TQ7

Under the BOP, up to how many years can the insurer request to examine the books and records of an insured? A- 3 years B- 1 year C- 2 years D- 4 years

A- 3 years

Which of the following cannot be covered under a BOP? A- credit union B- office buildings C- apartment buildings D- a small gift shop

A- credit union

Who is responsible for the legal fees in a lawsuit covered by Employer's Liability in a standard workers compensation policy? A- the insurer B- the insured C- the employer if found negligent D- the party bringing the lawsuit

A- the insurer

The Equipment Breakdown policy provides automatic coverage to equipment in use or connected for use at newly acquired or existing locations for ____ if the insured reports to the insurer in writing. A- 120 days B- 30 days C- 90 days D- 60 days

C- 90 days

Which of the following is a true statement regarding the "law of large numbers?" A- it does not apply to insurance B- it proves that writing a large number of risks makes an insurance company profitable C- as the number of units increases, the ability to predict total and average losses increases D- all insurance rates are based on the law of large numbers

C- as the number of units increases, the ability to predict total and average losses increases

The Terrorism Risk Insurance Act and its extensions is an agreement between: A- between the states and the Federal Gov B- between the insurance companies and the states C- between the Federal Gov and the insurance companies D- between the Federal Gov and foreign governments

C- between the Federal Gov and the insurance companies

Which of the following coverages are not automatically included in the BOP? A- seasonal increase in contents coverage B- loss of income C- employee dishonesty D- general liability coverage

C- employee dishonesty

Under the farm policy, which of the following is not considered livestock? A- pack mule B- sheep C- poultry D- cattle grazing in a field

C- poultry

The insured has a CGL policy with a $600,000 aggregate limit and a $300,000 per occurrence limit. The insured has one claim for $400,000 and another separate claim for $200,000. After paying these two losses, how much of the aggregate limit will remain for future claims? A- $50,000 B- $600,000 C- $400,000 D- $100,000

D- $100,000

Joan is covered for $10,000 under a personal articles floater for her jewelry. She acquires another piece of jewelry valued at $2,500. Under the automatic coverage provision within the policy, how much coverage would apply to the newly acquired jewelry for 30 days? A- Nothing B- $1,000 C- $1,500 D- $2,500

D- $2,500

The commercial inland marine coverage form known as the jewelers block excludes loss resulting from: I. Earthquake. II. Shortage found upon taking inventory. III. Unexplained disappearance.

I, II, and III

Which of the following types of property would be included under Coverage A of a Building and Personal Property Coverage Form? I. A central air-conditioning system II. Wall-to-wall carpeting III. A permanently installed intercom system

I, II, and III

An insured travels to Europe and has her fur coat stolen. The fur is worth $1,000. She is insured under an HO-4 contents policy. What will be paid by the insurer? A- $1,000 less the deductible B- Nothing because the property is out of the US C- $500 D- Furs are excluded for theft coverage **personal property is covered on a worldwide basis

A- $1,000 less the deductible

The West Virginia Essential Insurance Coverage Act (FAIR Plan) helps make coverage available to persons that insurance companies in the voluntary market will not insure. What is the maximum limit that can be provided for residential risks? A- $200,000 B- $50,000 C- $150,000 D- $25,000

A- $200,000

Insurance policy forms must be on file with the Commissioner for _____days before it may be sold. A- 60 B- 45 C- 30 D- none of the responses are correct because West Virginia has a "file and use" law

A- 60

An insurance agent represents the interest of: A- the insurance company B- the insured C- the general public D- both the insurance company and the insured

A- the insurance company

An insured driving a covered vehicle in West Virginia is run off the road by an unknown driver. The insured strikes a tree and is severely injured. What coverage might apply to pay for the injuries other than medical payments or health insurance? A- uninsured motorist B- liability coverage C- underinsured motorist coverage D- excess liability umbrella coverage

A- uninsured motorist

Under a Commercial Property policy, which of the following is not a covered peril under the Basic Cause of Loss form? A- water damage B- explosion C- sinkhole explosion D- smoke

A- water damage

Employee Benefits and Counseling Errors and Omissions is a form of which of the following professional liability policies? A- employee benefits liability B- fiduciary liability C- counseling errors and omissions liability D- all of the responses are correct

B- fiduciary liability

Which of the following would NOT be covered by a flood insurance policy? A- overflow of water from a pond on the insured property B- mudslides from recent heavy rain C- collapse of land along the shore of a body of water D- inundation and overflow of surface waters

B- mudslides from recent heavy rain

Which of the following claims would not be covered by the liability Section II of a Homeowner's Policy? A- the insured's neighbor files a claim for damage to his house caused by the named insured's dog B- the named insured files a claim for damage to his house caused by his dog C- an insured accidentally runs over his neighbor with a golf cart at a local country club D- an insured's dog attacks and damages his neighbor's golf cart

B- the named insured files a claim for damage to his house caused by his dog

What is the limit that will be paid for the fire department service charge in the BOP form? A- $1,500 B- $2,000 C- $2,500 D- $3,000

C- $2,500

In West Virginia, a producing agent must report to the Insurance Commissioner any administrative action taken against the producer in another jurisdiction or by another governmental agency in this state within _____of the final disposition of the matter. A- 6 months B- 48 hours C- 30 days D- 10 days

C- 30 days

How many continuing education credit hours in excess of the required 24 hours will be carried over into the next reporting period? A- 24 B- 12 C- 6 D- 0

C- 6

Most inland marine "all risk" forms exclude loss or damage caused by: A- Smoke B- Vandalism C- War D- Vehicles

C- War

Where is Covered Property listed and described on the BOP? A- in the coverage form B- under the conditions C- on the declarations page D- under the extensions of coverage

C- on the declarations page

Under Coverage C (personal property) of the homeowners program all of the following categories of property are limited, EXCEPT: A- securities B- gold C- recreational furniture D- watercraft

C- recreational furniture

Umbrella liability polices commonly exclude damages under: A- insured contracts B- a contract where liability is assumed for use of aircraft C- workers compensation obligations D- coverage for an amount above the specified value

C- workers compensation obligations

A dry cleaner wants to insure the pressure boilers used in the business. They also would like to cover some equipment and accessories that can be used in the boilers but have not yet been installed. Which of the following, if any, can be used to cover this exposure? A- expediting expense coverage B- extra expense coverage C- ordinance and law coverage D- spare parts and equipment coverage

D- spare parts and equipment coverage

A watercraft policy would pay for which of the following losses? I. A boat's motor is stolen before the insured reports its acquisition to the insurance company. II. A boat that sank in 40 feet of water is refloated at a cost of $700.

II only

An insured has an occurrence-type CGL policy with a $100,000 aggregate limit and a $25,000 per occurrence limit. The insured had one occurrence settled for $35,000 and a second occurrence, which took place during the same policy period, was settled for $20,000. How much of the aggregate limit remains for the payment of future claims. A- $55,000 B- $45,000 C- $35,000 D- $20,000

A- $55,000

In the rating of workers compensation coverage, a risk that has suffered a frequency of losses may be subject to what is termed "experience risk modification factors". Which of the following factors would indicate a relatively high surcharge on rates? A- 1.25 B- .75 C- 1.00 D- .95

A- 1.25

A leased vehicle is considered to be a covered auto under the Personal Auto Policy (PAP) if it is a private passenger auto leased for at least: A- 6 consecutive months B- 48 hours C- 30 consecutive days D- 1 year

A- 6 consecutive months

Under the livestock coverage form, how must livestock be covered? A- 80% to value B- 90% to value C- Replacement Cost D- 100% of market value

A- 80% to value

Binders for insurance coverage may be made either orally or in writing. In West Virginia, a binder is good for _____ except as suspended by the policy. A- 90 days B- 30 days C- 45 days D- 60 days

A- 90 days

An insurer was cited and found guilty of unfair discrimination. The carrier paid its fine for the offense and was also issued a cease and desist order. If the insurer continued with the practice of unfair discrimination, the additional penalty would be: A- A penalty of up to $10,000 for each violation and/or revoke or suspend the person's license B- A penalty of up to $10,000 for each violation. C- A penalty of up to $50,000 for each violation. D- A penalty of up to $50,000 for each violation and/or revoke or suspend the person's license.

A- A penalty of up to $10,000 for each violation and/or revoke or suspend the person's license

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

Under the Federal Terrorism Risk Insurance Act, who determines that an act of terrorism has occurred that would be covered under the Act? A- The Secretary of the Treasury B- The President C- The Vice President D- The Majority Leader of the Senate

A- The Secretary of the Treasury

Which of the following would not have the capacity to enter into a contract? A- a person who is under the influence of drugs at the time of making the agreement B- a person who agrees to purchase a sports car without carefully consider the costs involved C- a person who is insured by the Auto Assigned Risk Plan D- a person who has just turned 18

A- a person who is under the influence of drugs at the time of making the agreement

Which of the following statements best describes a representation in an insurance application? A- a representation is a statement made by the applicant that he believes to be true when made, but which might prove to be false B- a representation is a promise by the applicant that certain conditions will continue to exist throughout the policy term C- a representation explains the promise made by the insurance company D- another name for a representation is a warranty

A- a representation is a statement made by the applicant that he believes to be true when made, but which might prove to be false

Your car is damaged in an auto accident. While it is being repaired, the body shop loans you a replacement. From a coverage standpoint this replacement vehicle is known as: A- a temporary substitute B- a non-owned auto C- a newly acquired auto D- a replacement vehicle

A- a temporary substitute

Which of the following is not covered under the Commercial Building and Personal Property Form? A- all of the responses are correct B- accounts, bills, and currency C- animals not held for sale D- cost to rebuild foundations

A- all of the responses are correct

The declarations page on most property and casualty policies is signed by: A- an authorized representative of the insurer B- the named insured C- all insured persons D- an authorized inspector

A- an authorized representative of the insurer

A fur coat that is insured by a personal articles floater is damaged by a pet. Coverage for the coat would be provided because the policy is written on: A- an open perils basis B- a named perils basis C- a broad form D- a special form

A- an open perils basis

Which of the following is the procedures would the insured use to settle a dispute with the insurer over the value of covered property in a claim? A- appraisal B- subrogation C- audit D- pro rata liability

A- appraisal

If coverage for towing and labor costs is included in a Personal Auto Policy, labor costs will be covered only if the labor is performed: A- at the place of disablement B- within 24 hours of the disablement C- within 48 hours of the disablement D- at a garage by an experience mechanic

A- at the place of disablement

Liability arising out of expected or intended injury is excluded on the CGL. The exclusion does not apply if: A- bodily injury results from using reasonable force to protect people or property B- bodily injury occurring after the police are called C- bodily injury sustained during a shooting incident D- none of the answer choices are an exception to the exclusion

A- bodily injury results from using reasonable force to protect people or property

Under the DP-2 broad form, which of the following losses would not be covered? A- damage to the dwelling that is suddenly caused by wild animals B- a picture window is blown out during a tornado C- vandalism damage caused by a prankster to a dwelling that has been vacant for 14 days D- a roof caves in due to the weight of ice and snow

A- damage to the dwelling that is suddenly caused by wild animals

If the other insurance clause is by contribution, how would a loss be divided and paid between the various carriers? A- each would pay the same until its limits are exhausted B- one would pay the primary, and the other would pay excess C- each would pay its proportionate share D- each would pay out the claim entirely

A- each would pay the same until its limits are exhausted

What coverage is used to cover damage to a customer's vehicle in the care and custody of a repair garage? What coverage is used to cover damage to a customer's vehicle in the care and custody of a repair garage? A- garagekeeper's legal liability B- garage liability C- drive other car coverage D- general liability

A- garagekeeper's legal liability

Harry Smith is a minor and has been employed in violation of the laws of West Virginia. If he is injured in a job related accident, how will this affect workers compensation coverage? A- he will be covered for workers compensation benefits B- he will not be covered because he is a minor and employed illegally C- he will have to bring a lawsuit against his employer and prove legal liability D- workers compensation coverage will not apply and the employers will be held personally liable for his work related injuries

A- he will be covered for workers compensation benefits

Joe Smith operates a small manufacturing plant. Joe carries a Business Income form. His policy will cover which of the following? A- his loss of profit while out of business as a result of a fire loss B- his loss of earnings as the result of a market decline C- employees loss of earnings due to a strike D- his loss of earnings as a result of a discontinued product line

A- his loss of profit while out of business as a result of a fire loss

What is the purpose of reinsurance? A- it is insurance for insurance companies, to reduce the risk of catastrophic losses B- it can cover unusual risks which standard carriers are unwilling to insure C- it is special coverage for reinvestment trusts D- it is insurance for past claims that were inadequately covered

A- it is insurance for insurance companies, to reduce the risk of catastrophic losses

Third-party provisions allow for an entity that lends money to an insured to purchase property, to be named on the insurance for that property. In property insurance, this is known as a "standard mortgage clause." In auto insurance, it is known as: A- loss payable clause B- lender's clause C- full coverage D- reimbursement clause

A- loss payable clause

A partner in a firm authorized to have custody of the insured property outside the premises would be called a: A- messenger B- custodian C- guard D- watchman

A- messenger

A business owner who is careless about property left in his care may be guilty of which of the following hazards: A- morale B- moral C- catastrophic D- occupational

A- morale

In commercial property what is the effect of exercising the "agreed value" option? A- negates coinsurance B- pays replacement cost C- the insurer and insured must agree on the value of all insured property after a loss D- the insured reports values at an agreed upon date

A- negates coinsurance

Surety bonds guarantee the fulfillment of specific obligations. Each of the following may be the subject of a surety bond, EXCEPT: A- protection of funds handled by employees B- payment of a debt C- meeting contractual commitments D- performance of certain duties

A- protection of funds handled by employees

What is the definition of "agent?" A- someone who represents an insurance company in the soliciting and negotiation of insurance B- someone who shops and obtains insurance for the insured C- someone with a certificate of authority D- someone who handles claims for an insurer

A- someone who represents an insurance company in the soliciting and negotiation of insurance

The "when more than one coverage applies" condition in crime insurance is designed to: A- specifies how a claim would be allocated among the different insurers B- allow the insured to choose the company that will pay the claim C- provide for subrogation of a claim D- avoid over payment of a claim

A- specifies how a claim would be allocated among the different insurers

Mr. Vickers lives close to a river that has, on occasion, flooded. On Friday morning he is watching the weather station and notes that there is a flood warning in his area. He calls his agent and asks the agent to bind flood coverage immediately. Which of the following is true? A- the application for coverage requires a 30-day waiting period before coverage applies B- the agent can bind the coverage immediately C- there is a 7-day waiting period before the agent can bind coverage D- the agent can bind the coverage in 14 days

A- the application for coverage requires a 30-day waiting period before coverage applies

Which of the following dwelling forms provides removal coverage for 30 days? A- the broad and special forms only B- the basic, broad, and special forms C- the basic and broad forms only D- the special form only

A- the broad and special forms only

Under the DP-1 dwelling form, which of the following is true? A- the extended coverage (EC) perils can be added by endorsement B- the extended coverage (EC) perils can only be added by attaching the vandalism & malicious mischief (V&MM) endorsement C- the broad form perils can be added by endorsement D- Money, securities, software and credit cards are included under Coverage C- Personal Property

A- the extended coverage (EC) perils can be added by endorsement

All of the following are necessary for Liability coverage to apply under the Personal Auto policy, EXCEPT: A- the insured must not have been drinking B- the person liable must be an insured person C- the insured must be legally liable for the accident D- the damage or injury must be the result of an auto accident

A- the insured must not have been drinking

Under the appraisal clause in a commercial inland form, which of the following is true? A- the insurer still retains its right to deny the claim entirely B- it is not binding on all parties C- the insurer is not bound by the decision of the appraisers and/or umpire D- the insurer must seek legal action under the appraisal clause to enforce the terms and conditions

A- the insurer still retains its right to deny the claim entirely

The HO-6 policy provides full replacement cost coverage if it is rendered a total loss by fire, EXCEPT: A- the structure portion occupied by the insured as a residence B- improvements and betterments made to the structure by the insured C- structures owned by the insured other than the residence D- replacement cost coverage does not apply under the HO-6 form

A- the structure portion occupied by the insured as a residence

What is the maximum limit that can be provided for a structure for coal mine subsidence coverage? A- $50,000 B- $75,000 C- $35,000 D- $100,000

B- $75,000

Which of the following qualifies as a compensible injury under workers compensation coverage? A- A worker is involved in an accident while driving to work B- A factory worker fractures an arm while working over-time at his/her job C- An employee is struck by a car, and is seriously injured while walking back to work following a lunch break D- An employee is injured in a bank robbery while depositing his/her paycheck

B- A factory worker fractures an arm while working over-time at his/her job

In January 2011 ABC Company wrote a fidelity bond for Jim's Cleaners. In March, Jim discovered an employee theft that took place two years ago. This claim should be handled by: A- the carrier who wrote their bond in 2009 B- ABC company C- both carriers D- neither carrier

B- ABC company

Under Personal Liability - Section II of homeowner coverage, a cemetery plot is considered to be: A- The insured premises B- An insured location C- A non-insured location D- A non-insured premises

B- An insured location

The purpose of the Limited Fungi, Wet or Dry Rot or Bacteria Coverage endorsement is: A- Excludes coverage for these perils B- May be used to add coverage to the property and/or liability sections of the policy C- It excludes costs associated with testing for these items D- It may be used with the HO-8 form

B- May be used to add coverage to the property and/or liability sections of the policy

Which of the following is true regarding the homeowners HO-5 form? A- provides open peril coverage on buildings and broad form peril coverage on their contents B- provides open peril coverage on the building and their contents C- provides broad form peril coverage on the buildings and their contents D- provides broad form peril coverage on the building and named peril coverage on their contents

B- Provides open peril coverage on the buildings and their contents

Which of the following statement is true of the jewelers block coverage form? A- the form insures a package of property and liability coverage B- coverage may be written for the stock for retail jewelers or the jewelry stock of department and discount stores C- coverage may be written for pawnbrokers dealing in jewelry D- customers' property is not covered under the form

B- coverage may be written for the stock for retail jewelers or the jewelry stock of department and discount stores

An employer is involved in interstate commerce. They have an employee who works regularly in West Virginia. What is the status of the employee's workers compensation coverage? A- the employer must show proof of coverage in another state where the company is domiciled and where coverage is provided B- the employee must be covered for the benefits provided by the West Virginia workers compensation code C- The employee can elect which state's coverage is the most beneficial for his injuries D- The employer can elect what state in which the coverage will be provided

B- the employee must be covered for the benefits provided by the West Virginia workers compensation code

When is it allowed for a telemarketer to call to a person's home? A- 10:00 pm and 11:00 pm B- 7:00 am and 7:45 am C- 8:00 am and 9:00 pm D- 7:00 am and 10:00 pm

C- 8:00 am and 9:00 pm

The rights and duties of both parties to the insurance contract are specified in which section of a homeowner policy? A- declarations B- Insuring Agreement C- Conditions D- Exclusions

C- Conditions

When it is known that an employee is guilty of theft or other dishonest act, how is coverage affected? A- Coverage will continue if the employee agrees to make complete restitution B- Coverage continues until the expiration date of the coverage C- Coverage is cancelled immediately D- Coverage will continue if an additional premium is charged for the increased exposure

C- Coverage is cancelled immediately

Each of the following people would be an insured for auto medical payments coverage under Bob Thomas's BAP, except: A- Bob Thomas (the named insured), struck by an auto while walking across the street. The auto was not a covered auto B- Mel Carpenter, Bob's neighbor, occupying a covered auto C- Frank Thomas, Bob's 17 year old son, occupying an auto that is not a covered auto. Frank lives with his mother, who is divorced from Bob D- Mary Thomas, Bob's ex-wife occupying a covered auto

C- Frank Thomas, Bob's 17 year old son, occupying an auto that is not a covered auto. Frank lives with his mother, who is divorced from Bob

Under the BOP, which type of business would not normally be eligible for coverage? A- a family owned leather shop B- a doctors office C- a small manufacturer D- a hair salon

C- a small manufacturer

Tommy's Tip Top TV Store is delivering a new flat screen TV to Jerry's house. The delivery people set the TV down on the floor in the hallway to get a better grip. While picking it up, the TV scratches the floor. How will the Business Auto policy for Tommy's Tip Top TV Store respond to Jerry's demand for damage to his floor? A- no coverage for the damage to the floor B- coverage for the damage to the floor is covered under the liability coverage of the Business auto form C- coverage for the damage to the floor is covered under the CGL form D- damage must result from an auto accident

C- coverage for the damage to the floor is covered under the CGL form

Which of the following is NOT covered under a premise burglary claim? A- product is stolen B- damage to a door C- fire to the building caused from the break in D- damage to a show case

C- fire to the building caused from the break in

Which of the following would be considered a consequential loss under a dwelling policy? A- water damage to a house as a result of a fire B- a tree falling on a rood and branch breaks a window C- food spoilage in a freezer as a result of a fire in the house D- smoke damage to a detached garage as a result of a fire

C- food spoilage in a freezer as a result of a fire in the house

Anyone who threatens, forces or corruptly influences, obstructs or impedes the due and proper administration of the fraud law relating to the insurance business may be fined and/or imprisoned up to: A- 5 years B- 15 years C- 20 years D- 10 years

D- 10 years

Which of the following would be considered uninsured vehicles? A- An unidentified car that backs into your car at the supermarket, injures you and takes off B- A vacationing motorist who hits your car and whose liability coverage is below the required limit for the state you live in, and below that required to cover the damage and injuries C- A motorist who hits your car and has no insurance or bonding D- All of the responses would be considered "uninsured" vehicles

D- All of the responses would be considered "uninsured" vehicles

Legal responsibility is determined by: A- a police officer at the scene of an accident B- the insurance companies that cover the people involved in the accident C- the individual parties involved D- a court of law

D- a court of law

Coverage B-Personal and Advertising Injury Liability under the CGL will not cover: A- intentional acts B- unauthorized use of another's name or product C- pollution D- all of the answer choices are correct

D- all of the answer choices are correct

Which of the following is true regarding personal property floaters? A- it is a blanket coverage for personal property by category B- coverage is written on an all risk basis C- it cannot be purchased to insure golf carts D- all of the responses are correct

D- all of the responses are correct

In a legal sense, the term "person" includes: A- individuals B- companies C- other business entities D- all the responses listed are correct

D- all the responses listed are correct

On the basic dwelling policy all of the following perils are excluded, EXCEPT: A- war B- landslide C- earthquake D- volcanic eruption

D- volcanic eruption