MASTER EXAM - 2
S has an HO-5 policy with a $250,000 Coverage A limit. After a strong wind blows a mailbox into S's front window, causing $2,500 damage, S immediately buys $250 of wood and plastic sheeting to cover the damaged window and prevent further damage. How much will S's policy pay?
$2,750
L has a Basic Form Dwelling policy with a Coverage A limit of $300,000. Following a severe storm, L sustains a covered loss to the dwelling of $275,000 and a covered loss to a detached swimming pool of $30,000. How much will L's policy pay?
$300,000
In Nevada, money handled by a licensed administrator must be remitted to the person entitled to it, or deposited in a fiduciary account, within how many days?
15 Days
Under a Homeowners policy, an unrelated resident in the care of the named insured is also considered an insured up to what age?
21
An insured has a Special Form Homeowners policy written in Nevada with a 2-year policy term. The policy may be canclled by the insurer as of its anniversary date if notice is provided at least:
30 days prior to the anniversary date
Under the Commercial Building and Personal Property Coverage Form, the commercial building owned by the insured is considered vacant unless at least what percentage of the square footage is rented or is used to conduct operations?
31%
After a licensee in Nevada receives notice of a deficit in their fiduciary account from the Commissioner, the licensee must correct the deficiency within:
5 days
At what age can insured operators under an auto liability policy in Nevada obtain a premium reduction?
55 years old
Losses caused by vandalism are not covered under the Building and Personal Property Coverage Form if the property has been vacant for more than how many consecutive days?
60
An insurer that writes automobile liability insurance policies in Nevada must provide a permanent identification card, verifying an insured's compliance with financial responsibility requirements, within how many days of the effective date of coverage?
60 days
Commercial lines property and casualty policies written in Nevada for a policy term longer than one year may be cancelled as of its anniversary date as long as notice is provided by the insurer at least:
60 days prior to the anniversary date
Producers licensed by other states may obtain a resident license without having to take an examination if they apply within how many days of moving to Nevada?
90
The general aggregate limit of a Commercial General Liability policy may be subject to sublimits for all of the following losses, except:
A claim payable after the insured's faulty completed operations damages a customer's home
Under a Personal Auto policy, Part A would provide coverage to all of the following people as insureds, except:
A mechanic servicing the auto
When caused by a covered peril, the unendorsed Business Auto Physical Damage Coverage Form will cover:
A permanently installed stereo
Which of the following is not a Common Policy Condition on a Commercial Package policy?
Abandonment
A property owner in a participating community completes the application with the NFIP and pays the first premium. Their flood policy will become effective:
After 30 calendar days
Under Employers Liability coverage, the Doctrine of Dual Capacity applies to which of the following?an as an employer
After an employee is injured during the course of employment, the employee brings action against the insured in a capacity other than as an employer
Which term describes the maximum amount payable for loss from all occurrences within a policy period?
Aggregate limit
A Commercial Crime policy would consider all of the following to be a messenger while having custody of covered property outside the insured premises, except:
An armored car service hired to move property
Employment Practices Liability insurance is intended to provide coverage in the event that:
An employer fires an employee for reporting a breach of employment contract
A Personal Auto policy is designed to cover:
An individual's or their family's personal use of an auto
Which of the following statements accurately represents the Nevada Insurance Code's definition of transacting insurance?
An insurance negotiation that does not result in an insurance contract is still an insurance transaction
All of the following are examples of unfair marketing practices in the state of Nevada, except:
An insurer represents the terms of an insurance policy so as to induce the insured's comprehension of forfeiture and surrender conditions
Which of the following is used to resolve differences between the insured and the insurer when the parties disagree on whether or not a liability claim is payable?
Arbitration
Under Inland Marine insurance, controlled lines refer to forms that:
Are filed with state insurance departments
A retail store, protected by a Businessowners policy, has a claim made against them by a customer injured on the store's premises. Notice of the claim must be delivered to the insurer:
As soon as practicable
The Extended Non-Owned Coverage Endorsement available to Personal Auto policies should be added by an insured who is:
Being furnished a company car
Which of the following methods of writing insurance is used to provide insurance on properties at different locations, using a single policy, and a single limit of insurance?
Blanket
Commercial General Liability policies would cover all of the following, except:
Bodily injury arising out of the insured's dram shop liability
Which of the following is an example of special damages?
Compensation to an injured party for actual medical expenses and loss of earnings
An unendorsed Businessowners policy with no optional coverages covers which of the following types of property?
Completed additions
The standard Builders Risk Coverage Form with a limit of insurance that reflects the anticipated replacement value of the covered buildings and structures is written on what basis?
Completed value
Because the insurance company must pay claims and the insured must comply with the policy terms, the insurance contract is considered which of the following types of contracts?
Conditional contract
The purpose of the Businessowners Coverage Form is to:
Cover major property and liability exposures of a small- to medium-sized business
Which of the following is not a coverage under any Farm Property coverage form?
Coverage H - Bodily Injury and Property Damage Liability
Which of the following would be found in Section I of a Commercial General Liability policy?
Coverage for bodily injury and property damage liability
Under a Commercial General Liability policy, which of the following statements about the available coverage forms is NOT correct?
Coverage under the Occurrence Form is initiated based on the date the loss is reported to the insurer
Nevada's Insurance Commissioner can do all of the following, except:
Create insurance laws if it is in the public interest to do so
Common exposures covered by Professional Liability policies include:
Cyber risks
Which of the following claims would be covered by collision coverage under Part D - Coverage for Damage to Your Auto of a Personal Auto policy?
Damage to the insured auto's bumper when the auto crashed into a tree
Section II of a Homeowners policy would not provide liability coverage for:
Damage to the property of others arising out of the insured's business pursuits
Y has an unendorsed Special Form Homeowners policy (HO-3) on their home with a $500 deductible. The home's old sewer system backs up, resulting in $1,500 of damage to floors and Y's personal property. When Y submits information related to the loss to the insurer, the insurer will:
Deny coverage
The initial premium of a Workers' Compensation and Employers Liability policy is known as a:
Deposit premium
Which of the following statements regarding types of property loss is incorrect?
Direct losses include additional living expenses
The insured may opt into all of the following coverages on the Equipment Breakdown Protection Coverage Form, except:
Earth Movement
Which coverage is not automatically provided by the Businessowners Coverage Form as an Additional Coverage?
Equipment breakdown protection
In Nevada, proof of financial responsibility for motor vehicles may be furnished in all of the following forms, except:
Evidence the vehicle is owned by a county or city government agency
Property insurance policies exclude losses resulting from inherent vice, which would include all of the following perils, except:
Explosion
With respect to Marine policies, the term uncontrolled means:
Forms that are not standardized by any rating bureau
Under a Commercial General Liability policy, which of the following is considered an insured's product?
Goods sold by the insured at a trade show
The following are all Additional Coverages provided by Homeowners policies, except:
Governmental Action
A deer chews a hole in an insured's shed sitting next to a pond. Which of the following forms could cover this damage?
HO-3
A tenant should buy which of the following Homeowner policy forms?
HO-4
When a Farm Property policy includes Coverage D - Loss of Use, coverage is provided after a covered loss for:
Increased costs necessary to maintain the household's normal standard of living
All of the following are Coverage Extensions under the Building and Personal Property Coverage Form, except:
Inflation Guard
When an individual faces the risk of economic loss in the event of property damage, this indicates which of the following?
Insurable interest
In Nevada, license requirements to become a motor vehicle physical damage appraiser do not apply to which of the following individuals?
Licensed adjusters
An insured has coverage under the Equipment Breakdown Protection Coverage Form. A $25,000 sublimit applies to all of the following losses, except:
Loss to equipment that is used to supply utility services to the premises and that is owned by a private utility
After an earthquake damages an insured's property, an Earthquake policy would provide coverage for which of the following losses?
Loss to furniture inside a structure held for rent
When applies to a commercial property policy, the Causes of Loss - Basic Form insures against all of the following named perils, except:
Mechanical breakdown
Which of the following coverages is not provided by the Personal Liability Supplement?
Medical payments to a regular resident of the dwelling who sustains an injury
In what kind of state is Workers' Compensation insurance available only through a state-operated fund?
Monopolistic
Which type of state provides Workers' Compensation insurance only through a state fund?
Monopolistic
Which of the following workers is typically eligible to receive Workers' Compensation benefits?
Part-time worker
Which statement regarding medical expenses coverage under Section II of the Businessowners Coverage Form is not correct?
Payments are made to insureds or people the insured hires to do work
The Damage to Premises Rented to You limit under the Businessowners Coverage Form may be subject to which of the following type of limit?
Per fire limit
Which type of standard policy includes coverage options that would not exclude damage by flood?
Personal Auto policies
Liability coverage provided by a Business Auto policy includes all of the following, except:
Physical damage coverage
Supplementary payments under Part A - Liability Coverage of a Personal Auto policy will pay:
Premiums on appeal bonds
After M's children move out to go to college, M builds a new home and purchases a Special Form (HO-3) Homeowners policy with no endorsements. Which of the following is covered by M's policy?
Property belonging to M's child is covered by Coverage C while located in a dorm room away from the residence premises
A Personal Umbrella Liability policy does not provide coverage for which of the following?
Property damage liability to property in the insured's care, custody, or control
Which of the following would not be covered under Section II of a Homeowners policy?
Property damage to property owned by an insured
The Government Crime coverage forms are designed for:
Public utilities operations
The HO-2 protects against all of the following losses, except:
Rain damage to the interior after a window was left open during a storm
The Personal Articles Floater is similar to which of the following Homeowners endorsements?
Scheduled Personal Property Endorsement
Under Section II of a Homeowners policy, which of the following is correct?
Section II is the same on all Homeowners Forms
The Common Policy Conditions are found in which section of the BOP?
Section III
Dwelling policies contain all of the following policy conditions, except:
Severability
Under the Nevada Insurance Code, Workers' Compensation is the exclusive right of an employee to recover compensation against an employer for workplace injuries. This is the definition of:
Sole remedy
Under the PAP, which of the following is not considered occupying a vehicle?
Standing by the car exchanging insurance information
All of the following are common law defenses against negligence, except:
Statute of limitations
The type of liability that applies to products is called:
Strict liability
What is the difference between the Occurrence Form and Claims-Made Form available for Commercial General Liability policies?
The coverage trigger point
Which of the following best describes the purpose of the Protective Safeguards Endorsement available for Businessowners policies?
The insured is required to maintain the safeguards listed in the endorsements such as automatic sprinkler systems or security services
Coverage B - Personal and Advertising Injury Liability of a Commercial General Liability policy would cover which of the following claims?
The insured was accused of causing a customer to be falsely arrested
Which of the following could be considered a custodian under the terms of a Commercial Crime policy?
The insured's partner
If an auto insurance policy is issued to provide proof of financial responsibility for the insured, the policy may only be cancelled if:
The insurer notifies the Department of Motor Vehicles 10 days in advance of cancellation
All of the following accurately describe a binder issued in Nevada, except:
The issuance of a binder prevents the insurer from disapproving the policy on the basis of the insurer's financial standards
Which person is not a covered resident under Homeowners policies?
The named insured's tenant
An insured owns a home with a replacement cost of $300,000 and a market value of $250,000. What is the most a valued policy will pay in the event of a total loss without a deductible?
The policy limit
Mobile home insurance policies issued in Nevada are subject to all of the following regulations, except:
The policy premium may be increased due to the breed of the policyholder's dog, at the insurer's discretion
Residents of Nevada may be exempt from proof of financial responsibility requirements in regards to their use of a motor vehicle in the event of any of the following events, except:
The resident's auto liability policy is cancelled by an authorized insurer
Under a Broad Form Dwelling policy (DP-2), which peril is not included for coverage without an endorsement?
Theft
Homeowners policies would not cover which of the following losses?
Theft of building materials from the dwelling while it is under construction
Under the Dwelling Program, which Other Coverage is not included on the Basic Form?
Trees, Shrubs, and Other Plants
An insured has a Mobile Homeowners policy. If the mobile home is removed from the premises to protect it from a covered peril, how much coverage is available?
Up to $500, provided by an Additional Coverage
Under the Basic Dwelling Form, when is damage caused by vandalism included as covered peril?
When the VMM Endorsement is added to the DP-1
Which of the following is not a specified cause of loss under Garagekeepers coverage provided by the Garage Coverage Form?
Windstorm
