insurance practice questions
which of the following licensees is classified as a representative of the insurance company and not allowed to represent an insured or claimant
producer
in insurance terms what are components
the actors that determine rates
under which of the following circumstances would an insurer be allowed to cancel a dwelling policy midterm
the insured knowingly lied about the year the property was constructed
If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered to be
authrorized
an insurance contract must contain all of the following to be considered legally binding EXCEPT
beneficiary's consent
Under the HO-4 and HO-6 homeowners policy forms, property is insured against
broad form perils
the liability coverage of the business owners policy is written on a
business owners liability coverage form
homeowners policies provide coverage for
business property while on the residence premises
which of the following is an additional coverage that is covered by the broad causes of loss form
collapse
which statement regarding insurable risk is not correct
insureds cannot be randomly selected
Which inland marine coverage condition says that an insurer will settle with the actual owners of property involved in a loss?
privilege to adjust with the owner
the Limited Fungi, wet or dry rot, or bacteria coverage endorsement applies to which type of losses
property and liability
limited fungi, wet or dry rot, or bacteria endorsement in HO policies applies to
property and liability losses
While an insured was towing a utility trailer with his auto, the trailer came loose and ran into a store front. What part of the insured's auto policy would pay for the damage to the store?
property damage liability
Who would participate in a Write Your Own (WYO) flood insurance program?
private insurers that wish to write and service National Flood Insurance policies on a no risk-bearing basis
according to the loss payment condition in HO policies, losses must be paid within how many days of the insurer receiving proof of loss
60 days
Ocean marine policies commonly refer to the person covered by the policy as the
assured`
for how long must a company maintain a complete file of all advertisements used
at least 4 years
insurable interest in a property policy must be proven
at the lime of loss
under the personal auto policy, liability for bodily injury resulting from the insured's use of a non owned automobile is
provided by the insured's policy on an excess basis
All of the following are considered parts of the policy structure EXCEPT
provisions
all of the following are considered parts of the policy structure except
provisions
All of the following are regarding rebates EXCEPT
rebates are allowed if it's in the best interest of the client
all of the following are true regarding rebates EXCEPT
rebates are allowed if it's in the best interest of the client
what type of information would be found in a policy's insuring agreement
renewal dates
which method of loss valuation is contrary to the basic concept of indemnity
replacement cost
In property insurance, actual cash value is defined as which of the following?
replacement cost at the time of the loss, less depreciation
a business owner whose inventory changes significantly throughout the year should consider having coverage written on what type of form
reporting form
adverse selection is a concept best described as
risks with higher probability of loss seeking insurance more often than other risks
If the insured owns a watch valued at $10,000, full coverage can be provided on a homeowners policy by purchasing the
scheduled personal property endoresment
If the insured owns a watch valued at $10,000 full coverage can be provided on a home owners policy by purchasing the
scheduled personal property endorsement
in a farm policy, any cost incurred by the insurer for the investigation or defense of a claim will be paid by
the insurer
if more than one person has an insurable interest in the property covered under a dwelling policy
the insurer will be liable for only the insured's interest in the damage property
a licensee serving in the military is unable to fulfill her continuing education requirement. What would the licensee have to do to renew the license
the licensee may submit a request to the department to have requirements and fees waived. The department will then determine if the request is permissible
the members of a limited liability company are insureds under a business owners policy (BOP) if
the limited liability company is designated as the name insured
on a DP-3 dwelling property special form policy, the coverage provided for personal property is
the same as provided on the DP-2 Broad form
which of the following would determine minimum and maximum limits for FAIR plan rates
the state
all of the following are perils covered under the broad form dwelling policy except
theft
all of the following are other coverages included in both the broad and special form dwelling policy EXCEPT
theft of personal property
when an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following
consideration
which of the following reports will provide the underwriter with the information about an insurance applicant's credit
consumer report
the designation symbols used in commercial auto policies can be found in which policy section
covered auto
under the examinations of books and records condition, the insurance company has the right to examine and audit the insured's books and records related to the policy
during the policy period and for up to 3 years after the termination of the policy
the section of an insurance policy that details what perils are not insured against and what persons are not insured is known as the
exclusions
a house insured under a dwelling policy has been vacant for 70 consecutive days. Which of the following statements is true
loss by vandalism and malicious mischief is excluded
an insured is driving her automobile and strike 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
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
a $100,000 house insured on a policy with an 80% coinsurance requirement has a fire that cause $40,000 of damage; the owner has a policy with $60,000 coverage. How much can the owner collect for his loss
$30,000
a grave marker was damaged by vandals. it would cost $3,000 to have the damage repaired. under these circumstances, how much would a homeowners policy pay
$3000
A common exclusion found under physical damage to your auto includes
mechanical breakdown
a common exclusion found under physical damage to your auto includes
mechanical breakdown
on its advertisement, a company claims that it has funds in its possession that are, in fact, not available for the payment of losses or claims. the company is guilty of
misrepresentation
an insured's business is damaged because of a fire, and he is forced to close the business temporarily for repairs. As a result, the insured lost income. What type of loss is this?
consequential
the difference in the contents coverage on an HO-3 and HO-5 is which of the following
contents are covered open peril on HO-5, and named peril on HO-3
which of the following would NOT be considered an unfair and deceptive practice
controlled business
because an insured owns a lot of expensive jewelry, her insurance agent has advised her purchase a scheduled personal property endorsement. If the insured adds this endorsement to her homeowners policy, which of the following 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 damages to the insured dwelling by an insured peril
coverage D
with regards to a homeowners policy, which coverage provides for indirect or consequential losses
coverage D
in dwelling policies, automatic increase in insurance is
coverage by endorsement
which of the following is a unit of measurement an underwriter uses when determining the premium rates for insurance
exposure
which of the following is an example of an unfair claims settlement practice
failure to promptly settled a claim when liability has been clearly established
an insurance company has published a brochure that inaccurately portrays the advantages of a particular insurance policy. what is an examply of
false advertising
if an insurer changes a form that it uses to transact insurance, it must do which of the following
file the form with the Commissioner for approval
which of the following claims would be included under the dwelling policy
fire damage to the insured's stored in the attached garage
which of the following will be covered by aviation hull insurance
fuselage and wings In aviation insurance, hull refers to the fuselage, wings, tail, rudders, and other major structural features of an aircraft. The hull policy covers the airplane and its parts
what type of compensatory damages will pay for pain and suffering disfigurement
general
Events or conditions that increase the chances of an insured loss occurring are referred to as
hazards
the Pennsylvania Property and Casualty Insurance Guaranty Association provides protection to insureds in the event of
insurance company insolvency
a deliberate act that causes harm to another person, regardless of whether the harm is intended is called a
intentional tort
which of the following would NOT be covered by HO liability insurance
intentional tort
which of the following does a producer not have the authority to do
issue policies
all of the following statements describe the concept of strict liability EXCEPT
it is imposed on defendants engaged in hazardous activities
in a dwelling policy, which of the following is true regarding personal liability coverage
it must be added as a supplement or written as a separate policy
all of the following are true of coverage B- other structure except
it must be added by endorsement to a homeowners policy
extended non owned coverage endorsement in a PAP broadens which of the following coverages
liability and medical payments
extended nonowned coverage endorsement in a PAP broadens which of the following coverages
liability and medical payments
which of the following policy provisions would automatically broaden coverage under a policy without requiring additional premium
liberalization
what provision in a property policy applies when the insurer broadens coverage but does not increase the premium
liberalization clause
Under the dwelling policy, Coverage C - Personal Property is
limited to covering a servant's property while at the insured location
the regular National Flood Insurance Program would insure an eligible single-family dwelling for up to
$250,000
Equipment breakdown coverages is written with a single limit of insurance per accident. What is the sublimit for hazardous substance cleanup or repair or replacement of contaminated property
$25000
a premium discount is the term that describes when an insured owes a total standard premium greater than
$5,000
under the commercial crime coverage inside the premises- robbery or safe burglary of other property, what is the special per occurrence limit that applies to loss or damage to precious metals, precious and semiprecious stones, pearls, furs, manuscripts, drawings, or records
$5,000
when a producer holding a certificate or a broker's license has a change in his/ her residence or business address, he/ she must notify the department of insurance and any company for which the producer holds an appointment within
30 days
if a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply
5 days
Under workers compensation, the employer or insurance company must designate how many health care providers from which an injured employee may seek care
6
the 1980 Act requires FCIC to offer one price election that is not less than what percent of the projected market price for the commodity
90%
which inland marine form would provide the best protection for a dry cleaning company against loss or damage to their customer's property while in the care, custody, and control of the dry cleaners
Bailees customer policy
which of the following statement regarding coverage for the flood and earthquake perils is true
Both flood and earthquake are excluded perils in all property policies
which of the following is eligible for a business owners policy
a 6-story office building with less than 100,000 square feet total area
a contract for the transport of goods between the shipper and the carrier is called
a bill of lading
a tornado that destroys property would be an example of which of the following
a peril
which of the following statements is true regarding the premium computation for workers compensation insurance
a premium auditor has the right to examine the insured's compensation records at the end of the policy period to determine the actual premium basis
when other insurance is written on the same basis as a commercial property policy, the obligation of the insurer is to cover
a share of the loss
a unique feature in a bailee form is that it covers
customers property whether or not the insured has been negligent
what term includes damage where the insured peril was the proximate cause of loss
direct loss
which commercial crime form would provide coverage for a loss that did not necessarily happen during the policy period but was revealed during the policy period
discovery form
According to the appraisal condition of a homeowners policy, what procedure may be followed if the insurer and insured do not agree as to the size of a loss?
either party may make a written request for an appraisal
duties of the insurer found in property policy conditions include all of the following EXCEPT
notify the insured in the event of financial difficulty
a producer has become disabled. In order to keep his business going, what may his designee do
obtain a temporary license
ABC Insurance Company wishes to begin transacting business in Pennsylvania. Before it can do so, it must do which of the following
obtain certificate of authority
in order for a Protection and Indemnity policy to cover a loss which of the following must be TRUE
the insured must be legally liable for the loss
what will happen if a house covered by a standard mortgage clause is a total loss
the insurer pays the mortgagee according to the mortgagees interest in the property
if more than one person has an insurable interest in the property covered under a dwelling policy
the insurer will be liable for only the insured's interest in the damaged property
the most the insurer will pay for a loss under a business owners policy is
the limit of insurance after the deductible is paid
the individual named insured endorsement under a commercial auto policy provides coverage for which of the following
the sole proprietor of the business and his or her family members
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
the declarations page of the homeowners policy provides all of the following information EXCEPT
a statement that the earthquake damage is not covered
for the purpose of insurance, an owner-occupied residential dwelling is
a structure of not more than 4 units, one of which is occupied by the owner
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
insurers are required to keep records. When may the Department examine these records
at any time
a producers license must be renewed
biennially - every 2 years
a professional who wants coverage for all liability exposures should purchase what form of liability insurance
commercial general and professional
a producer who fails to segregate premium monies from his own personal funds is guilty of
commingling
which of the following authorities is authorized to issue a temporary insurance producer's license
commisioner
the insurance code identifies all of these as prohibited acts that can cause suspension, revocation or denial of an insurance producer license for a licensee or applicant, with the exception of
commission of any misdemeanor
what terms best describes the act of withholding material information that would be crucial to an underwriting decision
concealment
in which of the following sections of a commercial auto policy will you find specific information about the policy period
conditions
the requirement that agents not commingle insurance monies with their own funds is known as
fiduciary responsibility
with regard to fire insurance premiums, structures with which of the following type of construction would most likely have the most favorable premium rate for the peril of fire
fire resistive
which of the following would be named on the declarations page of a property or a liability policy
first name insured
in farm insurance, Coverage I- Personal and Advertising injury liability for suits alleging personal injury is most similar to the coverage found in which coverage form
general liability
which coverage would a business owner need in a crime policy to cover money that may be stolen from a messengar
outside the premises
an insured has a liability policy that sets the amount for all claims that arise from a single incident at $50,000. which type of limit of liability does this insured's policy have
per occurrence
a customer was injured in a supermarket parking lot when a grocery cart collided with the customers leg. coverage for this claim would be provided under
premises and operations
the policy conditions define
how parties to the contract must act following a loss
in liability insurance policies, supplementary payments are made
in addition to the limit of liability
a basic dwelling policy automatically provides coverage against fire, lightning, and
internal explosion
when is a hired and non owned auto liability endorsement available in business owners policy (BOP)
only if the insured does not have commercial auto coverage
what method of premium computation relates an employers losses, payroll, and premiums to the rating bureau's classifications of operations
experience modification factor
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 crime coverage form is used to cover securities held in trust by another party as collateral for some obligation
coverage J- securities deposited with others
Another person has alleged that you are responsible for damage to their property. You notify your homeowners insurer. The insurer will
either pay or defend as it decides
What is the purpose of the coinsurance clause found in property insurance policies
encourage the insured to insure the property closer to its full value
a producer sold an insurance policy. Subsequently, his license was suspended. In this case, how much of the commission will the producer recieve
all
the insured with a homeowners policy has had damage to his property caused by a volcano. Which of the following is true
all volcanic eruptions within a 72- hour period will be considered one occurrence
the inspections and surveys condition in a business owners policy
allows the insurer the right to inspect the insured's premises
in insurance, an offer is usually made when
an applicants submits an application to the insurer
in order to reject uninsured motorist coverage, the first named insured must make the rejection
in writing at the time of application
the Pennsylvania Property and Casualty Insurance Guaranty Association provides protection to insureds in event of
insurance company insolvency
which of the following would be covered under the Broad Form (DP-2) policy's falling object
interior building damage if the exterior was damaged first
for the reported losses of an insured group to become more likely to equal the statistical probability of loss for that particular class, the insured group must become
larger
the transfer of an insured's right to seek damages from a negligent parry to the insurer is found in which of the following clauses
subrogation
an insured suffers a windstorm loss in which the insured's driveway is blocked by two of the insured's trees and two of the neighbor's trees. The total amount of the removal adds up the following: three trees at $300 per tree, and one tree at $600. How much will the insurer pay for the loss
$1,000
the pollutant cleanup and removal coverage in the business owners policy has a limit of
$10,000 in any 12-month period
A policyholder has an equipment breakdown policy with a $200,000 limit. If a boiler explosion causes $100,000 damage to the boiler itself, $50,000 damage to the insured's buildings, and $30,000 of expediting expenses, how much will the insured collect under the policy
$175,000
which of the following types of valuation works best for property whose value does not fluctuate much
Agreed value
an installation floater is used to insure
Appliances intended to become a permanent part of the building
because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements EXCEPTS
Conditions
in a dwelling policy, which of the following provides coverage for additional living expenses incurred by an owner- occupant in the event of a covered peril makes the premises uninhabitable due to a covered loss
Coverage E
which of these is defined as the maximum limit of coverage available under a liability policy during a policy year, regardless of the number of claims that may be made or the number of accidents that may occur
aggregate limit of liability
which of the following is a mandatory part of an insurance policy that varies with each individual policy
Declarations
FAIR plans are state insurance pools that provide property insurance to high risk areas, such as neighbors that have deteriorated or are in urban decay. What does FAIR stand for
Fair Access to Insurance Requirements
which of the following is the federal body that regulates truckers who travel across state lines
Federal Motor Carrier Safety Administration
An insured condominium unit owner wants to purchase fire and extended coverage for personal property and liability coverage for himself and his family members. He should purchase
Ho-6
an insurer publishes intimidating brochures that portray the insurer's competition as financially and professionally unstable. Which of the following best describes this act
Illegal under any circumstances
which of the following is NOT a contract bond
Litigation Bond:
when a parent is required to pay for damages caused by his or her children, this is an example of
Vicarious liability
professional photographers and musicians may insure the equipment with
a commercial articles floater
An automobile that is owned by a nontraditional household, not consisting of a husband and wife, may be insured under a personal auto policy if
a joint ownership coverage endorsement is added
when an insurance company uses a policy form that has been developed by an organization, such as ISO, what is usually required to be added to the form so that the policy will conform to the state's insurance regulation
a special provisions endorsement
the personal injury liability endorsement to an HO policy applies to all of the following EXCEPT
a third party breaks a leg when the insured knocks him down
what is a certificate of insurance
a written document showing the types and amounts of insurance that haven been issued to the insured
in a personal auto policy, the medical payments coverage is similar to
accident insurance, because it pays medical expenses regardless of fault
what is a reinsurance
an agreement between a ceding insurer an assuming insurer
which coverage form would provide coverage for all incoming and outgoing shipments
annual transits
which of the following describes contributory negligence
any degree of negligence by the insured party may bar recovery
which of the following would be considered an insured under a business auto coverage form
anyone while using, with permission, a covered auto owned by the named insured
because an agent is using stationery with the logo of an insurance company, applicants for insurance assume that the agent is authorized to transact on behalf of that insurer. What type of agent authority does this describe
apparent
which of the following clauses establishes the procedure for determining the amount of a loss when the insurer and the insured cannot agree on the value of property or amount of loss
appraisal clause
which of the following is a statutory defense
comparative negligence
An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. from what type of insurer did the insured purchase the policy?
mutual
an insured who has coverage for all this personal property has his TV stolen from the shop of the repairman. The owner of the repair shop filed a claim under the insured's policy, but it paid nothing to the owner of the store. Which provision does the policy have
no benefit to bailee clause
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
an insured has a liability policy that sets the amount for all claims that arise from a single incident at $50,000. Which type of limit of liability does this insured's policy have
per occurrence
which of the following limits, shown in the declarations of a policy, applies to medical expenses
per person a combined single limit of insurance is applicable for all bodily injury and property damage losses that arise from a single occurrence. Medical expenses are limited to the per person limit shown on the declarations
the insurance consultation services exemption act protects insurers from liability actions resulting from
performing or failing to perform services
which of the following symbols is available to an insured with vehicles subject to no-fault coverage
symbol 5
burglary is defined as
taking of property from within the premises leaving visible signs of forced entry
an example of a producer being involved in an unfair trade practice of rebating
telling a client that his first premium will be waived if he purchases the insurance policy today
an insured's building has an actual cash value of $200,000, and he has insured the property for $120,000 with an 80% coinsurance clause. A $40,000 loss occurs. How much will the policy pay
$30,000
all of the following are special personal property limits under a homeowners policy except
$500 for business personal property on the insured premises
what is the civil penalty for the first violation of the Pennsylvania Insurance Fraud Prevention Act
$5000
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
$5000 for each violation
under business owners policy Section I, if an insurer wants to non renew a policy for nonpayment of premium, how many days before the expiration date must the insurer notify the mortgage holder
10 days
what is the maximum number of boarders per unit that would be allowed in the homeowners policy
2
under the additional living expenses coverage, is a civil authority prohibits the insured from using the dwelling because of direct damage to a neighboring location from a peril covered in the insured's policy, loss would be covered up to
2 weeks
coverage for medical payments under a personal auto policy applies to expenses following a covered accident that are incurred and services rendered within what maximum time period
3 years
an insured with a homeowners policy has removed property from the insured location to protect it from loss that could be caused by a covered peril. the removal coverage applies for
30 days
how long is the waiting period upon purchase of flood coverage through NFIP
30 days
within how many days must a producer respond to an inquiry from the commissioner
30 days
what is the maximum length of time that an employee who is partially disabled can receive a loss of time benefits under Workers Compensation
500 weeks
vandalism and malicious mischief would be covered if the insured's premises have been vacant for no more than how many days
60
assuming the insurer and the insured agree to the amount payable for a loss covered under a dwelling policy, how soon after the insurer has received proof of loss must it make payment
60 days
Coverage under the Builders Risk form will end in all of the following situations EXCEPT a) Construction has been abandoned. b) 60 days after the building became occupied. c) The insured has sold the property. d) 60 days after the construction has ended.
60 days after the construction has ended
the dwelling insured on H0-2, H0-3, or H0-5 forms is covered for replacement, provided that it is insured for at least what percentage of replacement cost on the date of loss
80%
the dwelling insured on a HO-2, HO-3, or HO-5 forms is covered for replacement, provided that it is insured for at least what percentage of replacement cost on the date of loss
80%
an insured owns a building that is valued at $400,000. To comply with an 80% coinsurance provision of his insurance policy, how much should he insure the property for
80% of the property's replacement cost or more
an insured owns a building that is valued at $400,000. To comply with the 80% coinsurance provision of his insurance policy, how much should he insure the property form
80% of the property's replacement cost or more
if a licensed person is moving to Pennsylvania, he or she may become licensed as a resident if they submit a completed application within how many days of establishing residence in Pennsylvania with proof of licensing from their prior home state
90
all of the following situations would be covered under a professional liability policy EXCEPT
The failure of an attorney to properly defend a client due to his personal dislike of the client
Which part of an insurance policy covers claims-related expenses, reasonable expenses incurred by an insured to protect damaged property from further loss, or defense expenses
additional coverage
an insured is driving her car through a residential area when she loses control and crashes into a neighbor's front porch. the neighbor, who was sitting on the porch, is injured. the insured's liability policy has a limit of $500,000. this amount applies to the total of damages for any bodily injury and property damage resulting from one accident. Which type of limit liability does the insured have
combined single
all of the following are classes of inland marine risks except
common carrier cargo liability
a builders risk form is most often written as which of the following
completed value form
Because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements EXCEPT
conditions
additional coverages in the liability section of a homeowners policy cover all of the following except
damage to a third-party property for which the insured is legally liable
the part of a property policy that shows the amount of insurance, premium, and policy term is the
declarations
if an insurer appoints a producer, which authority must be notified
department of insurance
a beauty parlor burns to the ground. What type of loss is this to the owner
direct
all of the following are optional coverages that may be attached to an H0-3 policy EXCEPT
dwelling replacement cost
which of the following is true regarding the Difference in Conditions (DIC) policies
each DIC policy is an individually written contract that contains provisions unique to the particular risk that it covers
The Subsequent Injury Fund was established to
encourage employers to hire workers who had suffered prior compensable injuries
how often must the commissioner examine rating organizations
every 5 years
which of the following is NOT a P&I exclusion
excess coverage
the provision in Pennsylvania workers compensation that requires an employer to pay compensation, without regard to negligence, according to 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 callled
exclusive remedy
under which of the following circumstances can financial institutions share insurance coverage information with third parties, for the purpose of soliciting the purchase of insurance
if a consumer does not sign and return the notice of disclosure within 30 days
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
after a storm dumps several inches of snow, an insured spend several hours clearing his sidewalk and driveway. Later that night it begins to sleet. Before the insured can clear his walks again, his neighbor slips and falls while walking past the insured's house, breaking his arm. Which defense will reduce recovery for the neighbor's injury
intervening cause
which of the following is NOT true regarding a certificate of authority
it it issue to group insurance participants
which of the following statements concerning the builder risk coverage form is correct
it may be written on a reporting form for the completed value of structure
Which of the following is NOT one of the 3 requirements for property to be eligible for FAIR plan coverage
it must be valued at an amount under the maximum value amount set by the state
if an employer in a state with elective workers compensation laws chooses not to subject to those laws, what does the employer lose
its common law defense against liability suits
the form of payment bond that protects an owner contracting for work against liens from subcontractors, suppliers, or laborers who are not paid for their services and materials by the general contract is called
labor and material bond
which of the following lists all the required elements for establishing a charge of negligence
legal duty owed, breach of legal duty owed, proximate cause, damages
which rating method provides an insurer with that portion of a rate that does not include provisions of expenses (other than adjusting expenses) or profit and is based on historical aggregate loss and loss adjustment expenses projected through development to their ultimate value and through trending to a future point in time
loss costs rating
A shipload of cement has bee damaged by water and has become concrete. According to general cargo insurance terms in Ocean Marine policies, this is considered
loss of specie
all of the following are exclusions under farm property coverage EXCEPT
loss of use
which of the following is NOT true concerning the fair rental value coverage provided in a dwelling policy
loss or expenses caused by the cancellation of a lease is covered
The process of determining the premium charged and how much insurance is required for a particular loss is called
loss valuation
the process of determining the premium charged and how much insurance is required for a particular loss is called
loss valuation
what losses are considered when computing individual FMHA emergency loan eligibility
losses on crops which the farmer chose to insure will be considered
An insured's home is mortgaged by the local bank. The insured is required to carry insurance on the home, showing the bank as the mortgagee. If the home is damaged by a covered peril, which of the following is true?
losses will be paid to the mortgagee and mortgagor as their interest appears
rates that are established based on the similarities of the risk with other risks are known as
manual rates
An insured stated on her application for life insurance that she had never had a heart attack, when in fact she had a series of minor heart attacks last year for which she sought medical attention. Which of the following will explain the reason a death benefit claim is denied
material misrepresentation
which of the following homeowners endorsements covers liability exposures arising from an incidental business conducted within a building on the residence premises
permitted incidental occupancies
all of the following are additional liability coverages automatically provided in a homeowners policy EXCEPT
personal injury
who might receive dividends from a mutual insurer
policyholders
all of the following are examples of risk rention except
premiums
what is the term for the entity that an agent represents regarding contractual agreements with third parties
principal
FAIR plans are provided by
private insurers
Which of the following endorsements is used to insure coverage C (personal property) for values beyond the limitations of the homeowners policy
scheduled personal property endorsement
workers compensation statues require employers to meet capital reserves requirement sufficient to pay any claims that might arise. Employers can meet such obligations through all of the following EXCEPT
second injury funds programs
in a personal umbrella policy, the amount paid by the insured for certain losses not covered under the primary coverage is called
self insured retention
which policy condition in H0 policies states that insurance applies separately to each insured
severability of insurance
payment for medical expenses, loss of wages, funeral expenses, or the cost to repair or replace damaged property are known as what type of compensatory damages
special
events in which a person has both the chance of winning or losing are classified as
speculative risk
which of the following insurers are owned by stockholders who have the usual rights of ownership, including the right of voting
stock
which of the following terms describes a reduced or limited amount of coverages, other than the combined single limit, that is available to pay claims resulting from passenger bodily injury
sublimit
the legal process that gives the insurer, after payment of a loss, the right o seek recover from a third party that was responsible for the loss is known as
subrogation
the legal process that gives the insurer, after payment of a loss, the right to seek recovery from a third party that was responsible for the loss is known as
subrogation
an apartment occupants personal property would be insured under which homeowners form
tenant broad form (HO-4)
which of the following may NOT be included in an insurance company's advertisement
that its policies are covered by a state Guaranty Association
the amount an insurer will pay under coverage D (Loss of Use) depends on
the amount of coverage on the dwelling
replacement cost coverage is provided in both the broad and special form dwelling policies when
the amount of insurance on the dwelling is at least 80% of its replacement cost at the time
what is the maximum amount of protection available to insureds under the Pennsylvania Property and Casualty Insurance Guaranty Association
the amount of loss up to the amount of coverage in the original policy, not exceed $300,000 (per claimant)
When a regular bill of lading is issued, who will be responsible for the invoice cost of any damaged property?
the carrier
which of the following entities must approve all continuing education courses in this state
the commissioner
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
the claims- made trigger is based on which of the following
the date the claim is first made in writing against an insured for injury or damage that occurred on or after the policy's retroactive date
the occurrence form trigger is based on which of the following
the date when injury or damage 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
When an umbrella policy is broader than underlying insurance and it pays a loss that is not covered by the underlying policy, it usually only pays
the excess over the self insured retention
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"
Which of the following losses would be covered under the property damage liability coverage of a personal auto policy
the insured damages a rented garage when he failed to stop in time
according to the standard workers compensation and employer liability policy form, a state should be listed in Part Three- other states' insurance of the workers compensation and employers liability policy when
the insured expects to extend operation to that state
the abandonment provision in property insurance policies state that
the insured may not relinquish ownership of damaged property to claim a total loss, but must protect damaged property from further loss
all of the following statements regarding the supplementary payments of a commercial general liability policy EXCEPT,
they pay defense costs even after the aggregate limit has been reached
which of the following statements is NOT true regarding mobile agriculture machinery and equipment coverage
this coverage must be written as part of farm coverage
the business income coverage form covers consequential loss of business income that occurs when a business must suspend operations because of a direct loss. Which of the following terms best describes the nature of this type of coverage
time element
an insured covered under a mobile homeowners policy wants to move the location of the covered mobile home. which of the following must the insured obtain from the insurer
transportation/ permission to move endorsement
In the personal auto policy, owned trailers being towed by an insured auto are automatically covered for
uninsured motorist coverage
Pete wants to have separate insurance coverage for separate acreages. What kind of insurance should Pete get
unit insurance
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
one of the primary benefits to the insured in selecting the "full tort option" under their auto insurance coverage is
unrestricted ability to sue for pain and suffering
all of the following are supplemental payments included in the liability section of a personal auto policy EXCEPT
up to $100 for the cost to secure the release of a vehicle form an impoundment lot following a covered accident
all of the following are supplemental payments included in the liability section of a personal auto policy except
up to $100 for the cost to secure the release of a vehicle from an impoundment lot following a covered accident
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
An insured is a member of the neighborhood association, and has become liable for damage to a third party. Each member of the association has been assessed a portion of the loss equal to $2,000. How much will the Loss Assessment additional coverage of the insured's homeowners liability policy pay?
up to 1,000
which of the following would NOT be considered part of the insured location under the liability section of a homeowners policy
vacant farmland owned by the insured
a type of policy that is used to provide a specific amount of replacement cost for a given risk after an insured property has been destroyed is called a
valued poicy
a type of policy that is used to provide a specific amount of replacement cost for a given risk after an insured property has been destroyed is called a
valued policy
when would uninsured motorist coverage apply
when the other party is legally liable but has no insurance
The bankruptcy provision found in the personal auto policy states that bankruptcy of the insured
will not relieve the insurer of its policy obligations
the bankruptcy provision found in the personal auto policy states that the bankruptcy of the insured
will not relieve the insurer of its policy obligations
how soon after the due date should the insurer pay the agent appointment fees
within 30 days
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
A commercial package policy (CCP) allows the insured to select the coverage needed and customize the policy to meet the needs of the insured's business. in a CCP, the business owner may select from all of the following types of coverage EXCEPT
workers compensation coverage
which of the following would NOT be covered by medical payments to other in Section II of your HO policy
you cut your leg while whacking weeds in your backyard with your neighbor's weed whacker