Practice Test 2
Homeowners policies provide personal liability coverage that follows an insured anywhere in the world under: a. Coverage E b. Coverage A c. Coverage F d. Coverage D
a. Coverage E
Which of the following professional liability policies would also cover bodily injury damages? a. architects and engineers b. insurance agents c. lawyers d. fiduciary legal liability
a. architects and engineers
Personal Injury is best described in which of the following situations? a. death as a result of cancer b. calling a client a cheat and a fraud c. a dog bite d. a broken leg
b. calling a client a cheat and a fraud
Which of the following coverages is included as "no fault" coverage on the standardized Personal Auto policy? a. uninsured motorists b. medical payments and physical damage c. a state mandated "no fault" coverage plan d. liability coverage
b. medical payments and physical damage
An adjusters license is for a term of: a. 2 years b. 1 year c. An indefinite period of time d. 3 years
c. An indefinite period of time
An admitted insurer in any given state could include all of the following, EXCEPT: a. a domestic insurer b. a foreign insurer c. a surplus lines insurer d. an alien insurer
c. a surplus lines insurer
The NFIP Dwelling form provides coverage for all of the following, EXCEPT: a. a single-family residence b. a three-family dwelling c. manufactured housing d. a five-unit apartment building
d. a five-unit apartment building
Under a DP-2 or DP-3 standardized policy what is the maximum that would be paid for one month for additional living expenses if Coverage A was $75,000? a. $1250 b. $500 c. $1000 d. $750
a. $1250= (75,000 x.20)/12 months
Darla has he business covered by a standard Businessowners policy that includes the "Personal Effects" coverage extension. Catherine, one of Darla's employees has brought her brief case to work on day with her purse, make-up bag, tablet, and laptop computer inside. A fire breaks out in Darla's building and all of the contents of Catherines briefcase, worth $2,000 are destroyed. How much will Darla's BOP pay for Catherines lost "personal effects"? a. $2000 b. $1000 c. $2500 d. $1500
a. $2000
Under a Business Auto Policy, which coverage symbol indicates that a car is subject to mandatory no-fault insurance as required by state law? a. 5 b. 9 c. 7 d. 2
a. 5
A business insured under a Commercial General Liability policy has a general aggregate limit of $1,000,000 and an occurrence limit of $100,000. If today an injured party is awarded $100,000 what will the company's general aggregate limit and occurrence limit be tomorrow? a. General aggregate of $900,000; occurrence limit of $100,000 b. General aggregate of $1,000,000; occurrence limit of $100,000 c. General aggregate of $1,000,000; occurrence limit of $0 d. General aggregate of $900,000; occurrence limit of $0
a. General aggregate of $900,000; occurrence limit of $100,000
South Carolina has a compulsory insurance and financial responsibility law. This law applies to: a. automobile insurance b. property and casualty insurance c. wind and hail coverage d. bonding and surety insurance
a. automobile insurance
Under the Inside the Premises- Theft of Money and Securities insuring agreement of a crime policy, which of the following situations would NOT be covered: a. cash that is stolen by employees b. cash in the register is destroyed in a fire c. travelers checks that have turned up missing d. a casino suffers a theft of slot machine tokens
a. cash that is stolen by employees
In the event of a catastrophe, the Director may permit nonresident adjusters to handle claims in South Carolina if the nonresident adjuster exhibits: a. evidence of an adjusters license in his/her home state b. a surety bond in the amount of $25,000 c. an ability to handle catastrophic losses d. all of the above are correct
a. evidence of an adjusters license in his/her home state
Robert is retired and lives in an older home in Maine. He has an old floor furnace to heat his home that is in need of repair and he forgets to have it checked. In the winter he stays in Florida for a month with his daughter. While Robert is away, the furnace malfunctions, allowing the temperature in the house to drop so low that all his water pipes freeze and burst, causing massive water damage. His house is covered under a Homeowners broad cause of loss form, that includes water damage from a heating or plumbing system. How will the adjuster handle this claim? a. pay for all damages except the furnace b. deny the entire claim because of neglect of the insured c. pay for the furnace and the resulting water damage only d. pay for the water damage and depreciate the payment for the replacement of the furnace
a. pay for all damages except the furnace
An agent with a surplus/excess lines license, will place insurance business with an unauthorized insurer when: a. the coverage cannot be obtained from insurers authorized within the state b. the coverage can be obtained from an unauthorized insurer at a lower premium c. the coverage can be obtained from an unauthorized insurer with fewer coverage exclusions d. the unauthorized insurer has a better reputation than authorized insurers offering the same coverage
a. the coverage cannot be obtained from insurers authorized within the state
The Homeowners policy on Dylan'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 when he committed the arson, but he still has an outstanding mortgage balance of $76,000. How does this event affect the mortgage lender? a. the insurer pays the mortgage lender $76,000 b. the insurer pays the mortgage lender $110,000 c. the insurer pays the mortgage lender $55,000- half the total amount of the loss d. Because the arson voided the policy, the mortgage lender is paid nothing
a. the insurer pays the mortgage lender $76,000
A tornado blows over a wall of a barn which, in turn, knocks over a lamp and starts a fire. What is the proximate cause of loss? a. tornado b. smoke c. fire d. water damage
a. tornado
Requiring a claimant to travel a long distance to have his or her automobile repaired violates which of the following standards for prompt investigations and fair and equitable settlements? a. unreasonable travel b. avoidance of payment c. notice of applicable time limitations d. denial of claims
a. unreasonable travel
Vehicles which may be insured by a personal auto policy are described in the eligibility rules. Each of the following statements is true about vehicles eligible for personal auto policy (PAP) coverage, EXCEPT: a. vehicles with fewer than four wheels are covered b. vans used for business are not eligible c. vehicles owned by an individual or married couple may be insured d. private passenger autos and pickup trucks may be insured
a. vehicles with fewer than four wheels are covered
When a claim reserve is set "subjectively" it is set: a. by using a reserve chart in a claims adjusting manual b. by using the judgement of experienced claims adjusters c. by arbitrarily selecting a loss ratio d. by using a mathematical formula to calculate the reserve amount
b. by using the judgement of experienced claims adjusters
The Uninsured Employers Fund must maintain a balance of at least: a. $250,000 b. $500,000 c. $200,000 d. $300,000
c. $200,000
Supplementary payments under the liability section of a Commercial Auto policy include reasonable expenses incurred by the insured including loss of earnings up to ______ per day a. $50 b. $150 c. $250 d. $500
c. $250
The requirements of the Employment Retirement Income Security Act compel employers to cover their professional liability exposure for honest errors and omissions regarding employee benefit plans by purchasing: a. environmental liability b. employment practices liability c. fiduciary liability d. directors and officers liability
c. fiduciary liability
All of the following are "open-peril" exclusions of the HO-3 and HO-5 form, EXCEPT: a. flood b. neglect, deterioration, and general wear and tear c. theft d. mold, fungus and wet rot
c. theft
What limit of liability would be needed for a risk that transports radio active materials as required by the Motor Carrier Act under the MCS-90 endorsement? a. $500,000 b. $750,000 c. $1,000,000 d. $5,000,000
d. $5,000,000
The insured carries a yacht policy. One of the crew members is injured while performing a work related task. What coverage must be added under the policy that would respond to cover the crew members injuries? a. Hull insurance b. medical payments c. liability coverage d. Jones Act
d. Jones Act
The penalty for acting as an adjuster without a license is: a. a fine of not more than $5,000 and six months in jail b. a fine of not more than $10,000 and six months in jail c. a fine of not more than $10,000 and one year in jail d. a fine of not more than $10,000 and/or two years in jail or both
d. a fine of not more than $10,000 and/or two years in jail or both
Under which of the following Aviation physical damage losses would a deductible apply? a. fire caused by lightning b. theft or pilferage c. a deductible applies to all aviation physical damage losses d. fire caused by a collision
d. fire caused by a collision
Which of the following is the additional limit provided by a standard Businessowners policy "Debris Removal" in the event that the policy limit is exhausted in paying the loss? a. $25,000 b. $20,000 c. $10,000 d. $15,000
a. $25,000
A non-waiver agreement allows the insurer to: a. investigate a loss without implying that it is covered b. decline to investigate due to coverage exclusions c. hire a public adjusters to protect his Interests d. hire an attorney to protect his rights
a. investigate a loss without implying that it is covered
Under the Businessowners policy, for up to how many years can the insurer request to examine the books and records of an insured after the policy has expired? a. three years b. one year c. two years d. four years
a. three years
Under Ben Green's personal auto policy, each of the following would qualify as a "family member" EXCEPT: a. Alice Green, Ben's sister who lives in Ben's house b. Susan Green, Ben's wife. Susan maintains a separate residence although she and Ben are not divorced c. Ben Green Jr., Ben's 16 year old son, living with his father d. Patty Green, Ben's 21 year old daughter who maintains a residence with Ben while she is going to college in another state
b. Susan Green, Ben's wife. Susan maintains a separate residence although she and Ben are not divorced
A standard Homeowners policy is best described as: a. a property policy that offers optional liability insurance b. a package policy that provides both property and liability insurance c. a personal insurance policy for anyone who owns property d. a personal insurance contract between the insured and the agent
b. a package policy that provides both property and liability insurance
Which of the following is a general summary of a policy? a. the insurance contract b. binder c. certificate of insurance d. a coverage form
c. certificate of insurance
In which of the following situations should an adjuster consider obtaining a non-waiver agreement? a. when requested by an insurer b. when subrogation may be involved c. in dealing with a potential coverage dispute d. when directed by the court
c. in dealing with a potential coverage dispute
Which of the following would be covered under the building coverage of an NFIP policy? a. a portable dishwasher b. a clothes washing machine c. the plumbing system of the covered building d. window curtains
c. the plumbing system of the covered building
On the renewal date of her existing NFIP policy, the insured selects two additional coverages. Which of the following statements is TRUE about the insureds waiting period before the new additional coverages will take effect? a. because the coverages were selected on an existing policy, a 1 day waiting applies b. a 60 day waiting period applies for additional coverages c. the standard 30-day waiting period applies d. there is no waiting period
d. there is no waiting period
Under the Regular Program of the NFIP in a state territory other than Alaska, Hawaii, Guam or the US Virgin Islands, a single-family residence is insured for up to: a. $250,000 b. $35,000 c. $100,000 d. $185,000
a. $250,000
All of the following are eligible risks for Commercial Inland Marine Insurance, EXCEPT: a. goods manufactured in the United States for export to other countries b. domestic shipments traveling over land c. bridges and radio towers d. tools and machinery owned by a contractor
a. goods manufactured in the United States for export to other countries
Which of the following would not be eligible for coverage under a livestock floater? a. poultry b. cattle c. sheep d. swine
a. poultry
Under a standardized personal automobile policy, the definition of a "covered auto" for Part A- Liability includes: I. private passenger autos the named insured acquires during the policy period II. trailers owned by the named insured III. Autos or trailers not owned by the named insured that are being used as a temporary substitute IV. Farm wagons or implements a. I, II, III, and IV b. I, II, and III c. I and III only d. I and II only
b. I, II, III, and IV
A formal request to an insurance company requesting payment according to the terms of an insurance contract is known as: a. a notice of lawsuit b. a declaratory judgement request c. an insurance claim d. a service of process
c. an insurance claim
The insured carries a yacht policy and is pulling a water skier. The skier is a family member and is injured. What coverage might apply to this accident? a. no coverage would apply b. liability coverage and defense coverage would apply c. medical payments coverage d. only the injured party's health insurance would cover the claim
c. medical payments coverage
The original Terrorism Risk Insurance Act of 2002 defined an act of terrorism as a violent act or any act that is dangerous to all of the following, EXCEPT: a. human life b. property c. infrastructure d. reputation
d. reputation
Mary left an expensive ring on her bedroom dresser before leaving on a business trip. When she returned, nothing seemed disturbed in her home, but her ring was gone. Under the terms of the HO-3 policy, this loss would be considered: a. robbery b. burglary c. malicious mischief d. theft
d. theft
Zach's factory was damaged by a fire and shut down for 90 days for repairs. In order to keep his business going, Zach spends $150,000 renting another building, along with some machinery and other supplies. Had he not taken these measures, Zach's total loss of business income would have been $300,000; but by renting a building and equipment, he manages to reduce that loss by $80,000. Zach's Commercial Property policy includes Business Income coverage with Extra Expense. How much will his insurer indemnify him? a. $370,000 b. $300,000 c. $120,000 d. $210,000
a. $370,000
All of the following are covered under the definition of money in commercial crime insurance, EXCEPT; a. proof of debt b. money c. currency d. coins
a. proof of debt
When a policy is issued by a surplus lines company who later becomes insolvent, who pays the claims? a. the insured must assume the loss b. the guaranty fund of the state where the insurance was placed c. the operating fund of the state insurance department where the insurance was placed d. the NAIC guaranty fund for surplus/excess lines insurer
a. the insured must assume the loss
All of the following statements are true regarding a Personal Liability Supplement, EXCEPT: a. the policy can be written as a monoline policy b. the policy will cover watercraft liability c. It provides Coverage L- personal liability coverage at $100,000 per occurrence d. if the insured would like to obtain the Loss Assessment coverage, it must be added to the Personal Liability Supplement by endorsement
b. the policy will cover watercraft liability
Chucks Home is covered under a DP-1 policy when his dwelling suffers a significant damage due to a tornado. His Coverage A limit is $100,000 and this satisfies his coinsurance requirement. His policy does not have a deductible form attached. His dwelling is severely damaged and he submits a claim for $96,520 for the dwelling. How much coverage does Chuck have remaining on his policy to cover an appurtenant structure on his property that was also severely damaged. a. $5,000 b. $10,000 c. $3480 d. $0
c. $3480
Normally, which of the following would be excluded as a workers compensation claim in South Carolina? a. an employee is poorly trained and is injured on a machine b. an employee disregards wearing safety glasses and suffers an eye injury c. an employee claims stress and mental injuries due to their employment d. an employee is injured while using their personal vehicle on company errands
c. an employee claims stress and mental injuries due to their employment
In which of the following situations should a non-waiver agreement by used? a. an insureds picture window was broken by a neighbor throwing a baseball b. an insureds house burned to the ground c. an insureds house shows rot damage, and it appears there is a long-term plumbing leak d. an insureds roof blew off in a tornado
c. an insureds house shows rot damage, and it appears there is a long-term plumbing leak
Which of the following statements concerning the Earthquake and Volcanic Eruption Endorsement to a Commercial Property policy is not true? a. the endorsement is written to include earthquake and volcanic eruption as a covered cause of loss b. the endorsement can be written to cover only sprinkler leakage that is caused by an earthquake or volcanic eruption c. if the policy expires before the end of the 168 hour period, coverage will not apply to the time period following the expiration date of the policy d. the endorsement will treat all earthquake shocks or volcanic eruptions that occur in any 168 hour period as a single earthquake or volcanic eruption
c. if the policy expires before the end of the 168 hour period, coverage will not apply to the time period following the expiration date of the policy
Mr.York had his pickup truck stolen while it was parked in a "no parking" zone outside his office. The value of the truck was $18,500. In addition, tools valued at $200, extra tires and hubcaps for the truck valued at $550 and a tarp worth $50 were in the truck. Mr.York has a collision deductible of $500 and a comprehensive deductible of $250. The insurance company will pay what amount/ a. $18,000 b. $18,250 c. $19,050 d. $18,800
d. $18,800 (18,500+550-250)
The Ocean Marine coverage that insures either prepaid shipping charges or the income to be earned for moving cargo is known as: a. freight insurance b. protection and indemnity (P&I) c. block policy coverage d. cargo coverage
a. freight insurance
What coverage is used to cover damage to a customer's vehicle in the care and custody of a repair garage? a. garagekeepers liability b. garage liability c. physical damage coverage d. the broadened coverage- garages endorsement
a. garagekeepers liability
Which coverage of a Homeowners policy would pay for damage to a neighbors window caused by the insured? a. Coverage A b. Coverage E c. Additional Coverages d. This is an exception to an exclusion
b. Coverage E
The cost of defense is paid without limitation and does not affect the limit of liability for damages. When does the insurer's duty to defend and pay these defense costs end? a. there are no limitations b. when the cost of defense and the requested demands reach the policy limit c. after the statute of limitations is exhausted d. when the limit of liability is exhausted through the payment of settlements or judgments
d. when the limit of liability is exhausted through the payment of settlements or judgments
The Homeowners additional coverages includes coverage up to _______ for gravemarkers including mausoleums on or away from the residence premises by a peril insured against. a. $5000 b. $1000 c. $2500 d. $1500
a. $5000
Which of the following would not be covered under Coverage B of the Homeowners forms? a. a separate building on the insured premises used for business b. a building connected to the main dwelling only by a fence c. a private garage rented to a non-tenant d. an in ground swimming pool
a. a separate building on the insured premises used for business
A large tree has fallen into Paul's yard caused by wind. The claims service representative (CSR) advises Paul to call a contractor to remove the tree and send the bill to the insurance company. The bill is $1200. However, the policy coverage for the debris removal of a tree that has fallen by the wind, is only $500 unless the tree hits the house, which was not the case. What should the adjuster do? a. pay only $500 b. pay the $1200 c. Pay the $1200, but then explain the policy provisions and ask to insured to reimburse the insurer for the difference d. Negotiate
b. pay the $1200
All of the following statements about the HO-8 are correct, EXCEPT: a. the policy form is designed for older or historical homes with replacement values that exceed market values b. HO-8 covers the dwelling, other structures, and personal property on a named peril basis c. HO-8 covers the same perils as HO-2 d. HO-8 is also known as the modified coverage form
c. HO-8 covers the same perils as HO-2
Which of the following is NOT a responsibility of the Insurance Commissioner in any given state? a. issuing insurance licenses and certificates of authority b. enforcing insurance laws and regulations c. setting insurance rates d. ensuring the availability of necessary insurance in the state
c. setting insurance rates
Jamie has submitted a claim against Ron's insurance policy for a loss he has legitimately suffered. This claim is: a. third party property claim b. first party liability claim c. third party liability claim d. first party property claim
c. third party liability claim
To qualify as an adjuster, the applicant must comply with all of the following, EXCEPT: a. Have sufficient knowledge of the business of insurance b. Be of good moral character c. Has not been violated any insurance laws of South Carolina d. Be a resident of South Carolina
d. Be a resident of South Carolina
Which of the following is covered under the Federal Employees Compensation Act? I. federal employees exempt under state workers compensation laws II. active duty military members III. members of the merchant marine under the Jones Act IV. longshoremen and harbor workers a. I only b. I, II, and III only c. I and III only d. I and IV only
a. I only
Ocean marine coverage for losses to the insured vessel caused by bursting boilers, latent defects in the vessel and negligence of the master or crew members are addressed by which of the following? a. the inchmaree clause b. protection and indemnity coverage c. hull coverage d. barratry
a. the inchmaree clause
An insure has her business automobiles covered under a Business Auto policy with Symbol 7 specified on her Declarations page. She has purchased a trailer with a load capacity of 2,500 pounds and hitched it to a covered van. While she is driving the van, the trailer breaks free and crashes into another vehicle, causing bodily injury. Which of the following statements is true regarding this insured's situation? a. liability coverage is extended under Symbol 7 for a trailer with a load capacity of less than 5,000 pounds, therefore coverage will apply b. liability coverage is not extended under Symbol 7 for a trailer with a load capacity of more than 2,000 pounds, therefore coverage will apply c. liability coverage is excluded for all trailers under the Business Auto Coverage form d. Liability coverage will not apply for the trailer, but coverage for the van will pay the damages awarded under the lawsuit
b. liability coverage is not extended under Symbol 7 for a trailer with a load capacity of more than 2,000 pounds, therefore coverage will apply
Under Coverage B of the BOP, how are exterior signs covered? a. they are covered for a limit of $500 b. they are listed as "property not covered" but they can be covered if they are scheduled on the policy c. they are never covered d. they are covered up to the policy's limit of liability, but the deductible applies
b. they are listed as "property not covered" but they can be covered if they are scheduled on the policy
Chad has his commercial building covered by a Commercial Property Policy that includes Coverage A of the Building and Personal Property Coverage form. He purchases a new building because he plans to expand his business. Which of the following statements is TRUE regarding coverage for Chad's new building? a. Chads newly acquired building will be covered for 10 days from the date of acquisition for $250,000 b. Chads newly acquired building will be covered for 30 days from the date of acquisition for $200,000 c. Chads newly acquired building will be covered for 30 days from the date of acquisition for $250,000 d. Chads newly acquired building will be covered for 60 days from the date of acquisition for $200,000
c. Chads newly acquired building will be covered for 30 days from the date of acquisition for $250,000
Which of the following are considered unfair claim settlement practices in South Carolina? I. Provisioning misleading information with respect to the coverages II. Failing to acknowledge with reasonable promptness pertinent communications with respect to a claim III. Attempting in good faith to make prompt, fair and equitable settlements of claims on which liability has become reasonably clear IV. Compelling policyholders or claimants to initiate suits to recover amounts due under a policy a. I, II and III b. II, III, and IV c. I, II, and IV d. I and II
c. I, II, and IV
Which of the following is NOT TRUE of coverage for Business Personal Property and Personal Property of Others in a Commercial Property policy? a. coverage is provided while the property is located in an open field as long as it is within 100 feet of the insured premises b. coverage is provided while the property is located in the insured premises c. coverage is provided while the property is located within a covered vehicle at any location as long as the vehicle is owned by the insured business d. coverage is provided while the property is in any vehicle as long as it was located within 100 ft of the insured premises when the loss occurred.
c. coverage is provided while the property is located within a covered vehicle at any location as long as the vehicle is owned by the insured business
Which of the following is considered to be "custom farming"? a. specific planting, cultivating, or harvesting for which the insured receives no compensation In money or goods b. specific planting, cultivating, or harvesting at a farm that is rented or leased to the insured c. specific planting, cultivating or harvesting that is not the insured location and under the supervision of the farm owner d. a neighborly exchange of farming services
c. specific planting, cultivating or harvesting that is not the insured location and under the supervision of the farm owner
Part One of the NCCI standard workers compensation policy specifies the: a. the schedule showing the dollar limit of the policy coverage b. amount of coverage that federal programs will pay c. statutory provisions of the policy d. the schedule showing the dollar amount paid for exemplary damages
c. statutory provisions of the policy
A legal term describing an intentional act that is illegal or morally wrong, and contributes to the injury of another person is: a. negligence b. a crime c. a tort d. malfeasance
d. malfeasance
Which of the following terms is used to describe a contract where the insurance company is the only party to the contract that is legally bound to perform its part of the agreement? a. aleatory b. conditional c. absolute d. unilateral
d. unilateral
Which of the following injuries would be covered under Part A of the Personal Auto policy? a. Injuries to the insured that are sustained in an auto accident where he/she is at fault b. injuries to a pedestrian struck by the insured while driving the covered auto c. injuries to a member of the insured's family that are sustained in an auto accident where the named insured is at fault d. damage to personal property being transported by the named insured in the covered auto
b. injuries to a pedestrian struck by the insured while driving the covered auto
The insured carries a personal auto policy providing a bodily injury limit of $50,000 each person with a per accident injury limit of $100,000. He injures two occupants in another vehicle. Their injuries total $60,000 for Mr. Jones and $50,000 for Mrs. Jones. The insurance company spent $40,000 in defense and investigation costs. How much will the insured policy pay? a. $50,000 b. $100,000 c. $140,000 d. $110,000
c. $140,000
An insured is covered under a CGL policy. He would like to purchase another policy to increase the limits of insurance for his commercial liability exposures. Which of the following statements is correct regarding the insureds situation? a. a commercial umbrella policy is the only type of policy that will permit the insured to increase his liability insurance limits b. an excess liability policy is the only type of policy that will permit the insured to increase his liability insurance limits c. the insured may purchase either a Commercial Umbrella or an excess liability policy to increase his liability insurance limits d. neither a commercial umbrella nor an excess liability policy can be used to increase an insureds liability limits under a CGL policy
c. the insured may purchase either a Commercial Umbrella or an excess liability policy to increase his liability insurance limits
Under the comprehensive coverage of a business auto policy, which of the following would not be a covered loss? a. after sliding on an icy pavement, a driver hits a guard rail b. electrical wiring in the vehicle catches fire when the ignition is turned on. c. All four tires are removed and a truck is put on blocks while it is parked over the weekend, even though there is no evidence of forcible entry into the company parking lot d. a vehicle has its tires slashed by an undetermined person
a. after sliding on an icy pavement, a driver hits a guard rail
Generally, losses that are covered under the collision coverage of a Personal automobile policy are NOT covered under the "other than collision" coverage. Which of the following would be an exception to this general rule, allowing a claim to paid under EITHER coverage? a. glass breakage that is due to an upset or rollover of a covered auto b. glass breakage due to contact with a bird or animal c. glass breakage caused by theft or larceny d. glass breakage caused by a falling object
a. glass breakage that is due to an upset or rollover of a covered auto
Which of the following accurately lists the four elements of a legally binding contract? a. offer and acceptance, consideration, competent parties, and legal purpose b. authority, ethical intent, competent parties, and legal purpose c. offer and acceptance, consideration, ethical intent, and legal signatures d. authority, consideration, competent parties, and legal purpose
a. offer and acceptance, consideration, competent parties, and legal purpose
Which of the following would be a permitted reason to cancel or non-renew an auto policy in South Carolina? a. the insured or other household operator has had his/her drivers license suspended or revoked b. lack of driving experience or number of years of driving experience c. accidents or violations that occurred more than 36 months before the upcoming anniversary date d. claims filed under policy's Uninsured Motorist coverage where the uninsured motorist is known or there is evidence of physical contact
a. the insured or other household operator has had his/her drivers license suspended or revoked
The chief deputy of the county auditor steals $2.5 million from the county and gambles it away. What bond if any would the county need to have in place in order to try and recoup this loss? a. Employee dishonesty b. Blanket Public Official Bond c. Fiduciary bond d. Extortion-Commercial entities
b. Blanket Public Official Bond
When an insured submits a claim under a Commercial Inland Marine policy, the insurer must pay the claim: a. within 15 days of reaching an agreement with the insured b. within 30 days of reaching an agreement with the insured c. within 45 days of reaching an agreement with the insured d. within 60 days of reaching an agreement with the insured
b. within 30 days of reaching an agreement with the insured
Fred owns two commercial buildings and carries NFIP coverage on them. The area where the buildings are located is a full-risk zone in the Regular Program. Both buildings are 30 years old and when they are damaged by flood, Fred finds that the cost to comply with the new Floodplain Management Ordinance will be quite expensive. What is the total amount of coverage Fred could receive for the Increased Cost of Compliance? a. $59,000 b. $58,000 c. $60,000 d. $30,000
c. $60,000
Gena purchased a policy to cover her home for personal use. Recently, she has been conducting business from the home and has hired several employees. She also has several clients per day coming to the home for business purposes. When Gena's insurer finds out about the additional exposures she has introduced to her home, they decide to take action. Which of the following actions is Gena's insurer most likely going to take? a. void her policy back to the date in which she started the business b. cancel her policy immediately c. suspend her policy until she moves the business out of her home d. void her policy to inception
c. suspend her policy until she moves the business out of her home
When is a nonresident of South Carolina permitted to hold an adjuster license in the state? a. At the discretion of the Director of Insurance b. If south carolina has a reciprocal agreement with the adjusters home state c. If the adjusters home state will allow licensees of South Carolina to hold a nonresident license in that state d. All of the above are correct
d. All of the above are correct
A burglar apprehended in Smith's Jewelry Store by Mr.Smith, the owner, puts up a fight and suffers a broken jaw as a consequence. The burglar sues Smith's Jewelry Store for bodily injury. Will the store's CGL policy provide defense of the suit? a. No. the burglars claim does not fit the policy's definition of "bodily injury" b. No. the suit is frivolous and the insurer is not obligated to defend such suits c. No. the injury to the burglar was an intentional act of the insured and is therefore excluded d. Yes. Although, intentional, the injury was committed by Mr.Smith to protect himself and his property and is therefore covered.
d. Yes. Although, intentional, the injury was committed by Mr.Smith to protect himself and his property and is therefore covered.
Lara is moving to Europe for two years in order to take advantage of a promotion at her job. She will not take her 4 seat propeller plane with her. What type of Aviation policy would be best for Lara to purchase for coverage on her plane while it is in storage and she is in Europe? a. All risks- ground and flight b. admitted aircraft liability c. hangarkeepers liability d. all risks-not in motion
d. all risks-not in motion
Which of the following statements is TRUE regarding coverage under the NFIP for a building in violation of floodplain management ordinances? a. both the building and the contents are covered b. only the building is covered, but the contents is not c. only the contents is covered, but the building is not d. neither the building nor the contents are covered
d. neither the building nor the contents are covered
The Coverage C- Uninsured Motorists coverage of a standard, unendorsed Personal Auto policy applies to all of the following EXCEPT: a. bodily injury sustained by an insured or occupants of the insured vehicle b. the vehicle that is responsible for the bodily injury sustained must meet the definition of an uninsured vehicle c. the insured or occupants of the insured vehicle must be legally entitled to recover damages for bodily injury d. property damage sustained by the insured vehicle by an uninsured vehicle
d. property damage sustained by the insured vehicle by an uninsured vehicle
An insurance contract must comply with the "Principle of Indemnity." Jarron's friend Nick, accidentally destroys Jarron's laptop computer. Nick pays Jarron for the damage, but Jarron also submits a claim to his insurance company for the laptop. The claim will be: a. paid, the fact that Jarron has already paid for the damage has no bearing on the insurance company's obligation to pay b. denied because Jarron has already been paid for the damage c. paid, but only at 50% of the limit of liability d. denied because the damage was caused by a friend and not the insured
b. denied because Jarron has already been paid for the damage
Which of the following is NOT true concerning the Terrorism Risk Insurance Program Reauthorization Act of 2015? a. coverage is mandatory b. the insured can reject the coverage c. it is an agreement between Insurers and the United States government to provide coverage d. must be certified as an act of terrorism by the Secretary of Treasury in concurrence with the Secretary of Homeland Security and the US Attorney General
a. coverage is mandatory
Which of the following statements is CORRECT regarding fidelity bonds? a. they are two party contracts between the employer and an insurance company b. they are three party contracts between the principal, obligee, and surety c. they are two party contracts between the employer and employee d. they are three party contracts between the employer, employee and the customer
a. they are two party contracts between the employer and an insurance company
Under Coverage F of a Homeowners policy, which of the following would be covered? a. a roomer or tenant who falls down the stairs b. a neighbor who is injured while helping the Insured to lay carpet c. the insureds five year old son who falls off a deck on the back of the insured dwelling d. the insured who is bitten while playing with the family dog
b. a neighbor who is injured while helping the Insured to lay carpet
Under Coverage F- Medical Payments in Section iI of the standard Homeowners policies, medical expenses for the injured party will be paid as long as the claim is submitted: a. within 3 years of the date each medical service was performed b. within 3 years of the date of the accident c. within one year of the date of the accident d. within 3 years of the date that a licensed medical professional certifies that the injured person no longer needs treatment
b. within 3 years of the date of the accident
Which of the following is not a true statement regarding the use of non-original equipment manufactured replacement parts for vehicles? a. the parts are at least equal to the original equipment manufacturer parts in terms of kind, quality, safety, fit and performance b. insurers specifying the use of non-original equipment manufacture replacement crash parts shall not be required to pay the cost of any modifications to the parts which may become necessary to affect the repair c. insurers specifying the use of non-original equipment manufacture replacement crash parts warrant that such parts are of like kind, qualify, safety, fit and performance as the original equipment manufacturer replacement crash parts d. non-original equipment manufacture replacement crash parts must carry non-removable identification so as to identify the manufacturer
b. insurers specifying the use of non-original equipment manufacture replacement crash parts shall not be required to pay the cost of any modifications to the parts which may become necessary to affect the repair
Which of the following represents an indirect loss? a. a tree fell on a house, causing a hole in the roof, which later allowed rain to enter b. rain entered a house after a tree fell onto it, later causing mold to develop c. mold developed in a house, alter causing the occupants to become very ill d. a kitchen fire made a house untenable, causing to the occupants to incur hotel charges
d. a kitchen fire made a house untenable, causing to the occupants to incur hotel charges
