OK Adjuster Test
In addition to license suspension or revocation, the Commissioner may assess a fine of between ______ and ______ to any producer who has violated any insurance law in Oklahoma. $500/$1,000 $100/$5,000 $1,000/$5,000 $50/$500
$100/$5,000
Wholesalers can be covered by the BOP if no more than _____ of their total floor area is open to the public. 25% 10% 15% 65%
25%
Which of the following businesses can cover their private passenger and commercial automobile exposures with a Business Auto policy? An auto dealership. A trucking company. A grocery store. A motor carrier company that delivers cargo.
A grocery store The grocery store is the only type of business listed in the answer choices that can be covered by the Business Auto policy.
Supplementary payments on the CGL would provide which of the following? Accrued interest on unpaid judgments Loss of earnings up to $200 per day 10% excess coverage if the policy limits are exhausted None of the answer choices are correct
Accrued interest on unpaid judgments The policy provides the paying of accrued interest on unpaid judgments as a supplementary payment. The loss of earnings is $250 per day.
Which of the following refers to "any individual or organization, or an attorney or individual authorized to act on their behalf, who asserts a right of recovery under an insurance policy or surety bond through administrative means"? Insured. Plaintiff. Claimant. Defendant.
Claimant "Any individual or organization, or an attorney or individual authorized to act on their behalf, who asserts a right of recovery under an insurance policy or surety bond through administrative means" is known as a claimant. "Administrative means" refers to filing a claim.
Under a motor truck cargo policy, which of the following would be covered? Damage to the shipper's goods during the course of transit Damage to another vehicle that is the caused by the insured's products Spillage of hazardous materials from the insured's vehicle Spoilage of the cargo due to the shippers packing
Damage to the shipper's goods during the course of transit Motor truck cargo policies cover the liability exposure for damaage to the "shipper's" goods while those goods are in transit.
An insurance contract must comply with the "Principle of Indemnity". Jarron's friend Nick, accidentally destroys Jarron's laptop computer. Nick pays Jarron for the damage, but Jarron also submits a claim to his insurance company for the laptop. The claim will be: Paid, the fact that Jarron has already been paid for the damage has no bearing on the insurance company's obligation to pay. Denied because Jarron has already been paid for the damage. Paid, but only at 50% of the limit of liability. Denied because the damage was caused by a friend and not the insured.
Denied because Jarron has already been paid for the damage. The claim will be denied because Jarron was already paid for the damage to his laptop. If the insurance company paid him again for the same damage, it would violate the principle of indemnity.
Using the modified comparative negligence standard, a plaintiff in a lawsuit who is 60% at fault for her injuries will receive: A 50% reduction in her damage award. A 40% reduction in her damage award. A 60% reduction in her damage award. No award.
No award. The plaintiff will receive $0. Using the modified comparative negligence standard, if the plaintiff is 50% or more at fault for the injury or damage sustained, damages will not be awarded.
Which of the following terms is deemed as the uncertainty of future outcome? Risk Hazard Peril Cause of loss
Risk Risk is defined as the uncertainty of a loss. Hazards create risks. A peril may result from a hazard and is the cause of the loss.
Of the following businesses, which one is NOT eligible for coverage under a Businessowners policy? An auto dealership with $1 million dollars in gross annual sales. A barbershop with two chairs. A hair salon with 7,000 square feet of floor space. A pizza joint with a seating capacity of 30.
An auto dealership with $1 million dollars in gross annual sales. Auto dealerships are not eligible for the BOP, no matter the amount of their gross annual sales. The barbershop and hair salon would qualify as "service risks" that meet the requirements and the pizza joint would qualify as a restaurant that also meets the requirements.
All of the following are common-law duties of an employer under a workers' Compensation policy, EXCEPT: Warn workers of inherent dangers. Provide a safe working environment. Assumption of risk. Provide an adequate number of competent fellow workers.
Assumption of risk Assumption of risk is a common-law defense if a claim is filed. All of the other three answer choices are common-law duties.
A Commercial General Liability policy provides coverage for exposures to loss arising out of which of the following operations? On or away from the insured's premises Business and Personal Away from the insured's premises only On the insured's premises only
On or away from the insured's premises The policy is rather comprehensive in that incidents occurring both on and off the insured's premises are covered for liability. "Commercial" policies generally do not cover "personal" exposures.
Which of the following standardized Dwelling insurance forms provides coverage for loss of rental income? The DP-1, DP-2, and DP-3 forms. The DP-1 and DP-2 forms. The DP-2 and DP-3 forms. The DP-3 form.
The DP-1, DP-2, and DP-3 forms.
The insured carries a standard Yacht policy on his vessel registered in Florida. One of the crew members is injured while performing a work-related task on the yacht while sailing off the coast of Italy. What coverage would respond to the crew member's injuries? Medical Payments coverage. Liability coverage. Hull coverage. The Jones Act.
The Jones Act. Crew coverage under the Jones Act would provide the coverage for the captain and crew. This is a provision under the Jones Act.
Whose responsibility is it to see that a ship is seaworthy? The Ship Owner The Shipper The Captain Both the Captain and the Crew
The Ship Owner The ship owner is ultimately responsible to see that the ship is sea worthy. This is an implied warranty in ocean marine insurance.
Underinsured motorist coverage provides first-party protection to an insured after an accident in which of the following situations? The other driver has insufficient liability limits and is "at-fault". The other driver has no insurance and is "at-fault". The other driver has no insurance but is not "at-fault". The insured driver has insufficient liability limits and is "at-fault".
The insured driver has insufficient liability limits and is "at-fault". The purpose of underinsured motorist coverage is to provide protection for the insured when the "at-fault" driver has insurance, but it is insufficient to cover the injuries to the insured. In this case, the insured may collect the "excess" from their own insurer.
Tom rents half of a duplex. During a severe storm, lightning strikes a tree in the front yard and it falls, causing damage on Tom's side of the duplex. Which of the following losses will be covered by Tom's HO-4 policy? The removal of the tree and debris costing hundreds of dollars. Tom's TV and entertainment system that were damaged when the tree fell through the roof. Tom's attached carport that was damaged when the tree ripped it from the side of the house. Tom's roof and front wall that were damaged when the tree fell on the house.
Tom's TV and entertainment system that were damaged when the tree fell through the roof. An HO-4 covers personal property if damaged by a covered peril. There is no coverage for real property under an HO-4 policy.
The Section II - Additional Coverages of Homeowners policies, damage to the property of others (whether or not in the insured's custody and regardless of fault) is covered up to: $1,500 per occurrence $5,000 per occurrence $1,000 per occurrence $2,500 per occurrence
$1,000 per occurrence
No award for disfigurement will be entered until ____ after the injury. 90 days 12 months 18 months 2 years
12 months There is a 12 month waiting period for an award for disfigurement.
All of the following are a "cause of loss" form, EXCEPT: Basic Broad Comprehensive Special
Comprehensive The cause of loss forms used with property insurance are the basic, broad, and special. The comprehensive form does not exist.
Which of the following statements is TRUE regarding the "debris removal" coverage of the Dwelling forms? Debris removal is not covered. Debris removal coverage is in addition to the limits applicable to dwelling and contents coverage. There is a specific limit that applies. Coverage A and Coverage B both include an amount for debris removal.
Coverage A and Coverage B both include an amount for debris removal. Debris removal is part of the limit of coverage. It does not have a specific limit and is tied to the overall limits of Coverages A and B. Coverage is limited to "reasonable expenses" to remove the debris.
A producer works with a realtor who is offering free Homeowners insurance as an incentive to buy a home in a new housing development. The producer is guilty of: Defamation False advertising Coercion Boycotting
False advertising
Claims filed against the insurance company by the insured are known as: First-party claims. Third-party claims. Self-insured claims. Subrogation claims.
First-party claims.
Oklahoma requires that the acceptance or denial of a claim must be within 45 days of the claim after receipt of a properly executed proof of loss by a Property and Casualty insurer. When might there be an exception to this rule? In the event of a weather-related catastrophe or a major natural disaster, as declared by the Governor, the Insurance Commissioner may extend the deadline by an additional 20 days imposed under this section. The first party claimant has fraudulently caused the loss. The first party claim has contributed to the loss. The Governor or Insurance Commissioner may extend the deadline by an additional 30 days due to a weather related catastrophe or major natural disaster.
In the event of a weather-related catastrophe or a major natural disaster, as declared by the Governor, the Insurance Commissioner may extend the deadline by an additional 20 days imposed under this section. The Governor or Insurance Commissioner may extend the deadline for an additional 20 days, not 30 days.
A furrier customers policy does not cover: Property in the custody of the insured. Property owned by the insured's customers. Loss in excess of the value of the property as declared by the owner. The furrier's liability as a bailee.
Loss in excess of the value of the property as declared by the owner. The furrier is not responsible for a value beyond what is declared by the owner of the property.
An insurer's certificate of authority in Oklahoma must be renewed each year by: December 31 January 1 March 1 June 30
March 1
What Commercial Auto form is used to cover taxis and bus companies? Business Auto form. Garage Liability form. Trucker's form. Motor Carrier form.
Motor Carrier form
Under a Flood insurance RCBAP (residential condominium building association policy) will settle claims on what basis? Functional Replacement Cost Replacement Cost Actual Cash Value Market Value
Replacement Cost
Claims paid under which of the following will reduce the aggregate limit under the Commercial General Liability policy? The Per Occurrence Limit The Liquor Liability Limit The Pollution Liability Limit The Retroactive Date
The Per Occurrence Limit Claims paid under this limit are deducted from the aggregate limit and the remaining amount is all the insured has available for future occurrences until the policy is renewed. Liquor and Pollution Liability coverage is excluded under the CGL. The retroactive date "triggers" coverage and has nothing to do with the policy limits and how much will be paid on the loss.
All of the following statements are true regarding a Personal Umbrella policy, EXCEPT: The policy can be written to increase the limits of liability of an existing liability policy. The policy can only be triggered when the liability limits of the underlying policy have been exhausted. The policy can be written as a monoline policy. The policy can be written to broaden coverage of an existing liability policy.
The policy can be written as a monoline policy. A Personal Umbrella policy cannot be written as a monoline policy, Umbrella policies must always be written to broaden and/or extend the coverage of an underlying liability policy.
All of the following would be covered under Coverage B of a Homeowners policy, EXCEPT: A 4-car garage located on the insured location, away from the covered dwelling. A gazebo located several yards away from the insured dwelling, beside a pond on the insured location. A shed containing the insured's work tools, located near an unattached garage and not attached to the insured dwelling. The roof of the covered dwelling.
The roof of the covered dwelling All of the items listed would be covered under Coverage B, except the roof of the covered dwelling that would be covered under Coverage A.
The giving up of a known right is called: Waiver. Estoppel. Violation of policy conditions. Rebating.
Waiver.
Insurers are required to maintain a complete record of all complaints which it has received during the preceding: 12 months. three years. five years. 18 months.
three years. Insurers are required to maintain a complete record of all complaints which it has received during the preceding three years or since the date of its last financial examination conducted or accepted by the Commissioner, whichever time is longer.
Which of the following is the amount of additional coverage on the standardized Homeowners forms for a Fire Department Service Charge? $1,000 $500 $250 $750
$500 $500 is paid under the standardized Homeowners forms for a Fire Department Service Charge. This is an "additional coverage" and a deductible does not apply to this amount.
Motels insured under an ISO Businessowners may not exceed how many stories? 3 stories. 4 stories. 5 stories. No limit.
3 stories. Motels not exceeding three stories may be insured. There is no floor area restriction. Motels closed for more than 30 days are not eligible.
An additional coverage provided by Part D of the Personal Watercraft policy includes coverage for "salvage liability". This is best described as: A maritime law that states that any salvage from watercraft belongs to the state where the watercraft was being used at the time of the accident. Coverage for damage caused to another vessel by the salvage of the damaged watercraft. A maritime law requiring watercraft owners to recover items that have gone overboard. Coverage for bodily injury caused to others when the covered watercraft collides with another boat or a dock.
A maritime law requiring watercraft owners to recover items that have gone overboard. The additional coverage for "salvage liability" refers to a maritime law requiring watercraft owners to recover items that have gone overboard.
The three parties to a contract bond are:
Principal, obligee, surety. The three parties to a contract bond are the principal (contractor), obligee (the protected party) and the surety (the guarantor) who pays the loss to the obligee because the principal failed to perform.
All adjusters in Oklahoma who adjudicate Workers Compensation claims must complete _____ hours of continuing education relating to the Workers Compensation Act as part of the required 24 clock hours of continuing insurance education. Four Six Twelve Three
Six All adjusters who also adjudicate Workers Compensation claims must complete six hours of their 24 hour continuing education requirement in the topic of Workers Compensation claims.
Which of the following would be covered under Business Auto Symbol 7? Hired autos only. Non-owned autos. Specifically described auto only. Any auto.
Specifically described auto only. The purpose of Symbol 7 on Commercial Auto policies is to cover only specifically described vehicles as opposed to covering any vehicle. This occurs when an insurer may agree to cover all of the owner's vehicles except certain types. A vehicle used to transport pollutants or explosives is an example.
In Oklahoma, how long does an insured have to submit a required proof of loss statement? 30 days. 60 days. 120 days. 365 days.
60 days The insured has 60 days to return the required proof of loss forms.
Which of the following would be covered under Section II - Liability of the Homeowner policy? Damage to rented premises occupied by the insured caused by a fire accidentally set by the insured. Intentional acts of the insured. Operating a dirt bike off the insured's premises. Operating a 75-HP boat owned by the insured.
Damage to rented premises occupied by the insured caused by a fire accidentally set by the insured. Damage to property rented to, occupied by, used by or in the care, custody or control of an insured for specified perils consisting of fire, smoke and explosion would be covered. An insured would have coverage under an HO-4 if he accidentally sets fire to the apartment where he is residing.
Before interviewing the injured worker who has filed a claim, the adjuster should: Determine if it is a work related injury. Determine if workers compensation coverage is in effect. Determine if the employee was at fault. Determine if the employee is represented by an attorney.
Determine if the employee is represented by an attorney. Before actually interviewing an injured worker, the adjuster must determine if the injured worker is represented by an attorney. If so, the adjuster needs to contact that attorney and arrange an interview.
In Oklahoma automobile law, which of the following is true regarding the "stacking" of the uninsured motorist limits of coverage? Is permitted Is not permitted Only the highest limit on the policy applies Only permitted for hit and run accidents
Is not permitted The "stacking" of limits apply to an insured that owns more than one vehicle and carries uninsured motorist coverage on both vehicles. In some states, the insured can make a claim for this coverage under both vehicles when involved in an uninsured motorist claim, thereby doubling the coverage. This is not permitted in Oklahoma.
Misrepresentation by an agent or adjuster is: Encouraging a prospect to drop an existing policy in order to sell another policy. Leading a client to believe that an insurance policy provides coverage that it does not provide. Offering an inducement for the purchase of insurance. Suggesting that the insured's carrier is inferior and does not pay claims promptly.
Leading a client to believe that an insurance policy provides coverage that it does not provide.
Which of the following coverages is included as "no-fault" coverage on the standardized Personal Auto policy? Uninsured Motorists coverage. Medical Payments and Physical Damage. A state-mandated "no-fault" coverage plan. Liability coverage.
Medical Payments and Physical Damage. Part B - Medical Payments and Part D - Physical Damage coverage are both "no-fault" coverages provided by the standardized Personal Automobile policies.
What coverage under the BOP automatically applies if a customer slips and falls on the named insured's premises, regardless of legal liability? Business liability coverage. Personal injury coverage. Medical expense coverage. Advertising injury coverage.
Medical expense coverage. Medical expense coverage pays regardless of the insured's legal liability. It is a "good will" type of coverage where negligence is not a factor in the claim.
Advertising injury coverage applies only if the offense arises from: Slander or libel in the course of any advertising. Misappropriation of ideas or copyright infringement in the course of any advertising. The insured's advertising goods, products or services for someone else. The insured's advertising his or her own goods, product or services.
Misappropriation of ideas or copyright infringement in the course of any advertising. "Advertising injury" is the stealing or infringement of copywrites, slogans, and trademarks
Which of the following professional liability policies would cover a dishonest, fraudulent or criminal act of the manager of a LLC? Fiduciary Liability Malpractice Liability Errors and Omissions None of the policies cover these acts
None of the policies cover these acts
For the insured dwelling and other structures, the DP-3 provides: Open peril coverage. The broad form perils. The basic form perils. Fire, lightning, the extended coverage perils and vandalism & malicious mischief coverage.
Open peril coverage. The DP-3 provides open perils protection for the dwelling and other structures, and named perils protection for personal property. The DP-1 and DP-2 forms provide named peril protection only for the dwelling, other structures, and personal property.
The insured is moving to a new primary residence. Coverage under a Homeowners policy for the personal property being moved between the old and new location is: Provided for the coverage limit at the old residence. Provided on a pro-rata basis. Provided for the coverage amount the insured has selected for the new residence. No coverage would apply once the move commences.
Provided on a pro-rata basis. Coverage would apply at both locations on a pro-rata basis for 30 days.
Gena purchased a policy to cover her home. Recently, she has been conducting business from the home and has hired several employees. She also has several clients per day coming to the home for business purposes. When Gena's insurer finds out about the additional exposures she has introduced into her home, they decide to take action. Which of the following actions is Gena's insurer most likely going to take? Void her policy back to the date in which she started the business. Cancel her policy immediately. Suspend her policy until she moves the business out of her home. Void her policy to inception.
Suspend her policy until she moves the business out of her home. When there has been a significant change in the risk, insurer's will suspend policies. This allows the insured time to correct the issue that caused the policy suspension.
The maximum amount a liability policy will pay for all occurrences taking place during the policy period, is known as: The limit of liability. The single limit. Split limits. The aggregate limit.
The aggregate limit The aggregate limit is the maximum amount the policy will pay for all occurrences that take place during the policy period. When the aggregate limit is reached, the insured no longer has coverage under the policy.
Which of the following best describes "no release" or "walk-away" release claim settlement? A form of advanced payment to the claimant. A structured settlement. The bills are paid and no attempt to obtain a separate release is made. The insurer agrees to waive its right to subrogation against a third party who caused the damage.
The bills are paid and no attempt to obtain a separate release is made. The bills presented are paid with no attempt to obtain a separate release, although the wording on the draft or check may also serve as a form of release. After a certain amount of time has passed with no further contact with the claimant, the file is considered closed.
If an insurance policy is issued by a surplus lines company in Oklahoma, what statement must be contained on the Declarations page of the policy? The fact that the policy may have certain coverage limitations. The fact that the premiums may have been surcharged. The fact that the coverage is not subject to the protection of any guaranty association. The fact that the insured is being charged a premium tax in addition to the premium.
The fact that the premiums may have been surcharged. Insurance contracts procured as surplus line coverage must contain in boldface type notification stamped by the surplus lines licensee or broker or surplus lines insurer on the declaration page of the policy that the contracts are not subject to the protection of any guaranty association in the event of liquidation or receivership of the surplus lines insurer.
Making distinctions in the premium rates charged for insurance between insureds or property having similar risk characteristics is an example of: Rebating Unfair Discrimination Coercion. Boycotting.
Unfair Discrimination Risks showing like characteristics must be treated equally. Making distinctions on similar risks is unfair discrimination.
A vehicle rolled over exiting the interstate. The insured carries collision coverage with a $1,000 deductible and other than collision coverage with a $500 deductible. The damage to the vehicle is $2,000. What amount is the insurer responsible to pay? $2,000. $1,000. $1,500. Nothing.
$1,000. A vehicle that rolls over and sustains damage is considered to be a collision claim versus an other than collision claim. The damage to the vehicle is $2,000 and the deductible is $1,000. Therefore, the insurer is liable for $1,000.
Any person acting as a licensee in Oklahoma after having an insurance license revoked will be guilty of a felony and may be subject to a monetary fine of up to: $1,000. $10,000. $5,000. $25,000.
$5000 Acting as a licensee without a license in the state of Oklahoma is a serious violation of the Insurance Code. The fine for this violation is up to $5,000, imprisonment for up to five years or both.
The liberalization clause of a Businessowners policy automatically applies favorable expansions of coverage, for which a premium is not charged if the changes are made during the policy period or within ______ prior to the effective date of the policy. 45 days. Six months. Three months. 30 days.
45 days A liberalization condition states that the insurer will automatically and immediately apply to the policy any revisions made during the policy period or within 45 days prior to the effective or renewal date if those revisions broaden the coverage without additional premium.
If the employer fails or neglects to provide medical treatment within ____ after actual knowledge is received of an injury, the injured employee may select a physician to provide medical treatment at the expense of the employer. 48 hours 3 days 5 days 10 days
5 days If the employer does not provide treatment within five days, the employee may select a physician to provide treatment.
A leased vehicle is considered to be a covered auto under the personal auto policy (PAP) if it is a private passenger auto leased for at least: 6 consecutive months. 48 hours. 30 consecutive days. 1 year.
6 consecutive months. The policy states, "a private passenger type auto, pickup, or van will be deemed to be owned by a person if leased for a continuous period of at least 6 months."
Which of the following losses would be covered by Part D of a standard Personal Auto policy providing both "Other Than Collision" (Comprehensive) and "Collision" coverage? A front tire blows out in a high-speed head-on collision, which also causes extensive damage to the vehicle. An insured did not add antifreeze to his radiator and the engine is damaged when the cooling system freezes. A radar detector is destroyed when an insured hits a tree after skidding on a patch of ice. The bearings in a rear wheel burn out after 85,000 miles of use.
A front tire blows out in a high-speed head-on collision, which also causes extensive damage to the vehicle. Road damage to tires is specifically excluded under the PAP, however the claim described in the correct answer involves a collision, therefore the entire claim would be covered minus the deductible. The policy does not cover losses due to freezing or any radar equipment designed to help the drive avoid police. The damage to the bearings is due to wear and tear which is also excluded.
The current version of the nationwide definition recognizes six broad classes of property as eligible for marine coverage. These eligible classes include all of the following, EXCEPT: Domestic shipments. Imports and exports. Instrumentalities of Transportation and Communication Business personal property.
Business personal property. Business personal property is not a "class" or category of business mentioned in the definition specifically. Obviously this type of property can be covered under the commercial property forms or the BOP.
Each of the following is considered to be an "implied warranty" in an Ocean Marine insurance policy, EXCEPT: General Average. Seaworthiness. Condition of Cargo. Legality of the Voyage.
General Average Implied warranties consist of seaworthiness, condition of cargo, legality and no deviation in voyage. A violation of any of these could void coverage.
The Medical Expense coverage for a standard Businessowners policy will pay for all of the following, EXCEPT: A visit to the emergency room for the injured person after a covered accident. The insured when injured while working in their business. First aid at the time of the accident for a client who is injured on the business premises. Funeral services for a customer who is injured while shopping at the insured business and later dies from those injuries.
The insured when injured while working in their business. The Medical Expense coverage under a standard Businessowners policy does NOT cover any insured.
Under the definitions section of the CGL policy, the term "your product" does not include: Goods or products manufactured by you. Vending machines rented to or located for use by others. Goods or products manufactured by others under your name. Containers other then vehicles used with "your product."
Vending machines rented to or located for use by others. A vending machine rented for use by others is not considered to be "your product." The other three choices are all considered to be "your product."
To be covered under a workers' compensation policy, the last exposure to the conditions causing bodily injury by disease must occur: During the most recent term of employment. Within the policy period. During the last day of employment. During normal working hours, excluding overtime.
Within the policy period. The policy which was in force during the last exposure to the disease-causing conditions is the one which responds for the payment of any applicable benefits.
Under a Personal Articles Floater, the total amount that will be paid for loss or damage to an unscheduled coin collection is: The actual cash value at the time of the loss. $500. The agreed value. $1,000.
$1000 An unscheduled coin collection is limited to $1,000 under a Personal Articles Floater.
Which of the following would be considered a "supplementary payment" coverage under a business auto policy? All post-judgment interest in a suit defended by the insurer Payment for an insured employee's truck being used by the employee on a business-related trip Costs for a private investigator hired by an employee to prove he was not involved in a hit and run accident of which he has been accused Up to $2,000 for the cost of bail bonds for an employee involved in an accident while he was on a trip to Mexico that he won for exceeding sales goals set by the company
All post-judgment interest in a suit defended by the insurer Supplementary payments do not include physical damages, nor personal expenses of employees. The bail bonds would be covered except that Mexico is outside the coverage area.
Which of the following is covered under Part A of the Personal Auto policy? Damage to the attached garage of a dwelling rented by the insured. Intentional acts by the insured. Damage to insured's property in the vehicle. Damage to property of others in the vehicle.
Damage to the attached garage of a dwelling rented by the insured. The Personal Auto policy does not cover damage to property of the insured, or property in the care, custody or control of the insured. The PAP makes an exception in the exclusions to cover damage to a private residence and garage rented by the insured. The other three examples are excluded.
The "occurrence" form of a CGL policy provides coverage for bodily injury and property damage that: Occurs during the policy period regardless of when the claim is made. Occurs during the policy period as long as the claim is made during the policy period. Is claimed during the policy period with no regard to when the bodily injury or property damage occurred. Occurs after the policy period and the claim is made after the policy period.
Occurs during the policy period regardless of when the claim is made. The occurrence form provides coverage for claims that occur during the policy period regardless of when the claim is filed.
Which of the following is considered an Unfair Claim Settlement Practice? Paying undisputed settlements under one portion of a claim before the entire claim has been settled. Requiring a claimant to submit a preliminary claim report before moving forward on the claim. Consulting with the claimant before instructing a body shop to conduct repairs on the insure'd vehicle. Requiring the claimant to submit formal proof of loss forms and subsequent verification before moving forward on the claim.
Paying undisputed settlements under one portion of a claim before the entire claim has been settled. Requiring a claimant to submit a preliminary claim report before moving forward on the claim is an Unfair Claim Settlement practice according to the NAIC.
The form used to report the insured's actual and estimated business income under an Equipment Breakdown policy is called: Report of net income form Earnings reporting form Estimated income form Business income—Report of Values
Business income—Report of Values This endorsement gives information to the insurer as to the actual values and estimated values of the insured's business income. This enables the insurer to charge a proper premium for the business income exposures that are covered under the boiler and machinery program.
Coverage B covered by the general liability policy provides coverage for: Personal and advertising injury liability Bodily injury and property damage liability Medical payments Supplementary payments
Personal and advertising injury liability Coverage B in the CGL policy covers personal and advertising injury liability. Normally these claims do not involve bodily injury. The forms provide coverage for consequential bodily injury when an injury occurs when a person such as a shoplifter has been detained, and a scuffle occurs.
Which of the following employees must be covered under workers compensation? An employee of a department store A sole proprietor An employer who employs fewer than five employees, all of whom are related by blood or marriage to the employer. A domestic servant
An employee of a department store Generally, every employee hired in Oklahoma or who is injured in Oklahoma is covered by the workers' compensation laws of the state. Independent contractors are not employees and are therefore not covered. Other exceptions to coverage include persons covered for job-related injuries under the federal law, certain agricultural workers, licensed real estate brokers paid on a commission basis, certain persons providing services administered by the Oklahoma Department of Human Services, any person employed by an employer with 5 or fewer employees, all of whom are related by blood or marriage to the employer. A sole proprietor can elect to be covered.
The insured carries an unendorsed DP-3 dwelling policy on his home and personal contents. While traveling abroad someone broke into the home and stole $200 in cash, a shotgun valued at $1,000, and other household items valued at $2,000. Damage caused by the burglars is $1,500. Assuming no deductible applies to their coverage how much would be paid? $3,200 $4,500 $1,500 $2,000
$1,500 The DP-3 only provides damage to covered property caused by the burglars. Theft is excluded under the DP-3 unless endorsed with the theft endorsement.
Which of the following contractors would be eligible for a Businessowners policy? A carpenter doing all of his own work building kitchen cabinets in people's homes and earns $75,000 per year. A general contractor who subcontracts about 5% of the businesses annual gross sales. A roofing contractor with an annual payroll of $400,000. A contractor who constructs high-rise apartment buildings up to six stories in height.
A carpenter doing all of his own work building kitchen cabinets in people's homes and earns $75,000 per year. General contractors and contractors with annual payroll in excess of $300,000 are ineligible for coverage under the BOP. Contractors working above four stories in height are also not eligible. A specialized contractor performing carpentry work who does not have a payroll of more than $300,000 annually would be eligible.
If an insurer in Oklahoma takes an adverse action based upon credit information, the insurer must: I. Provide notification to the consumer that an adverse action has been taken, in accordance with the requirements of the federal Fair Credit Reporting Act. II. Provide notification to the consumer explaining the reason for the adverse action. I only II only Both I and II Neither I nor II
Both I and II The insured must advise the consumer that adverse action has been taken and explain the reason for the adverse action. The reasons must be provided in sufficiently clear and specific language so that a person can identify the basis for the insurer's decision to take an adverse action.
Which of the following types of coverages are included in the standardized Businessowners policy? Coverage for employer's liability. Coverage for business personal property. Coverage for disability income. Coverage for business automobiles.
Coverage for business personal property. The only type of coverage listed in the answer choices that are included with a BOP policy is coverage for business personal property.
The professional liability of a lawyer would be addressed by which type of insurance? Errors and Omissions Employer's Liability Commercial General Liability Contractual Liability
Errors and Omissions Errors and omissions insurance is a type of professional liability insurance covering attorneys and other professionals who are blamed by others for various wrongful acts.
An insured has purchased BAP physical damage coverage against specified causes of loss. Protection applies to all of the following perils, EXCEPT: Theft. Fire. Falling objects. Vandalism.
Falling objects. This is named peril coverage (specified causes of loss) and is not nearly as broad as comprehensive coverage. This coverage form names the perils that will be covered and falling objects is not a named peril. Comprehensive covers anything other than collision.
The right to request an appraisal belongs to: I. The insured. II. The insurer. III. The salvage company. I only. I and II only. II only. II and III only.
I and II only The request for an appraisal can come from either the insured or the insurer.
A person, firm, or corporation that, for compensation, acts on behalf of an insured in negotiating the settlement of certain claims for loss or damage to property is known as a/an: Independent adjuster. Consultant. Public adjuster. Insurance agent.
Public adjuster.
A tornado blows over a wall of a barn which, in turn, knocks over a lamp and starts a fire. What is the proximate cause of loss? Tornado Smoke Fire Water Damage
Tornado The proximate cause of loss would be the tornado (wind).
Steve has removed the rear seat in the company car and installed stereo equipment and two speakers. The maximum the physical damage coverage will pay for damage to the items in an accident is: The actual cash value of the equipment since it is permanently installed in the car. Nothing, because the equipment was not factory equipment. $1,000 because the equipment was permanently installed in a place where the auto maker would normally not have it put it minus deductible. $1,500 for the equipment but nothing for the labor to install it.
$1,000 because the equipment was permanently installed in a place where the auto maker would normally not have it put it minus deductible. For any electronic equipment that reproduces audio, video or data signals that are permanently installed in the auto in a place where the auto maker would not normally install is covered up to a total of $1,000 per loss.
In which of the following situations would trees, shrubs, and other plants be covered by the Homeowners additional coverages? The insured's fruit trees are destroyed when an ember from a nearby brush fire lands on them and burns them. The insured's shrubs are destroyed when a 100-year snow storm hits the area and the weight of the snow is so heavy, it snaps the branches. The insured's 150-year-old oak tree is pushed over by high winds. The insured's fruit trees are ruined when snow and ice from a storm build up on the trees, causing large sections to break off and fall to the ground.
The insured's fruit trees are destroyed when an ember from a nearby brush fire lands on them and burns them The perils of wind, hail, and the weight of ice and snow are excluded under the Homeowners additional coverage for trees, shrubs and other plants. Therefore, the only situation that would be covered is: "The insured's fruit trees are destroyed when an ember from a nearby brush fire lands on them and burns them".
The type of auto body frame that is most often used in today's automobile and is a single molded unit, is known as: A universal frame. A subframe. A conventional frame. A unibody frame.
Unibody frame A unibody frame is a single molded unit to which the other structures of the automobile are welded.
Font Masters Printing Company has a printing press that suffers a covered total loss. The company paid $25,000 ten years ago for the press. Actual cash value is $40,000 and the replacement cost is $55,000. The company has had to cancel several contracts for printing due to the loss of the press and they are anxious to resume full production. Font Masters is covered under a Businessowner's Policy (BOP). How much will the insurer pay for this claim? $25,000. $55,000. $40,000. $20,000.
$55,000 The Businessowners policy settles property claims on a replacement cost basis. The insurer will pay $55,000 to Font Masters for this claim as that is the replacement cost of the damaged property. The price the insured paid for it 10 years ago as well as the actual cash value of the press are not considered in settling the loss.
At the time of fire damage to a covered auto under a business auto policy, the auto's actual cash value is $9,200. The cost to fully repair the damage would be $11,500. If the policy has a $250 comprehensive deductible, what amount will the insurer pay for the loss? $11,500. $9,200. $8,950. $11,750.
$8950 The deductible that applies to comprehensive also applies to losses caused by fire or lightning under the business auto policy. Therefore, the insurer would pay the ACV of the vehicle less $250 or $8,950.
Adrianna owns a dwelling that is covered under a DP-3 form and located in a rural area close to a small wooded area. While grazing outside of Adrianna's picture window one day, a deer sees its own reflection and jumps through the picture window to scare off the "other" deer. Once inside the dwelling, the deer realizes he is trapped and causes significant damage to the walls, floor and furniture. Adrianna is covered for $100,000 under Coverage A and for $50,000 under Coverage C. Which of the following statements is TRUE regarding this loss? The entire claim would be denied by the insurance company. The insurer would pay RCV on the dwelling and ACV for the personal property. The insurer would pay RCV on both the dwelling and the personal property. The insurer would deny the claim for the personal property and pay the loss to the dwelling on an RCV basis.
The insurer would deny the claim for the personal property and pay the loss to the dwelling on an RCV basis. Because the DP-3 is an open peril form for dwelling coverage, the loss to the dwelling is not excluded. However, the personal property coverage is provided on a named perils basis and this type of loss is not named in the policy, therefore it would not be covered.
A requirement that a plaintiff file a lawsuit within a specific period of time after the cause of the lawsuit has occurred, which is oftentimes when the injury occurred or was discovered is known as: The burden of proof. The statute of limitations. The subrogation clause. The time limit on certain defense.
The statute of limitations. A requirement that a plaintiff file a lawsuit within a specific period of time after the cause of the lawsuit has occurred, which is oftentimes when the injury occurred or was discovered is known as the statute of limitations.
The insured has a CGL policy with a $600,000 aggregate limit and a $300,000 per occurrence limit. The insured has one claim for $400,000 and another separate claim for $200,000. After paying these two losses, how much of the aggregate limit will remain for future claims? $50,000 $600,000 $400,000 $100,000
$100,000 Even though the insured has incurred $600,000 in the two losses, the insurer will pay the occurrence limit of $300,000 on the first loss. This amount is subtracted from the $600,000 aggregate leaving a balance of $300,000. The second loss is within the occurrence limit and payable. After paying the second claim, the aggregate is now reduced to $100,000 for the remainder of the policy period.
Catherine suffered a covered cause of loss that resulted in water in her basement along with other damage. Alan, an adjuster for Binders Keepers Insurance, tells Catherine to immediately have the water damaged carpeting and wall paneling removed from her basement, so that mold will not cause further damage. Alan then begins the process of identifying coverage under the policy and finds that the water damage is not covered. Which of the following statements is TRUE regarding this claim? Alan will need to report to Catherine as soon as he is aware of the coverage issue so that she will not expect Binders Keepers to pay for the carpeting and paneling that Alan told her to remove. Because Alan told Catherine to remove the carpeting and paneling before he checked the coverage, he waived the right of Binders Keepers to deny the claim. Because Alan told Catherine to remove the carpeting and paneling before he checked the coverage, he will personally be responsible to pay for that part of the claim caused by the water damage. Alan will pay the claim out of the reserves that all insurance companies are required to set aside to pay claims when an adjuster accidentally waives the company's right to deny that claim.
Because Alan told Catherine to remove the carpeting and paneling before he checked the coverage, he waived the right of Binders Keepers to deny the claim. In this situation, Alan waived the right of Binders Keepers to deny the claim because he told Catherine to remove the water-damaged carpeting and paneling from the basement without informing her that he did not yet know if the damaged carpet and paneling would be covered under the policy.
Harvey's Hardware carries a CGL policy with a $2,000,000 "per occurrence" limit and a $4,000,000 "aggregate limit". Harvey's also carries a Commercial Umbrella policy with a $2,000,000 "aggregate limit" and a $300,000 self-insured retention (SIR). The hardware store has 7 bodily injury claims during the policy period, with no single occurrence totaling more than $2,000,000, but the total of the 7 occurrences is $8,000,000. How will this claim be paid? The CGL policy will pay $4,000,000, the Umbrella policy will pay its $2,000,000 "aggregate limit" minus the $300,000 SIR, leaving 2,300,000 of the claim uninsured. The CGL policy will pay $4,000,000, the Umbrella policy will pay $2,000,000, leaving $2,000,000 of the claim uninsured. The CGL policy $2,000,000 on 2 of the 7 occurrences, up to its $4,000,000 aggregate limit, leaving the Umbrella policy to split the remaining 5 occurrences to a payment of $400,000 for each occurrence. The CGL policy will pay the entire $8,000,000 claim because each occurrence was less than its $2,000,000 "per occurrence" limit.
The CGL policy will pay $4,000,000, the Umbrella policy will pay $2,000,000, leaving $2,000,000 of the claim uninsured. The CGL policy will pay its "aggregate limit" of $4,000,000, the Umbrella policy will pay its $2,000,000 "aggregate limit", leaving $2,000,000 of the claim uninsured. The SIR has no bearing on this claim.
Which of the following would be covered by Section I of the Businessowners policy? Flood caused by tidal waters that were blown into the insured's covered building. The seizure of the insured's building by the civil authorities in order to stop the spread of fire. The insured's inventory that was shipped according to a bill of sale that was later found to be fraudulent. Damage from frozen plumbing when the insured fails to take precautions to keep the building warm enough to keep the pipes from freezing.
The seizure of the insured's building by the civil authorities in order to stop the spread of fire. The only answer choice that would be covered is: "The seizure of the insured's building by the civil authorities in order to stop the spread of fire." All of the other answer choices were specifically excluded.
Manfred's Masonry is covered by a standard workers' compensation policy. One day Manfred is looking through his policy and he sees policy limits listed. He begins to worry that his employee's indemnity benefits will not be paid because of these limits. Which of the following statements is TRUE about Manfred's worries? Manfred should not worry, his agent knows how to set the limits in his policy to cover all of the indemnity benefits being paid. Manfred must be mistaken because there are no limits of liability listed anywhere on a standard NCCI workers' compensation policy. Manfred's worries are understandable if the indemnity benefits being paid to his injured employees is higher than the limits expressed in the policy. Manfred's worries are unfounded because the only liability limits shown in a workers' compensation policy are for Part Two - Employers' Liability.
Manfred's worries are unfounded because the only liability limits shown in a workers' compensation policy are for Part Two - Employers' Liability. The only liability limits shown in a workers' compensation policy are for Part Two - Employers' Liability. This has nothing to do with the statutory benefits for indemnity.
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 both the loss to Chaz's car, and the damage to the garage under the Collision coverage of Part D. It would not cover either the damage to Chaz's car or the damage to the garage, because Chaz permitted someone other than an insured to drive his car. It would not cover the damage to Chaz's car because he allowed someone other than an insured to drive it. But it would cover the damage to the garage because the insured automobile caused the 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.
It would cover the loss to Chaz's car because it is the insured automobile, but would not cover the damage to the garage. Part D would cover the loss to Chaz's car because it is the insured automobile, but would not cover the damage to the garage because Part D specifies that a bailee cannot benefit from the policy if a loss occurs to the vehicle while it is in the bailee's possession. The damage to the garage would be covered under the restaurant's policy.
An insured, covered under a standard Businessowners Policy, has sustained a fire loss to his building. Due to changes in the building codes in his town, it's going to cost $20,000 extra just to comply and make the repairs. How much, if any, will the BOP pay for these extra costs? $5,000. Nothing. $10,000. $20,000.
$10,000 There is a limited amount of $10,000 for the "Increased Cost of Construction" in order to comply with newer ordinances or laws. However, this coverage applies only to buildings insured on a replacement cost basis. Further, the $10,000 coverage cannot be used to pay any costs after a loss for an ordinance or law, that the insured was required to comply with before the loss, but failed do so. It is important to note that the ordinance or law exclusion is still in place, preventing the insured from assuming that the entire policy limit is available to pay these costs to bring the building up to code after a claim. The policy will then provide "Increased Cost of Construction" coverage through an "additional coverage", but these costs are limited to $10,000.
Dave has suffered a property loss. He hires Katie, a public adjuster to assist him in presenting his claim to Indemnify Insurance, Inc., the company that insures his damaged property. Indemnify assigns the claim to Mark, one of their staff adjusters. Which of the following statements best describes how Katie and Mark will proceed in processing Dave's claim? Katie will process the claim from Dave's perspective and submit it to Mark, who will use the information to complete his claims report to Indemnify. Katie and Mark will immediately begin the claims investigation as a team, creating their reports together, providing for a smooth settlement between the two parties. Katie will proceed with her investigation and Mark will proceed with his investigation independently of each other. Each will create individual reports regarding the claim. Any time a public adjuster is involved in a claim, a lawyer must also be hired. Katie and Mark will each submit their claim reports to Dave's attorney who will make a decision as to whether or not a lawsuit will result.
Katie will proceed with her investigation and Mark will proceed with his investigation independently of each other. Each will create individual reports regarding the claim. The public adjuster and the staff/company adjuster will investigate the claim and create their reports independently of the other.
In the event of a catastrophe, the Oklahoma Insurance Commissioner may declare an emergency to exist, and in the event of such a declaration, the Commissioner may issue an emergency adjuster license to any resident or nonresident applicant. All of the following is statements are correct regarding the emergency adjuster license, EXCEPT: Must be a licensed adjuster in Oklahoma or another state that reciprocates with the state. The license as an emergency adjuster will remain in force for not more than 90 days from the date of issue, unless extended for an additional 90 days by the Commissioner. An individual licensed as an emergency adjuster pursuant to this section may only adjust claims related to the catastrophe. The employer of this applicant must certify the application for license as an emergency adjuster to the Commissioner within five days after the applicant begins working as an emergency adjuster for said employer.
Must be a licensed adjuster in Oklahoma or another state that reciprocates with the state. The person does not have to be a licensed adjuster to obtain the emergency license.
Which of the following is true regarding the dealers' physical damage coverage under the Garage policy? The coverage is provided by a blanket limit for covered autos. The coverage extends to customers' autos. The coverage provides an annual maximum limit for comprehensive and collision losses. The coverage sets a maximum limit per auto.
The coverage is provided by a blanket limit for covered autos. The dealers' physical damage limit would be set up on a blanket limit basis. This would apply to comprehensive and collision losses to the auto inventory of the dealership. A blanket limit is used because it is simply not practical to schedule each dealer-owned vehicle for physical damage coverage. Additionally, the amount of the coverage is adjusted by the use of a monthly reporting form.
