Chapter 7-9

All of the following are true of the Occurrence Form, except:

The length of the retroactive date will depend upon the insurer

Which of the following is not found in the Common Policy Declarations page of a Commercial Package Policy?

Exclusions

When an insured's boat is in storage, which warranty allows for a return on premium?

Lay Up

Which form responds to losses that occur while the policy is in force, regardless of when the claim is made?

Occurence

A building valued at $200,000 is insured for $150,000 with an 80% coinsurance requirement and a $1,000 deductible. After the building is totally destroyed, incurring debris removal expenses of $10,000, how much will the Building and Personal Property Coverage Form pay?

$159,000

Medical payments coverage under the Commercial General Liability Coverage Forms includes reasonable medical expenses if they are incurred and reported within how many years following an accident?

1

Which of the following may be insured on a replacement cost basis under the National Flood Insurance Program?

1- to 4-family residences and residential condominiums

The Basic Cause of Loss form covers damage caused by bacteria during what period of time following policy inception?

12 months

How long after a loss before the Period of Restoration begins for Business Income coverage?

72 hours

A Mobile Home Insurance Policy is most similar to:

A Homeowners Policy

Which of the following injuries would not be covered under CGL Medical Payments?

A child accidentally overdoses on cough medication he drank from his parent's medicine cabinet

Which of the following scenarios would be covered under Personal Injury coverage?

A storeowner falsely detains a young child believing the child egged the store

Which of the following is not a common policy condition on a commercial property policy?

Abandonment

Personal Article Floater claims are normally settled on a(n):

Actual cash value basis with some exceptions

Which of the following would not be covered under Coverage A of the CGL?

An insured's employee is injured when a bookcase in the office falls on her

Under the CGL policy, the earned premium used in a premium audit to compute the final premium is determined at what point in time?

At the end of the policy period

Under the Cameras Floater, which of the following is true?

Automatic coverage is provided on newly acquired items for 30 days, up to 25% of the policy amount

Personal injury liability insurance does not cover which of the following?

Bodily injury

Which of the following is not one of the limits of liability provided by the CGL?

Bodily injury limit

Which of the following is not covered under the Condominium Commercial Unit-Owners Coverage Form?

Building exterior wall

Which of the following forms provide coverage for indirect loss?

Business Income Coverage Form

Time Element is best defined as:

Business Income and Extra Expense Coverage Form

Which of the following is excluded under both the Limited Pollution Liability coverage form and Pollution Extension endorsement?

Clean up costs

Which of the following is included in the building coverage provided by the Building and Personal Property Coverage Form?

Completed additions, fixtures, including outdoor fixtures, permanently installed machinery and equipment

ABC Industries contracts with municipal governments to build bridges, viaducts, and similar engineering projects. If a bridge completed in the prior year by ABC Industries were to collapse, which kind of liability exposure would this be an example of?

Completed operations

What type of insurance indemnifies the legal liability of an insured for the actions of the insured's subcontractors?

Contingent Liability Insurance

Mobile Home Insurance includes all of the following, except:

Coverage C with a limit of 50% of Coverage A

Which of the following is correct regarding products liability under the CGL?

Coverage applies to the bodily injury (BI) and property damage (PD) the product causes, but not to the product itself

Which of the following statements about the National Flood Insurance Program is false?

Coverage becomes effective after a 24-hour waiting period

Under the Builders Risk Coverage Form, all of the following are true, except:

Coverage includes trees, plants, outside antennas and signs that are not attached to the building

Choose the false statement regarding Flood Insurance.

Coverage is provided for damage to growing crops

Which of the following is false about the CGL's two coverage forms?

Coverage under the occurrence form is based on when the loss is reported

Which of the following is true regarding the Musical Instrument Floater?

Covered instruments may not be played for remuneration during the policy term

All of the following are true of an Umbrella Liability Policy, except:

Damage to property in the care and custody of the insured is covered

The Commercial basic Cause of Loss Form does not cover which of the following perils?

Earth Movement

After being rejected by an insurer due to underwriting guidelines an applicant may request homeowners coverage under which of the following?

FAIR Plan

The Legal Liability Coverage Form would not cover which of the following losses?

Fire damage to the cash register

Which of the following property may be covered under a Building and Personal Property Coverage Form?

Grain stored inside a building

What is the term for tangible property, that cannot be used because it is defective, inadequate, deficient, or dangerous?

Impaired property

All of the following are true of the Commercial General Liability Conditions (Section IV) under the Claims-Made Form, except:

Insolvency of the insured relieves the insurer of any obligations under the policy

The Personal Articles Floater is used to do which of the following?

Insure individual personal property on a scheduled basis

Endorsements that coordinate CPP coverages to avoid duplication are called:

Interline

The Lay Up Warranty under the Yacht Policy is best described by which of the following?

It applies when the insured yacht is in storage and allows a return of premium due to the lower risk

Which of the following is true regarding the Earthquake Cause of Loss Form?

It can be used only with another Causes of Loss Form

Which description of the Personal Articles Floater is incorrect?

It covers claims on a replacement cost basis

Which of the following is true regarding the Fine Arts Floater?

It covers such items as paintings, rare manuscripts and antiques

Which of the following is true regarding the Yacht Policy?

It has navigational limits that describe the area where the yacht is allowed to operate

Choose the best answer regarding the details of the Yacht Policy.

It is an Ocean Marine Form and provides both property and liability coverage

The National Flood Policy defines all of the following as floods, except:

Leakage of underground water systems

Which of the following is true regarding the Boatowners Policy?

It provides open perils coverage, and losses are settled on an actual cash value basis

Which statement would not be included in a description of the National Flood Insurance Program?

It provides unlimited coverage for qualified property owners

Which of the following regarding the value reporting form is true?

Late reporting or under-reporting will result in a penalty in the event of a loss

Which of the following is not included in the Personal Effects and Property of Others Extension under the Building and Personal Property Coverage Form?

Loss by theft of personal effects

Which of the following statements regarding Multi-Peril Crop Insurance is correct:

Multi-peril crop insurance is reinsured by the federal government by FCIC

Which of the following statements regarding flood insurance is not true?

No deductible applies to loss of contents

All of the following are considered liability assumed under insured contracts, except:

Ordinance or Law

All of the following are false concerning the National Flood Insurance Program, except:

Payment for losses are made by the federal government

Which statement is false regarding Supplementary Payments under the Commercial General Liability policy?

Payments made under this section reduce the limits of the policy

Which of the following is not an additional coverage under the Building and Personal Property coverage form?

Peak Season

Which of the following is designed to cover the risk of a business that experiences a specified increase in business personal property during a designated period?

Peak Season Endorsement

The Boatowners Policy does not cover which of the following?

Personal Property

Choose the property that is not settled on a replacement cost basis under the Building and Personal Property Coverage Form.

Personal property of others

An insured who goes to client's offices and homes for appointments would need coverage for which liability exposure?

Premises and Operations

Which statement is false regarding the Building Personal Property Coverage Form?

Preservation of Property Coverage provides named-perils coverage for 10 days

The CGL's general aggregate limit does not cover which of the following?

Product recall

Which of the following statements is incorrect about Supplementary Payments under the CGL?

Supplementary payments apply to losses under all Section I coverages

All of the following are true of the Building and Personal Property Coverage Form, except:

Tenant's improvements that are not legally removable are included in the Personal Property of Others Coverage

Which of the following conditions would not be found in a CGL policy written on the occurrence form?

The Insured's Right to Claim Information

What is the date after which an occurrence can take place and be covered under the claims-made form?

The Retroactive Date

If personal injury coverage is not provided by an insured's homeowners policy, but is provided by the insured's umbrella policy, and the insured is sued for slander, which of the following statements is correct?

The insured must pay the umbrella policy's self-insured retention

Coverage B of the CGL would cover which of the following claims?

The insured was accused of causing a business associate to be falsely arrested

Which of the following is correct about Inspections and Surveys under the Common Policy Conditions of the CPP?

The insurer has the right, but is not obligated, to make inspections and surveys at any time

Which of the following is correct regarding preservation of property under the Building and Personal Property Coverage Form?

The policy provides open perils coverage for 30 days on insured property that is being moved or temporarily stored at another location because of the endangerment of a covered peril

Which statement is correct regarding the Supplemental Extended Reporting Period?

The premium is a one-time charge and fully earned at issuance

All of the following are true of the extended reporting period, except:

The supplemental extended reporting period must be purchased at the beginning of the policy period

When would a person purchase a value reporting form?

When an insured has business personal property values that fluctuate, and needs protection for the values actually at risk

Which Statement is true regarding a Difference In Conditions Policy?

There is no standard form

All of the following are true of Supplementary Payments under the CGL, except:

They reduce the limits of insurance

The intent of the Personal Effects Floater is:

To provide coverage worldwide for travelers

Fine arts and antiques are classes of property insured on a:

Valued basis