Insurance study guide part 1

Coverage B of an unendorsed standard BOP policy provides how much coverage for theft of money & securities?

$0

As defined in a Commercial Crime policy, all computer and hand-held or portable devices, software, and networks that allow data to be collected, transmitted, processed, stored or retrieved is known as:

A computer system..

Which of the following losses would be covered under a Commercial Property policy with the special cause of loss form attached?

A fire that breaks out in an office building and causes damage to two of the offices.

Which of the following is NOT usually considered a "custodian" under the Securities Deposited with Others endorsement to a Crime policy?

A licensed property and casualty broker..

Under an Equipment Breakdown policy, which of the following statements is NOT TRUE regarding deductibles?

A single deductible applies to losses occurring under all coverages selected by the insured..

Which of the following property would be excluded from coverage for loss under Coverage C of the Homeowners policies?

A valuable baseball card collection owned by the named insured's son that is covered under a separate personal articles floater. .

Part D of the Personal Auto policy provides coverage for all of the following, EXCEPT:

All direct losses to the insured's covered auto..

As a fiduciary, insurance professionals handle "trust money". All of the following are examples of "trust money", EXCEPT:

Commissions

"A set of related instructions that direct the operation of a computer" is included in the Commercial Crime definition of:

Computer program

The amount of insurance countersigned, issued, or sold by an agent or producer to cover immediate family members, an employer, or employees is known as:

Controlled business

All of the following are excluded under the Commercial Crime "Inside the Premises - Theft of Money and Securities" insuring agreement, EXCEPT:

Dishonest acts of customers

Which of the following statements is TRUE regarding the HO-6 form?

It covers the walls, floors, and ceilings of dwelling unit..

Chaz takes his girlfriend to an expensive restaurant for Valentine's Day. It is raining, so he decides to have the valet park his car, saving his girlfriend from getting wet. The valet is driving the car into the restaurant's parking garage, when he clips the side of the garage entrance with the front fender of Chaz's car. The garage wall needs to be repaired as well as the fender and headlight of Chaz's car. How would Part D of Chaz's Personal Automobile respond to this loss?

It would cover the loss to Chaz's car because it is the insured automobile, but would not cover the damage to the garage

Agencies in West Virginia are required to have an agency producer license that renews annually on:

June 30

All of the following are excluded from coverage under the Personal Effects Floater, EXCEPT:

Luggage

A legal term describing an intentional act that is illegal or morally wrong, and contributes to the injury of another person is:

Malfeasance.

Which of the following statements are is NOT TRUE of ERISA bonds?

The amount of the ERISA bond purchased must be at least equal to 20% of the total plan assets..

All of the following claims would be excluded under the Homeowners Watercraft Endorsement, EXCEPT:

The bodily injury suffered by the insured while he was operating the covered watercraft, loses his balance and hits his head on the floor of the boat

Evan is the CEO of Worldwide Widgets and is also the named insured under the company's Commercial Crime policy with the Extortion Commercial Entities endorsement attached. Evan's son has been kidnapped and the criminals are threatening to kill him if Evan does not pay them 2 million dollars in unmarked bills within 12 hours. Evan loves his son and decides to pay the money immediately without reporting the kidnapping to law enforcement. Which of the following statements is TRUE regarding how Evan's loss will be paid?

The claim will most likely be denied because Evan did not make a reasonable effort to report the extortion attempt to the authorities before surrendering the money..

If the insured carries a DP-2 Dwelling form and insures the dwelling for 80% of its replacement cost value, what will he be paid if his 30-year-old roof sustains $10,000 in damages (disregarding any deductible)?

$10,000.

The insured is covered under a standard Businessowners policy. She has several computers used in the business and the electronic data stored on them becomes corrupted as a result of lightning. The cost to research and restore this data is $20,000. How much will the policy pay for the electronic data?

$10,000.

A Personal Automobile policy provides liability coverage on a single limit basis for $100,000. A covered accident caused by Mr. Jones involves a $75,000 liability judgment to Mr. Allen for his injuries and $25,000 liability judgment for the damage to his car. In addition, $20,000 in legal bills are incurred defending the insured. The company will pay:

$120,000.

With regard to Workers Compensation insurance, which of the following experience modification factors would indicate that an insured has sustained a relatively high frequency and severity of losses in the recent past?

1.25

In West Virginia, every insurer must commence an investigation of any claim filed by a claimant within _____ of receipt of notice of claim.

15 working days

All of the following statements are TRUE if Builders' Risk coverage is written on a completed value basis, EXCEPT:

All premiums must be paid up front before construction can begin

Which of the following endorsements can be attached to the Business Auto policy to extend coverage to individuals such as the owner of the business who does not carry personal auto insurance?

Drive Other Car endorsement

Which of the following losses would NOT be covered under the Signs coverage form of a Commercial Inland Marine policy?

During installation, several tubes in the insured's fluorescent sign are damaged..

Which of the following is NOT usually excluded under a Professional Liability policy?

Financial losses..

Any corporation organized with a representative form of government operated solely for the mutual benefit of its members is known as a:

Fraternal benefit society.

Which of the following would NOT be covered under the specified cause of loss physical damage coverage under a Business Auto policy?

Glass breakage

All of the following are eligible risks for Commercial Inland Marine insurance, EXCEPT:

Goods manufactured in the United States for export to other countries

Duties of the West Virginia Insurance Commissioner include: I. Affixing his or her official seal to all documents required to be filed. II. Reporting to the governor and legislature annually on department operations. III. Subpoena witnesses and compel their attendance at a hearing. IV. Establishing insurance rates for West Virginia Insurers.

I, II and III only

Which of the following may be included in the Commercial Package Policy? I. Commercial Auto. II. Commercial Inland Marine. III. Equipment Breakdown coverage.IV. Aviation.

I, II, and III only

A person takes bank deposits to the bank every day for a business. In Commercial Crime insurance terminology, this person is known as a:

Messenger.

An insured has fabricated a claim so that it would appear to be legitimate. This would be a:

Moral hazard

Under West Virginia state statues, an insurance agent:

Represents the insurer

The insured auto dealer has opted to include Part IV - Garage Physical Damage coverage to her policy. Which of the following symbols must be indicated on the Declarations page of the policy for physical damage coverage to apply?

Symbol 31.

Katrina has her commercial building covered by a Commercial Package policy. Which if the following is the section within her policy where she would see the dimensions of her building listed?

The Commercial Property declarations page

Mr. Carey is a longshoreman and is covered under the Federal Longshoreman and Harbor Worker's Compensation Act. If he is injured on a barge while working on the rivers of West Virginia, what coverage would apply?

The Federal Longshoreman and Harbor Workers' Compensation coverage..

Which of the following individuals was NOT required to be in concurrence with certifying an act of terrorism under the Terrorism Risk Insurance Act of 2002?

The Secretary of Homeland Security

All of the following sections of a Commercial General Liability policy are identical whether written on a claims-made or occurrence form, EXCEPT:

The coverage trigger.

All of the following statements are true when an insurance company cancels a STANDARD Commercial Package policy, EXCEPT:

The insurer is not permitted to cancel a CPP mid-term..

Which of the following statements is TRUE when an insured is covered under the West Virginia Automobile Assigned Risk Plan?

The insurer is required to deliver a one-time notice in writing to the insured informing them of their eligibility for a standard or preferred policy when they have met the requirements

The Homeowners policy on Dylan's $110,000 home is voided when he intentionally burns the house to the ground. Consequently, he does not receive the settlement check he was hoping to when he committed the arson, but he still has an outstanding mortgage balance of $76,000. How does this event affect the mortgage lender?

The insurer pays the mortgage lender $76,000..

An insured has his dwelling covered under a DP-2 policy. A 100-year snow storm hit the area where his covered dwelling is located and the weight of the ice and snow caused the roof to cave in. This caused extensive damage to the roof, the personal property inside the dwelling, the foundation of the home, the walkway leading to the outdoor swimming pool, and the pool itself. Which of damaged property would be covered by the policy?

The roof and the personal property located inside the covered dwelling

Willies Widgets has been covered under a Crime policy for several years but has cancelled the policy in favor of purchasing another policy through a different insurer. Which of the following statements is CORRECT regarding the "Extended Period to Discover Loss" condition of the Crime policy?

Willie discovers a loss two weeks after the cancellation date of the policy. The effective date of his new policy is not for another month. Willie can expect his cancelled policy to pay for the loss..

The insured has a $1,000,000 personal umbrella policy with a $5,000 retention limit. For a $7,000 liability loss not covered under the insured's personal auto policy, but covered under the umbrella policy, the insurance company would pay:

$2,000

A business auto policy has a $100,000 limit of insurance for liability coverage. As a result of an automobile accident involving a covered auto, two people are injured. The first injured party sues the named insured and wins a $150,000 judgment. The insurer pays its limit of insurance. If the other injured party later sues the insured, the insurer will:

Deny further obligations to the insured as a result of the other injured party..

When an insurer "red tags" equipment and attaches the "suspension of coverage" endorsement to an Equipment Breakdown policy, the coverage suspension commences:

Immediately.

Martika is covered under an unendorsed, standard HO-3 policy and suffers a loss to an awning that covers her deck. The cost to purchase a new awning is $900, however the awning can be repaired for $300. The actual cash value of the awning is $750. Which of the following statements is correct regarding how this claim will be settled with the insurance company?

The loss will be settled at $300..