Insurance 3

Once it has been reasonably proven that a person has knowingly violated the Insurance Code regarding unfair methods of competition, the Department may impose a civil penalty of

$5,000 for each violation.

For how long after the death of the named insured must basic property insurance continue coverage?

180 days

If an insurer terminates a producer's appointment, the Commissioner must be notified within how many days?

30

Jean owns a craft store. The protective safeguards endorsement of her BOP requires the store to have a functional automatic sprinkler system. A winter storm freezes the pipes to the sprinkler system, causing the system to shut down. How many hours does Jean have to restore the system before she must notify her insurer?

48 hours

Under Coverage C of a homeowners policy, the amount of insurance provided to cover personal property of the insured is

50% of the amount provided as Coverage A.

According to the Insured Duties after a Loss provision in homeowners policies, if the insurer requires a signed, sworn proof of loss, the insured must provide within how many days?

60 days

A contract for the transport of goods between the shipper and the carrier is called

A bill of lading

Which of the following would NOT be classified as personal property for insurance purposes?

A house

Which of the following statements is INCORRECT?

A licensee is barred from charging a fee in addition to a commission to a person for the sale, solicitation or negotiation of a contract of insurance for commercial business.

Which of the following would be required to be licensed as an insurance producer?

A salaried employee who advertises and solicits insurance

Cargo is damaged short of its destination. An agent of the insurer at an immediate port sells the damaged cargo at the best price. Settlement is based on the difference between insured value and the net sales proceeds. This is considered

A salvage loss.

What is a material misrepresentation?

A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company

Under a businessowners policy, an insured can cancel the policy

At any time by mailing a written notice of cancellation.

For how long must a company maintain a complete file of all advertisements used?

At least 4 years

If an insurer makes a change to broaden coverage in a dwelling policy while it is in effect, the changes will apply

Automatically.

An employee is injured while visiting the employer's out-of-state site. How will the workers compensation benefits be determined?

Benefits will be provided if the state was listed on the policy information page.

To legally transact insurance in this state, an insurer must obtain which of the following?

Certificate of Authority

All of the following are classes of inland marine risks EXCEPT

Common carrier cargo liability.

Which of the following is a statutory defense?

Comparative negligence

Workers compensation laws provide all of the following types of benefits EXCEPT

Compensatory benefits.

The part of the policy that sets forth the rules of conduct, duties, and obligations of the parties is called the

Conditions.

Which of the following statements is true concerning Underinsured Motorists Coverage under a Personal Auto Policy in Pennsylvania?

Coverage applies as excess to the bodily injury limits carried by the operator of the other vehicle.

Which of the following is a mandatory part of an insurance policy that varies with each individual policy?

Declarations

Which of the following special liability coverages will provide protection to managers of a corporation for claims arising from a wrongful act committed by the manager while in an official capacity?

Directors and officers liability

The provision in Pennsylvania workers compensation that requires an employer to pay compensation, without regard to negligence, according to a compensation schedule set by law, and for the injured employee to agree to limit the employer's responsibility to the amount of workers compensation to which he or she is entitled, is called

Exclusive remedy.

What method of premium computation relates an employer's losses, payroll, and premiums to the rating bureau's classifications of operations?

Experience modification factor

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

Hill & Morton Funeral Home

The policy conditions define

How parties to the contract must act following a loss.

Which of the following endorsements is used by individual business owners who use company vehicles for personal use rather than purchasing a personal vehicle?

Individual named insured

The Pennsylvania Property and Casualty Insurance Guaranty Association provides protection to insureds in the event of

Insurance company insolvency.

A basic dwelling policy automatically provides coverage against fire, lightning, and

Internal explosion.

Which of the following is true regarding the fire department service charge under the builders risk form?

It is an additional coverage.

If an employer in a state with elective workers compensation laws chooses not to be subject to those laws, what does the employer lose?

Its common law defenses against liability suits

What type of property would NOT be covered under the dwelling policy special form Coverage A - Dwelling?

Land on which the dwelling is located

Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report

Must be informed of the source of the report.

The transit clause does which of the following?

Names the points of the voyage

A property insurance policy that insures a commercial building on a replacement cost basis includes the ordinance or law coverage endorsement. This endorsement will cover all of the following expenses EXCEPT

Ordinance with which the insured was required to comply prior to the loss.

Which of the following licensees is classified as a representative of the insurance company and not allowed to represent an insured or claimant?

Producer

Under the personal auto policy, liability for bodily injury resulting from the insured's use of a nonowned automobile is

Provided by the insured's policy on an excess basis.

If a court ordered payment for a loss that was not covered in the policy even if it was clearly worded, it would be an example of which legal concept?

Reasonable expectations

Which of the following is NOT considered a residual market?

State Property and Casualty Guaranty Association

The policy provision found in property insurance policies that prevents the insured from collecting twice for the same loss is called

Subrogation.

Which of the following symbols is available to an insured with vehicles subject to no-fault coverage?

Symbol 5

Which of the following protects consumers against the circulation of inaccurate or obsolete personal or financial information?

The Fair Credit Reporting Act

Which of the following entities established the Do-Not-Call Registry?

The Federal Trade Commission

Which of the following would determine minimum and maximum limits for FAIR plan rates?

The State

According to the privacy of consumer financial information regulation, if a consumer decides to opt out, this means

The consumer directs the licensee not to disclose the consumer's nonpublic personal financial information to a third party.

Under the "limited tort insurance" option, an insured may not seek recovery for pain and suffering or other nonmonetary damages UNLESS

The injuries fall within the definition of "serious injury."

The medical payments coverage in a personal auto policy will pay reasonable medical expenses for all of the following EXCEPT

The insured is injured while exiting a friend's mobile home.

An insured relocated to another state for work. However, she still owns and insures a house in this state, but has had no one living in it for 3 months. She is also storing some furniture and clothes in the house. From an insurance standpoint, the insured's house is considered

Unoccupied.

The cost of restoring farm records is an additional coverage offered under a farm policy. How much will the policy pay to restore the records?

Up to $2,000

All of the following are essential elements of a commercial package policy (CPP) EXCEPT

Valuations and/or settlement provisions

Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract?

Warranty

What endorsement may be added to a homeowners policy to protect against property damage caused by the overflow of a sump pump?

Water back up and sump discharge or overflow

A commercial package policy (CPP) allows the insured to select the coverage needed and customize the policy to meet the needs of the insured's business. In a CPP, the business owner may select from all of the following types of coverage EXCEPT

Workers compensation coverage