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Which homeowners policy provides coverage on an open-peril basis for personal property without an endorsement?

HO-5

He can purchase endorsements for protection from additional perils at any time, with his insurer's agreement.

Hannah is six months pregnant when she switches jobs. Which law ensures that Hannah's "pre-existing condition" will be covered under her new health insurance plan?

Health Insurance Portability and Accountability Act

Jeremy is purchasing a homeowners policy for his house in the country. He is a beer enthusiast and is especially concerned with protecting his home brewing equipment from the black bears commonly seen in the area. Which of the following is the least expensive option that meets Jeremy's special need?

Homeowners 5

Which ISO is known as the Condominium form?

Homeowners 6

Jane's health insurance policy has a supplemental coverage that pays a flat daily amount if Jane were to be admitted into a hospital. What type of supplemental coverage does Jane have?

Hopsital Indemnity Insurance?

Which of the following is least likely to be one of the important questions an adjuster must answer before entering into the negotiations process?

How much is the insured willing to pay

Widespread insurance fraud has led to increases in the cost of goods and higher insurance premiums for the American public. Which of the following is NOT a contributing factor?

Insurance fraud is seen as a low-risk, high-profit crime

In which section of the Standard Fire Policy would you find an explanation of the losses covered under the policy and what the insurer has agreed to provide in exchange for premiums?

Insuring agreement

What does not demonstrate insurable interest

Insuring engagement ring given to fiancé

Which of the following would be covered under Coverage B of a typical Business Owners Policy?

Inventory

All of the following statements are correct concerning an umbrella liability policy EXCEPT it

Is the only liability contract an individual or business needs

Under Jacqueline's Personal Injury Protection, all of the following would be covered for bodily injuries except:

Jacqueline's sister who also has PIP

Scheduled personal property

Jewelry, furs, collectibles

After Jerry pulled the fire alarm, the indoor sprinkler system came on and flooded the offices at Elliot Designs, which caused thousands of dollars in damage. Elliot Designs filed a claim with KLM Insurance, who dispatched Chrystal to investigate and process the claim. Who is the principal in this scenario?

KLM Insurance

What is Coverage F of an HO policy?

Medical Payments to Others

Don has a PAP with $500 Collision and Comprehensive deductibles, Liability limits of 25/50/25, and $5,000 in Medical Payments coverage. He is struck by a car while taking a walk in his neighborhood, leaving him with $36,500 in medical costs. The driver of the vehicle has liability coverage of 30/60/25, which pays up to its limit for Don's injuries. How will Don's policy respond to the loss?

Medical Payments will pay $5,000.

In a personal auto policy, what endorsement allows coverage to be added for motorcycles and motor homes?

Miscellaneous Vehicle Coverage

Symbol 19

Mobile Equipment

Which of these causes of loss is LEAST likely to be covered by a typical insurance policy?

Nuclear Hazard

_________covers losses ships and their

Ocean Marine insurance

When does the coverage begin for a builders risk form?

On the date construction starts above the lowest basement floor if there is a basement

In the CGL Coverage for Premises Rented by You, how is the coverage for fire damage different than for other perils?

Only the rented premises are covered, not personal property

Liability limits in a Personal Auto Policy are applied:

Per Person, and Per Accident

Each of the following is a producer's responsibility to the insurer EXCEPT to

Perform all duties regardless of the degree of care

As a requirement for getting her New York adjuster license, Alice is required to submit proof of bonding with her application. She purchases a surety bond from PBJ Bonds. In this contract, Alice is considered the:

Principal

Property Removal

Provides coverage for items removed from danger Property remains covered for 30days

What kind of adjuster is hired by the claimant and is paid by commission?

Public Adjuster

Reasonable repairs

Reimburses HO for expenses ro protect from further damage Example shingles cover roof

What is the formula for Actual Cash Value?

Replacement Cost - Depreciation

How is actual cash value calculated?

Replacement cost minus total depreciation

Risk Avoidance

Risk avoidance is an area of risk management where the goal is to eliminate a risk and not just reduce it. Rather than mitigating existing risk, it aims to eliminate the source of the risk altogether, sometimes replacing it with a smaller, more easily manageable risk.

You are riding in Sarah's car when she fails to yield and causes an accident. Which of the following coverages would NOT pay for your injuries?

Sarah's Collision coverage

The declaration of the homeowners policy provides all of the following EXCEPT? A. Statment that earthquake damage is not covered B. The amount of premium charged for each coverage C. The insured Address D. what deductible amount applies to each loss covered by the policy

Statment that earthquake damage is not covered

In which situation would Utility Service - Time Element coverage apply?

Steve's Software Solutions loses power for two days when a bolt of lightning damages the power station. Steve experiences a significant loss of income during the outage.

What is not a prohibited disclosures under the Fair Credit Reporting Act EXCEPT

Surcharge disclosures

Whose responsibility is it to maintain an open line of communication during the settlement process?

The Adjuster

Who must fill out a proof of loss form?

The claimant

Which of the following best describes the policy conditions

The responsibilities and obligations of the insured and insurer

Which of these statements about Personal Article Floaters is FALSE?

They have a minimum $100 deductible.

Deana has Personal Injury Protection coverage in her PAP. Which of these injuries would NOT be covered by Deana's PIP?

Tom suffers neck injuries when Deana rear-ends him at a stop sign.

Homeowners policies don't provide coverage for:

Water Damage, Flooding, Earthquake Damage.

HO theft peril

Will not cover Theft by insured Dwelling under construction/material Rented out residence premise's Off promises theft of trailer watercraft or ítems in secondary property

Jane's shed burns to the ground during a tornado, when a tree falls on the roof and snaps a power line, which then ignites the structure. What is the proximate cause of the loss?

Wind

All of the following lines of coverage may be offered in Commercial Package Policy, except:

Workers' Compensation.

Under the TRIA, only terrorist acts in excess of?

a $100 million threshold will result in the payment of federal funds.

The "Consent to Settle" clause in the Professional Liability policy is best described as:

a clause that requires the insurance company to get approval from the insured prior to settling a claim Pointing out a piece of evidence that works in a claimants favor, and then conceding that point to a claimant is a negotiating technique known as:

all of the following would be eligible for coverage under the Dwelling policy except A. duplex b. an apartment complex with more than 10 units C. a private residence with 5 boarders D. A dwelling in the course of construction

an apartment complex with more than 10 units

New Mexico's approach to Workers' Compensation insurance can be described as _____and____

compulsory; competitive

Coverage L in a Personal Liability Supplement provides

coverage for both bodily injury and property damage to a third party for which the insured is legally liable.

The purpose of the federal Terrorism Risk Insurance Act (TRIA) is to?

ensure that insurers have the financial capacity to insure acts of terrorism.

Tom purchases a new car from his local car dealer. He also decides to get insurance coverage that will pay to repair the car if he were to get into an accident. This is because Tom wants to protect:

his own financial interest in the car.

All of the following may be covered under a Personal Injury endorsement in a homeowners policy

invasion of privacy. wrongful eviction slander

An uncontrolled lines inland marine insurance policy form:

is customized to meet the needs of the insurer's individual clients.

An independent adjuster:

is self-employed and may be contracted by one or more companies at a time.

A Commercial Package Policy has:

one Declarations page, applicable to every line of insurance in the policy.

when is the interior of a building covered against damage from rain, snow, sand, sleet, ice or dust

only if the roof or walls are first damaged by a coverage cause of loss that allows these elements to enter

In a personal auto policy, Collision coverage:

pays for physical damage to the vehicle caused by a rollover.

Everstrong Insurance enters into a surety contract with Homestead Construction, in which Everstrong guarantees that Homestead will finish a new housing development. In order to protect itself from being on the hook for large losses if the construction company fails to complete its contract, Everstrong Insurance turns to a fourth company, the KLM Group, which agrees to indemnify Everstrong Insurance if Homestead Construction fails to complete its contract. In this arrangement, Homestead Construction is the _______, Everstrong Insurance is the _______, and the KLM Group is the _______.

principal; surety; indemnitor

Which of the following would be eligible to collect survivor and death benefits from workers? compensation in the event of the covered injury resulting in the death of an employee?

spouse of employee

An HO-3 policy is intended for

standard homeowners insurance

A few weeks ago, Grace's garage was destroyed by an out-of-control motorist named Zach. Fortunately, Zach had sufficient liability insurance to cover the damages, but Zach's insurer is giving Grace the runaround negotiating the claim. Grace finally files a complaint, forcing Zach to:

submit an answer

The Commissioner has the power to?

subpoena the attendance of any person at a hearing and require the production of their books and records.

the boat was not fully enclosed inside a building during the hailstorm.

Which of the following does NOT constitute one of the four elements of a negligent act?

the defendant entered a legal contract with the plantif

Appraisal is used to decide:

the settlement amount

In a Personal Auto Policy, the split limits under the liability section will apply to all of the following, EXCEPT:

the total for property damage to the insured's auto caused by the accident.

Insurance policies are aleatory contracts. This means:

they depend on an unknown future event.

An adjuster must report a change of address to the Insurance Commissioner:

within 30 days.

A dryer fire scorches the interior of Bill's home, forcing him to move out while repairs are made. Bill has to find temporary housing, and he also loses the rental income he received from his roommate Frank. Which two coverages could help Bill with the lost rental income AND the repairs to the dwelling? A. Coverage A & Coverage E B. Coverage D & Coverage E C. Coverage A & Coverage D D. Coverage C & Coverage D

✓ A. Coverage D & Coverage E

During a severe windstorm, a large tree in Jeff's yard was blown down and two large bushes were ripped from the ground. Jeff has an HO-3. What is the maximum amount that Jeff can receive for the replacement of the tree and bushes that were damaged by the windstorm?

Sam, who has a typical HO-3 policy, is forced to evacuate his home by civil authorities due to rising flood waters in his neighborhood. It takes a month before Sam is allowed to come back to his home. During this time, he has spent $3,000 in hotel expenses, on top of his monthly mortgage payment of $850. When he files a claim, how much will Sam receive under Coverage D - Loss of Use?

$0 (Flood insurance is not included in an HO-3 policy)

The most the policy will pay for tree removal is ?

$1,000

Frank purchases a homeowners policy worth $700,000 with a 4% deductible. A few months later, a heavy hailstorm destroys his roof, porch, and windows, causing $50,000 in damages. Frank should expect __________ from the insurance company to pay for the damages.

$22,000

Bill's home was destroyed by a tornado, and Nick is adjusting the claim. Bill's home will cost $235,000 to rebuild. His homeowners policy has a $225,000 limit and a $1,700 deductible. How much would Nick typically calculate the final settlement amount to be?

$225,000

Any licensee who fails to file a timely license renewal shall be charged a?

$25 late fee.

With Grave Marker coverage, what is the maximum you can receive to pay for damaged gravestone?

$5,000

Jamie has an automobile policy with limits of $50,000 per person and $100,000 per occurrence. An accident occurs and two people are injured, one with $25,000 in injuries and the other with $75,000 in injuries. If Jaime is found responsible, what is the maximum amount his policy will pay for the injuries? a. $50,000 b. $75,000 c. $100,000 d. $0; the injured parties' policy will pay for their injuries

$75,000

Coverage Symbols 1,2,3

1. Any auto 2. Any owned vehicle 3. Owned private passenger vehicle

In South Carolina, how much notice must an insurer give when cancelling a dwelling policy for non-payment of premiums?

10 days

Regardless of the type of policy, cancellation for non-payment of premium only requires?

10 days' advance written notice.

Citizens residential insurance policies have a _____ deductible for hurricane coverage

10%

A New Mexico insurer must provide _____ days' notice before cancelling a policy for non-payment of premiums and ____days' notice before cancelling a policy if there is a substantial increase in the risk being insured.

10; 30

All drivers in Louisiana must carry liability coverage of at least ______ and Bodily Injury UM/UIM coverage of at least ______, unless the insured rejects UM/UIM coverage in writing.

15/30/25; 15/30

An employee whose work-related injury leaves scars that seriously disfigure her face and neck can receive up to how many weeks of benefits under workers compensation insurance?

208

Marlene has been living in her $120,000 home for 31 years. Because she has paid off the mortgage, she decides to save some money on her monthly insurance premiums by reducing her homeowners coverage to $40,000. After a severe hailstorm totals her roof, her adjuster estimates the damage at $12,000. Assuming the insurer imposes the standard coinsurance penalty, and ignoring the deductible, how much will Marlene receive in the settlement?

5,000

Under the The Longshore and Harbor Workers' Compensation Act, what percentage of the deceased worker's average weekly wage would the surviving spouse receive in benefits?

50%

A Discovery form covers losses that the insured discovers during a policy period and up to how many days after the policy expires?

A proof of loss form is often due within how many days of the loss?

How many days in advance is an insurer required to notify the insured if it does not intend to renew a homeowners policy before it expires?

In the event of a catastrophe, emergency adjuster licenses in New Mexico are valid for:

90 days.

Which of the following would be covered under Coverage B of the Business Owners Policy?

A copy Machine

With respect to auto insurance the term owned autos included all of the following EXCEPT A. A pickup or van titled to and used in the named insureds business B. Any private passenger auto titled to the named insured C. A pickup or van acquired by the named insured during the policy period D. Any private passenger auto leased to the named insured for a period of more than 6 months

A pickup or van titled to and used in the named insureds business

Which of the following best describes a "risk," according to the insurance definition?

A potential for financial loss

What is not TRUE regarding a nonowned auto

A rental car would not be covered under the policy

Lightning strikes one of Christy's trees in her backyard and starts a fire that spreads to two other trees before firefighters are able to put it out. The fire department charges her $600 for responding to her call. Christy's DP-2 policy has a Coverage A limit of $95,000. What is the maximum amount of indemnification that Christy can expect to receive for this loss (ignoring any deductible)?

B. $2,000

When a licensee receives a letter notifying her that she has been fined by the Superintendent, how long does she have before the fine must be paid? A. 30 days B. 20 days C. 10 business days D. 14 days

B. 20 days

An employee receiving income benefits under Workers Compensation insurance cannot receive more than:

B. 66 2/3% of the State Average Weekly Wage.

Which of these businesses may qualify for a Business Owners Policy? A. An auto repair shop B. An apartment building C. A parking garage D. A nightclub

B. An apartment building

Anton is purchasing homeowner's insurance for his new house. He wants to make sure his policy offers the BEST coverage available. Which policy should Anton choose?

B. HO-5

Which of the following is NOT one of the disciplinary powers of the Superintendent of Financial Services? A. Issue a cease and desist order B. Impose a jail sentence of up to 1 year C. Impose a fine of up to $2,500 D. Revoke the license of any insurance adjuster or producer

B. Impose a jail sentence of up to 1 year

One morning, Jill arrives to open the bank, only to find the door already unlocked. Upon entering the bank, she sees the vault door has been blown open and a large amount of money has been burned when an explosive charge went off. Which commercial crime insurance coverage might cover the loss?

B. Inside the Premises: Theft of Money and Securities

All of the following are covered under Coverage A of a Business Owners Policy, except:

B. Leased business personal property that must be insured

According to the commercial property policy, a commercial building is considered vacant if less than ____ of the available square footage is occupied for ____ consecutive days.

C. 31%, 60

Which of the following could be covered by a homeowners policy? A. A home used as a shelter by the local community B. A multi-family townhome housing five families C. A large home currently under construction D. A home that has been converted into a veterinary clinic

C. A large home currently under construction

Adam is shopping for a car in a local automobile dealership. While visiting the showroom, he trips over a rug that has folded over and breaks his arm in the fall. Which of the following is true?

C. Adam may file a third party claim with the dealership's insurance company.

Which part of a homeowners policy provides coverage for the medical expenses of third parties who are injured on your property? A. Coverage D B. Coverage A **dwelling C. Coverage F ** medical D. Coverage C **personal property limit

C. Coverage F -In a homeowners policy, Coverage F pays for medical expenses of third parties who are injured on the insured's property.

Which of the following coverages is typically included in a BOP? A. Coverage for company owned vehicles B. Malpractice coverage C. Coverage for slander and copyright D. Professional liability coverage

C. Coverage for slander and copyright

Which of the following may be covered under an Equipment Breakdown Protection Coverage Form?

C. Equipment built to operate under internal pressure or vacuum

Monique has been appointed to manage Gretta's finances because the court has deemed Gretta to be incompetent. Part of the court-order required that Monique be bonded. What type of bond does Monique need to buy? A. Court bond B. Contract bond C. Fiduciary bond D. Finance bond

C. Fiduciary bond

What are the two main types of coverage usually found in an aviation insurance policy? A. Hull coverage and Cargo Liability insurance B. Passenger Bodily Injury and Bodily Injury Excluding Passengers C. Hull coverage and Liability coverage D. Admitted Aircraft Liability and Hull coverage

C. Hull coverage and Liability coverage -Aviation insurance differs from other kinds of insurance in that there are no "standard" policies used by all insurers. Some contracts will include coverages or exclusions that won't be found in other policies. In general, however, an aviation policy contains Hull coverage and Liability coverage.

Which of the following is TRUE about workers' compensation insurance?

C. It benefits both the employee and the employer.

ABC Roofing has two CGL policies that cover the same losses. Both policies are occurrence forms, thus pay out on a pro rata basis. The first policy is through KLM Insurance and has a limit of $300,000. The second is through XYZ Mutual, with a limit of $600,000. One day, ABC Roofing suffers an occurrence resulting in a $150,000 covered loss. How will this loss be indemnified?

C. KLM Insurance will pay $50,000; XYZ Mutual will pay $100,000

New U, an upscale beauty shop, wants to purchase a Business Owners Policy. Which of the following is a typical requirement that New U must meet in order to qualify for a BOP? A. New U must have 25% or less of its floor space open to the general public. B. New U must make at least $1,000,000 per year in revenue. C. New U's sales must not exceed $3,000,000. D. At least 25% of New U's sales must be from retail operations.

C. New U's sales must not exceed $3,000,000. -Processing and Servicing businesses qualify for the BOP if total annual sales do not exceed $3 million, and no more than 25% of sales occur off-premises.

Which of the following statements about Inland marine insurance is FALSE? A. Inland marine policies are often known as "floaters." B. Inland marine insurance can provide coverage for tunnels. C. Personal articles floaters cover property on a named-peril basis only. D. An inland marine policy can provide coverage for goods shipped by train.

C. Personal articles floaters cover property on a named-peril basis only.

Which of the following insurance protections is NOT offered by a garagekeeper's insurance policy?

C. Personal injury protection

Don works as an adjuster for ABC Insurance. Which of the following is most likely NOT one of Don's responsibilities?

C. Represent the insured if a claim goes to court

Coverage C - Personal Property of a homeowners policy typically excludes:

C. fish.

which statement about the federal employees compensation act is TRUE?

C. it provides federal government insurance for civilian employees.

Which of the following is NOT a way to determine an insurer's liability in a claim?

Check if the current month's premium had been paid at the time of loss.

Sam was tired of the neighbor's trees along the fence line poking through the fence and dropping leaves in his yard, so he reached across the fence with his pole saw and cut down the neighbor's tree. Sam's neighbor was upset and sued him for the damages. Sam is ordered to pay $500 for the tree. Under which category of damage would this fall?

Compensory Damage

William owns a construction business and is insured with a Commercial General Liability policy. After three weeks of work, William finally completes the porch he has been building for a client. A week later, the stairs to the porch collapse and the

Completed Operations Liability

Which of the following topics would NOT likely be found in the Conditions section of the Standard Fire Policy?

Covered Perils

HO6 -Condominium Form

Covers only belongings Covers all finished surfaces of individeal unit @ACV

In a farm policy, what is the limit of coverage for cash, platinum, or gold personal property? A. $1500 B. $2500 C. $1000 D. $200

D. $200 -Coverage C - Household Personal Property limits coverage for cash, platinum, or gold (other than goldware) to $200.

Which of the following statements regarding Commercial Package Policies (CPP) is TRUE?

D. A CPP is an elective-based policy.

Which of these statements about foreign insurers in Florida is TRUE?

D. A foreign insurer can usually only issue insurance to someone who was denied coverage by domestic insurers.

All of these insureds have had their policy for at least 60 days. Which of the following is NOT a valid reason for the insurer to cancel the insured's policy? A. Bob's 18-year-old son who uses the car to drive to school has his driver's licnese revoked. B. Laura's insured risk has changed substantially, beyond what her insurer should have reasonably expected. C. George failed to disclose material information when he applied for his policy. D. Amy filed a claim in which the damage exceeded the policy limit.

D. Amy filed a claim in which the damage exceeded the policy limit.

Honey's Bakery is a local coffee shop run by two sisters. In a rush to leave one afternoon, their new employee forgets to turn off the gas stove. The leaking gas causes an explosion, destroying the kitchen. Which condition in their commercial property policy could help the sisters cover the cost of the damage?

D. Control of Property

Which of the following adjusters is acting appropriately as a fiduciary agent? A. Kim tries to calm an angry claimant by telling him that she's sure his claim will be covered, even though she has not yet determined the cause of loss. B. Gail investigates the claim and determines the loss is not covered, but writes up her estimate in such a way that it would appear to be covered so she could pay the claimant anyway. C. Victor finds additional damage that seems to be related to the claim, but he leaves it off of his estimate because the claimant didn't notice it in the first place. D. Ernest knows the claimant can't possibly afford to pay for their extensive damages, but he denies the claim anyway because the cause of loss was not covered by the policy.

D. Ernest knows the claimant can't possibly afford to pay for their extensive damages, but he denies the claim anyway because the cause of loss was not covered by the policy.

Coverage E refers to which part of a HO policy? A. Additional Coverages B. Dwelling C. Loss of Use D. Personal Liability

D. Personal Liability

Which characteristic would prohibit a convenience store/gas station from purchasing a BOP?

D. The operation of a car wash

A. The plan only offers minimal property coverage. B. Only those who cannot obtain property insurance in the voluntary market are able to participate. C. All insurers licensed to sell property insurance in New Mexico must participate. D. The plan covers damages caused by flood.

D. The plan covers damages caused by flood.

Generally speaking, which of the following has the broadest coverage?

D. Umbrella coverage

Phil owns a public pool. One day, Phil has an altercation with a woman visiting the pool. Phil doesn't like the way she looks, so he tells her that she has to leave the premises right away. The woman takes Phil to court for violating her civil rights. This is an example of what type of personal injury covered under Phil's Commercial General Liability policy?

D. Wrongful Eviction

While reviewing his DP-3 policy, Jim notices that some additional coverages are included in his Coverage A limit, while others are paid in addition to that limit. Which TWO additional coverages are included within Jim's Coverage A limit?

Debris Removal and Reasonable Repairs

In an insurance policy, where might one find the make and model of the covered vehicle?

Declarations

What is the first step of the Evaluation process of a claim?

Determining time and cost of repairs

Persons or corporations not eligible for homeowners insurance

Dwelling policy Eligibility

Which endorsement to the BAP would extend policy coverage to Jenny's employee Trisha, who drives her own car around the city to sell the company's hair products?

Employees as additionally insured

Of the four types of bonds listed below, which guarantees that the principal will NOT do something?

Fidelity Bonds

Fiduciary Bond

Which of these homeowners policy coverages does NOT usually have a deductible?

Fire department Service Charge

Homeowners policies don't provide coverage for:

Flood damage

Which of the following statements about flood insurance is FALSE?

Flood insurance rates are determined by private insurers

This Florida agency is responsible for ensuring the financial stability of the state's insurance companies:

Florida's Department of Financial Services and Office of Insurance Regulation

Part D of the Personal Auto Policy does NOT cover:

Freezing

Enter in the correct order describing the main difference. In a _____, the claimant signs a release form giving up the right to additional claims; in a ______, the claimant does not sign a release form.

Full Release Settlement, No Release Settlement

If a ship's captain has to jettison a disproportionate amount of one policyholder's cargo in order to save the ship, there is a provision of ocean marine insurance that spreads that loss among all of the insurers involved with the ship. What is this provision called?

General Average clause

CIVIL AUTHORITY

Government vacates w/ covered peril will be covered 2 weeks max

Best describes the CGL'S general aggregate annual limit as it applies to the coverage parts of the CGL

Coverage A,B and C apply in sum and are the most that will be paid subject to the general aggregate annual limit

Helen is looking to reduce her insurance costs for her home. She currently has an HO-3 open-peril policy, but she doesn't feel she needs liability coverage anymore and wants to change over to a dwelling policy. Though the policies are fundamentally different, which dwelling policy would most closely resemble Helen's current homeowners policy?

DP-3

Steadfast Insurance, Inc wants to cancel Orion's policy after Orion missed a premium payment. Which of the following is true?

Steadfast Insurance must notify Orion at least 15 days before ending the policy.

What is the transfer of rights that allows the insurer to recover its losses after it has indemnified a policy holder?

Subrogation

What is the limit that the Connecticut Insurance Guaranty Association will pay for covered workers compensation claims?

There is no limit on workers compensation claims

garage policy is identical to BAP

is nearly identical to the business auto policy, but it adds a general liability policy to cover the business owner for damages to customer vehicles in their care.

All of the following are excluded losses under Part D-damage to an auto of the personal auto policy EXCEPT

to caps, covers, or bedliners on pickup trucks.

Which of the following does proof of loss mean to provide

An itemized list of the items insured

A power surge sparks a small electrical fire in an office building. The electrical fire triggers the automatic sprinkler system. The water from the sprinklers soaks the carpets and shorts-out all the computers, causing thousands of dollars in damage. The office must close for two months during repairs. The sprinklers soaking the office would be considered:

An occurrence

During a storm, heavy winds blow a tree over in Norman's back yard, causing it to fall on his house and damage his roof. The wind blowing over the tree would be considered:

An occurrence

Summer owns a home with a replacement cost of $150,000. For the replacement cost provisions of a homeowners contract to apply, Summer must carry how much minimum coverage? a. $90,000 b. $105,000 c. $120,000 d. $135,000

$120,000

An insured purchased new furniture for $6,000. At the time of a fire loss, it had depreciated $2,000. The same furniture will cost $7,000 to replace. What is the actual cash value of the destroyed furniture? a. $4,000 b. $8000. c. $6000. d. $5000.

$5000.

Heather's house is fully insured with a DP-3 with a limit of $85,000. One day, the house is struck by lightning, and despite the fire department's efforts, burns to the ground. She still had a balance of $20,000 left on her mortgage at the time of the fire. What is the maximum indemnification that would go to Heather, the fire department, and her mortgage lender respectively?

$65,000; $500; $20,000

If a fire destroys a delivery truck - The physical destruction of the trucks - The cost of renting a new truck in order to keep business going

- Direct Loss - Indirect Loss

As Seth is driving along a country road, a deer jumps out in front of him. This causes Seth to veer off the road and crash into Cassie's wood fence and a brick mailbox. As a result of the crash, Seth suffers $3,700 in damage to his sedan and causes $1,800 in damage to Cassie's property

1,800

Which of the following is excluded from liability insurance coverage?

1. Professional liability coverage doesn't apply to anything other than the profession shown on the policy 2. Professional liability policy doesn't cover anything arising out of any claim made by a person because of: Refusal to employ that person Termination of that person's employment 3. professional liability policy won't cover any matter arising out of actual or alleged discrimination. 4.Professional liability insurance does not cover anything arising out of sexual therapy. 5.Professional liability coverage does not cover anything arising from allegations of physical and/or sexual abuse.

The limit of liability for Coverage B - Other Structures is typically:

10% of coverage A

An injured employee or his representative must file a claim within ___ years of an accident or ___ years from the date of death in order to receive workers compensation benefits.

2,2

Under a Personal Auto Policy, an insurer will cover Medical Payments for up to ____ from the date of the accident.

3 years

Andrea, a licensed insurance adjuster, just got married and is taking her new husband's last name. She must report this change to the Commissioner within how many days.

In a Commercial Auto Policy, which coverage symbol indicates that a car is subject to mandatory no-fault insurance?

Graham has an auto liability policy with limits of 30/60/25. While heading to the grocery store, Graham turns onto 2nd street and slams into a stopped vehicle. The driver of the car, Jeremy, is not hurt, but Graham has totaled Jeremy's $30,000 SUV. How much, if any, of the damages will Graham have to pay out of pocket?

5,000

Coverage Symbol 7,8,9

7. Specifically described autos 8. hired Autos 9. Non-owned vehicles

All volcanic eruptions that occur within a period will be considered one occurrence

72 hour

James holds a DP-1 policy on his house for $150,000. His wife, Jane, feels that they should really have closer to $200,000 in total coverage, so she takes out an additional $50,000 DP-1 policy on the same dwelling. Both policies pay settlements on a pro rata basis. After a fire causes $32,000 in damage to the home, how much of the damages will be covered by Jane's DP-1 policy?

8,000

What is the main difference between a stock insurance company and a mutual insurance company?

A stock insurance company is owned by its shareholders, a mutual insurance company is owned by its policy holders

Who is NOT eligible for a homeowners policy?

A. An owner of a house in which he does not live, but rents to a tenant

If a restaurant employee in New York City dies in a work-related accident on January 15th, 2017, Workers' Compensation benefits will pay up to ________ for the employee's funeral expenses. A. $12,500 B. $10,500 C. $5,000 D. $6,000

A. $12,500

After wrecking her car on an icy road, Lilly filed a claim with her insurer, ABM Insurance, who dispatched Richard to investigate her claim. Who is the principal in this scenario? A. ABM Insurance B. This information is not provided in the scenario. C. Lilly D. Richard

A. ABM Insurance

Peter works as a real estate agent and uses the internet extensively for sales leads and advertising. One day, he finds another realtor's ad online and copies it, using his own information as the contact info. This generates a lot of business for Peter, but unfortunately Peter gets a call one day and is informed that he is being sued for copyright infringement. This is an example of what type of claim covered under Peter's Commercial General Liability policy?

A. Advertising Injury

Lena is moving to Japan for two years in order to take advantage of a promotion at her job. She won't bring her 4-seater propeller plane with her. What kind of aviation insurance should Lena purchase for her plane while it's in storage and she is away? A. All Risks - Not in Motion B. Admitted Aircraft Liability C. All Risks - Ground and Flight D. Hangarkeepers Liability

A. All Risks - Not in Motion

Which of the following cases would most likely NOT be covered under Workers' Compensation insurance? A. An employee filed a claim for work-related stress after receiving a job transfer. B. After dealing with breathing problems that have progressed over the past year, an employee finally discovers that chemicals in the factory where she works have given her lung cancer. C. A distillery employee was intoxicated due to fumes in the workplace, fell over a railing, and broke her wrist. D. A news reporter was hit in the eye by a ball at a company softball game which he was covering for the local paper.

A. An employee filed a claim for work-related stress after receiving a job transfer.

Angie earned $600 per week restocking shelves in a warehouse before a work-related accident caused her to lose her right leg above the knee. After she reaches Maximum Medical Improvement, Angie's physician declares that her percentage of impairment is 40%. Her employer transfers her to a secretarial position, where she earns $650 per week. Which of the following statements is TRUE about Angie's Permanent Partial disability benefits?

A. Angie will receive $400 per week for up to 500 weeks.

Nature's Best Vitamins is ready to invest in a new lab for their growing company. The company wants to make sure they have insurance coverage that will protect their interest in the new building and the building materials while construction takes place. What coverage should Nature's Best purchase for that purpose? A. Builder's Risk B. Preservation of Property C. Extra Expense D. Business Income

A. Builder's Risk

This type of crop coverage only pays after at least a 50% loss to a crop, and it only pays 55% of the price of that crop. The insured is not required to pay premiums. A. Catastrophic Risk Protection B. Revenue Protection with Harvest Price Exclusion C. Yield Protection D. Actual Revenue History

A. Catastrophic Risk Protection -The Catastrophic Risk Protection Endorsement only kicks in if at least half of the insured crop is damaged, and it pays 55% of the value of the crop. The federal government pays the premiums for this coverage.

Due to an E-coli contamination in its production facility, Company F is facing multiple lawsuits from customers who became sick after eating its product. The resulting negative press, lost revenue, and added expenses have proven too much for the small company to handle, so it has filed for bankruptcy. which of the following is true?

A. Company F's insurer will still pay the claims, up to the policy limit.

Lillian owns an antiques shop and Sandy works part time for her. One afternoon, while Sandy is decorating the window display, she loses her balance and falls backward off a step stool, breaking some very expensive lamps in the process. What policy condition in Lillian's commercial property policy provides evidence that this loss may be covered? A. Control of Property B. No Benefit to Bailee C. Liberalization D. Subrogation

A. Control of Property

A dryer fire scorches the interior of Bill's home, forcing him to move out while repairs are made. In addition to paying for temporary housing, he also loses the rental income he received from his roommate Frank. Which two Dwelling policy coverages could help Bill with the lost rental income AND his additional living expenses?

A. Coverage D & Coverage E

Dale just bought 30 shares of a hot new startup company online. Which of the following statements about Dale is FALSE? A. Dale has just taken a pure risk which cannot be insured. B. Dale's investment is not an insurable risk. C. Dale has just taken a speculative risk which cannot be insured. D. Dale's investment could result in a gain or a loss.

A. Dale has just taken a pure risk which cannot be insured.

Jim drops his car off at ABC Garage to have his exhaust system repaired and takes the train to work. When he returns, he finds that his car has been vandalized. Jim has comprehensive coverage, but feels the garage is responsible for the damage since Jim entrusted the car to ABC Garage. Which coverage type under ABC's garagekeepers policy would cover any part of the loss that Jim's policy does not cover?

A. Direct Excess Coverage

When a claimant submits a claim to an insurer, the insurer has several options for responding. Which option does the insurer want to avoid? A. Having a court of law dictate the proper settlement B. Accepting the claim and paying what the claimant requests C. Rejecting the claim and refusing to pay D. Letting the claim go to arbitration

A. Having a court of law dictate the proper settlement

Bill's new home is in the final stages of construction, and he has purchased an HO-2 policy to insure his financial interest in the property. This morning, Bill's contractor calls to tell him that an electrical fire has destroyed his new kitchen, and all of the crown molding that was supposed to be installed today has been stolen. It will be $15,000 to rebuild the kitchen and another $4,200 to replace the trim. How will Bill's insurer respond when he files a claim?

A. His insurer will pay $15,000 to rebuild the kitchen and nothing for the stolen trim.

Which of the following statements about aviation policy deductibles is FALSE? A. If a loss takes place while the aircraft is being transported, the loss is subject to a fixed deductible. B. There are separate deductibles for when the plane is "in motion" and "not in motion." C. The deductible does not apply to losses from theft or robbery. D. Partial losses are usually subject to a percentage deductible.

A. If a loss takes place while the aircraft is being transported, the loss is subject to a fixed deductible.

Which of the following would be covered under Coverage B of a typical Business Owners Policy? A. Inventory B. Stock certificates C. An outdoor antenna D. Permanently installed fixtures

A. Inventory

Which of the following perils would NOT be covered by a commercial property policy with a Causes of Loss - Special Form attached to the Building and Personal Property Coverage Form? A. LuLu's Fine Jewelry must shut down for a month to repair flood damage. B. When a riot breaks out in the town square, Sam's Boutique is looted and vandalized in the commotion. C. Izzy's Furniture loses an entire warehouse in a fire caused by a lightning strike at a nearby power plant. D. A tornado whips through town, leveling a warehouse belonging to Built Industries.

A. LuLu's Fine Jewelry must shut down for a month to repair flood damage. -Flooding is one of the universal exclusions in the commercial property policy, so Lulu's Fine Jewelry would not be covered during thier shut-down for flood damage repairs.

Which of the following is NOT one of the objectives accomplished by an insurance company's periodic cybersecurity risk assessment? A. Manually update the FBI's cybercriminal "most wanted" database B. Find and evaluate both inside and outside risks to private information that the company has in its system C. Identify and stop cybercriminal attempts D. Help the company recover from any damage caused by cybercriminals

A. Manually update the FBI's cybercriminal "most wanted" database

Which of the following individuals would qualify for a New Mexico non-resident license without taking an New Mexico examination?

A. Patrick, who passed an exam for the adjuster license he holds in his resident state

Which of the following would not be covered by Coverage C- Personal Property in a homeowners policy? A. Pets B. Food C. Furniture D. Clothes

A. Pets

Which endorsement to the Commercial Crime policy would protect a bank against its legal liability for burglary, robbery, destruction, or damage to customers' belongings kept in safe deposit at the bank?

A. Safe Depository

Gary has UM/UIM coverage on his Personal Auto Policy. Which of the following losses would be covered under this coverage? A. Sam, Gary's neighbor who has liability limits high enough to cover the damages, intentionally runs into Gary's car with his own during an argument. B. Gary borrowed Sam's car without his permission, and was struck by Tom, who doesn't have auto insurance. C. Gary's wife hits Gary's car while backing out of the garage. D. Gary's car, which he uses during his part time job as an Uber driver, is damaged by a hit-and-run driver.

A. Sam, Gary's neighbor who has liability limits high enough to cover the damages, intentionally runs into Gary's car with his own during an argument. -Gary's UM/UIM would cover the damage caused intentionally by Sam, since Sam's liability coverage will not pay for intentional losses. This would leave Sam "uninsured" as far as Gary's losses are concerned, so Gary's UM/UIM would kick in.

What kind of adjuster is employed by only one insurance company and is paid by salary? A. Staff adjuster B. Independent adjuster C. Emergency adjuster D. Public adjuster

A. Staff adjuster

Which of the following is NOT a "covered" employee with regard to Workers' Compensation insurance? A. Teacher at a non-profit educational institution B. Paid staff-member of a non-profit organization C. Public school aide D. Corporate officer in a company with four stockholders

A. Teacher at a non-profit educational institution -not covered employees under the NY WC law.

Which of the following is TRUE about cease and desist orders?

A. The superintendent should give the order either in person or by certified mail.

Which of the following statements does NOT apply to subrogation? A. The exact amount of subrogation will usually be determined by a court of law. B. Subrogation prevents injured persons from collecting twice on the same damages. C. A policyholder forfeits his right of recovery up to the amount of indemnification. D. Subrogation transfers the rights of the policyholder to the insurer.

A. The exact amount of subrogation will usually be determined by a court of law.

Which of the following would NOT be covered under a typical Ocean Marine policy?

A. The owner sustains a financial loss when her vessel is confiscated by the government.

Which of the following statements regarding health insurance is TRUE?

A. To be covered, members of an HMO must receive treatment for their medical conditions within the established network of healthcare providers.

Randy runs a business where he takes on the possessions of others and transports them from one location to another in exchange for a fee. What type of occupation does Randy have?

A. Trucker

Under what circumstances does an Area Revenue Protection policy pay an indemnity to an insured farmer? A. When the entire county experiences low crop production, falling commodity prices, or both B. When a peril destroys all of the farmer's crop C. When the farmer's actual revenue from his entire farm falls below the average revenue for the area D. When the mayor of a rural town declares the area to be experiencing a natural disaster

A. When the entire county experiences low crop production, falling commodity prices, or both

All of the following lines of coverage may be offered in a Commercial Package Policy, except: A. Workers' Compensation. B. Equipment Breakdown. C. Professional Liability. D. Boiler and Machinery.

A. Workers' Compensation.

Most health insurance policies exclude: A. cosmetic surgery expenses. B. cancer treatments. C. injuries incurred while on vacation. D. pregnancy and childbirth.

A. cosmetic surgery expenses.

When the settlement difference between an insurer and a claimant is minor: A. it should be settled in favor of the claimant. B. it should be settled in favor of the insurance company. C. a third party should be brought in to help reach agreement. D. the adjuster will need to work harder to reach an agreement.

A. it should be settled in favor of the claimant.

Medical payments coverage in a Farm policy includes all of the following EXCEPT:

A. libel or slander.

Daily Constructions has been contracted by the City to renovate the historic courthouse building. Daily Constructions has also purchased a surety bond from KLM Insurance, as one of the requirements to get the job. If Daily Constructions were to fail to complete the job, KLM would be responsible for paying the City up to $150,000. This amount is known as the: A. penal sum. B. contract bond. C. collateral. D. fiduciary amount.

A. penal sum. -The penal sum is the specified maximum amount the surety will be required to pay, if the principal defaults.

A bid bond ensures that the principal, if selected, is capable of taking on the project and will obtain the required: A. performance or payment bond. B. fiduciary bond. C. completion and maintenance bonds. D. attachment bond.

A. performance or payment bond

Which of the following sequences is most likely in the correct chronological order?

Acknowledge the claim, then open a line of communication with the claimant.

Which of the following is the easiest and least costly option?

Adjuster/clamant negotiation

African Spice Exporters Inc. brings two shipments of cloves from Zanzibar, Tanzania to the United States each year. When their second shipment of the year is stopped ...

African Spice Exporters Inc. violated the "legality" implied warranty of ocean marine insurance.

African Spice Exporters Inc. brings two shipments of cloves from Zanzibar, Tanzania to the United States each year. When their second shipment of the year is stopped by the Coast Guard off the coast of Florida, 10 pounds of contraband is found hidden among the bins of cloves. All of the ship's cargo is seized and the ship's crew arrested. When African Spice Exporters Inc. files a claim with its insurer for the seized cargo, the claim comes back denied. Why might this claim have been denied?

African Spice Exporters Inc. violated the "legality" implied warranty of ocean marine insurance.

All risks- Not in motion

HO Home day care

Amount is based on # of children

Which of the following is NOT an endorsement commonly added to a Dwelling Policy?

Annual Depreciation

Any occupant of the other not at fault vehicle When an insured is driving his covered automobile causes an accident that results in injury, his automobile medical payments will pay medical expenses for all of the following EXCEPT

Any occupant of the other not at fault vehicle

Nick's home suffered major damage during a tornado. His contractor says it will cost $85,000 to complete repairs, but the adjuster's estimate gives a total of $63,000. Nick and his insurer have tried to reach an agreement, but have failed to do so. Neither party wants to go to court, but they do want to enlist the help of a neutral third party to make a legally binding decision and resolve this matter. Which of the following is the best option in this case?

Arbitration

All of the insurance professionals below are in danger of having their licenses suspended or revoked, except:

Arlene, who received a $175 traffic ticket after running a stop sign.

While a claim remains open, an insurer may require the adjuster to submit an interim report how often?

At regular set intervals

In a third-party claim, the injured person has a duty to:

Authorize the insurer to look at her medical records

Rachel is filling out an application for a homeowners policy. She is truthfully answering the questions regarding her home's location, size, age, etc. Which of the following is a true statement?

B. Rachel is providing representations.

A large tornado ripped through Ken's farm and destroyed $4,000 of his $10,000 corn crop. Ken is covered under an MPCI policy with a Catastrophic Risk Protection Endorsement. How much indemnification can Ken receive from the Catastrophic Risk Protection Endorsement for this loss? A. $2,000 B. $0 C. $2,200 D. $4,000

B. $0

Both Steve and his wife, Arlene, carry DP-2 policies on their $135,000 home. Steve's policy has a limit of $108,000 and Arlene's has a $27,000 limit, and both policies pay on a pro rata basis. After a hailstorm causes $13,000 in damage to their roof, how much of the damage will be covered by Steve's policy (ignoring any deductible)?

B. $10,400

Craig has an HO-3 policy covering his primary residence with a Coverage A limit of $250,000, Coverage B limit of $25,000, and a Coverage C limit of $150,000. Craig also has a cabin on the lake, which was burglarized. The thieves stole much of the cabin's contents, for a total loss of $18,500. Ignoring any deductibles, how much will Craig's HO-3 policy pay for this claim?

B. $15,000

Diana is insured under a DP-2 policy with the following coverage limits: Coverage A - $150,000, Coverage B - $15,000, and Coverage C - $25,000. She and her fiancé have planned a destination wedding, but their hotel catches fire shortly after their arrival. Smoke from the fire damages all of their belongings, including Diana's $4,000 wedding dress. Diana's loss totals $5,200. When she files a claim with her insurance company, how much can she expect to receive for this loss under her DP-2 (ignoring any deductible)?

B. $2,500

Norris borrows Arnold's truck to pick up some lumber from the hardware store. On the way to the store, Norris collides with a car, injuring the three people inside. The driver suffers $15,000 in injuries, one passenger suffers $25,000, and the other passenger suffers $20,000. Norris has a PAP with liability limits of 50/100/50, and Arnold's policy has liability limits of 25/50/10. Everyone involved in the accident has minimum PIP coverage for Florida. How much will the primary policy pay for the injuries?

B. $30,000

While Andrea was grocery shopping in BB Mart, the large Dairy sign fell off the wall and landed on her. Because of her extensive injuries, Andrea sued BB Mart and was awarded $375,000 in damages. BB Mart's Commercial General Liability policy has a general aggregate limit of $1,000,000 and a per occurrence limit of $300,000. What is the per occurrence limit after this claim is settled?

B. $300,000

Jennifer's PAP has a Comprehensive deductible of $100. Jennifer lets her sister Tina borrow her car, and Tina hits a llama worth $500. The llama's owner files a claim for the loss of his llama. How will that claim be settled?

B. $500 paid under Jennifer's liability coverage

Heather's house is fully insured with a DP-3 with a limit of $85,000. One day, the house is struck by lightning, and despite the fire department's efforts, it burns to the ground. She still had a balance of $20,000 left on her mortgage at the time of the fire. What is the maximum indemnification that would go to Heather, the fire department, and her mortgage lender respectively? A. $85,000; $1,000; $85,000 B. $65,000; $500; $20,000 C. $84,500; $1,000; $20,000 D. $64,500; $500; $20,000

B. $65,000; $500; $20,000 -Heather's insurable interest in her home is $65,000, while her mortgage lender has an insurable interest in the $20,000 mortgage balance that Heather has not yet paid off. The policy will also pay up to $500 to cover Heather's Fire Department Service Charge, in addition to the Coverage A limit.

On January 27, 2008, Ryan was using an exercise bike purchased from NusquamCycle when the chain broke, causing him to fall and severely bruise his knee. It seemed to heal just fine, but three years later, on January 25, 2011, Ryan's knee gave out while jogging. His doctor told him that he'll need surgery and that this deterioration most likely resulted from the earlier accident with the exercise bike. Which of the following CGL policies would cover Ryan's claim filed January 25, 2011?

B. A claims-made policy from Jan 31 2010 -Jan 31 2011 with a retroactive date of Jan 1 2008

Which of the following may be covered under a Mechanical Breakdown Insurance policy?

B. Breakdown due to electrical system malfunction

Jill was forced to close her convenience store and evacuate because of a strong hurricane that hit her town. Jill was not allowed to reopen her store for two weeks, so she lost two full weeks of income. Which additional coverage would indemnify Jill for this loss? A. Law and Ordinance Coverage B. Business Interruption Insurance C. Business Owners Liability Insurance D. Extra Expenses Coverage

B. Business Interruption Insurance

Daily Constructions has been contracted by the City to renovate the historic courthouse building. Daily Constructions has also contracted with KLM Insurance, which has agreed to act as the surety, but requires that Daily Constructions deposit $90,000 into a bank account under KLM's control until the job is finished. If Daily Constructions fails to complete the job for the City, it will forfeit the $90,000. What is this $90,000 called? A. A guarantee B. Collateral C. An indemnitor D. A surety bond

B. Collateral -Collateral is cash or valuable property put into a reserve controlled by the surety. The surety holds the cash or property until the principal completes its obligation, at which point the surety returns the collateral to the principal.

All of the following are true of the liability coverage in a Business Owner's Policy, except: A. Coverage is provided for both bodily injury and property damage from business operations and premises. B. Coverage is provided on a "claims-made" basis. C. Coverage comes with a series of separate aggregate limits. D. Coverage is provided for product and operation liability.

B. Coverage is provided on a "claims-made" basis.

Tim, taking advantage of the economic downturn, started a business buying gold and silver from people who needed cash. Tim and one employee negotiated deals with sellers in the front of the shop, while another employee worked in the back of the shop, where she counted the money and kept the books. Which commercial crime coverage would protect Tim from losses resulting from theft, specifically by either his current money counter or any other money counter he may employee after her?

B. Employee theft: scheduled positions

Cliff receives a letter from the IRS, informing him that he has severely underestimated his Adjusted Gross Income for the past year. Cliff was oblivious to this fact because XYZ Accounting has filed his taxes for him for the past 15 years. Now, Cliff owes $15,000 in back taxes. He sues XYZ Accounting for this mistake. Which of the following would cover the cost of the lawsuit for XYZ Accounting?

B. Errors and Omissions Insurance

Which of the following is NOT one of the unfair claims settlement practices specifically prohibited by New York law? A. Failing to promptly acknowledge communications about a claim B. Failing to pay a claim settlement within 5 business days of receiving a proof of loss C. Not attempting in good faith to bring about a prompt, fair claim settlement when liability is reasonably clear D. Knowingly misrepresenting pertinent facts or policy provisions to a claimant

B. Failing to pay a claim settlement within 5 business days of receiving a proof of loss

RWW Insurance creates a radio promotion where they advertise that they will insure any car for $200 a year. They don't actually offer such a plan, but they figure they will be able to sell hundreds of policies to people who show up looking for the bargain. What type of unfair insurance trade practice does this behavior exemplify?

B. False information and advertising

Which of the following best describes inland marine insurance?

B. Insurance designed to protect property being transported on land and property related to transportation

Which of the following is not true about Business Income from Dependent Properties, an Additional Coverage in a Business Owners Policy? A. It provides coverage for lost income when a key supplier suffers damage that affects the insured. B. It is also known as Extended Business Operations Interruption coverage. C. It provides coverage when a key customer suffers damage that affects the insured. D. Coverage is provided at no extra charge to the insured.

B. It is also known as Extended Business Operations Interruption coverage.

Mark is on vacation in Italy when his luggage is stolen, including a $2,000 laptop, a $500 suitcase, and $400 in clothes. Mark has an HO-3 homeowners policy. Excluding any applicable deductible, which of the following statements is TRUE?

B. Mark's homeowners policy will cover $2,400 of this loss.

An HO-3 policy is intended for a/an: A. corporation. B. individual. C. small business. D. government entity.

B. individual.

Kate has a Personal Auto Policy through XYZ Insurance. In which of the following scenarios would XYZ Insurance NOT be allowed immediately to increase Kate's policy premium?

B. XYZ Insurance expands coverage for all policies - a change which automatically applies to Kate's policy, as well.

Sally has an HO-3 policy on her $150,000 home in the country. One day, a bear breaks down Sally's back door to get into her kitchen for a snack. When Sally comes home to find the damage, she files a claim with her insurance company. Will the damage to Sally's home be covered, and why or why not?

B. Yes. The HO-3 is an open-peril policy, without an exclusion for wildlife.

A fidelity bond covers:

B. an insured business for loss resulting from any dishonest acts committed by its bonded employees.

Joe (the principal) is handling the disbursement of a deceased executive's estate, and he is required to carry a bond guaranteeing such work. The surety company requires one of its accountants to be a second signer on the disbursement checks that Joe writes. In this case, the surety has established:

B. joint control.

The ___________ is the organ responsible for filtering out urine from the blood. A. liver B. kidney C. pancreas D. spleen

B. kidney

Coil springs are used on most cars and ________ springs are used on most truck and heavy duty vehicles. A. shock B. leaf C. kinetic D. suspension

B. leaf -Leaf springs are used on most truck and heavy duty vehicles.

If a claim includes lost wages, an adjuster should: A. first determine when the injured party can return to work. B. verify the loss with the employer. C. prioritize it over other claims. D. make sure that lost wages are paid first.

B. verify the loss with the employer.

If a neighbor accidentally drives his vehicle into the insured's fence, this would a. Be covered under a basic form-dwelling policy with the extended coverage perils b. Not be covered under any of the dwelling policy forms c. Be covered under the broad form-dwelling policy d. Be covered as part of the extension of coverage under all dwelling coverage forms

Be covered under the broad form-dwelling policy

acme construction, inc has one contractor and one receptionist. the contractor makes $25/hr, and the receptionist makes $10/hr. the contractor worked exactly 8 hours in 2010, so he made $200......

C. $105

C. $15,000

Sherrie's roof and fence are damaged in a violent windstorm. Sherrie has a typical HO-3 policy with a $150,000 limit for Coverage A - Dwelling. Assuming she has no endorsements, how much coverage does she have available for the damage to her fence?

C. $15,000

A processing and servicing company would qualify for a BOP only if they have less than _____ in annual revenues.

C. $3 million

In order to be considered "fully insured" at 80% or more, Richard must carry at least $240,000 in insurance coverage on his home. What is the value of Richard's home? A. $192,000 B. $240,000 C. $300,000 D. $216,000

C. $300,000 300,000( Full home value)-80%(coinsurance)=240,000(Amount needed)

Which of the following is most likely a third party claim?

C. A woman files an insurance claim when she is injured by an employee at a local bar.

John moved out of his house and put it up for sale three months ago. While he was waiting for the house to sell, John's plumbing pipes froze and burst in the icy temperatures, which eventually led to water damaging the cabinetry and hardwood floors. Which of the following statements would most likely be TRUE?

C. Although John's house was still covered under an HO-3, the damage would not be covered because he didn't shut off the water supply.

Bill has experienced a loss covered under the Business Income and Extra Expense coverage in his Equipment Breakdown Protection Coverage Form. When does the period of restoration begin?

C. At the time of the breakdown or 24 hours before Bill was notified of the breakdown, whichever is later

Which of the following does NOT apply to commercial property insurance?

C. Because of their complexity, commercial policies only offer named-peril coverage.

Mike, a restaurant chef, was severely injured in an accident at work. His injuries will require surgery and rehabilitation. Mike has a Major Medical plan, but it will not cover this accident. Why? A. Major Medical plans are limited to preventative medicine. B. Mike's Major Medical plan does not cover rehabilitative specialists. C. Because the accident occurred at work, it would be covered by a Workers' Comp policy. D. Major Medical plans do not cover accidents.

C. Because the accident occurred at work, it would be covered by a Workers' Comp policy.

Which policy is used as an alternative to the Trucker's Policy to cover companies that offer transportation services to the public on a regular basis, rather than for hire?

C. Motor Carrier policy

C. Personal articles floaters cover property on a named-peril basis only.

Farmer Barb has purchased a $200,000 tractor to help her conduct farm operations. Due to its high value, Barb wants an insurance policy that applies only to her new tractor. Which type of insurance would Barb most likely purchase to cover her tractor? A. Household Personal Property coverage B. Unscheduled Farm Personal Property coverage C. Scheduled Mobile Agricultural Machinery coverage D. Excess Machinery coverage

C. Scheduled Mobile Agricultural Machinery coverage

When Emma's house was burglarized, the thieves stole several pieces from her art collection. Although the pieces were only prints, Emma files a claim stating that they were originals, and therefore worth a good deal more than they really are. What has Emma committed?

C. Soft fraud

Dean has cancer and is covered under a major medical plan. Which of the following coverages, sold as a supplement to Dean's major medical plan, would help him pay the high out-of-pocket costs related to his cancer treatments? A. Disability Income Insurance B. Medicare C. Specified Disease Insurance D. Credit Disability Insurance

C. Specified Disease Insurance

In which situation would Utility Service Time Element coverage apply?

C. Steve's Software Solutions loses power for two days when a bolt of lightning damages the power station. Steve experiences a significant loss of income during the outage.

After Cindy crashes into Nancy's mailbox while driving drunk, she gets out of her car, trips over Nancy's sidewalk, falls and breaks her arm. She then sues Nancy for the medical bills related to her broken arm. They are in a state that follows the doctrine of comparative negligence. What is the likely outcome of Cindy's lawsuit against Nancy? A. Cindy will not receive anything because she was partially responsible for her injury. B. The case will be dismissed because Cindy was intoxicated. C. The amount awarded to Cindy will be reduced by the percentage of her own negligence. D. Nancy's liability insurance will cover all of Cindy's medical bills.

C. The amount awarded to Cindy will be reduced by the percentage of her own negligence.

Payment on a Mechanical Breakdown claim is subject to which of the following conditions? A. The insured must have paid the full amount of the premium when the vehicle was purchased. B. The insured must have the vehicle inspected every year. C. The insured must have taken reasonable care to minimize the cost of repairs. D. The insured must only take the vehicle to an auto repair shop on the insurer's approved vendor list.

C. The insured must have taken reasonable care to minimize the cost of repairs.

Sandra rear-ended Randy's car when he stopped quickly for a yellow light that she was sure they were both going to make. The damage was minor, but Sandra was worried her premiums would increase if the accident was reported, so she gave Randy $500 in an effort to keep it just between the two of them. However, Randy filed the claim with his insurance company and received a settlement check for $750. What has Randy violated? A. The principle of insurable interest B. The principle of subrogation C. The principle of indemnity D. The principle of loss minimization

C. The principle of indemnity

Which of the following losses would NOT be covered under Part D-Coverage for Damage to Your Watercraft in a Personal Watercraft Policy? A. John has to pay transport charges to have his damaged craft delivered to a repair facility. B. Jack has to pay recovery charges to salvage his sunken craft. C. Tim damages another boat while cruising on a lake. D. Jennifer's $500 Nikon Camera is damaged when her boat starts taking on water.

C. Tim damages another boat while cruising on a lake. -The damages that Tim causes to another boat would fall under liability coverage, not Part D-Coverage for Damage to Your Watercraft.

When a faulty electrode in a children's toy is recalled by ABC Toymakers Inc., it is a costly endeavor. Especially since ABC Toymakers Inc.'s base insurance policy doesn't cover product recalls. Which excess liability coverage could help pay for losses associated with the recall?

C. Umbrella Policy

Which of the following is TRUE of the Stamp and Coin Collection Personal Articles Floater of Inland Marine Insurance? A. Only blanket policy coverage is available. B. Coverage excludes paper money and banknotes. C. Under blanket coverage, the policy will only pay up to $1,000 for any unscheduled coin collection. D. Under blanket coverage, the policy will only pay up to $500 for any individual item, such as a stamp or coin.

C. Under blanket coverage, the policy will only pay up to $1,000 for any unscheduled coin collection. -Under blanket coverage, the policy will only pay up to $1,000 for any unscheduled coin collection (and up to $250 for any individual item, such as a stamp or coin).

All private passenger insurance policies written under the New York Automobile Insurance Plan are required by law to include which of the following? A. Replacement cost coverage for the insured auto B. Liability limits of at least 50/100/50 C. Up to $1,000 in Medical payments coverage D. A $500 deductible

C. Up to $1,000 in Medical payments coverage

Which of the following is NOT a feature of a typical Business Owners Policy?

C. Usually Actual Cost Valuation

Francis has many employees who go out and market his product in the streets on a daily basis. This "go get 'em" approach seems to work well for business, but it does increase the risk of an auto accident. To curb the financial risk of a hospital stay resulting from an accident, Francis adds _____________ to his BAP.

C. a Medical Payments/PIP endorsement

Florida law requires all Medigap insurance policies to have a "Free Look Period," which means that:

C. a policyholder may return the policy for a full refund anytime during the first 30 days of coverage.

In connection with an insurance business transaction, an adjuster should never: A. begin a claim investigation later than 5 business days after receiving the claim. B. deny, in writing, any portion of a claim due to a specific policy provision. C. advise any person on questions of law. D. take special care to clearly represent the facts of a claim.

C. advise any person on questions of law.

A large corporation owns a small hunting cabin in the woods, that it uses for occasional weekend getaways. The corporation can insure the cabin against property damage with a:

C. dwelling policy.

An insurer that adheres to the laws of a state but is located outside of that state is called a(n) ___________ insurer.

C. foreign

In order to obtain auto liability coverage through the New York Automobile Insurance Plan, an applicant must: A. have no moving violations on his driving record. B. have been unable to get coverage in the voluntary market during the past 120 days. C. have a valid drivers license. D. be over the age of 25.

C. have a valid drivers license.

Zayden has just landed his plane and it is still moving very quickly down the runway when another plane crashes into the side of his plane and causes extensive damage. For the purposes of aviation insurance, this occurrence took place while Zayden's plane was: A. not in flight. B. not in motion. C. in flight. D. in transition.

C. in flight.

Flora is driving in the rain when she skids off the road and slams into Cam's billboard, totalling her car and causing $2,000 in damage to the billboard. Flora has an auto policy with ABC Insurance. Cam files a third- party claim and ABC Insurance pays him $1,500 for the billboard. Which of the following is TRUE?

Cam may sue Flora for $500.

Flora is driving in the rain when she skids off the road and slams into Cam's billboard, totalling her car and causing $2,000 in damage to the billboard. Flora has an auto policy with ABC Insurance. Cam files a third-party claim and ABC Insurance pays him $1,500 for the billboard. Which of the following is TRUE?

Cam may sue Flora for $500.

Anytown Pediatrics has been having a hard time finding medical malpractice insurance. The premiums are extraordinarily high, and they get higher every year. Finally, fed up with the cost of insurance, the directors decide to form their own insurance company, which will serve only Anytown Pediatrics. This way, any profits generated by the insurer will come back to Anytown Pediatrics. What kind of insurance company would this be?

Captive insurer

Which of the following businesses would not qualify for a Business Owner's Policy?

Car dealership

James has purchased a collection of antique furniture to sell to fine furniture dealers in the United States. James is moving the entire collection from Shanghai to Los Angeles in one shipment, and wants to purchase insurance for his cargo, should anything occur during the voyage to compromise his investment. What kind of coverage is James looking for?

Cargo coverage-Single Risk Form

What would trigger coverage under business income form with extra expense coverage

Carpet cleaning after a water main break

The Director has just received a complaint stating that an adjuster has violated insurance law. Which of the following actions may the Director take?

Commence an investigation of the adjuster's actions

A motor carrier that offers transportation services to the public on a regular basis (rather than only for hire) is known as a:

Common Carrier

Sarah and a carload of her friends are driving to Vermont for the weekend when she hits a deer, causing $10,000 in damages to her car and $5,000 in medical bills for herself and her passengers. Which insurance coverage will pay for the damages to Sarah's car?

Comprehensive

The use of which doctrine would result in David receiving no damages for his loss, if he were found 25% responsible for his own loss?

Contributory negligence

Control of Property

All of the following are supplemental payments found in liability policies EXCEPT

Costs the insured incurs in hiring their own attorney

Which of the following best describes the CGL?s general aggregate annual limit as it applies to the coverage parts of the CGL?

Coverage A, B and C apply in sum and are the most that will be paid subject to the general aggregate annual limit.

Which of the following statements about a PAF's coverage for silverware and goldware is FALSE?

Coverage does not include silver-plate and gold-plate items.

Which of the following coverages is typically included in a BOP?

Coverage for slander and copyright

The primary purpose of the Insuring Agreement is to specify the ____________ of an insurance policy.

Coverages

Tim's $2,500 boat trailer was stolen from his driveway. Ignoring any deductibles, how much can Tim receive for his stolen trailer when he files a claim against his homeowners policy?

D. $1,500

Scott lived in a mobile home before it was completely destroyed in a recent flood. The mobile home is large enough to qualify for a special loss settlement under his flood policy, which has a limit of $28,000. Before the flood, the mobile home was worth $15,000, but it would cost $25,700 to buy a new one today. How much indemnification will Scott receive for this loss?

D. $22,500

Orlando's house was fully insured when it was completely destroyed by a tornado. All that's left is a huge pile of debris and a $167,000 mortgage balance. Orlando files a claim against his DP-3 with a $220,000 limit. Normally, the cost of debris removal is subject to the policy limit, but Orlando's total costs exceed his limit. Once all cleanup and repairs are completed, what is the maximum indemnification the insurer could end up paying for the dwelling and debris removal? A. $220,000 for the dwelling, plus up to $8,350 for Debris Removal. B. $167,000 for the dwelling, plus up to $8,350 for Debris Removal C. $167,000 for the dwelling, plus up to $11,000 for Debris Removal. D. $220,000 for the dwelling, plus up to $11,000 for Debris Removal.

D. $220,000 for the dwelling, plus up to $11,000 for Debris Removal. -Debris Removal coverage can pay up to an additional 5% of the coverage limit, when needed. Since Orlando's Coverage A losses exceeded his policy limit, his policy can pay up to $11,000 (since this is 5% of $220,000) over and above that limit for the cost of removing the debris of Coverage A property.

If the Superintendent serves a licensee a written notice of a hearing on the violation of insurance code, he must give the licensee _______ notice of the hearing. A. 5 business days' B. 14 days' C. sufficient D. 10 days'

D. 10 days'

This agent is a salaried employee who sells insurance products for only one insurer.

D. Direct Writer

Which of the following oversees continuing education classes for customer representatives?

D. Division of Insurance Agent and Agency Services

Which of these homeowners policy coverages does NOT usually have a deductible? A. Sewer Backup B. Debris Removal C. Personal Property D. Fire Department Service Charge

D. Fire Department Service Charge -Coverage for Fire Department Service Charge does not usually have a deductible. Personal Property and Debris Removal are subject to the policy deductible, while Sewer Backup is excluded in the homeowners forms.

This Ocean Marine insurance coverage protects the vessel owner in the event that cargo shipping costs are not paid. A. Protection and Indemnity B. Hull coverage C. Cargo coverage D. Freight insurance

D. Freight insurance

Anton is purchasing homeowner's insurance for his new house. He wants to make sure his policy offers the BEST coverage available. Which policy should Anton choose?

D. HO-5

Oscar is covered for fire and lightning under his basic Standard Fire Policy, but he is concerned about facing financial losses related to other perils. Which of the following would be TRUE for Oscar? A. He must purchase a new policy that covers the additional perils for which he is seeking coverage. B. He can purchase endorsements for protection from additional perils, but only during the grace period between policy terms. C. He can purchase exclusions for protection from additional perils at any time. D. He can purchase endorsements for protection from additional perils at any time, with his insurer's agreement.

D. He can purchase endorsements for protection from additional perils at any time, with his insurer's agreement. -Oscar can add coverage for additional perils by adding endorsements to his policy, with his insurer's agreement.

All of the following statements are true regarding Medicaid, EXCEPT: A. To qualify for coverage, applicants must pass a means test. B. The program provides medical coverage for qualified individuals. C. The majority of the program is funded by the federal government and the states fund the rest. D. It is designed to provide health insurance for everyone 65 years of age or older, persons of any age with permanent kidney failure, and certain disabled people.

D. It is designed to provide health insurance for everyone 65 years of age or older, persons of any age with permanent kidney failure, and certain disabled people.

Which of the following would be covered under the peril of "theft" in an homeowners policy?

D. Losses caused by attempted theft

An adjuster must make several important decisions during the adjusting process. All of these are examples of such decisions, EXCEPT: A. Linda must determine if Lyle was intoxicated when the car he was driving was side-swiped by Jeffery. B. Becca must determine if the marks on Shellie's roof were caused by a hammer or by hail. C. Steve must determine the water damage in Monica's bathroom is recent or pre-existing. D. Stacy must determine how much of a limit for Coverage A would best fit John's needs in his Your new homeowners policy.

D. Stacy must determine how much of a limit for Coverage A would best fit John's needs in his Your Answer new homeowners policy.

__________ connect muscles to bones, whereas _________ connect bones to bones. A. Tendons; cartilage B. Cartilage; tendons C. Ligaments; cartilage D. Tendons; ligaments

D. Tendons; ligaments

The primary purpose of the Insuring Agreement is to specify the ____________ of an insurance policy. A. policy period B. damages C. location D. coverages

D. coverages

Farmer Steve barely escapes a massive tornado, but the storm does completely destroy one of the barns on his property. Luckily, Steve has an insurance policy on his barn with a replacement cost endorsement, and the barn was fully insured. At the time of the loss, the actual cash value of the barn was $65,000, and its replacement cost is currently $85,000. When will Steve receive full indemnification for his losses on the barn?

D. When he replaces the barn and submits receipts to the insurer

Coverage L in a Personal Liability Supplement provides: A. coverage similar to Coverage E in a homeowners policy, but it doesn't cover the insured's legal defense. B. no-fault coverage for necessary, reasonable medical expenses for a third party injured on the insured's premises. C. at least $1,000 in loss assessment coverage. D. coverage for both bodily injury and property damage to a third party for which the insured is legally liable.

D. coverage for both bodily injury and property damage to a third party for which the insured is legally liable. -Coverage L in a Personal Liability Supplement provides coverage for both bodily injury and property damage to a third party for which the insured is legally liable. It also pays for the insured's legal defense costs in a covered claim.

which fidelity bond form provide coverage against public employee dishonesty?

D. coverage form O

In a typical Workers' Compensation policy, Part 2, Employer Liability insurance: A. has a limit of $50,000 per accident. B. states that Workers' Compensation is an exclusive remedy for employee injuries, thus employers are not liable for further damages. C. excludes coverage for employee injuries when the employer took on the risk of such injury via signed contract. D. covers the employer when employees claim injuries not subject to Workers' Compensation law.

D. covers the employer when employees claim injuries not subject to Workers' Compensation law.

A CGL can provide liability insurance coverage for all of the following persons, EXCEPT:

D. customers.

All of the following are typical exclusions in an insurance policy, EXCEPT:

D. explosion.

The Standard Fire policy has 4 main parts. They are:

Declarations, Insuring Agreement, Conditions, and Exclusions

What allows a court to declare the legal rights of both parties and then the disputing parties can use the court's decision to come to a settlement?

Declaratory Judgement Action

Which of the following is NOT one of the primary functions of an insurance adjuster?

Defending the insurer

Under a garagekeepers policy, which coverage would pay for a covered loss after the vehicle owner's personal insurance has paid up to its policy limits?

Direct Excess

Under a garagekeepers policy, which coverage would split a covered loss with the car owner's personal insurance?

Direct Primary

This agent is a salaried employee who sells insurance products for only one insurer?

Direct Writer

An adjuster has several tasks to complete during the adjusting process. All of the following are examples of the types of tasks an adjuster may be required to perform, EXCEPT:

During a meeting with Darlene, Mindy collects various pieces of information and writes an auto policy for Darlene to purchase.

Which of the following people would be covered under her Errors & Omissions policy?

Errors and omissions insurance (E&O) is a type of professional liability insurance that protects companies, their workers, and other professionals against claims of inadequate work or negligent actions. Errors and omissions insurance often covers both court costs and any settlements up to the amount specified by the insurance contract.

Failure to disclose known facts when filling out an insurance application is an act of:

Failure to disclose known facts when filling out an insurance application is an act of: Concealment

Brendan is applying for a new job at Acme Superstore. Which law limits how much information Brendan's bank and mortgage lender can share with Acme Superstore, with regard to Brendan's finances and credit score?

Fair Credit Reporting

Fair Credit reporting act

Jocelyn visits her local car dealership to test drive a sports car, but once she gets on the road, she skips town with the car and doesn't come back. Which Garage policy coverage could pay for the theft of the sports car?

False pretense coverage

Federal Crop Insurance is a type of insurance sometimes called which one of the following

Federal Crop Insurance is a type of insurance sometimes called which one of the following residual market insurance

Which act only protects interstate railroad workers and their families by allowing workers who are not covered by regular WC laws to sue their employers?

Federal Employer Liability Act

Which of the following is NOT an example of an "indirect loss"?

Fire department hosing down a house fire causes water damage

IIPPA

Gives reason for denial of covers of claims

UM/UIM coverage excludes?

Government Vehicles

Which of the following people are in the process of submitting a formal request to settle the damage?

Grace is filing a claim with her insurer for hail damage to her roof.

Which Dwelling policy form provides open-peril coverage?

HO-3

The Act that regulates the collection and use of your personal information by an insurance provider is the

IIPPA

The house they own but rent to a tenant, and the car on which they are still paying

In which of the following would a person have an insurable interest:

Newman Medical has a balcony on the top floor of their headquarters. During a severe rainstorm, lightning strikes the balcony, breaking it into pieces. The company would like to repair the balcony, but the state's new building codes require construction materials that are quite a bit more expensive than what was used originally. What coverage in their commercial property policy pays for this extra expense?

Increased construction cost

According to the Worker's Compensation policy conditions, the insurer has the right to?

Inspect the workplace at any time

Dwelling coverage includes all of the following except A. materials B. Building and outdoor equipment used to service location C. Land on which the dwelling is located D. The dwelling used principally for residential purposes

Land on which the dwelling is located

What does a declaratory judgment action seek?

Legal Clarification of policy coverage

D'Anton spills coffee in his lap while driving, causing him to veer off the road and smash into a lamp post. Which part of his Personal Auto Policy will help him pay for the repairs to the lamp post?

Liability Coverage

What does the insuring agreement that is known as "the heart of the policy deal" mean

Losses covered under the insurance agreement

Kerry's advertising business employs Meg to clean offices at night, and recently Meg slipped and fell at work, hurting her back. Kerry can be assured that workers' compensation insurance will provide Meg with:

Medical Payments and lost wages

Homeowners liability coverage can pay for what?

Medical bills, Lost wages, pain and suffering, inconvenience, property damage

What type of commercial auto policy would best suit a taxi company?

Motor Carrier policy

When the dollar amount difference between an adjuster and claimant is very large, the adjuster should?

Move to dispute resolution

Negotiate a settlement amount with Gail.

Carol is adjusting a liability claim. After thoroughly examining the case, Carol comes up with what she believes is a fair and equitable amount of indemnification for the claimant. However, the claimant may reject her offer, so she prepares a second offer, just in case. Which function of an insurance adjuster might Carol be preparing for?

Negotiating a claim

Jim's 16-year-old son Dan wants to get insurance for his expensive mountain bike. He calls ABC Insurance, and says he would like to purchase an Actual Cash Value policy on his $3,000 bike. When they are finished talking, the ABC Insurance informs Dan that they cannot sell him the policy. What is most likely the reason for this?

No. This is because, in order for a contract to be legally binding, both parties to the contract must be 'competent.' In many states, a person would not be considered legally competent until he is 18 years old.

ABC Consulting has a CGL policy and an Umbrella policy, but the CGL runs from January 1 to December 31 and the Umbrella policy runs from June 1 to May 31. This difference in inception and expiration dates creates confusion when settling claims. This condition is known as:

Nonconcurency

Sal works for XYZ Plumbing, where he makes house calls to unclog bathroom drains, repair garbage disposals, and fix other plumbing related problems. While working under a sink, he uses the wrong tool to screw in a pipe and causes a massive leak that damages the wood flooring in the kitchen. This hazard would be covered under?

Operations Liability

Which of the following people is NOT occupying a vehicle that would qualify as "your covered auto" on the declarations page of his Personal Auto Policy?

Patrick borrows his neighbor's 45,000 pound semi truck to help his neighbor move.

Coverage E refers to which part of a HO policy?

Personal liability

Which of the following is eligible for coverage under the Personal Property Replacement Cost endorsement in a homeowners policy?

Photographers equipment

Paul and his wife have three separate insurance policies covering their home: Policy X with a limit of $100,000, Policy Y with $50,000, and Policy Z with $25,000. These policies are set up to pay covered claims by contribution of equal shares. After a fire causes $125,000 in damage to their home, how much will each policy pay (ignoring any deductibles)?

Policy X: 50,000 Policy Y: 50,000 Policy Z: 25,000

A garage policy is almost identical to a BAP, but it covers which two additional hazards?

Premises and Operations and Products and Completed Operations

Garage policy

Premises/Operations: injury or damages suffered on premises Products/Completed Services: for defective items or service

All of the following statements are correct regarding the duties of an insured following a loss except the insured must a. Reimburse the mortgagee for its interest in the damaged property b. Protect the property from further damage c. Separate the damaged from undamaged property d. Provide immediate written notice to the company

Reimburse the mortgagee for its interest in the damaged property

ACV FORMULA

Replacement cost (RC) minus Depreciation = ACV

Which of the following would be covered perils under theDP-1 Basic policy form?

Riots or Civil Commotion

Anytown Pediatrics has been having a hard time finding medical malpractice insurance. The premiums are extraordinarily high, and they get higher every year. Finally, fed up with the cost of insurance, the directors decide to join with a group of other medical providers to form an insurance company that will provide liability insurance only for members of the group. In this way, as a group, they are able to retain certain risks instead of transferring them to an outside insurer. Which of the following BEST describes this arrangement?

Risk retention group

Some producers supervise all of an insurance company's business within a specified territory. These producers appoint other producers, supervise their business, and receive an overriding commission on that business. What is the formal name for this type of producer?

This type of residential construction consists of lumber delivered to, and assembled on site piece-by-piece, with little or no previous assembly of components.

Stick Frame

What is the insurance concept that holds a party 100% liable for damages when the activity or instrument the party performs is inherently dangerous?

Strict Liability

Which of the following is NOT one of the requirements an adjuster must meet in order to be qualified to handle small commercial NFIP claims?

Submit written recommendations from three insurance company supervisors or claim management personnel.

In a PAP, the Insurer's Right to Recover Payment basically reinforces the principle of

Subrogation

In a PAP, the Insurer's Right to Recover Payment basically reinforces the principle of:

Subrogation

David's office assistant, Tina, is about to have a baby and will be gone for three months on maternity leave. While she is gone, David will need to hire someone to run the office, but only until Tina returns to work. According to the definitions in David's Commercial General Liability policy, which type of worker is he needing to hire?

Temporary Worker

Sylvia is in the process of building an addition onto her used book store, which is insured under a commercial property policy. About 40 days into the process, her mother takes a bad fall and breaks her hip. Seeing that she needs to move closer to her mom, Sylvia sells the book store. Her Builder's Risk coverage is terminated because:

Sylvia no longer has insurable interest in the bui;ding

Why might a Reservation of Rights letter be sent?

The Clamant took too long to file the claim

Who is responsible for paying the premiums on a workers' compensation policy?

The Employer

Protects seaman.

The Jones Act

PAP holders have several duties after a loss. Which of the following is NOT one of them?

The Policy holder must complete a drivering safety course

Apparent Apparent authority is the authority that a producer seems to have based upon his actions, whether he actually has it or not.

The authority that a producer seems to have that is based upon certain actions that the producer takes is known as __________ authority.

Which of the following statements does NOT apply to subrogation?

The exact amount of subrogation will usually be determined by a court of law.

If a building is completely destroyed by a fire, the Valued Policy Law states that the insurer should pay:

The full amount listed in the policy

How can insurance companies afford to pay for an individual's catastrophic loss?

The insurer collects premiums from all policyholders and pools them to pay the claims of the few

Which of the following people would NOT qualify as an "insured" under a BAP?

The policyholder's spouse, who is not named on the policy but habitually drives the company's SUV without permission.

Marisol has $100,000 in coverage for her fine art collection, as stated in the Scheduled Personal Property endorsement of her homeowners policy. She just purchased another piece of art worth $30,000. Which of the following statements is TRUE?

The new piece is automatically covered for $25,000, and she has 90 days to report the acquisition to the insurer to be eligible for full coverage.

An insurance policy's declarations page contains all of the following, EXCEPT:

The perils insured against

What does it mean when we say that an adjuster has the "power to bind"?

The principal is bound to the decisions the adjuster makes.

In the context of insurance adjusting, who is the principal?

The source of the adjuster's authority

Which is TRUE of the Right of Recovery condition of the Inland Marine policy?

This policyholder must not hamper the right of the insurer to recover damages from a third party.

Skip's Convenience Store must agree to install and maintain an emergency shutoff system for its gas pumps in order to qualify for insurance coverage. Which of the following statements is true?

This requirement is a warranty found in the conditions section of the policy.

This Florida agency is responsible for ensuring the financial stability of the state's insurance companies:

Treasury Office

T or F-UNDER THE SPECIAL FORM, COVERAGE APPLIES UNLESS A PERIL IS SPECIFICALLY EXCLUDED

True

Eve's Organic Applesauce makes a family sick, and Eve has to recall thousands of boxes of product. Since her base policy does not cover product liability, which of the following could help pay for Eve's losses associated with the recall? A. Excess Liability - Stand Alone B. Excess Liability - Follow Form C. Self-Insured Retention D. Umbrella policy

Umbrella Policy

Which of the following is TRUE of the Stamp and Coin Collection Personal Articles Floater of Inland Marine Insurance? A.Only blanket policy coverage is available. B.Coverage excludes paper money and bank notes. C.Under blanket coverage, the policy will only pay up to $1,000 for any unscheduled coin collection. D.Under blanket coverage, the policy will only pay up to $500 for any individual item, such as a stamp or coin. NEXT QUESTION

Under blanket coverage, the policy will only pay up to $1,000 for any unscheduled coin collection.

What IS NOT a supplementary payments under the personal auto policy

Up to $250 for the cost of bail bonds, fines and penalties

Which of the following would NOT be considered part of the insured location under the liability section of a homeowners policy? A. A residence where an insured is temporarily residing B. A family cemetery plot C. A lakeside cabin rented by the insured for vacation D. Vacant farmland owned by the insured

Vacant farmland owned by the insured

If a claim includes lost wages, an adjuster should:

Verify the losses with the employer

All of the following describe blanket property insurance coverage EXCEPT

a particular item insured.

a person or party to whom goods are delivered for a purpose, such as custody or repair, without transfer of ownership.

a person or party to whom goods are delivered for a purpose, such as custody or repair, without transfer of ownership. Bailee

ll of the following perils would typically be covered by Other than Collision coverage in a personal auto policy, EXCEPT:

a rollover

What is NOT considered an insured under the liability part of a personal auto insurance policy

a stranger who takes the car without permission

Liam, an adjuster for KLM Insurance, is inspecting hail damage on Ken's property. Once his investigation is complete, Liam tells Ken that his final settlement amount is $5,500, writes him a check, and closes the claim. In order to save his employer money, Liam did not tell Ken that he has a Replacement Cost endorsement and can recover the depreciation after he completes repairs. Liam has just:

engaged in misrepresentation.

Inland marine insurance protects:

property related to transportation and property being transported

Steve is an agent for XYZ Insurance. As a fiduciary agent, Steve's primary role is to: A. protect the financial interests of XYZ Insurance. B. analyze his conflicts of interest with XYZ Insurance. C. investigate the financial health of XYZ Insurance. D. ensure XYZ Insurance increases its annual revenues.

protect the financial interests of XYZ Insurance.

which of the following is when the only exception occurs under an assignment condition that transfers a policy with written consent of the insurer

the named insurer dies

Uninsured motorist coverage would not apply if the insured was at fault it applies only if___

the other ddriver is at fault but has no coverage

four types oc ocean marine insurance

the vessel or hull, the cargo, the freight revenue to be received by the ship owner, and legal liability for negligence of the shipper or the carrier.

The purpose of insurance regulation is?

to protect the public interest.

An injured employee covered under workers? compensation is entitled to reasonably justifiable expenses for retraining. This benefit falls under which of the following?

vocational rehabilitation

Workers' compensation is "no-fault" insurance. This means:

works by paying claims regardless of who is to blame for an accident.

An adjuster with draft authority can:

write settlement checks on the insurer's behalf.

What are the 3 Dwelling forms

DP-1 Basic form DP-2 Broad form DP-3 Special form

As Seth is driving along a country road, a deer jumps out in front of him. This causes Seth to veer off the road and crash into Cassie's wood fence and a brick mailbox. As a result of the crash, Seth suffers $3,700 damage to his sedan and causes $1,800 in damage to Cassie's property. How much of the damage will be covered by Seth's liability insurance?

$1,800

coverage under pollutant clean up and removal additional coverage

$10,000 limit for each separate 12 month policy period, the insured must report expenses within 180 days after the date of loss

An insured with split liability limits of 100/300/100 is at fault in an automobile accident and the other vehicle sustains $6,500 in property damages as well as two occupants have bodily injury and are claiming $150,000 each. What is the most insurance will pay to each occupant

$100,000

Bill has a typical Farm Policy with a Dwelling limit of $200,000. How much coverage is available for Bill's Household Personal Property?

$100,000

What is the minimum limit for Coverage L of the Personal Liability Supplement in a dwelling policy? $1,000 $100,000 None $10,000

$100,000

To satisfy the compulsory liability requirements, an auto liability policy must be written with limits of at least?

$15,000 bodily injury per person, $30,000 bodily injury per occurrence and $25,000 for damage to the property of others, per occurrence.

$1800

A typical homeowners policy without a Home Business endorsement has how much coverage available for business personal property?

$2,500

The insured carries underinsured motorists coverage limits of 250/500/250 on his automobile policy and his vehicle is struck by an at fault motorist who insures with the State minimum for liability of 20/40/10. If the insured brings suit for bodily injury damages to himself of $500,000, how much will he recover from at fault driver's policy?

$20,000

$22,000 4% of $700,000, or $28,000. Subtract the deductible from Frank's covered losses of $50,000, and the result is $22,000.

$220,000 for the dwelling, plus up to $11,000 for Debris Removal. $11,000 (since this is 5% of $220,000)

$225,000

Hank has collision coverage with a $2,000 deductible on his 2010 truck. One dark rainy night Hank's truck slipped off the road and rolled down the embankment. Hank's truck sustained $45,000 in damages, but the actual cash value of the vehicle is only $25,000. How much will Hank be indemnified by his insurer?

$23,000

Kelly took her eyes off the road and ended up smashing into the back of a passenger van. All five passengers were injured, with a total of $125,000 in medical costs. Assuming Kelly has liability coverage with limits of 50/100/50, how much will Kelly have to pay out of pocket?

$25,000

Bill lives in New Mexico and has the minimum auto liability coverage required for the state. He causes an accident that results in $35,000 in property damage and $50,000 in bodily injury to another person. How much will Bill have to pay out of pocket for this accident?

$25,000 in property damage and $25,000 in medical expenses

Liability Coverage Limits 25/50/10

$25,000 max for any one person's injuries $50,000 max for all injuries in any one accident $10,000 max for all property damage

Watson makes $550 a week as a waiter. When he trips over a customer's briefcase and breaks his leg, he can't wait tables for 9 months. The restaurant decides to pay him $100 per week to roll silverware until his leg heals. How much would Watson's Temporary Partial Disability benefits pay?

$300

In order to be considered "fully insured" at 80% or more, Richard must carry at least $240,000 in insurance coverage on his home. What is the value of Richard's home?

$300,000

Calvin earned $450 per week before he was killed in a work-related accident. His dependents will receive per week for up to weeks

$300: 700

Connecticut drivers must carry proof of insurance with them in their cars. If you get into an accident or are stopped by law enforcement, and cannot show this proof of insurance, you will have to pay how much for the first offense and how much for subsequent offenses?

$35, $50

Nancy borrows Drew's car so she can run to the grocery store. While out, she rear-ends an SUV, injuring the driver and one passenger. The passenger suffers $40,000 in injuries, while the driver suffers $60,000. Assuming Drew has a liability policy with limits of 30/60/10, while Nancy carries minimum coverage for South Carolina, how much will Nancy's policy cover?

$35,000

Kerry accidentally set his kitchen on fire while frying a turkey for the holidays. The fire results in $32,000 in damage to his home, which is valued at $175,000. However, Kerry only has a $120,000 homeowners policy limit. Assuming Kerry's policy has the 80% coinsurance requirement, approximately how much of the damage will Kerry be responsible for paying? (Round all numbers to three decimal places.)

$4,576

The insured's home is covered by a DP-3. Two years ago, the insured bought the home for $58,000. Today, its replacement value is $60,000. How much Coverage A does the insured need to qualify for replacement cost coverage? a. $60,000 b. $46,000 c. $58,000 d. $48,000

$48,000

$5,000

If an HO-3 policy has a coverage limit of $100,000 on the dwelling, how much coverage would automatically apply to cover the insured's personal property under Coverage C? a. $20,000 b. $25,000 c. $50,000 d. $100,000

$50,000

In an HO policy, the additional coverage Tree and Shrub Replacement will pay up to how much per tree?

$500

Citizens residential insurance policies have a _____ deductible for hurricane coverag

$500 2 %

While Andrea was grocery shopping in BB Mart, the large Dairy sign fell off the wall and landed on her. Because of her extensive injuries, Andrea sued BB Mart and was awarded $375,000 in damages. BB Mart's Commercial General Liability policy has a general aggregate limit of $1,000,000 and a per occurrence limit of $300,000. What is BB Mart's general aggregate limit after the claim for Andrea's injuries is paid?

$700,000

James holds a DP-1 policy on his house for $150,000. His wife, Jane, feels that they should really have closer to $200,000 in total coverage, so she takes out an additional $50,000 DP-1 policy on the same dwelling. Both policies pay settlements on a pro rate basis. After a fire causes $32,000 in damage to the home, how much of the damages will be covered by Jane's DP-1 policy?

$8,000 - Jane's policy represents ¼ the total coverage and therefore pays ¼ of the damages

Under which circumstances may an insurer cancel a policy after 60 days with sufficient notice?

(2) No notice of cancellation of a policy shall be effective unless it is based on one or more of the following grounds: (a) Nonpayment of premium. (b) Material misrepresentation or fraud. (c) The driver license or motor vehicle registration of the named insured or of any other ?

In a PAP, Personal Injury Protection:

(applies to covered injuries before any available Medical Payments coverage.) A policyholder who does not currently have Comprehensive Coverage, but would like to add it to a vehicle.. it is an extension of car insurance that covers medical expenses and, in many cases, lost wages.(PERSON INJURY PROTECTION)

Adjustors must report to commissioner

- Violation of laws - Felony - Misdemeanor

Risk Reduction

- employeeees

XYZ Trucking Company has a franchise deductible policy with a deductible of $100,000. When a tornado rips through their lot, the company sustains $965,000 in damage. How much of the damage will XYZ Trucking Company be responsible for paying?

Cheney owns a construction company in New Mexico. How many employees does Cheney have to have in order to be required by law to purchase workers' compensation coverage for them?

Under the Fraud and False Statements Act, what is the maximum prison sentence that can be imposed on an insurance professional who attempts to influence, obstruct, or impede the proper administration of the law while an insurance company is under investigation?

10 years

Every driver in Florida must carry $10,000 of _____ and $10,000 of ______ in order to operate a vehicle legally in the state.

10,000 of personal injury protection (PIP) insurance and $10,000 property damage liability insurance

Molly borrows her friend Dom's car to run to the grocery store. On the way home, she rear-ends a van, injuring the driver and 3 other passengers. Each of the passengers suffers $45,000 in injuries, while the driver suffers $40,000. Assuming Dom has a liability policy with limits of 50/100/50, while Molly has 25/50/25 coverage, how much will the primary policy cover?

100,000

When a severe flood is imminent, Erica goes out and spends $600 on sandbags, $200 on plastic sheeting and lumber, and $500 on a pump. Then she works for 8 hours, applying the protective measures to her home. After the flood passes, Erica files a claim for these expenses. Assuming the federal minimum wage at that time is $10 per hour, how much will her flood policy indemnify her?

1000

180 days; 90 days Catastrophe adjuster permits are valid for _____, but the commissioner may extend them for an additional _____.

180 days; 90 days

How long does Civil Authority coverage pay for Additional Living Expenses and Fair Rental Value up to?

2 weeks

A typical homeowners policy without a Home Business endorsement has how much coverage available for business personal property?

2,500

225000, the deductible is absorbed into the amount of damage exceeding the policy limit.

When lightning strikes Brittany's home during a storm, the resulting fire completely consumes the structure before firefighters manage to put it out. Brittany is fully insured by a DP-3 policy with a limit of $245,000, every bit of which is needed to rebuild her home. In addition, she receives a bill from the fire department for $650. How much is Brittany likely to receive from her insurer in response to her claim?

245,500

Liability Limits meaning 25/50/10

25 - $25,000 max for person's injury 50 - $50,000 max for all injuries in accident 10 - $10,000 max for all property damage

For the purposes of workers' compensation insurance, an employee's Average Weekly Wage is determined by averaging the employee's pay in the weeks leading up to the injury.

Dragonfly Landscapers has one landscaper and one bookkeeper. The landscaper makes $25/hr, and the bookkeeper makes $15/hr. The landscaper worked 20 hours in 2014, so he made $500. The bookkeeper also worked 20 hours, so she made $300. So Dragonfly's entire payroll for 2014 was $800. Let's say that for every $100 of payroll, the WC rate for landscapers is $50 and the rate for bookkeepers is $5. How much did Dragonfly have to pay in workers compensation premiums for 2014?

265

Jim is covered under a Personal Automobile policy with liability limits of 25/50/25 and $5,000 in "medical payments" coverage. Jim causes an accident which leaves him with $7,500 in medical costs and $50,000 in property damage to a parked BMW.

27, 500

Jim has a PAP with liability limits of 25/50/25 and $5,000 in medical payments coverage. Jim causes an accident which leaves him with $7,500 in medical costs and $50,000 in property damage to a parked BMW. How much will Jim be out of pocket in total for all damages occurring in this accident?

27,500

Linda's home is worth $525,000. She has a homeowners policy with a $500,000 limit and a 1.5% deductible. When Linda's husband sets their kitchen on fire while frying a turkey, he accidentally causes $36,000 in damages. How much can Linda and her husband expect to receive in their settlement?

28125

With regard to Workers Compensation Insurance, Temporary Total disability benefits kick in after an employee has been unable to work for how many days?

If a Connecticut HO insurance policy has been in effect for fewer than 60 days and is not a renewal (if it is a new policy), the insurer may cancel for any reason with how many days advance notice?

How long before the expiration or anniversary date should the insurer notify the insured that it intends to renew the policy?

30 days

When a company acquires a new vehicle under symbol #7, when must the company report the acquisition to the insurer?

30 days

Insurers must pay valid third-party claims for property damage or medical expenses within?

30 days after obtaining a written agreement of claim settlement.

The DMV suspended Ruby's license and registration when she was caught driving with no insurance. This is her first offense, but Ruby does not surrender her license and registration to the DMV. Which of the following penalties might Ruby face?

30 days in prison

Commercial insurers must deliver notice of any rate increase, change in deductible, or a reduction in limits or coverage at least?

30 days prior to the expiration date of the policy.

A Standard Fire Policy may be cancelled by the insurer at any time by giving the named insured and the mortgagee, if any, at least how many days advance?

30 days' advance written notice, unless the cancellation is for non-payment of premium, in which case only 10 days' notice is required.

A South Carolina driver with minimum liability limits gets into an accident in Texas, where the minimum liability requirement is 30/60/25. How much liability coverage will his policy provide for the damage?

30/60/25

In order to be considered "fully insured" at 80% or more, Richard must carry at least $240,000 in insurance coverage on his home. What is the value of Richard's home?

300,000

A policyholder who does not currently have Comprehensive Coverage, but would like to add it to a newly purchased vehicle, must notify the insurer within:

4 days

Coverage Symbol 4,5,6

4. Owned vehicles other than passenger trucks, buses 5. Owned Autos subject to no-fault insurance 6. Owned autos subject to compulsory uninsured motorist law

If a Connecticut insurer decides to cancel an auto policy for a reason other than non-payment of premiums, it must provide written notice to the insured in how many days advance?

During a storm, lightning strikes a tree in Harry's yard and starts a fire that spreads to his shed where he keeps all his equipment for his landscaping business. In addition to the shed, Harry has to purchase all new equipment to stay in business. The cost to replace the equipment would be considered?

A Direct Loss

During a storm, heavy winds cause a tree limb to break and fall onto Paul's house, causing $6,500 in damage. Paul's insurance company now considers his house:

A Loss

April 30, 2018. Louisiana adjuster's license expires on the last day of the licensee's birth month in even-numbered years if the license number ends in an even number.

A Louisiana adjuster who received his license (number: 4764) on May 1st, 2017 and whose birthday is April 10 must renew his license by:

An economic device used to protect against the risk of realizing unforeseen and extraordinary financial loss is called:

A Peril

Jim has been arrested for drunk driving. In order to be allowed out of jail before his court date, Jim will most likely need:

A bail bond

How does concealment differ from a warranty or representation

A concealment is an omission of detail by the insured designed to distort the truth, while the others are perceived as true

Which of the following people does NOT have an insurable interest in an insured property?

A homeowner's interest in the local town water pipes that deliver water to his home.

Which type of loss does an exclusion describe

A loss for which there is no protection under the policy terms

Which of the following is NOT eligible for Directors and Officers Liability Insurance?

A private, family-owned company that produces baby shoes.

What do the Standards of Conduct for Public Adjusters say about lawyers?

A public adjuster may not recommend a lawyer to an insured in exchange for a fee.

Sara's home was partially destroyed by a fire and she insists will cost $97,000 to repair the damage. However, after completing his investigation, the adjuster determined the repairs could be done for $65,000. All attempts at negotiation have failed. Even though it's risky to go to court, why might the insurer decide to pursue that course of action?

A reputation of being a "pushover" will make future negotiations more difficult

Blue Lines Shipping sustains hundreds of thousands of dollars in losses when one of their ships full of cargo catches fire and sinks in the Pacific Ocean. Which of the following situations would NOT be cause for the insurer to refuse to indemnify Blue Lines Shipping for its losses?

A storm knocks out the navigation system, causing an electrical fire.

One of the biggest movie studios has just agreed to finance and release Harvey's independent film. However, the studio wants a guarantee that Harvey's movie will be completed and delivered on schedule and within budget. Harvey can satisfy this requirement by purchasing:

A surety bond

Adjuster Andy is trying to determine a final settlement amount for Bob's claim. Bob's house was destroyed in a fire and it will cost $220,000 to rebuild it. Bob's homeowners policy has a limit of $210,000 and a $1,500 deductible. How much should Adjuster Andy's final settlement calculation be? A. $210,000 B. $220,000 C. $208,500 D. $218,500

A. $210,000 -Because the cost of repairs is more than the policy limit, the final settlement amount is the full policy limit ($210,000) and the deductible is absorbed into the amount of the loss that exceeds the limit.

Wilson is a Florida resident who maintains a liability policy with limits of 10/20/10. Recently, he was visiting a friend in Georgia when he ran a red light and hit a BMW, causing $30,000 in property damage. The minimum liability requirement in Georgia is 25/50/25. How much will Wilson's liability insurance pay in this situation?

A. $25,000

under the longshore and harbor workers' compensation act, how much would the surviving spouse of a deceased worker receive in benefits?

A. 50% of the deceased workers average weekly wage

In the event of a hit-and-run, an injured person who is eligible for MVAIC benefits must submit a Notice of Intention (NOI) to MVAIC within: A. 90 days. B. 180 days. C. 30 days. D. 10 days.

A. 90 days. -the event of a hit-and-run, an injured person who is eligible for MVAIC benefits must submit a Notice of Intention (NOI) to MVAIC within 90 days.

Which of the following employees would be covered under the Disability Benefits Coverage Law? A. A construction worker B. A farm laborer C. A golf caddy D. A Catholic priest

A. A construction worker

Dr. Keaton had an Occurrence Medical Liability policy with ABC Insurance from March 1, 2010 until March 31, 2013, at which time he switched to XYZ Insurance and a Claims Made policy. The policy with XYZ Insurance was in effect from April 1, 2013 until April 31, 2015. Which lawsuit would trigger the ABC Insurance policy to pay? A. A man sues Dr. Keaton on August 18, 2014 for a botched hip replacement surgery performed on October 10, 2012. B. A woman sues Dr. Keaton on February 26, 2014 for a bungled face lift performed on December 1, 2013. C. A woman sues Dr. Keaton on April 15, 2011 for a failed hysterectomy performed on February 6, 2010. D. A man sues Dr. Keaton on March 5, 2010 for a mistaken amputation performed on January 30, 2010.

A. A man sues Dr. Keaton on August 18, 2014 for a botched hip replacement surgery performed on October 10, 2012.

Which of these businesses would be LEAST likely to need a bailee's customer floater?

A. An ice cream shop

Which of the following is not true about Business Income from Dependent Properties, an Additional Coverage in a Business Owners Policy? A. It is also known as Extended Business Operations Interruption coverage. B. It provides coverage when a key customer suffers damage that affects the insured. C. Coverage is provided at extra charge to the insured. D. It provides coverage for lost income when a key supplier suffers damage that affects the insured.

A. It is also known as Extended Business Operations Interruption coverage.

After a fire destroys Gale's kitchen, she files a claim with her insurer and hires a contractor. The contractor estimates it will take $42,250 to repair the damage, but the adjuster estimates it will only take $38,340. Which of the following is the best option for the adjuster's response to Gale's claim? A. Negotiate a settlement amount with Gale. B. Reject Gale's request and deny the claim. C. Allow Gale and her insurer to settle the claim in court. D. Accept Gale's request and pay the claim.

A. Negotiate a settlement amount with Gale

The property coverage of a BOP includes which of the following

Carpeting that is permanently installed inside the building

In a Commercial Package Policy, interline endorsements: A. apply to at least two coverages or lines of insurance within the policy. B. apply to only one line of insurance within the policy. C. allow businesses to add more lines of insurance than are usually covered by a Commercial Package Policy. D. allow payments to be made under one line of coverage in the policy before a settlement is reached under a different line of coverage.

A. apply to at least two coverages or lines of insurance within the policy.

In a garagekeepers policy, PIP coverage is:

A. available with an endorsement.

A pre-defined monetary portion of an insurance claim paid by a policyholder is a: A. deductible. B. premium. C. co-insurance. D. replacement cost.

A. deductible.

A kickback involves:

A. giving someone compensation in order to gain favorable treatment in an insurance transaction.

An adjuster's preliminary report would most likely not: A. include the settlement amount. B. establish a claim reserve. C. document the initial contact with the claimant. D. list any known liability issues.

A. include the settlement amount.

After a loss covered under a dwelling policy, Ordinance or Law coverage pays for:

A. increased repair costs due to laws or codes.

according to the workers' compensation policy conditions, the insurer has the right to:

A. inspect the workplace at any time.

Jared is fishing from his 22-foot sailboat when he is caught in a sudden hailstorm. His boat suffers extensive hail damage. When he files a claim against his homeowners policy, he is upset to learn that his claim is denied because: A. the boat was not fully enclosed inside a building during the hailstorm. B. damage to sail boats is not covered by a homeowners policy. C. a homeowners policy will only cover watercraft smaller than 20 feet. D. damage to sail boats is only covered by endorsement.

A. the boat was not fully enclosed inside a building during the hailstorm.

Mark has an ocean marine insurance policy with cargo coverage. The type and value of his cargo varies from one shipment to the next, so rather than having a set value for this coverage, the amount of his settlement is only determined after a covered loss. Mark's cargo coverage is written on a/an ________ basis.

A. unvalued

After a hail storm passed through his neighborhood, Perry had his roof inspected by a local contractor. The contractor gave Perry an estimate of $9,850 to replace his roof, so he filed a claim with his insurer. The adjuster came up with her own estimate of $9,645 to replace Perry's roof. How will the adjuster likely respond to Perry's request?

Accept his request, since the difference between the two amounts is small enough to settle in Perry's favor.

Which of the following is NOT an endorsement commonly added to a Dwelling Policy?

Annual depreciation

This type of trim is typically placed around windows and doors to give them a finished look.

Casement

Jackie recently inherited a life-sized marble statue of her great-grandfather. It is an irreplaceable antique, and it is nearly impossible to determine the ACV. Which type of policy would best indemnify Jackie in the event that the statue was ever damaged?

Agreed Value Policy

Agreed value policy

What are the four requirements of a legally binding contract?

Agreement, consideration, competent parties, legal purpose

What does the adjuster's code of ethics say about release forms?

An adjuster shall not draft any form of release, unless approved in writing in advance by the insurer.

What is not considered competent to enter into an insurance contract

An adult currently diagnosed with dementia

n a condo association's commercial property policy, which of the following items would be covered by the Condominium Coverage Form?

An elevator in common ground

In a condo association's commercial property policy, which of the following items would be covered by the Condominium Coverage Form?

An elevator in the common area

Which of the following would NOT be considered an "occurrence" according to a CGL policy?

An employee is mopping the floor of a grocery store while numerous people are present.

Darnell is applying for auto insurance with his agent. Currently, he only wants to get a minimal amount of coverage to keep his premiums as low as possible, so he decides not to include uninsured motorist coverage on his policy. His agent has him sign a document giving up his right to this coverage. What is this called?

An express waiver

Why is an insurance policy considered to be a unilateral contract?

An imbalance exists which legally requires only the insurer to meet its part of the contract

Bailee

An individual or company that receives the property of someone else for a special purpose and returns the property after use.

Which of the following best defines "insured"? A. An individual or organization that pays premiums in exchange for financial protection B. A company, group, or government agency offering financial protection C. Transfer of the risk of financial loss from one party to another D. A legally binding contract in which the insurance company agrees to pay for specified losses in exchange for premiums

An individual or organization that pays premiums in exchange for financial protection

On January 27, 2008, Ryan is using an exercise bike purchased from NusquamCycle when the chain breaks, causing him to fall and severely bruise his knee. It seems to heal just fine, but three years later, on January 29, 2011, Ryan's knee gives out while jogging. His doctor informs him that he'll need surgery and that this deterioration was most likely caused by his earlier accident with the exercise bike. Assuming NusquamCycle is no longer in business, which Commercial General Liability policy would cover Ryan's claim filed January 29, 2011?

An occurrence policy from Jan 31 2006-Jan 31 2009

How does the arbitration condition differ from the appraisal condition

Arbitration includes other disagreements besides disputes of value

Which of the following situations does NOT involve misrepresentation?

Atticus manages an insurance agency and posts the salespeoples' numbers publicly each month, to promote competition.

Which of the following is NOT an endorsement commonly added to a Dwelling Policy? A. Dwelling Under Construction B. Annual Depreciation C. Theft D. Liability

B. Annual Depreciation -Annual Depreciation is NOT a common endorsement to the Dwelling Policy.

Joe is looking for information in his Standard Fire Policy, relating to policy cancellation, assignment, and subrogation. In which section would he find this information? A. Insuring Agreement B. Conditions C. Declarations D. Exclusions

B. Conditions

When a fire breaks out inside XYZ Printing, it damages the building structure, and two of the printing presses, which were bolted to the floor. What coverage within the BOP policy would cover the printing presses?

B. Coverage A

Caitlin works as a driver for a local oil company. She picks up the field workers and drops them at the wellsite. Then, once their shift is completed she brings them home again using the company van. Which endorsement provides the best coverage for Caitlin? A. Customized Equipment B. Extended Non-Owner C. Miscellaneous Vehicle D. Non-Owner

B. Extended Non-Owner

Caitlin works as a driver for a local oil company. She picks wellsite. Then, once their shift is completed she brings them home again using the company van. Which up the field workers and drops them at the endorsement provides the best coverage for Caitlin?

B. Extended Non-Owner

Which of the following would be covered under Coverage A in a dwelling policy?

B. Gas furnace in the basement

Which of the following people is NOT occupying a vehicle that would qualify as "your covered auto" on the declarations page of his Personal Auto Policy? A. Sam is driving his BMW that he purchased 2 days ago and has not yet added to his insurance policy. B. Patrick borrows his neighbor's 45,000 pound semi truck to help his neighbor move. C. George is standing in the trailer he bought last year. D. Alex is driving a rental car while his own car is being repaired.

B. Patrick borrows his neighbor's 45,000 pound semi truck to help his neighbor move. -Over the weight limit

Which of the following would be considered an Instrumentality of Transportation and Communication?

B. Pipeline

A garage policy is almost identical to a BAP, but it covers which two additional hazards?

B. Premises & Operations and Products & Completed Operations

A garage policy is almost identical to a BAP, but it covers which two additional hazards? A. Products & Completed Operations and Freezing B. Premises & Operations and Products & Completed Operations C. Mechanical Breakdown and Premises & Operations D. Mechanical Breakdown and Freezing

B. Premises & Operations and Products & Completed Operations

Which aviation coverage would indemnify a farmer for damage to his crop if a plane crashed on his farm? A. Admitted Aircraft Liability B. Property Damage Liability C. Bodily Injury Excluding Passengers D. Airport Liability

B. Property Damage Liability

Skip's Convenience Store suffers severe fire damage after a gas pump explodes. The adjuster asks if the emergency shutoff system, which is required by the policy, was properly maintained and functional at the time of the accident. Skip says "yes," even though the system was actually broken at the time. Which of the following statements is true? A. Skip is guilty of concealment and violating a binder, so the insurer could deny the claim. B. Skip is guilty of misrepresentation and violating a warranty, so the insurer could deny the claim. C. Skip is guilty of misrepresentation and violating an estoppel, so the insurer could deny the claim. D. Skip is guilty of concealment and violating a warranty, so the insurer could deny the claim

B. Skip is guilty of misrepresentation and violating a warranty, so the insurer could deny the claim.

Craig has a poor driving record. He lives in Florida, has a valid driver license, and has registered his car, but due to his history, he is unable to obtain auto insurance through the private market. According to state law, Craig must have liability insurance in order to drive on public roads. How will Craig be able to purchase coverage?

B. Through the Florida Automobile Joint Underwriting Association

Edward is a member of the Knights of Columbus, a religious group dedicated to voluntary service to the benefit of society. He also recently purchased a $100,000 life insurance policy from the organization. This was possible because the Knights of Columbus is:

B. a fraternal benefit society.

Frank owns a bakery specializing in authentic French bread. He uses two specialty ovens for his daily production of French bread. If one of these giant ovens were to break down, it would cost Frank's bakery a lot of money to repair, not to mention the loss of revenue caused by lower production. On his Equipment Breakdown Protection Form, each of Frank's ovens would be considered:

B. an "object."

Janine's hair salon was already having a bad year when a client slipped, broke her hip, and sued the salon for $100,000. Relieved that she had just purchased an excess liability policy last month, Janine hopes she can use that, leaving her base liability policy untouched. This is not possible because: A. all excess liability policies have a 10% per occurrence clause. B. an excess liability policy pays only when the base policy limit has been exhausted. C. Janine's excess liability policy is a Stand Alone policy. D. there is an imposed waiting period of 45 days for all excess liability policies.

B. an excess liability policy pays only when the base policy limit has been exhausted.

The Office of Insurance Regulation:

B. approves insurance forms.

Jack is awaiting trial after his arrest, but he would rather wait at home than in jail. He cannot be let out of jail without a guarantee that he will show up to the trial, so he purchases a: A. fiduciary bond. B. bail bond. C. fidelity bond. D. contract bond.

B. bail bond.

When a storm rolled through town a month ago, John's home suffered substantial damage. He filed a claim, but his insurer has offered a settlement much lower than John feels is fair. Each party selects an appraiser, who in turn agree on an umpire, to help settle the claim. If two of the three parties agree, their decision is: A. suggested. Either party may walk away at any time. B. binding. C. only legally binding if both the insurer and the claimant agree to it. D. partially binding.

B. binding.

Every time Duke goes to the doctor, he has to pay $25 and his health insurer is billed for the rest. This $25 out-of-pocket expense is Duke's: A. capitation. B. copayment. C. deductible. D. coinsurance.

B. copayment.

In a Dwelling policy, the Glass or Safety Glazing Material Coverage will not cover: A. direct damage to covered items caused by broken glass. B. damage to abandoned buildings caused by broken glass. C. the breakage of a covered building's glass caused by earth movement. D. storm doors broken by earth movement.

B. damage to abandoned buildings caused by broken glass.

In order to qualify for disability benefits through Social Security, a person must: A. be a Federal employee. B. have a physical or mental condition that prohibits any type of work and is expected to last for at least one year or result in death. C. have worked for at least 15 years, and have 40 credits. D. have an injury that arose out of and in the course of employment.

B. have a physical or mental condition that prohibits any type of work and is expected to last for at least one year or result in death.

john and lucy both apply for policies with acme insurance at the same time. they are exposed to similar hazards and would presents essentially the same amount of risk to acme insurance. acme insurance offers lucy a premium policy at excellent rates, but restricts john to a very limited policy with high premiums. acme insurance may be guilty of:

B. unfair discrimination

Because the cost of repairs is more than the policy limit, the final settlement amount is the full policy limit ($210,000) and the deductible is absorbed into the amount of the loss that exceeds the limit.

Which driver is meeting the minimum insurance requirements for South Carolina?

Ben has liability coverage with limits of 100/300/100 and UM coverage with limits of 25/50/25

Jake and his neighbor Bill are working to repair Jake's roof. Jake sets up two ladders side-by-side for each of them to use while working on the gutters. While at the top of the ladder, Jake falls into Bill's ladder, sending both of them tumbling to the ground. Whose injuries will be covered by Jake's homeowners policy under Coverage E - Personal Liability?

Bill's Injuries

Which of the following would be considered a physical hazard?

Brad's pool in his backyard.

Olivia suffered third degree burns when her new espresso machine malfunctioned and sprayed her with scalding hot water and steam. She sued the manufacturer and was able to collect damages under which of the following?

Breach of product warranty

Which coverage form provides the foundation for all commercial property policies?

Building and Personal Property Coverage Form

Which of the following is often Coverage B in the Business Owners Policy?

Business Personal Property.

ABC Manufacturing is covered by an Equipment Breakdown Protection Coverage Form which includes Business Income coverage. Which of the following is a TRUE statement regarding the Business Income coverage? A. In the event of a covered loss, coverage is provided for lost business income for as long as it takes to make needed repairs, regardless of how long it takes. B. ABC Manufacturing must supply the insurer with a yearly report detailing the company's income and expenditures in order to avoid a coinsurance penalty in the event of a loss. C. ABC Manufacturing must supply the insurer with a yearly report detailing the values of all the covered equipment in order to avoid a coinsurance penalty in the event of a loss. D. This coverage pays for extra costs that ABC Manufacturing incurs while making temporary repairs and expediting permanent repairs after a breakdown of covered equipment.

C. ABC Manufacturing must supply the insurer with a yearly report detailing the values of all the covered equipment in order to avoid a coinsurance penalty in the event of a loss - Business Income coverage has a valuation condition that requires the insured to give the insurance company a yearly report detailing the values of covered equipment. If the insured fails to supply this report, the insurer may apply a coinsurance penalty on covered losses.

Randy owns a clothing store. One day, he notices a shady character with a backpack who is hanging around acting nervous. Randy becomes suspicious and approaches the young man. As the boy makes an effort to avoid him, Randy grabs his arm and detains him until the police arrive. Not finding any stolen merchandise, the police let the boy go. Two weeks later Randy is notified that he will be sued for violation of the young man's civil rights. This is an example of what type of personal injury covered under Randy's Commercial General Liability policy?

C. False Arrest, Detention, or Imprisonment.

All of the following are requirements for operating as a Group Self-Insurer in New York, EXCEPT: A. Group must contain at least two members in the same industry B. Employers must apply with the Workers' Compensation Board's Office of Self-Insurance C. Group members must have a combined payroll of at least $250,000 D. Group members must have a combined net worth of at least $1,000,000

C. Group members must have a combined payroll of at least $250,000

Paula is hoping to become a customer representative; under what circumstances might she be able to skip the pre-licensing course and exam?

C. If she has earned nine hours of college credit in property and casualty courses.

The coverage limit in Bob's commercial property policy goes up 2% every time the policy renews. Which optional coverage might Bob have included as part of his insurance package?

C. Inflation Guard

"Hepatic" means having to do with the ___________. A. large intestine B. bladder C. liver D. kidneys

C. liver

coast-to-coast trucking is in the business of transporting fresh produce from farmers to markets all across the us. which type of inland marine policy would best protect coast-to-coast trucking's interest in the produce that it ships?

C. motor truck cargo policy

Customer representatives:

C. must be licensed by the Florida Department of Financial Services.

For loss settlement purposes, most homeowners policies:

C. pay for damages to personal property at actual cash value, and damages to structures at replacement cost.

which of the following is not one of the employer's duties if injury occurs?

C. remain with the injury employee until emergency assistance or a family member arrives.

In a Dwelling policy, Coverage A provides protection for: A. land surrounding the principal dwelling. B. construction tools left outside next to the building. C. structures attached to the principal dwelling. D. a detached garage.

C. structures attached to the principal dwelling.

in order for customers of a home to qualify for flood insurance protection , which of the following conditions must be met?

C. the contents must be located in a fully enclosed building.

In a BOP, the General Aggregate Limit is:

C. twice the per occurrence limit.

In an HO policy, Coverage F would not pay for?

Chiropractic Care

Which of the following would most likely be covered under Other Than Collision coverage in a personal auto policy?

Civil Unrest

Greg works for XYZ Insurance. Part of his daily tasks involve visiting sites, investigating liability, and determining the time and cost of repairs. On occasion, Greg will have to negotiate with claimants as part of his job. Which type of agent is Greg?

Claims Adjuster

Most states require businesses to purchase workers' compensation insurance to cover their employees. Workers' comp in those states is:

Compulsory

States that require all businesses to purchase worker's compensation insurance are called?

Compulsory

In which section of the Standard Fire Policy would one find the following subsection titled: "Duties of the Insured after an Occurrence"?

Conditions

Coverage A & Coverage D

Which part of a homeowners policy provides coverage for the medical expenses of third parties who are injured on your property?

Coverage F

An insured operates a auto repair shop and has garage coverage form with garage keepers insurance when an employee on a test drive with a customer car is involved in a crash. How will the customer's car be covered by the insured's policy

Customer's car is covered for any physical damage while in the custody of the insured

Which of the following is NOT one of the unfair claims settlement practices specifically prohibited by New Mexico law? A. Not attempting in good faith to bring about a prompt, fair claim settlement when liability is reasonably clear B. Knowingly misrepresenting pertinent facts or policy provisions to a claimant C. Failing to promptly acknowledge communications about a claim D. Failing to pay a claim settlement within 5 business days of receiving a proof of loss

D. Failing to pay a claim settlement within 5 business days of receiving a proof of loss

What document do insurance companies give to claimants when they think something in the claim is not covered by the policy, but they are not sure yet? A. Declaratory judgment action B. Coverage clause C. Non-waiver agreement D. Reservation of Rights letter

D. Reservation of Rights letter

Veronica owns a pottery business and is insured under a commercial property policy. She was in the process of building an extra structure for the sole purpose of kiln firing her pottery when a massive storm came through and blew down all the scaffolding, which added additional cost to the construction project. Which coverage extension of the Builder's Risk Coverage Form would cover the scaffolding?

D. Scaffolding, Construction Forms, and Temporary Structures

Rosa's barn burned down when it was struck by lightning during a storm. The barn was insured for $45,000 under Rosa's Farm policy, which included a replacement cost endorsement with an 80% coinsurance requirement. At the time of the loss, the barn's Actual Cash Value was $35,000, but it will cost $60,000 to replace it. How will Rosa's insurer respond to her claim? A. The insurer will give Rosa one check for $35,000, and another for up to $21,250 once repairs are completed. B. The insurer will give Rosa one check for $35,000. C. The insurer will give Rosa one check for $45,000, and another for up to $11,250 once repairs are completed. D. The insurer will give Rosa one check for $35,000, and another for up to $10,000 once repairs are completed.

D. The insurer will give Rosa one check for $35,000, and another for up to $10,000 once repairs are completed. -Rosa's policy will pay the actual cash value of her barn first ($35,000). Then, once Rosa has finished rebuilding it and submits the receipts to her insurer, the insurer will pay the remaining expenses, up to her policy limit of $45,000. This means it can pay up to $10,000 more after she completes repairs.

After a rain storm, Nancy realizes that she left her bedroom windows open the entire time. Now there is extensive water damage to her area rug and furniture, and the laptop that had been sitting on her desk is ruined. Nancy has a Broad Form homeowners policy, so she calls her insurance company and files a claim. What is the likely result of Nancy's claim?

D. The insurer will not cover any of the damage, since Nancy left the windows open.

The Insurance Guaranty Association is a mechanism that covers claims in the event of:

D. an insurer's insolvency.

bill works for an alien insurer operating in florida. his company began business overseas and follows all applicable florida laws. in order to operate his business in florida, in addition to following all the state's insurance laws, bill's company must also possess:

D. certificate of authority

Shaking a baby might cause all of the following, EXCEPT: A. diffuse brain injury. B. acquired brain injury. C. primary brain injury. D. focal brain injury.

D. focal brain injury.

A customer representative's duties include:

D. giving customers information about their policies.

a recent flood caused %5,000 in damages to maxwell's outdoor furniture and professional grade barbecue grill that he keeps on his patio. if maxwell has a flood insurance policy with $25,000, of personal property coverage, which of the following statements is true?

D. maxwell's insurer will pay nothing for his loss, because the damaged property was not inside a building

Cindy holds an insurance policy from Sine Nomine Insurance. This is not a publicly traded company, and Cindy can participate in the election of the board, receiving dividends if the company does well. Sine Nomine Insurance could be best described as a:

D. mutual insurance company.

Moriah's plane is damaged and is being towed to a repair facility. For the purposes of aviation insurance, her plane is: A. in flight. B. in motion. C. in transition. D. not in motion.

D. not in motion.

In a Personal Auto Policy, deductibles are applied on a/an ________ basis.

D. per claim

which of the following is NOT considered an "out-of-pocket expense" in health insurance?

D. policy premiums

Dwelling policies cover:

D. property, and liability with an endorsement.

josephine has purchased a business owners policy. she insures both real and personal property at 80% under the policy. assuming no endorsements apply, the losses will be adjusted on a(n) _____________ basis.

D. replacement cost

which financial institution bond is designed for all types of insurance companies?

D. standard form 25

The insuring agreement for Part A-Liability in a personal auto policy states that:

D. the insurer has the right to settle liability cases out of court.

which of the following is NOT a reason to purchase umbrella liability coverage?

D. to reduce your insurance costs

under which circumstance would it be legal for an insurer to charge one insured more than another insured for the same coverage?

D. when the insured is statically more likely to experience a loss

DEC Construction was hired to renovate Randy's home completely. As the general contractor of the job, DEC Construction subcontracts the electrical portion of the job to Mac Electric and requires Mac to have Owners & Contractors Protective Liability for the job. Who retains ultimate control over this policy?

DEC Construction

Ben and his family are renting a home, and they have a Homeowners 4 policy to cover their belongings. During a strong windstorm, a tree falls on the house and causes some damage. Which of the following would be covered under the HO-4 policy?

Damage to the carport Ben built last Fall at his own expense

what applies when an insured is found legally liable for the loss of another and is ordered to pay general damages

Damages compensate for pain and suffering

In each of the following, the insured has filed a claim against their homeowners policy. In which of these scenarios would the insurer most likely deny the claim?

Darla files a claim when her estranged husband sets fire to her back deck, but she doesn't notify the police for fear of getting her husband in trouble.

In each of the following, the insured has filed a claim against their homeowners policy. In which of these scenarios would the insurer most likely deny the claim? A. Stephen is unable to provide pictures of his personal items that were destroyed in his house fire, but he is able to provide a list and descriptions for the adjuster. B. Susan can't make it home from work to meet an adjuster at her house (which was damaged by a recent hailstorm), but gives the adjuster permission to inspect the property in her absence C. Darla files a claim when her estranged husband sets fire to her back deck, but she doesn't Your AnswerV notify the police for fear of getting her husband in trouble. D. The insurer sends David a Proof of Loss form for him to complete in conjunction with his theft claim, and it takes him 25 days to return the completed form to his insurer

Darla files a claim when her estranged husband sets fire to her back deck, but she doesn't notify the police for fear of getting her husband in trouble.

Which Commercial Auto endorsement can provide liability, medical payments, physical damage, and UM/UIM coverages for a specific named individual who does not own his own car?

Drive other car

An adjuster has several tasks to complete during the adjusting process. All of the following are examples of the types of tasks an adjuster may be required to perform, EXCEPT: A. Suzanne calls Gary about his hail claim to schedule a time when she can come out and look at his roof. B. Matt collects various pieces of information and writes an estimate for the amount of indemnification he believes Sara is due. C. David crawls up into Ian's attic to check for the source of the water damage to his ceiling. D. During a meeting with Darlene, Mindy collects various pieces of information and writes an auto policy for Darlene to purchase.

During a meeting with Darlene, Mindy collects various pieces of information and writes an auto policy for Darlene to purchase.

The pair and set clause found in property insurance policies states that in the event of a loss to only part of a pair or set, losses will be settled

Either by repairing or replacing the damaged part or by paying the difference between the actual cash value before and after the loss

What is not considered an insured under Part A liability coverage, of the personal auto policy

Employer while insured is driving a company car

Who is responsible for paying the premiums on a workers' compensation policy?

Employers

Which of the following statements about a Standard Fire Policy is TRUE?

Endorsements either add or change coverage.

Which of the following adjusters is acting appropriately as a fiduciary agent?

Ernest knows the claimant can't possibly afford to pay for their extensive damages, but he denies the claim anyway because the cause of loss was not covered by the policy.

Errors & Omissions insurance

Which of the following would be most likely to purchase an Errors and Omissions policy?

Errors and omissions insurance (E&O) is a type of professional liability insurance that protects companies, their workers, and other professionals against claims of inadequate work or negligent actions. 1 Errors and omissions insurance often covers both court costs and any settlements up to the amount specified by the insurance contract.

An adjuster's preliminary claim report should:

Establish a claim reserve

An adjuster's preliminary claim report should?

Establish a claim reserve

Peter, an insurance adjuster, is going over a claim. He's examining the deductible, the total claimed damages, the policy limits, other policies that might also cover the claim, whether the property is adequately insured, and whether or not a coinsurance penalty applies. Which function of an adjuster is Peter performing?

Evaluating a claim

What 4 things are party's strictly liable for damages caused by under the Dangerous Instrumentality Doctrine?

Explosives, Toxic Chemicals, Guns, Wild Animals

What kind of waiver is signed and in writing?

Express Waiver

Extended Non-Owner

A loss to which of the following items would be covered under Coverage A - Buildings and Structures in a BOP?

Fire and smoke Lightning Wind Hail Theft Vandalism... DOES NOT COVER FLOODS OR EARTHQUAKES...also covers... additions , additons under construction, any construction equipment within 100 ft of insured property.. Machinery and equipment inside the building.. maintenance property.

Which of the following perils would NOT be covered by a commercial property policy with a Causes of Loss - Special Form attached to the Building and Personal Property Coverage Form?

Fire; Theft; Vandalism; Wind damage; ARE COVERED..

Which of the following is mandatory for drivers in the state of Florida?

Florida law requires identification, proof of date of birth, proof of residential address, and proof of social security number (if issued, Chapter 322, Florida Statutes, requires the Department of Motor Vehicles see proof of social security number for the issuance of driver license and identification cards) from all customers before a driver license or identification card can be issued.

Loss Assesment

For HO6- pays when condo association charges an assesment for loss 1000-2500 to cover ded

Building additional & alterations

For HO6/HO4 pp and improvements as long as they are part of residence

What kind of deductible policy kicks in only after the loss exceeds a predetermined amount?

Franchise Deductible

How does functional replacement cost differ from replacement cost?

Functional replacement provides for less expensive but serviceable equivalent items

The City of Hamforth has several insurance policies, one of which is a government crime discovery form. One day, a loss occurs which is covered under the government crime policy as well as one of the other policies that is not a government crime policy. How will these two policies handle coverage for the loss?

Government crime policy will cover?

Which of the following people are in the process of submitting a formal request to settle the damage? A. Grace is filing a claim with her insurer for hail damage to her roof. B. Norris is providing the insurer with his medical bills that resulted from his forklift accident at work. C. Bart is filling out proof of loss forms that his insurer sent after he filed a claim for his fire-damaged garage. D. Olivia is providing her testimony in the court case related to her product liability claim after finding glass in her canned soup

Grace is filing a claim with her insurer for hail damage to her roof.

Graham's policy can pay up to $25,000 for property damages that he causes to someone else in an accident. Subtract this from the total damages to calculate how much Graham will have to pay out of pocket: $30,000 - $25,000 = $5,000.

Simon just bought his first home-a cheap fixer-upper in a town where average snowfall exceeds 80 inches per year. It may be an old house in a run-down neighborhood, but he still wants to protect his initial investment. What is the cheapest policy option that would protect Simon's financial interest in his home, even in the brutal winters?

HO-2

Michelle just purchased a homeowners policy for her new single-family home. Although she would have liked the best coverage money can buy, she could not afford the most expensive policy. She compromised with a policy that provides open-peril coverage for her house and detached garage, and named-peril coverage for her personal property. Which homeowners policy did Michelle purchase?

HO-3

HO-5

ISO form for condo

HO-6

Jim is completely "upside down" financially on his car. He owes the finance company $8,000. If he sells the car, he knows he'll only get about $4,000 for it. But Jim knows that if the car was somehow stolen, his insurance company would pay him somewhere in the neighborhood of $7,000. Jim decides to have a friend steal the car and "make it disappear." Jim then files a claim with his insurance company to report his car stolen. Which best represents Jim's actions?

Hard Fraud

insurance company would pay him somewhere in the neighborhood of $7,000. Jim decides to have a friend car, he knows he'll only get about $4,000 for it. But Jim knows that if the car was somehow stolen, his Jim is completely "upside down" financially on his car. He owes the finance company $8,000. If he sells the steal the car and "make it disappear." Jim then files a claim with his insurance company to report his car stolen. Which best represents Jim's actions?

Hard fraud

In a Commercial Auto Policy, Symbol #8 represents:

Hired Auto Coverage

In a Commercial Auto Policy, Symbol #8 represents:

Hired Autos

ane's health insurance policy has a supplemental coverage that pays a flat daily amount if jane were to be admitted into a hospital. what type of supplemental coverage does jane have?

Hospital Indemnity

Which of the following is least likely to be one of the important questions an adjuster must answer before entering into the negotiations process?

How much is the insured willing to pay?

What are the two main types of coverage usually found in an aviation insurance policy?

Hull coverage and Liability coverage

Which of the following statements about litigation is FALSE?

In liability claims, the defendant is usually a third party.

Daily Constructions has been contracted by the City to renovate the historic courthouse building. To get the job, Daily Constructions contracted with KLM Insurance, which agreed to act as the surety. Because Daily Constructions is a fairly new company, KLM Insurance required that it find another party to join the contract and agree to reimburse KLM Insurance if Daily Construction fails to perform. This fourth party is known as

Indemnitor.

What information does NOT need to be included in the notice given to the insured any time the insurer issues or renews an insurance policy?

Information about how to obtain coverage through the SCWHUA

An economic device used to protect against the risk of realizing unforeseen and extraordinary financial loss is called:

Insurance. .. A PERIL?

Which of the following best describes the purpose of a certificate of authority in Florida?

It is a document issued by the Florida Department of Financial Services that grants an insurer authority to transact insurance in the state.

Which statement is INCORRECT regarding personal liability coverage?

It is standard coverage in a dwelling policy

Which statement about the Jones Act is TRUE?

It protects injured seamen by allowing them to sue for damages and to choose a jury trial.

An extended reporting period attached to a general liability policy provides coverage in which of the following ways?

It provides coverage for claims made outside the policy term

An extended reporting period attached to a general liability policy provides coverage in which of the following ways?

It provides coverage for claims made outside the policy term.

Which of the following statements about Equipment Breakdown Protection coverage is FALSE? A.It would cover hail damage to industrial air conditioning units on the roof of an insured business. B.It would cover the mechanical failure of a bottle-making machine in a glass factory. C.It would cover the damage to a company's computer server after an electrical failure shorted-out many of its internal components. D.It would cover the clean-up costs after a refrigeration unit experienced a sudden pressure failure of the vacuum system and sprayed hazardous refrigerant everywhere.

It would cover hail damage to industrial air conditioning units on the roof of an insured business.

Under Jacqueline's Personal Injury Protection, all of the following would be covered for bodily injuries except:

Jacqueline's sister who also has PIP.

James rents a home to Jill and maintains a DP-3 policy on the dwelling. One day, Jill accidently leaves the oven on all day while she is out, and James' house burns to the ground, along with all the contents. Which items could be covered under Coverage C in James' DP-3?

James Appliances

An explosion takes place at a manufacturing plant, injuring four people. Gina, the receptionist, broke her leg and has serious burns on her left hand. George, the manager, lost a foot above the ankle and a hand at the wrist. Taylor, a plant worker, lost sight in one eye, and Jason, the independent contractor, lost his left leg at the knee. Which of these people is not eligible to receive workers' compensation benefits?

Jason

Which of the following people are practicing concealment? A. Joey does not tell his insurer that he spends three months a year at his vacation home, leaving his primary residence vacant during that time. B. While completing his auto insurance application, Charlie states that he drives his vehicle 5,000 miles per year, but he actually drives more than 20,000 miles per year. C. Mandy is filling out a homeowners policy application and states that her roof is two years old, when it is actually 22 years old. D. On Sonnie's auto policy application, she says her year of birth is one year earlier than it really is in order to qualify for a lower premium rate.

Joey does not tell his insurer that he spends three months a year at his vacation home, leaving his primary residence vacant during that time.

Which of the following would qualify as an "injury" for the purposes of workers' compensation insurance?

Jordan falls off a defective ladder while working for a home improvement company, and breaks his leg.

Astrid, a public adjuster, agrees to reduce her damage estimates by 5%, in exchange for $500 in cash per claim from LMN Insurance. This is an example of:

Kickback

Kathryn, a manager at XYZ Distributors, leaves her diamond earrings on her desk in her office. Jordan, an employee at XYZ sees the earrings and takes them when he leaves for the day. Which term best describes what Jordan did?

Larceny

What helps an insurer predict losses more accurately?

Law of Large Numbers

Which of the following is NOT considered an insurable peril? a. Losses that result from gambling b. The loss of revenue caused by the temporary closing of a business following a covered loss c. Loss that results from a fire that starts when lightning strikes a barn d. A woman injured when she falls on the wet floor of local grocery store

Losses that result from gambling

Lucas owns a rental house on the beach in South Carolina. Which of the following is true?

Lucas can get ACV coverage for this property through the South Carolina Wind and Hail Underwriting Association.

What is it called when states require employers to buy coverage from a state-designated workers' compensation program?

Monopolistic

Natalie's brakes have been squealing for several months. Every time she drives her car, she's reminded that she needs to have them replaced, but she forgets all about it as soon as she gets out of the car. Natalie's actions can be considered a?

Morale Hazard

Ronald always drives with his windows rolled down because he loves the feeling of the wind in his hair. However, he often forgets to roll his windows up when he gets out of the car. Of course, this behavior makes it easier for thieves to steal his belongings from the car, but Ronald can't help being forgetful. Ronald's behavior would be considered a:

Morale hazard

What is the tool that can be used by either policyholder or insurer to clarify if a loss is covered under a specific policy?

Non-Waiver Agreement

What kind of payment is for the payment of property damage and bodily injury pending?

Partial Release Payment

Ordinance or Law

Pays difference between old/new code construction * pays upto 10% of cov A

Nina's home is located in a high crime neighborhood. One day, she comes home from work to find that her garage door had been spray-painted with graffiti. Nina's insurer would consider the act of vandalism to Nina's garage a:

Peril

Cause of loss form for farm property lists?

Perils property is insured against

James works for a contracting company that has a Businessowners Policy in place. One day, James brings his laptop to work and leaves it in the manager's office while he heads out to a jobsite. While he is gone, a fire breaks out and destroys the office, with James' laptop inside. Which coverage extension could cover the loss of James' laptop?

Personal Effects and property of Others

Clark lost power to his home when a windstorm blew the roof off of his house. As a result, he lost several hundred dollars worth of meat that he was keeping in a freezer in his basement. Which homeowners coverage might indemnify Clark for the loss of his meat?

Personal Property Coverage

Coverage E refers to which part of a HO policy

Personal liability coverage protects a homeowner from financial responsibilities of paying for a property or medical bills resulting form property damage or injury from the accidents caused by the homeowner or a member of their household... (PERSONAL LIABILITY COVERAGE)

Which of the following would not be covered by Coverage C - Personal Property in a homeowners policy?

Pets

administrative action taken against them in this or another state within 30 days of the final disposition of the matter.

Producers must report to the Commissioner any?

Which of the following makes use of market value in determining loss valuation

Property is evaluated for what it sells for at the time of the loss

An adjuster must make several important decisions during the adjusting process. All of these are examples of such decisions, EXCEPT:

Stacy must determine how much of a limit for Coverage A would best fit John's needs in his new homeowners policy.

Worker's compensation benefits for the loss of wages include which of the following

Replacement of a portion of lost wages

At the time of loss insured against in a property and casualty policy the insurers claim settlement options include all of the following EXCEPT A. Paying the value of the lost or damaged property B. replacing the property with other property of a lesser kind or quality C. paying the cost of repairing or replacing the lost or damaged property. D. taking all or part of the property at an agreed or appraised value.

Replacing the property with other property of a lesser kind or quality

An insurer may keep an independent adjuster from having the authority to bind the insurer by?

Requiring the insured to sign a non-waiver agreement

A lion at a zoo escaped when a zoo employee failed to follow protocol. The lion injured a zoo patron. In court, the injured patron's lawyer could invoke the doctrine of:

Res Ipsa Loquitur.

Sam's neighbor, Lee, is suing him for intentionally cutting down Lee's tree and damaging his gazebo when the tree fell on it. When Sam notifies his insurer of the lawsuit, the insurer issues Sam ___________, which gives him fair warning that he may need to prepare his own defense if the insurer finds this case is not covered.

Reservation of Rights

What document do insurance companies give to claimants when they think something in the claim is not covered by the policy, but they are not sure yet?

Reservation of rights letter

Gary has UM/UIM coverage on his Personal Auto Policy. Which of the following losses would be covered under this coverage?

Sam, Gary's neighbor who has liability limits high enough to cover the damages, intentionally runs into Gary's car with his own during an argument.

Under which circumstances may an insurer cancel a policy during the first 90 days that the policy is in effect?

The insurer may cancel for any reason

When Seth's old car is stolen from his apartment's parking lot, he goes out and buys himself a new car. Three months later, Seth decides he may as well report the stolen car to his insurer so he can get some money for it. What is the most likely reason the insurer might deny his claim?

Seth didn't protect his vehicle from being stolen.

Which of the following would NOT be considered a flood? A. Sewer backup B. Overflow of tidal waters C. mudslides D. Runoff of surface waters

Sewer backup

Sylvia no longer has insurable interest in the building

All of the following types of property are covered by a standard builders risk form EXCEPT A. Temporary structures B. Machinery that will be permanently attached to the building C. TOols 50 feet away from the building D. the building itself

TOols 50 feet away from the building

Which of the following is FALSE regarding terrorism insurance coverage under the Terrorism Risk Insurance Act (TRIA)?

TRIA coverage is available for both personal and commercial lines of insurance.

Ted has hurricane insurance for his $500,000 home in New Orleans, with a hurricane deductible of 2%. His normal deductible is $5,000. When a major hurricane hits his house, there is $4,000 in flood damage, $8,000 in wind damage, and $2,000 in rain damage. How much will his insurance policy pay for the damages?

Ted's hurricane deductible is $10,000 (2% of $500,000), and hurricane insurance does not cover flood damage. The other damages come out to exactly $10,000, so the insurer does not need to pay anything for the damages to Ted's house.

Sara's vehicle was stolen and her insurer paid her theft claim for the total value of the car. A week later, the police found Sara's car and returned it to her. Which of the following statements is true?

The Recovered Property provision states that Sara must notify the insurer and either return the settlement payment or surrender the vehicle to the insurer.

Andrew's house is struck by lightning. The power surge fries two of the family's laptop computers, and starts a fire that damages his roof, two living room walls, and a leather sofa. Which of these damages would fall under Coverage C of Andrew's Homeowners 3 policy?

The Sofa and laptop computers

Which of the following statements about Flood insurance is TRUE? A. Adjusters who want to adjust flood claims must be NFIP certified. B. The Standard Flood Policy excludes coverage for detached garages. C. Adjusters who want to adjust flood claims must complete continuing education about NFIP claims every five years. D. The Standard Flood Policy includes coverage for lawns, shrubs, and pets.

The Standard Flood Policy excludes coverage for detached garages.

Rebecca has Collision coverage in her Personal Auto Policy. After a collision, the adjuster determines that Rebecca's car is totaled. How much is Rebecca likely to receive from her insurer (ignoring the deductible)?

The actual cash value of her vehicle

A woman slips on icy steps and breaks her leg. Which of the following is the peril in this situation

The fall

A windstorm causes damage on a property covered by a DP-2 form. There is downed fencing, some furniture in the dwelling gets water damage from rain water that entered through a hole in the wind-damaged roof, and a tree is blown down. Aside from the damaged roof, what, if anything, is covered?

The fencing and the furniture

The amount awarded to Cindy will be reduced by the percentage of her own negligence.

If the insured has a loss with a private passenger nonowned temporary substitute vehicle how will the loss be treated by the insured's own policy for physical damage?

The broadest coverage available extends from the insured's policy.

Which of the following best defines the doctrine of Res Ipsa Loquitur?

The circumstances of the injury make it obvious that the defendant is negligent; no proof is needed.

What is the best way to reconstruct a loss and see how it was handled?

The claim file

Mindy filed a claim against XYZ Consulting on March 5, 2016 for an accident that happened on September 15, 2015. XYZ Consulting was previously covered by a claims-made CGL policy, but changed to an occurrence policy in January 2016, when the policy came up for annual renewal. How will XYZ Consulting's insurer respond to Mindy's claim?

The claim will not be covered because the accident did not occur during the current policy period.

Which of the following is NOT a valid reason for an insurance company to reject a claim?

The claimant lists damages that exceed the limits of his insurance policy.

What is the primary difference between a claims-made and occurrence form of a CGL policy

The claims made policy provides coverage for claims first made during the policy period

Which of the following would be covered under Coverage B of the Business Owners Policy?

The copy machine in a restaurant's back office

BAP coverage extends to mobile equipment as long as it is:

The coverage under a BAP applies to either vehicles owned or leased by the company, hired by the company, or employee-owned vehicles used in the course of business.

While driving one winter day, April is surprised by a deer jumping into the road directly in front of her. She strikes the deer, overcorrects, and slides on the icy road. Her car skids off the road and plows through a barbed-wire fence. What is the proximate cause of the damage to the fence?

The deer strike

Who must sign a Non-Waiver Agreement?

The insurance company and the claimant

Which of the following is required in order for coverage to apply under the Business Pursuits endorsement in a homeowners policy?

The insured must not be an owner or partner in the business

With respect to commercial auto policies the Garage coverage form provides liability protection for all of the following EXCEPT A. The insureds business products and work performed B. The insureds business income losses due to personal injury C. The insureds business premises D. The insureds business autos

The insureds business income losses due to personal injury

The following is not TRUE about regarding assigned risk plans

The insurer participation in the assigned risk program is mandatory

The homeowners policy on Daryl's $110,000 home is voided when he intentionally burns the house to the ground. Consequently, he does not receive the settlement check he was hoping to get when he committed the arson, but he still has an outstanding mortgage balance of $76,000. How does this event affect the mortgage lender?

The insurer pays the mortgage lender $76,000.

The insurer will give Rosa one check for $35,000, and another for up to $10,000 once repairs are completed.

Which of the following statements about insurance is FALSE? A.The insurer will only pay up to the amount already collected in premiums from each insured. B.The insurer takes on the insured's risk of financial loss for a premium. C.The insurer promises to pay for any covered losses that may occur. D.The insured pays for peace of mind provided by the insurer.

The insurer will only pay up to the amount already collected in premiums from each insured.

All of the following are true about the Law of Large Numbers in the insurance industry, except:

The larger the number of units insured the larger the amount the insurer will have to pay out

What is NOT TRUE regarding an umbrella policy

The policy can be issued alone without and underlying liability policy

Why is an insurance policy as aleatory contract

The policy is contingent on an uncertain event

Which of the following best describes a "risk," according to the insurance definition?

The potential for a financial loss

Appraisal is used to decide?

The settlement amount

The adjusters preliminary report would most likely not include:

The settlement amount

In Connecticut, a vehicle is considered "underinsured" for the purposes of UM/UIM coverage if?

The total of all liability coverage's or bonds that can apply after an accident is less than the injured person's UM/UIM coverage limit.

Dwelling policy coverage C personal property will cover all of the following EXCEPT A. computer software b. Canoes C. animals and birds D. Hobby aircraft

animals and birds

Which of the following is NOT a reason why an adjuster would collect written or recorded witness statements during a claim investigation?

To fully comply with the Conditions section of the insurance policy

Liability arising out of any of the following is excluded from the personal and advertising injury liability coverage EXCEPT

Unknowingly inflicting injury that violates the rights of another

What is the punishment in Connecticut for adjusting claims without a license?

Up to $2000 or 1 year in prison

Which of the following causes of loss to a vehicle will trigger collision coverage on the personal auto policy Part D- coverage for damage to your auto?

Vehicle upset

XYZ Shipping International is a major shipping company that transports goods both domestically and abroad. The company is looking for a new ocean marine insurer to cover its cargo all the way from the point of origin to its final inland destination. What kind of coverage is XYZ Shipping looking for?

Warehouse to Warehouse

According to the principles of ocean marine insurance an actual loss may occur in all of the following situations EXCEPT A. when all property has been destroyed B. With loss of specie C. When insured is irrretrievable of all property even though not destroyed D. When cargo is misplaced

When cargo is misplaced

they shall issue a notice of wrongful conduct, citing which law has been broken.

Whenever the Commissioner believes that any person is engaging in any unfair trade practice?

Which of the following is how defense costs are paid in relation to the limit of insurance under the personal auto policy for bodily injury and property damage part A liability coverage?

Which of the following is how defense costs are paid in relation to the limit of insurance under the personal auto policy for bodily injury and property damage part A liability coverage? In excess of the limit

Which of these companies would probably be interested in getting workers' compensation insurance through FWCJUA?

Workers comp - company with injured employees this policy is for employers that: Have no prior insurance Too low of a payroll for standard carriers

Which of the following is NOT one of the duties of the Director of Insurance?

Write Insurance Laws

Mr. Lee has a disruptive tenant who throws loud parties, trashes the apartment, and leaves trash in the common areas. When she fails to pay rent, Mr. Lee finally begins the lengthy eviction process. One day, after a heated telephone exchange, Mr. Lee decides he has had enough and storms into the tenant's apartment and begins throwing her belongings out on the street. This invasion of privacy is an example of what type of personal injury covered under Mr. Lee's CGL policy?

Wrongful Entry

Julie owns the local shopping mall. One day, Julie sees Greg walking through the mall and doesn't like the way he looks, so she forces him to leave the premises. Greg then sues Julie for her actions. This is an example of what type of personal injury ...

Wrongful Eviction.

Wrongful eviction

For the purpose of worker's compensation insurance all of the following are subject to the worker's compensation laws, either as an employer or employee EXCEPT

a crew member of an ocean going vessel.

Alan has just won a bid to overhaul the town park, getting it ready for the Fourth of July fireworks. While the city is impressed by his low bid, they have some concerns that he will be able to complete the job, so the city requires Alan to secure:

a surety bond

In a Personal Auto Policy, the definition of "Your Covered Auto" can refer to any of the following vehicles, EXCEPT:

a trailer that Tim's neighbor let him borrow.

Which one of the following persons would be covered for accidental injury on the insured?s premises under Coverage C of the CGL Medical Payments?

a volunteer worker

In an insurance contract, exclusions serve all of the following purposes, except:

add coverages that need special treatment.

When investigating a claim, an adjuster should do all of the following EXCEPT:

adjuster must not keep the details of the policy to himself. Rather, he must explain clearly to the claimant how he came to his decision about the claim

Jason has had mild asthma since childhood. He now works in a chemical processing plant, and his asthma has gotten much worse ever since he contracted pneumonia because of the fumes at the plant. For workers' compensation insurance, this is usually known as:

aggravation.

An independent adjuster in Louisiana is permitted to: act as a public adjuster.

agree to a loss settlement without the insurer's written consent.

What are the four requirements of a legally binding contract?

agreement, consideration, competant parties, legal purpose

In a full release settlement:

all damages are paid immediately in one lump sum.

In a personal auto policy, the Miscellaneous Vehicle Coverage endorsement:

allows coverage to be added for motorcycles and motor homes.

When Mary leaves her stove on by accident, she starts a fire that destroys her kitchen and leaves smoke damage throughout her home. While the fire department puts the fire out, the influx of water causes extensive damage as well. On top of all that, Mary is forced to board her three dogs at a kennel for several weeks while her house is under repair. The kennel charge would be considered:

an indirect loss.

A Commercial policy that has been in force for 60 days or less may be cancelled by the insurer for?

any valid reason with 60 days prior written notice to the first-named insured.

During a heavy rainstorm, the water accumulation rose high enough to flow under Angie's front door and ruined her hardwood floors. In response to Angie's claim, an adjuster came out to her home and inspected the damage. The adjuster determined that the loss was covered, wrote Angie a check, and closed the claim. Later, the insurance company reviewed Angie's claim and discovered that the adjuster should have denied it because Angie's policy doesn't cover flood. However, Angie refuses to return the settlement because of the adjuster's:

apparent authority.

In a PAP, Personal Injury Protection:

applies to covered injuries before any available Medical Payments coverage.

If an insurance professional who has been convicted of fraud wishes to return to work in the insurance industry, in most cases he must:

apply for a 1033 Waiver and have an offer of employment.

The New Mexico Insurance Fraud Act stipulates that the superintendent must:

assist in the prosecution of any suspected fraud that he reports to the appropriate law enforcement agency

When cancelling or non-renewing a HO policy, insurers must send the named insured?

at least 30 days' advance written notice.

On commercial policies that have not been in effect for at least 60 days, an insurer may cancel for any valid reason by giving the first-named insured?

at least 60 days' advance written notice.

In a third-party claim, the injured person has a duty to:

authorize the insurer to examine her medical records.

binding

Under the New Mexico Commercial Auto Insurance Plan, a policyholder can purchase additional coverage up to limits required by any other state:

but only for as long as the insured vehicles are being driven in that state.

Darren's SUV cost him $28,500 when he bought it new five years ago, but it would cost $29,600 to replace it today. The vehicle has an annual depreciation of $1,200. Darren loses control while driving too fast around a bend in the road and flips his vehicle, totaling it. Assuming Darren's auto insurance policy pays ACV, how much can he expect to receive in indemnification for this claim?

cost is $29,600. The total depreciation is $1200 x 5 (since the vehicle depreciates $1200 per year and was purchased 5 years ago). $1200 x 5 = $6000. $29,600 - $6000 = $23,600

Coverage L in a Personal Liability Supplement provides:

coverage for both bodily injury and property damage to a third party for which the insured is legally liable.

The Water Backup and Sump Discharge or Overflow endorsement:

covers water damage if it results from a mechanical breakdown of sump pump equipment.

All of the following are common exclusions in a liability policy EXCEPT

damage caused by acts of civil disobedience and riots.

In a Personal Watercraft policy, Part C would cover:

damage to the covered craft caused by an uninsured operator of another watercraft.

Employees are barred from suing employers in court to obtain compensation for injuries covered by workers? compensation because of which of the following doctrines?

exclusive remedy

Any person who violates a cease and desist order may be?

fined up to $25,000 for each violation, not to exceed a total of $250,000 for all violations.

Losses would be covered by an unendorsed homeowners policy are included in the basic perils and in turn included in almost all homeowners policies.

fire or lightning

Homeowners policies don't provide coverage for:

flood damage.

for the following types of property, the amount paid for theft losses is limited to $2500

furs, jewelry, metals, patterns, dies, molds, and forms

Which of the following could be covered by a homeowners policy?

homeowners A large home currently under construction

An adjuster's preliminary report would most likely not: A. list any known liability issues. B. establish a claim reserve. C. include the settlement amount. D. document the initial contact with the claimant.

include the settlement amount.

Stephan's insurance company denied his recent claim, citing that his particular cause of loss was not covered. However, according to Stephan's interpretation of the policy language, his loss could be covered, so he disputed the insurer's decision. When his case went to trial, the jury also decided the policy language was open to interpretation, so they decided in favor of Stephan. This is because:

insurance policies are contracts of adhesion.

The Principle of Indemnity is designed to prevent: A. having multiple payees on a policy. B. insurers from making a profit. C. an insured from making a profit. D. subrogation.

insurers from making a profit.

When the settlement difference between an insurer and a claimant is minor:

it should be settled in favor of the claimant.

Every time Maria adjusts an auto claim, she refers the claimant to Bud's Body Shop for repairs. In turn, Bud's Body Shop pays Maria $50 dollars for every vehicle brought to their shop based on Maria's recommendation. By taking this money, Maria is accepting:

kickbacks

All of the following are correct for towing and labor costs coverage on the personal auto policy EXCEPT

labor costs are performed at the shop are limited to $25.

All of the following specify limits of insurance for the CGL EXCEPT

legal defense.

All of the following statements are true of liability insurance, EXCEPT:

liability coverage indemnifies the insured

An unendorsed Dwelling Policy is intended to cover all of the following except:

liability damages

Ned's insurer made a business decision that broadened coverage in new standard policies without increasing premiums. Because of this, the insurer was required to automatically apply this new broadened coverage to Ned's existing policy. This requirement is documented in the:

liberalization clause

Split limit liability insurance

limit 1: Max payout for bodily injury for each person injured limit 2: Max payout for bodily injuries to multiple persons limit 3: Max payout for property damage

When an employer sends employees out of state on work related business, which of the following must he do to ensure the appropriate worker's compensation coverage?

list the state on the information page for other states' coverage

Which of the following is NOT considered misrepresentation as it pertains to unfair trade practices A. exaggerating the benefits provided in the policy B. Stating that the competitors will arbitrarily increase their premiums each year C. making comparisons between different policies D. Stating that the insurance policy is a share of stock

making comparisons between different policies

Lawrence is 24, but he gives his age as 26 on his car insurance application because he hopes this will get him a better rate. Lawrence's actions could best be described as

misrepresentation.

Today, XYZ Insurance has determined that Jeff's claim is covered under his homeowners policy and they have no valid reason for delaying payment. According to Louisiana law, XYZ Insurance should:

pay Jeff's claim within 60 days of the date on which they received his proof of loss.

Liability limits in a Personal Auto Policy are applied:

per person and per accident.

The Commissioner may?

place on probation, suspend, revoke, or refuse to issue, renew or reinstate a producer license, and/or may levy a fine not to exceed $500 for each violation, up to a total of $10,000 for all violations in a calendar year.

an insurance contract, the policyholder gives the insurer ___ and the insurer gives the policyholder ___.

premium payments; peace of mind

Professional liability insurance.

protects professional advice- and service-providing individuals and companies from bearing the full cost of defending against a negligence claim made by a client, and damages awarded in such a civil lawsuit.

While reviewing a homeowner policy, you may find all of the following listed as an insured's duty after a loss, EXCEPT:

provide the insurer with a loss estimate from an appraiser.

While reviewing a homeowners policy, you may find all of the following listed as an insured's duty after a loss, EXCEPT:

provide the insurer with a loss estimate from an appraiser.

In a Business Owners Policy, Business Income coverage:

provides coverage from 72 hours after a loss occurs, up to a maximum of 12 months.

provides coverage only for those perils listed in the policy, such as fire, theft, falling objects and vandalism

provides coverage only for those perils listed in the policy, such as fire, theft, falling objects and vandalism Named Peril

Cindy falls down the stairs at Jane's house and breaks her arm, resulting in $2,500 in medical expenses. Jane's homeowner's insurance will cover the liability, but Cindy is particularly mad at Jane for not keeping her house in order and is seeking punitive damages. Jane's insurance adjuster informs the two of them that they will likely have to go to court to settle the dispute because:

punitive damages can only be determined by a court of law.

A Florida company that is assigned to "Tier 1" for coverage under FWCJUA must pay:

rates that are 25% higher than voluntary market rates.

After thirty years of operating his business, Phil is finally ready to retire. At the end of next month he will shut his doors and cancel his claims-made Commercial General Liability policy. Assuming Phil does nothing else with his policy, it will:

receive the basic extended tail coverage.

As a public adjuster, Devin is permitted to: A. ask for a raise or bonus on behalf of a contractor who is working for the same policyholder Devin is working for. B. recommend a contractor to work on a loss he is adjusting, as long as he receives no fee or commission for doing so. C. go door-to-door in a neighborhood where flood waters are rising, offering his services. D. act as a independent adjuster when necessary.

recommend a contractor to work on a loss he is adjusting, as long as he receives no fee or commission for doing so.

Scott is visiting his insurance agent's office and applying for auto insurance on his new car. The auto policy that the agent drafts will be based on Scott's

representations

Mysterious disappearance in insurance refers to which occurrence?

the disappearance of property without any explanation of what happened

Reservation of Rights letter is sent by:

the insurer to the claimant.

Which type of crime listed below best describes someone who waits until store personnel are preoccupied and pockets merchandise while no one is looking and leaves without detection?

theft

an insured owns and operates a ranch. the insured has several vehicles that are used in the ranching operation and for personal use. Which of the following could not be insured under a personal auto policy A. A two wheeled trailer designed to be towed by the station wagon B. a farm pick up with 1000 pound capacity C. A station wagon that is used personally D. A two ton grain truck with a 6500 pound capacity

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