Practice P&C Test #2

which of the following entities protects policy-owners, insureds, and beneficiaries under insurance contracts when insurers fail to perform contractual obligations due to financial impairment?

Insurance Guaranty Association

A house insured under a dwelling policy has been vacant for 70 consecutive days. Which of the following statements is true?

loss by vandalism and malicious mischief is excluded

which of the following terms refers to other insurance that is written on the same risk, but not on the same coverage basis?

nonconcurrency

When is a hired and nonowned auto liability endorsement available in a businessowners policy (BOP)?

only if the insured does not have commercial auto coverage

the HO-3 homowners policy provides

open peril coverage on the dwelling and broad form coverage on personal property

When ABC Appliance's marketing stated that its mowing machine was the only safe mower available for purchase in town, ABC was sued by XYZ Lawn and Garden. ABC's coverage would come from which part of its general liability coverage?

personal and advertising injury liability

which professional liability form provides form coverage for liability arising out of malpractice, error, or mistakes made in rendering professional services?

physicians, surgeons and dentists malpractice

which of the following would NOT be considered grounds for the commissioner to suspend an insurance producer's license?

producer is found guilty of a misdemeanor

a producer in VT wants to become a producer in CT. the department will waive certain examination requirement, provided that VT would waive these same requirements if CT producer sought licensure in VT. what term describes this situation?

reciprocity

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

scheduled personal property endorsement

what is the deductible of a commercial liability umbrella policy called?

the SIR

in insurance terms, what are components?

the factors that determine rates

which of the following circumstance would be EXCLUDED under medical payments coverage of a personal auto policy?

the insured is injured while driving his motorcycle on his resident premises

with respect to commercial auto policies, the garage coverage form provides liability protection for all of the following EXCEPT

the insured's business products and work performed

on a DP-3 dwelling property special form policy, the coverage provided for personal property is

the same as provided on the DP-2 broad form

the individual named insured endorsement under a commercial auto policy provides coverage for which of the following?

the sole proprietor of the business and his or her family members

for the purpose of insurance, risk is defined as

the uncertainty or chance of loss

which of the following best expresses the purpose of a stated value contract?

to pre-establish the amount of coverage available for property items that are difficult to value

all of the following are supplemental payments included in the liability section of a personal auto policy EXCEPT

up to $100 for the cost to secure the release of a vehicle from an impoundment lot following a covered accident

an endorsement added to a businesowners policy that provides coverage for direct damage caused by utility service disruption stemming from a covered peril is called

utility services- direct damage

a liability policy that provides coverage for a claim for injury or damage if the claim is first reported or filed against the insured during the policy period is called

claims-made form

which of the following statements is FALSE concerning CT financial responsibility?

in lieu of insurance, the owner may pay a fee known as the uninsured motorist fee

if an employer in a state with elective workers compensation laws chooses not be to subject to those laws, what does the employer lose?

its common law defenses against liability suits

which of the following lists all required elements for establishing a charge of negligence?

legal duty owed, breach of legal duty owed, proximate cause, damages

a common exclusion found under the physical damage to your auto includes

mechanical breakdown

all of the following are examples of risk retention EXCEPT

premiums

which services are associated with Standard & Poor's and AM Best?

rating the financial strength of insurance companies

when the insured's car was totaled in a recent accident, the ownership of the car was transferred to the insurer. the insurer then sold off the wrecked car to recover some of the loss it paid to the insured. what is the term for this action?

salvage

Not all losses are insurable, and there are certain requirements that must be met before a risk is a proper subject for insurance. These requirements include all of the following EXCEPT

the loss may be intentional

the type of insurance used to cover goods for one specific trip is called

trip transit

which of the following is NOT settled on an ACV basis while covered under the business property coverage form?

valuable papers and records

which of the following is a statement that is guaranteed to be true, and if untrue, may break an insurance contract?

warranty

Any licensed person whose activities affect interstate commerce and who knowingly makes false material statements related to the business of insurance may be imprisoned for up to

10 years

how many days do producers have to notify the insurance department of the change of their residence or work address?

30 days

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

50% of the amount provided as CoverageA

What type of compensatory damages will pay for pain and suffering and disfigurement?

General

which of the following homeowners policies covers those who rent their dwelling?

HO-4

which of the following is NOT true concerning temporary licenses?

a temporary license may continue after the owner disposes of the business, as long as it's under 180 days

to be eligible for a BOP coverage, an office building CANNOT be higher than

6 stories

In earthquake coverage provided by endorsement in a homeowners form, one or more earthquake shocks would be considered a single earthquake if they occur within what maximum time period?

72 hours

Coverage F - Unscheduled Farm Personal Property is subject to a coinsurance clause of

80%

which of the following is eligible for a businesowners policy?

a 6-story office building with less than 100,000 square feet total

which of the following losses would NOT be covered by a homeowners policy?

a coin collection valued at $500 lost in a fire

the commercial general liability coverage form excludes bodily injury or property damage that the insured has assumed under any contract or agreement. however, the exclusion does not apply to certain types of contracts, as long as the injury or damage occurs

after the execution of the contract

in which of the following instances would workers compensation benefits probably be denied?

an administrative aide slipped and fell on the ice in the workplace parking lot

when employees are injured in the course of employment and are paid workers compensation benefits, they are barred from bringing a legal action against the employer for further damages. this is known as

exclusive remedy

under which of the following conditions can broad theft coverage be added to a dwelling policy?

if the insured is owner-occupant of the dwelling

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

it must be added by endorsement to a homeowners policy

which of the following personal auto coverages would pay for the insured's travel expenses and loss of earnings while involved in the settlement process of a covered loss?

liability coverage

which of the following is NOT a contract bond?

litigation bond