Insurance 3

Within how many years of a loss may an insured bring a lawsuit against an insurer, according to the dwelling policy?

2 years

What is a binder?

A temporary contract of insurance issued by the insurer that places insurance in effect prior to the policy being issued

An individual was just caught acting as an exclusive general agent - even though he is not properly licensed. Assuming that this occurred in a single day, what is the maximum penalty he faces?

A third-degree misdemeanor and a $1,000 fine

What are common carriers required to issue to every shipper that it transports goods for?

A uniform bill of lading

In a personal auto policy, the medical payments coverage is similar to

Accident insurance, because it pays medical expenses regardless of fault.

What documentation grants express authority to an agent?

Agent's contract with the principal

Which of the following authorities is authorized to issue a temporary insurance producer's license?

Commissioner

Because an insured owns a lot of expensive jewelry, her insurance agent has advised her to purchase a scheduled personal property endorsement. If the insured adds this endorsement to her homeowners policy, which of the following statements would be correct?

Coverage C limits will no longer apply to the jewelry insured by the endorsement.

In a farm policy, which of the following coverages would reimburse the insured for loss of rental income following damage to the insured dwelling by an insured peril?

Coverage D

Which of the following would provide coverage for loss of income when an insured rental dwelling is rendered uninhabitable because of a covered loss?

Coverage D

Farm fences (except field and pasture fences) are covered by which farm coverage form?

Coverage G

Which of the following would be covered under a business liability insurance policy?

Damage to a watercraft while on shore at the insured's premises

If an insurer appoints a producer, which authority must be notified?

Department of Insurance

In addition to the common policy conditions, all of the following conditions apply to liability coverage EXCEPT

Employers liability.

All of the following violations may result in an agent's imprisonment EXCEPT

Failing to report to the department a criminal prosecution taken against the agent in another jurisdiction.

All of the following are exclusions that apply in all three types of Dwelling Policies EXCEPT

Fire or lightning

The major portion of the premium for an equipment breakdown policy pays

For inspections and examinations.

Events or conditions that increase the chances of an insured loss occurring are referred to as

Hazards.

What provision in a property policy applies when the insurer broadens coverage but does not increase the premium?

Liberalization clause

When an insurer cancels an auto policy for an allowable reason, they must give notice to the named insured of possible eligibility for coverage through the Pennsylvania Auto Insurance Plan, unless the reason for cancellation is

Nonpayment of premium.

If a person is using an auto with the belief that he is entitled to do so, subrogation rights under a personal auto policy would apply to all coverages EXCEPT

Physical damage.

What are the two types of compensatory damages?

Special and general

In a farm policy, any cost incurred by the insurer for the investigation or defense of a claim will be paid by

The insurer.

Under the business auto coverage form, mobile equipment is covered for liability insurance

When being carried or towed by a covered auto.

The insured with a claims-made commercial general liability (CGL) policy may request in writing claim and occurrence information from the insurer at any time up to 60 days after the policy period ends. The insurer must provide the information

Within 45 days.

What is the civil penalty for violating a cease and desist order of the Commissioner?

$10,000

What is the maximum amount an insurer will pay under the equipment dealers pollution cleanup and removal extension of an inland marine policy?

$10,000 for all expenses incurred during a 12-month period

Licensees must make a report of any action taken against them in another jurisdiction or by another governmental agency in Pennsylvania within how many days of the final disposition of the matter?

30

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 licensed producer moving to Pennsylvania may become licensed as a resident if the producer submits a completed application within how many days of establishing residence in Pennsylvania with proof of licensing from their prior home state?

90

The personal injury liability endorsement to an HO policy applies to all the following EXCEPT

A third party breaks a leg when the insured knocks him down.

If an insurance company makes a statement that its policies are guaranteed by the existence of the Insurance Guaranty Association, that would be considered

An unfair trade practice.

Which of the following is NOT covered under accounts receivable coverage form?

Any loans required to offset uncollectible amounts

In equipment breakdown coverage, all accidents would be considered a single accident if they occur

At a single location at the same time and from the same cause

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

Persons covered under an insurance policy, whether named or not, are known as the

Insureds.

The part of the insurance contract that describes the covered perils and the nature of coverage of the contractual agreement between the insurer and the insured is called the

Insuring agreement.

Crews of ships are covered by the

Jones Act.

What type of coverage does a homeowners policy include that a dwelling policy does not?

Liability

An insured is driving her automobile and strikes a large pothole that causes a flat tire. Which coverage of the insured's personal auto policy will pay for the repair?

Loss is not covered.

In which type of commercial crime policy coverage is triggered by a loss that happens during the policy period but is not necessarily discovered during the policy period?

Loss sustained form

To comply with requirements for insurance for public liability under the Motor Carrier Act of 1980, which endorsement is added to motor carrier coverage form?

MCS-90

Which of the following events causing financial loss to an insured would not be covered under Federal Crop Insurance?

Market price decline

A business uses its own trucks to deliver their own products to the customer. Which commercial auto coverage form should the business buy to insure the trucks?

Motor carrier coverage

On a participating insurance policy issued by a mutual insurance company, dividends paid to policyholders are

Not taxable since the IRS treats them as a return of a portion of the premium paid.

When would UM coverage apply?

Only when the other party is legally liable but has no insurance

Which coverage would a business owner need in a crime policy to cover money that may be stolen from a messenger?

Outside the premises

In a watercraft policy, which coverage part will respond to a claim for damages for bodily injury or property damage for which the insured becomes legally liable because of a watercraft accident?

Part A

Which of the following limits, shown in the declarations of a policy, applies to medical expenses?

Per person

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

The SIR

An insurance agency could purchase an errors and omission insurance policy which would provide protection in the event of any of the following events EXCEPT

The agency loses commission income from policies that were not issued by the insurer.

Which of the following statements is true regarding the commercial general liability policy's Coverage C - Medical Payments?

The coverage is considered good will because payments are made without regard to fault.

In comparison to consumer reports, which of the following describes a unique characteristic of investigative consumer reports?

The customer's associates, friends, and neighbors provide the report's data.

All of the following conditions must exist for injury or damage to be included in the products and completed operations hazard of a commercial general liability policy EXCEPT

The injury or damage must occur within 90 days after the insured's work is completed.

According to the first-party benefits provision, which of the following would NOT be covered for injuries in an auto accident?

The vehicle owner who does not have proof of financial responsibility

An insurance company receives an application with some information missing and issues the policy anyway. What is this called?

Waiver