured against legal liability resulting from a. the unprofessional conduct of an employee b. errors and omissions c. liability assumed under a contract d. dishonest acts
b
The occurrence form trigger is based on which of the following? a. the number of claims made during the policy period b. the date when the injury occurs c. the place where the injury or damage occurs d. the amount of the insured's deductible
b
To have insurable interest, what risk must the policyowner face? a. speculative risk b. financial loss c. physical injury d. property damage
b
Tom's Truck Service's vehicle is stolen. The policyholder may obtain coverage for transportation expenses subject to which of the following limits? a. $25 per day; $450 maximum b. $20 per day; $600 maximum c. $15 per day; $300 maximum d. $15 per day; $450 maximum
b
What is material representation? a. concealment b. a statement be the applicant that, upon discovery, would affect the underwriting decision of the insurance c. any misstatement made by an applicant for insurance d. any misstatement by the producer
b
What is the amount of valuable papers and records coverage provided in an unendorsed HO policy? a. $1,000 b. $2,500 c. up to Coverage C policy limits d. no coverage is provided
b
Which of the following is not a contract bond? a. bid bond b. litigation bond c. performance bond d. maintenance bond
b
Which of the following statements is NOT true regarding a personal umbrella policy? a. it provides excess liability coverage over underlying personal liability b. it provides errors and omissions coverage for an agency c. it may cover certain exposures not provided under the primary layer d. it may require the payment of a self-insured retention
b
Which of the following statements is true regarding the commercial general liability policy's Coverage C- Medical Payments a. the coverage provides high limits of insurance for bodily injury to the named insured b. the coverage is considered good will because payments are made without regard to fault c. the coverage applies to bodily injury to the named insured d. the coverage is liability insurance because it only pays if the insured is legally liable
b
Which of the following statements would be correct if an insured failed to maintain the underlying limits as required by a personal umbrella policy? a. the insured would have to pay the self-insured retention limit b. the insured would be responsible for the amount required as underlying limits in the event of a claim c. it would have no effects on the umbrella policy d. the policy would be cancelled
b
Which of the following terms refers to other insurance that is written on the same risk, but not on the same coverage basis? a. contribution by equal shares b. nonconcurrency c. primary and excess d. pro rata
b
Which of the following types of property would be covered in homeowners coverage forms? a. animals, birds, or fish b. landlord furnishings in an on-premise apartment c. structures used for business purposes d. structures rented to others who are not tenants of the dwelling
b
While an insured was towing a utility trailer with his auto, the trailer came loose and ran into a store front. What part of the insured's auto policy would pay for the damage to the store? a. other than collision b. property damage liability c. collision coverage d. no coverage
b
A manufacturing company had five of its employees claim lung disease from a compound used in the manufacturing of their products. Each employee sued the company for $200,0000. What is the maximum the Employers Liability policy will pay for all claims? a. $100,000 b. $250,000 c. $500,000 d. unlimited
c
All of these types of property may be covered on a farm property coverage form EXCEPT a. barns b. silos c. growing crops d. farm machinery
c
An insurance company receives an application with some information missing and issues the policy anyway. What is it called? a. subrogation b. aleatory c. waiver d. estopple
c
An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated? a. good faith b. adhesion c. consideration d. representation
c
Another person has alleged that you are responsible for damage to their property. You notify your homeowners insurer. The insurer will a. proceed according to your request b. defend with the hopes of not paying damages c. either pay or defend as it decides d. pay the alleged damages
c
Assuming the insurer and the insured agree on the amount payable for a loss covered under a dwelling policy, how soon after receiving the proof of loss must the insurer pay the claim? a. 30 days b. 45 days c. 60 days d. 90 days
c
Employers liability coverage under a workers compensation policy includes a. punitive damages b. claims from a spouse injured by an employee c. third-party liability claims d. intentionally caused injuries
c
How much is covered for debris removal under the HO property additional coverages? a. everything after a $200 deductible b. nothing, unless added by endorsement c. all reasonable costs d. 90% of the total loss covered
c
In the personal auto coverage, owned trailers being towed by an insured auto are automatically covered for a. comprehensive coverage b. collision coverage c. uninsured motorist coverage d. towing coverage
c
Poe Insurance Co. has decided to cancel Joseph's auto liability policy due to nonpayment. What is Poe Insurance Co. required to do? a. Provide Joseph with a 45 day grace period; during this time, Joseph can pay overdue premiums and reinstate the policy b. nothing, nonpayment is grounds for immediate cancellation c. provide Joseph with written notice at least 10 days in advance d. provide Joseph with written notice at least 45 days in advance
c
The amount an insurer will pay under Coverage D (Loss of Use) depends on a. if the dwelling is owner-occupied or rented out b. the length of time the dwelling inuninhabitual c. the amount of coverage on the dwelling d. how long a dwelling has been occupied
c
The extended discovery period in the Crime general provisions for the Loss Sustained Form is a. 60 days b. 90 days c. 1 year d. 3 years
c
The insured's mother in law broke her leg falling down the front steps of the insured's premises. The insured's homeowners medical payments coverage will a. pay only if the mother in law has no health insurance of her own b. share equally in the cost of the mother in law's health insurance c. apply to injuries of any guests or visitors d. pay as excess over the mother in law's health insurance
c
The pro rata liability cause is designed to protect the principle of a. insurable interest b. waiver and estoppel c. indemnity d. subrogation
c
What is the maximum number of roomers or boarders for properties insured under the dwelling policy? a. 2 b. 3 c. 5 d. 6
c
What is the term for the entity that an agent represents regarding contractual agreements with third parties? a. designee b. insured c. principal d. client
c
What type of damages may be awarded by the court to create disincentives that discourage behavior that is deemed highly undesireable by society a. compensatory b. specific c. punitive d. general
c
What type of information would be found in a policy's insuring agreement? a. policy limits b. insurer's address c. renewal dates d. location of premises
c
Which HO form provides open peril coverage for Coverage A- Dwelling and Coverage C- Contents? a. HO-5 b. HO-2 c. HO-3 d. HO-8
c
Which method of loss valuation is contrary to the basic concept of indemnity? a. market value b. agreed value c. replacement cost d. functional replacement cost
c
Which of the following best describes the amount of loss assessment coverage included under a homeowners policy liability coverage section? a. up to $10,000 aggregate for the policy period b. up to $5,000 aggregate for the policy period c. up to $1,000 per occurrence d. up to $2,500 per occurrence
c
Which of the following is a cancellation procedure in which the premium returned to the insured is NOT in direct proportion to the number of days remaining in the policy period a. dividend b. flat rate c. short rate d. pro rata
c
Which of the following is the amount of loss assessment coverage included under an HO Liability coverage section a. up to $5,000 aggregate for the policy period b. up to $2,500 per occurrence c. up to $1,000 per occurrence d. up to $10,000 aggregate for the policy period
c
Which of the following is the most precise synonym for an "admitted" insurer a. licensed b. legal c. authorized d. certified
c
Which of the following other coverages in NOT included in the basic form dwelling policy? a. personal property temporarily away from the insured premises b. tenant's improvements, alterations, and additions c. breakage of glass d. removal coverage
c
Which of the following personal auto coverages would pay for the insured's travel expenses and loss of earnings while involved in the settlement process of a covered loss? a. comprehensive coverage b. collision coverage c. liability coverage d. medical payments
c
Which of the following protects consumers against the circulation of inaccurate or obsolete information a. Consumer Privacy Act b. The Guaranty Association c. The Fair Credit Reporting Act d. Unfair Trade Practices Law
c
Which of the methods of loss valuation replaces the damages property , even if its replacement is more expensive than the limits shown on the policy? a. replacement cost b. agreed value c. guaranteed replacement cost d. functional replacement cost
c
Why don't commercial auto coverage forms automatically include medical payment coverage? a. commercial auto coverage is for damaged vehicles only b. any person occupying a commercial vehicle must have a personal auto policy to cover any medical payments c. often, any person occupying a commercial vehicle would be covered under a workers compensation policy d. the business that owns the vehicle must be self-insured for medical payment coverage
c
Workers Compensation rating is developed by applying a rating bureau job classification rate to each a. $5,000 of payroll b. $1,000 of payroll c. $100 of payroll d. $250 of payroll
c
A special type of insurance that guarantees the faithful performance of a trust employee benefit plan is called a. directors and officers insurance b. errors and omissions c. surety bond d. fiduciary liability insurance
d
A unique feature in a bailee form is that it covers a. fire and theft losses to the insured's stock held for sale without and deductibles b. all loss and has no exclusions c. the building occupied by the insurer whether it is owned or leased d. customer's property whether or not the insured has been negligent
d
All of the following are Other Coverages included in both the broad and special form dwelling policy EXCEPT a. breakage of storm door glass b. collapse c. lawns, trees, shrubs, and plants d. theft of personal property
d
All of the following are additional liability coverages automatically provided in a homeowners policy EXCEPT a. claims expenses b. damage to the property of others c. loss assessment coverage d. personal injury
d
All of the following are other coverages included in both the broad and special form dwelling policy EXCEPT a. collapse b. breakage of glass c. lawns, trees, shrubs, and plants d. theft of personal property
d
All of the following are supplemental payments included in the liability section of a personal auto policy EXCEPT a. up to $200 days for loss of earnings due to attendance at hearings or trials b. premiums on appeal bonds in any suit the insurer defends c. up to $250 for bail bonds required because of a covered accident d. up to $100 for the cost to secure the release of a vehicle from an impoundment lot following a covered accident
d
All of the following people would be considered insureds under the liability section of a homeowners policy EXCEPT a. a 15-year-old foster child residing in the premises b. the mother of the insured who is residing in the household c. the legal representative of a deceased insured d. the 22-year-old niece of the insured who is visiting
d
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? a. $15,000 b. $5,000 maximum of the accident c. $5,000 minus the policy deductible d. $14,000
d
An insured runs a day care in her home. She purchased the home day care endorsement under her homeowners policy. Which of the following losses would her coverage cover? a. a child is playing in the insured's car, puts it in drive, and backs into the neighbor's mail box b. a child has bruises on her legs from receiving a spanking from the insured and must be seen by her pediatrician c. a child riding the insured's horse falls off, breaking her collar bone d. a child trips over a toy in the driveway, cuts her knee, and requires stiches
d
An ocean marine loss that occurs through the voluntary sacrifice of a part of the vessel to cargo to save the ship, crew, or other cargo is known as a. sue and labor b. a particular average c. a salvage loss d. a general average
d
Employers liability insurance, Part Two of a standard workers compensation and employers liability (WC&EL) policy form, excludes a. Liability to a third party for claims arising out of injury to an employee b. bodily injury caused by accident when the injury occurs during the policy period c. bodily injury caused or aggravated by disease during the policy period d. an intentional act that is caused by the insured
d
HMS Toys carries more inventory from October 1 to December 31. Which of these would provide higher coverage limits during those months and lower limits the rest of the year? a. value reporting b. spoilage c. inventory increase d. peak season
d
If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered to be a. resident b. qualified c. certified d. admitted
d
In a personal umbrella policy, the amount paid by the insurer for certain losses not covered under the primary coverage is called a. stop-loss b. coinsurance c. participational requirement d. self-insured retention
d
In addition to the common policy conditions, all of the following conditions apply to liability coverage EXCEPT a. separation of insured b. legal action against insurer c. bankruptcy d. employer's liability
d
The homeowners policy form that covers condominium unit owners is a. HO-2 b. HO-3 c. HO-4 d. HO-6
d
The insured is not legally bound to any particular action under the insurance contract, but the insurer is legally obligated to pay losses covered by the policy. What contract characteristic does this describe? a. adhesion b. conditional c. aleatory d. unilateral
d
The livestock coverage form covers which of the following losses? a. sheep died after an attack by the family dog b. a cow died after it ran into a moving tractor c. all risk coverage for death of livestock by any cause except those excluded d. named peril for death of livestock
d
Under a DP Policy, within how many years of a loss may an insurer bring a lawsuit against an insurer? a. 1 year b. 3 years c. 4 years d. 2 years
d
Under the dwelling policy, Coverage C - Personal Property is a. automatically provided as 50% of Coverage A b. a prohibited coverage in the dwelling form c. limited to 50% of the amount of insurance that is written as Coverage A d. limited to covering a servant's property while at the insured location
d
Under the dwelling policy, Coverage C- Personal Property is a. automatically provided as 50% of Coverage A b. a prohibited coverage in the dwelling form c. limited to 50% of the amount of insurance that is written in Coverage A d. limited to covering a servant's property while at the insured location
d
What documentation grants express authority to an agent? a. agent's insurance license b. fiduciary contract c. state provisions d. agent's contract with the principal
d
What is the maximum penalty for habitual willful noncompliance with the Fair Credit Reporting Act? a. $1,000 b. $100 per violation c. revocation of license d. $2,500
d
Which of he following is NOT settled on actual cash value basis while covered under the business property coverage form? a. property of others b. manuscripts c. works of art or antiques d. valuable papers and records
d
Which of the following is a statutory defense? a. assumption of risk b. intervening cause c. contributory negligence d. comparative negligence
d
Which of the following types of property will NOT be covered by business liability insurance? a. an auto parked at the insured's premises b. watercraft while on shore at a premises owned by the insured c. nonowned watercraft 50 feet long used for transporting personal property of the insured d. owned watercraft 30 feet long used for carrying passengers for a fee
d
Which of the following would NOT be covered by a homeowner's policy? a. $550 utility trailer blown away by a tornado b. stolen silver tea set worth $2,000 c. $800 outboard motor destroyed by hail d. coin collection valued at $500 lost in a fire
d
While cutting grass in your yard with your brother's lawnmower, the fuel line ruptures and the lawnmower is destroyed in the fire. How will you HO liability react? a. it will not cover the damage because you are not liable b. it will pay your brother's property insurance deductible c. your HO liability and your brother's property coverage will share on a prorated basis d. it will cover the damage
d
With respect to commercial auto policies, the Garage Coverage Form provides liability protection for all of the following EXCEPT a. the insured's business products and work performed b. the insured's business premises c. the insured's business autos d. the insured's business income losses due to personal injury
d