Exam Fx-Property and Casualty Exam

The businessowners policy (BOP) extension coverage for personal property off premises is limited to

$10,000

A liability policy has spilt limits of 25/50/30. Which of the following indicates the maximum amount payable for damage to a person's property?

$30,000

The businessowners liability coverage form will cover medical expenses incurred and reported within how many years of the accident date?

1 year

Within the first 60 days of coverage under the dwelling policy form, how much notice is required for policy cancellation?

10 days

In the split limit coverage in personal auto policies, which limit indicated the maximum amount the policy will pay for bodily injury per person?

1st limit

What is the maximum number of boarders per unit that would be allowed the homeowners policy?

2

What is the maximum number of roomers or boarders for properties insured under the dwelling policy?

5

To be eligible for businessowners policy (BOP) coverage, an office building CANNOT be higher than

6 stories

According to the loss payment condition in HO policies, losses must be paid within how many days of the insurer receiving proof of loss?

6o days

Which commercial property form is used to insure buildings while under construction?

Builders risk

Which of the following is the Fair Rental Value coverage in the dwelling policy?

Coverage D

Which of the following dwelling coverage forms would pay replacement cost for the dwelling?

DP-2 and DP-3

Elaborate homes with replacement costs greater than ACV or market value are insured on the

HO-8 Form

Which of the following businesses would be eligible for a businessowners policy?

Hill & Morton Funeral Home

When would a misrepresentation on the insurance application be considered fraud?

If it is intentional and material

Fair Rental Value coverage in the dwelling policy is similar to which homeowners policy form?

Loss of use

Coverage A- Bodily Injury and Property Damage in the commercial general liability policy will cover

Losses due to the insured's negligence

An insured is injured while driving his own car. Which personal auto coverage will pay for the loss?

Part B-Medical Payments

In a personal auto policy, which of the following describes coverage for uninsured motorist?

Part C

What type of coverage is Coverage E in homeowners policies?

Personal Liability

What is the deductible of a personal liability umbrella policy called?

SIR

According to the BOP definitions, which of the following does NOT mean valuable papers and records?

Securities

Which of the following is NOT a duty of the Department of Insurance?

Setting premium rates

Which of the following would NOT be considered a flood?

Sewer backup

Peril is most easily defined as

The cause of loss insured against

What is the purpose of NFIP?

The fill the coverage gap in flood coverage

A specific coverage part is listed on the commercial package policy declarations page, but there is no premium shown. What does that mean?

There is no coverage

When a vehicle travels from one state to another, what happens to the limits of policy liability in a personal auto policy?

They do not change

What is the main distinction between a hired auto and a nonowned auto?

Who owns the auto

Business personal property coverage insures property out in the open if it is

Within 100 feet of the described premises

Which of the following persons would be required to hold a producer license?

a nonresident agent who negotiates insurance contracts

A businessowners policy is

a self-contained prepackaged policy

Which of the following coverages is NOT included in the DP-1 form?

additional living expense

What type of license represents the insurance company?

agent

Who is considered a nonresident agent?

an agent who is licensed in another state, but is allowed to transact insurance in this state

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

an assignment

Dwelling policy Coverage C- Personal Property will cover all of the following EXCEPT

animals and birds

In property insurance, insurable interest in the property covered in a policy must be proven

at time of loss

If an insurer has an umbrella liability policy in addition to his personal auto policy, which would be considered the underlying policy?

auto policy

Business personal property coverage form covers all of the following except:

automobiles held for sale

Which of the following is NOT one of the Other Coverages available with the personal liability supplement?

bankruptcy

Which commercial property form is used to insure buildings while under construction?

builders risk

To be considered an insurable risk, a loss may NOT be

catastrophic

A policy that provides coverage for an injury or damage only if it is first reported during the policy period is called

claims-made form

Which of the following is NOT a primary property coverage in homeowners policy?

collapse

In which of the following sections of a commercial auto policy will the insured find specific information about the policy period?

conditions

Representations are statements made by the applicant for insurance that are

considered true to the best of the applicant's knowledge

An insurance agent sold an insurance policy to his spouse. What type of transaction is this?

controlled business

in dwelling policies, automatic increase in insurance is

coverage by endorsement

The designation symbols used in commercial auto policies can be found in which policy section?

covered auto

An insurer deliberately makes a maliciously critical statement about another insurer is guilty of an unfair trade practice called

defamation

Which of the following information will be found in the Declarations page of the commercial property policy?

description of the policy insured

All else being equal, which of the following will NOT be considered unfair discrimination by insurers?

discriminating in policy benefits based on the insurer's habits and lifestyle

Professional liability coverage protects the insured against legal liability resulting from

errors and omissions

Negligence may be defined as

failure to use reasonable and prudent care

When doing business in this state an insurance company that is formed under the laws of another state is classified as what type of insurer?

foreign

Events or conditions that increase the chances of an insured loss occurring are called?

hazards

An insured has purchased a used car. When does collision coverage for this car begin?

immediately

An additional loss that results from a direct loss of property is called an

indirect loss

When agents are acting within the scope of their contract, their actions will be assumed to be those of the

insurer

Which of the following information will NOT be found in the common policy declarations of a commercial package policy?

insuring agreement

Which of the following additional perils is covered under both of the Basic and Broad forms in dwelling policies?

internal explosion

All of the following are major coverages included in the homeowners policy except

loss of income

All of the following coverages are included in the businessowners form without requesting coverage extensions except

newly acquired property

Which of the following is the oldest known type of insurance?

ocean marine

How is the premium paid for the businessowners policy?

one indivisible premium

An insurance policy that covers all risks of loss that are not specifically excluded is an

open peril policy

For which of the following will a BOP property coverage form pay?

outdoor signs attached to the building

All of the following actions by a producer may be grounds for license revocation or non-renewal EXCEPT

participating in controlled business

A bond is written for a set limit, and the surety will be liable only for this amount. This limit is known as the

penalty

What type of bond guarantees that the principal will complete the contract as agreed upon?

performance bond

A runaway shopping cart injures a customer in a supermarket's parking lot. Coverage for this claim would be provided under

premises and operations

Section I of a Businessowners policy pertains to what type of coverage?

property

An agent offers his client free tickets to a sporting event in exchange for the purchase of an insurance policy. The agent is guilty of

rebating

Which of the following is used in the formula for calculating the actual cash value (ACV) of a property?

replacement cost

Which policy in HO policies states that insurance applies seperately to each insured?

sever-ability of insurance

What are the 2 types of compensatory damages?

special and general

Items of property that would be difficult to appraise after a loss are best insured with

stated-amount insurance

Who is covered by an HO-4 policy?

tenants

Which of the following is NOT consideration in an insurance policy?

the application given to a perspective insured

In insurance, an offer is usually made when

the application is submitted

For the purposes of insurance, risk is defined as

the chance of loss

The occurrence form trigger is based on which of the following?

the date when the lose occurs

The contents coverage on a homeowners policy would pay how much after the loss of one of a pair of golden candlesticks?

the difference in the actual cash value as a pair and as a single

In personal auto policies, the term "you" refers to

the named insured

Under a workers compensation policy, premiums will be determined when

the policy period ends

What is the main purpose of insurance regulation?

to protect the general public

Supplementary payments under the personal auto policy include all of the following EXCEPT?

unlimited cost of bail bonds

An insured building has had no residents for 10 years and it is empty of personal belongings. From an insurance standpoint, the building is

vacant

Which of the following perils would not be covered by the dwelling policy if the dwelling has been vacant for over 60 days?

vandalism