Exam Final

Which of the following would be eligible for homeowners coverage f- medical payments in the event of injury at the insured'd premises?

A full-time maid

An insured has a maximum limit of coverage available under her liability during a policy year, regardless of the number of the claims made of the number of accidents. Her limits are restored at the policy anniversary. What type of limit does this insured have.

Aggregate

an insured purchased an auto policy for his new car. He wants to understand what perils are not insured against. Which section of his policy should the insured check

Exlusions

An applicant for property insurance owns a building in which combustive materials are stored in the furnace room. From an underwriting standpoint, this risk would likely be considered a

Morale Hazard

Which statement best describes agreement as it relates to insurance contract

One party accepts the exact terms of the other partys offer

Which provision defines how the policy will respond if there other valid insurance written on the same risk?

Other Insurance

Which type of damages is intended as a form of punishment for negligent, willful, or outrageous intent.

Punitive

Which of the following terms means termination of an insurance policy at its expiration date by not offering a policy continuation or replacement?

Nonrewal

The declarations sections in a homeowners policy provides all of the following information except

Policy exclusions

An insured has a personal umbrella with a $2,000 self-insured retention (SIR). Assuming no other policy is involved, how much would the umbrella pay after a $12,000 personal injury liability claim?

$10,000

Which of the following is covered by auto other-than-collision (Comprehensive coverage).

Electric equipment required for the normal operation of the car

Policy limits are the maximum amount of an insured may collect, or for which an insured is protected under the terms of the

Policy

An applicant for a disability insurance policy has a heart condition of which they are unaware and therefore they answer to the question pertaining to hear problems on their application.

Representation

An insured was having a new home built/ While digging the footings for the foundation, the contractor struck a solid rock formation and found that was necessary to blast the formation in order to remove the rocks. The force of the blast broke several windows and some chinaware ina neighbor's home several blocks away. Who pays for this damage?

The Contractor

When does the federal emergency flood insurance program go into effect?

When a community applies for the program

Which type of authority is found in the agent's contract?

Express

Which of following describes an insurers responsibility for payment under a policy, as stated in the common policy?

Limits of liability

An insured is injured while driving his own car. Which of the following coverages will pay for the loss

Part B- Medical Payments

What sublimit in a liability policy sets the maximum amount that will be paid for all claims arising from a single accident

Per Occurence

For an additional premium, the extended coverages written on the basic form dwelling policy would cover which of the following

Riot

Which of the following types of property would be covered under Coverage C-Personal property in a dwelling policy.

Rowboats

the amount of loss the insured is willing to absorb without insurance protection is known as

Self-insured retention

In contrasting stock insurers with mutual insurers which statement is true.

Stock insurers are owned by the shareholders and issue nonparticipating policies.

Homeland housing corp hold a mortgage on a property that John and Carol Thomas purchased. John and Carol have a Homeowners policy with Home protection Insurance which has mortgage clause naming homeland as a loss payee. If John and Carol suffer a fire to their home

The Thomas's and homeland will be considered co-claimants and receive loss reimbursement from home protection insurance

If an insurance policy has the addition coverage provision, how does it affect the policy premium.

There is no additional premium

An insured believes that his insurer is not properly fulfilling its obligations regarding his policy. What section of the policy will give the insured more information about specific duties of the insurer

Conditions

Which would NOT be covered by an insured's uninsured motorist coverage

The insured causes a head-on-collision with the car of an uninsured motorist.

For there to be negligent liability, all of the following must exist EXCEPT

a reasonable expectation that the act may cause injury or damage

An insured was traveling down an icy road and hit a sign causing $1,350 in damage to his own car. If the insured has $250 deductible and already collected $1,500 claim, how much will he collect on this claim

$1,100

When do binders expire?

As soon as the policy is issued

An insurer must be fair in the underwriting and must pay all covered losses of any insured. For the faithful execution of these duties as insurer has the right to

Accept the payment of premiums for all policies currently in force

The transfer of legal right or interest in an insurance policy is called

Assignment

You are at fault in an auto wreck out of state. How does your company adjust?

At least to the minimum required by that state

As insured was judged at fault in an automobile accident. He has the 100/300 bodily injury liability coverage. Three other individuals were injured in the vehicle hit by the insured. They were awarded damages of $150,000. $75,000 and $75,000. What amount. if any, was not covered by his insurance

$50,000

Other than perils the difference in the three DP forms is coverage provided. Which of the following coverage options is covered by the DP-2 and DP-3 but not DP-1

Coverage E- Additional Living Expense

Under Coverage B- Other Structures, a homeowners policy provides coverage for other structures on the residence premises. Which of the following statements is NOT true of this coverage

Any loss paid under coverage B reduces the Coverage A limit of liability

When Jane and her insurer could not agree on the amount of liability loss after her accident, the settlement was submitted to someone whose decision was then binding both parties. What condition did Jane use?

Abritration

Which of the following exclusions would specifically fall under Coverage E

Contract Liability

How does insurance distribute the financial consequences of individual losses?

It transfers the risk to all persons insured

An insured has an automobile policy with the limits of 100/300/50 and a deductible of $1,000. He is involved in an auto accident and crashes into another diver's auto. The other driver is awarder $125,00 for his injuries and $25,000 for the damage to his car. The insured's vehicle has damage in the amount of $1,200. The total payment made under the insured's polocy is

$125,200

Which of the following elements best describes insurance written in support of public policy?

Legal Purpose

A golfer slices a tee shot and the ball goes through the window of a house beside the fairway. The broken glass is paid for by

The golfer's homeowners liability coverage