PC TEST

A building valued at $200,000 is insured for $150,000 with an 80% coinsurance requirement and a $1,000 deductible. After the building is totally destroyed, incurring debris removal expenses of $10,000, how much will the Building and Personal Property Coverage Form pay?

$159,000

Driver D slid into another car causing an accident in which three people in the other car were injured. Two injured parties claimed $15,000 in medical expenses and the third person claimed $25,000. How much will D's insurance company pay if her policy has 25/50 limits for bodily injury?

$50,000

Reasonable medical expenses incurred and reported within how many years following an accident are covered under Medical Payments coverage of the CGL?

1

The guaranty association will cover existing claims prior to the determination of insolvency or arising within how many days after the determination of insolvency?

30

In the event an apartment attached to the insured's home is damaged and unlivable, what percentage of Coverage A does the HO-3 provide for the rental value?

30%

How many days does a licensed producer who moves to Missouri from another state have to submit an application to become a resident producer?

90

Which of the following defines a surplus lines broker?

A broker who places risk with authorized but non-admitted carriers

The Homeowners Policy provides coverage for all of the following, except: A. A motorized golf cart being driven on a public beach C. An ATV on the insured's premises C. Amotorized wheelchair D. A riding lawn mower pulling a two-wheel garden trailer

A motorized golf car being driven on a public beach

The Inside The Premises Theft of Money and Securities insuring agreement will cover all of the following losses, except: A. Attempted robbery of a custodian B. Disappearance of money C. Damage to a locked safe D. Damage to a bank caused during a theft

A. Attempted robbery of a custodian

Which of the following is covered by Medical Payments under the CGL? A. Bodily injury to an insured's customer while shopping on the insured's business premises B. Bodily injury to an insured that is injured while playing tennis C. Bodily injury to a person on a part of the premises that the insured owns or rents and that the person normally occupies D. Bodily injury to a person hired to do work for the insured

A. Bodily injury to an insured's customer while shopping on the insured's business premises

Which of the following forms provides coverage for indirect loss A. Business income coverage form B. Legal Liability Coverage Form C. Commercial Glass Coverage Form D. Building and personal property coverage form

A. Business income coverage form

Which statement about the builders risk form is not correct? A. Coverage is always written on an open perils basis B. Coverage terminates 90 days after construction is completed, when a policy expires, is cancelled, or 60 days after the owners fully occupy the dwelling, whichever is soonest C. There is no vacancy provision D. Coverage does not apply to outside radio and television antennas

A. Coverage is always written on an open perils basis

Which of the following would not be covered under a Businessowners Policy unless specifically activated on the Declarations page? A. Employee Dishonesty B. Exterior building glass C. Fire department service charge D. Money order and Counterfeit paper money coverage

A. Employee dishonesty

Employers Liability Insurance is designed to do all of the following, except: A. Extend policy benefits to states not listed on the declarations page B. Cover claims that are not subject to compensation laws C. Protect the employer against common law claims D. Fill in gaps of compensation coverage

A. Extend policy benefits to states not listed on the declarations page

All of the following are true of Section II of a Homeowners Policy, except: A. Loss assessment charges against the insured by a property owners association are excluded B. First aid expenses are automatically included C. Medical expense coverage is payable to guests D. Medical payments coverage would apply if the family dog were to bite someone 3 blocks from home

A. Loss assessment charges against the insured by a property owners association are excluded

Which of the following is true about the Missouri insurance cease and desist order? A. Notice of intent to initiate administrative action must be served personally or by certified mail B. It is the only recourse to stop an insurance unfair trade practice C. Violation may result in a minimum fine of $100,000 D. An alternative to cease and desist order is federal court action

A. Notice of intent administrative action must be served personally or by certified mail.

What is the best description of punitive damages? A. Punitive damages are assessed as a punishment for extremely objectionable conduct by a negligent party B.Punitive damages are assessed in addition to specific damages for the benefit of low-income plaintiffs C. Punitive damages are so limited as to be punitive toward the plaintiff D. Punitive damages are limited to the disfigurement and mental anguish

A. Punitive damages are assessed as a punishment for extremely objectionable conduct by a negligent party.

Livestock is not eligible for coverage on which Farm policy? A. Special Cause of Loss Form B. Basic cause of loss C. Broad Cause of Loss Form D. Livestock Coverage Form

A. Special cause of loss form

The Workers' Compensation policy's guidelines for providing other state coverage do not include which requirement? A. Monopolistic states may be listed on the information page B. The insured must notify the insurer within 30 days when entering a state not listed on the policy C. If the insured begins work in a covered state after the effective date of the policy the other in force insurance, if any, applies D. The insurer must reimburse the insured for any payments the insurer is not allowed to pay.

A. monopolistic states may be listed on the information page.

Which of the following is an example of vicarious liability?

An employer's liability for the acts of an employee

All of the following statements regarding the property policy structure are correct, except: A. The insuring agreement describes the perils that are covered under the policy B. Additional coverage's are added to the policy for an additional premium C. The insureds duties and obligations are listed in the conditions section D. The declarations page lists other parties having an insurable interest in the property

B. Additional coverages are added to the policy for an additional premium

Which of the following autos is covered under Symbol 9 of the Business Auto Coverage Form? A. Any autos not used in the insured's business B. An auto owned by the insureds employee while used in the insureds business C. An auto borrowed by the insured D. An auto leased or hired by the insured

B. An auto owned by the insureds employee while used in the insured's business

Which Ocean Marine insurance provision protects against direct damage caused by bursting of boilers? A. Boiler and machinery clause B. Inchmaree clause C. Running down clause D. Mechanical failure clause

B. Inchmaree clause

Which of the following is not true about a nonresident producer? A. A letter from the home states regulatory authority is valid if received within 6 months of approval or nonresident license B. The home state is not obligated to insure nonresident producers licensed in Missouri C. A nonresident producer must be licensed for the same line of insurance in the home state D. The department may check the Naic producer data base

B. The home state is not obligated to insure nonresident producers licensed in Missouri

The Limited Theft Coverage endorsement to the DP is used under which of the following circumstances? A. Coverage is desired for off premises property B. The insured dwelling is tenant-occupied C. The insured dwelling is owner-occupied D. The dwelling has been vacant for more than 60 days

B. The insured dwelling is tenant-occupied

The spouse of which of these persons is not an insured covered under the BOP A. Joint venture partner B. Trustee C. Sole Proprietor D. Partner

B. Trustee

Under the BOP, which of the following types of property is not covered? A. Building materials, equipment or supplies located in the open B. Vehicles subject to motor vehicle registration C. Business Personal Prop located outside the building D. Tenants improvements made to structures not owned by the tenant

B. Vehicles subject to motor vehicle registration

Which of the following losses would the Building and Personal Property Coverage Form NOT pay on an actual cash value basis? A. Loss to outdoor equipment or furniture B. A loss $2500 or less to a building C. A loss to awnings and floor coverings D. A loss to appliances, whether attached or not.

B. a loss of $2500 to a building

Which of the following pays the cost of replacing papers and records that are important for the continuation of business? A. Business property coverage form B. Valuable papers and records coverage form C. Accounts Receivable coverage form D. Commercial articles coverage form

B. valuable papers and records coverage form

An insured accidentally backs into the neighbor's son on his skateboard. The son has medical expenses and there is damage to the skateboard. Which sections of the insured's policy will pay?

Bodily injury and property damage

Which of the following is true regarding liability insurance? A. A liability policy provides coverage for criminal acts B. The liability policy provides coverage for all acts of wrongdoing C. A liability policy provides coverage for unintentional torts D. A liability policy provides coverage for all torts

C. A liability provides coverage for unintentional torts

Which of the following would not be covered under an Installation Floater? A. Elevators B. Carpeting C. Construction equipment D. Electrical equipment

C. Construction equipment

Which of the following is not true of the National Flood Insurance Program? A. Personal Property in basements is not covered B. The deductible applies separately to the building and personal prop. C. Coverage becomes effective 24 hours after the applicant completes the application and pays the premium. D. Prop removed to another location to protect it from flood at the insured location is covered for 45 days at the other location

C. Coverage becomes effective 24 hours after the applicant completes the application and pays the premium

Which statement is true regarding the Accounts Receivable coverage form? A. It does not cover collection fees B. It does not cover the cost of reconstructing lost records C. It covers the insured's uncollectibles from customers due to a direct physical loss of the insured's business records D. It covers only the cost of reproducing the insureds accounts receivable records that are destroyed by an insured peril.

C. It covers the insured's uncollectibles from customers due to a direct physical loss of the insured's business records

Bodily Injury may include which of the following? A. False Arrest B. Invasion of privacy C. Loss of earnings D. slander

C. Loss of earnings

The Personal Umbrella Policy does not provide coverage for which of the following? A. Homeowners Liability B. Personal automobile liability C. Property damage liability to property in the insureds care D. Personal injury

C. Prop damage liability to property in the insureds care

All of the following are considered implied warranties in an Ocean Marine policy, except: A. Legality B. No deviation in voyage C. protection clause D. seaworthiness

C. Protection clause

Which of the following would not be an insured under Section II of the homeowners policy A. Any person legally responsible for watercraft owned by an insured B. Relatives of the named insured, meaning they are related by blood, marriage, or adoption C. The insureds tenants D. Members of the family under the age of 24 living at school away from home

C. The insured's tenant

Which of the following is covered under a Personal Auto Policy? A. Liability for damage caused by a vehicle designed mainly for off road use B. Use of a non-owned vehicle used without permission C. Intentional damage done by the insured D. A vehicle driven with permission by an unlicensed driver

D. A vehicle driven with permission by an unlicensed driver

All of the following are true of the dwelling special form except A. Mobile homes are not eligible B. Losses to the dwelling are paid on a replacement cost basis C. The dwelling must be used principally for residential dwelling purposes D. Both dwelling and contents are covered on an open perils basis

D. Both dwelling and contents are covered on an open perils basis

Which of the following statements about Section II of the Homeowners Policy is false? A. The obligations of an insurer end when it pays damages equal to the policy limit for any one occurrence B. The insurer investigation expenses are paid in addition to the limits stated in coverage E C. Total liability Coverage resulting from any one occurrence may not exceed the Coverage E limit that is stated in the policy D. Coverage F limits are subject to a deductible

D. Coverage F limits are subject to a deductible

All of the following are true of subrogation, except: A. It prevents the insured from collecting twice for the same loss B. It helps the insurer control expenses and premiums C. It allows the insurer to attempt collection from a third party to reimburse a loss D. It allows the insurer to file suit against the insured

D. It allows the insurer to file suit against the insured

Which coverage is not provided under Section II of a Homeowners Policy? A. Personal injury liability B. Damage to property of others C. Medical expenses of a boarder D. Medical expense of a guest

D. Medical expense of a guest

Making a false statement about the benefits or the nature of an insurance policy is what unfair trade practice? A. Twisting B. Defamation C. Unfair discrimination D. Misrepresentation

D. Misrepresentation

Making any statement that misrepresents the benefits or true nature of a policy refers to which of the following? A. False statements and entries B. Misrepresentation of insurance applications C. false information and advertising generally D. Misrepresentation and false Advertising of insurance policies

D. Misrepresentation and False advertising of insurance policies

Which of the following is not within an agents authority? A. Selling applications on the insurers behalf B. Countersigning insurance contracts C. Using express authority D. Representing the insured's interest

D. Representing the insureds interest

All of the following are true of Supplementary Payments under the Commercial General Liability Coverage Forms, except: A. The cost of bail bonds is included up to $250 B. They do not reduce the Limit of Liability C. Insurers claim related expenses are included D. Supplementary Payments apply to all Section 1 coverage

D. Supplementary Payments apply to all Section 1 coverage

Which of the following statements regarding Supplementary Payments under the CGL is false? A. Insurer claim related expenses are included B. The cost of bail bonds is included up to $250 C. Coverage only applies to losses under coverages A and B D. Supplementary payments will reduce the limits of the policy

D. Supplementary payments will reduce limits of the policy

hich of the following is not a characteristic of the employer-employee relationship as it related to Workers' Compensation coverage? A. The employer supplies the necessary tools and equipment B. The employer directs the way work will be completed C. The employer determines the work hours D. The employer signs a contract with employees

D. The employer signs contract with employees

Which of the following is stated in the insuring agreement? A. The perils excluded by the policy B. The other insurance provision C. The location of insured property and the named insureds mailing address D. The perils insured against

D. The perils insured against

All of the following are true of Supplementary Payments under the CGL, except: A. They apply to bodily injury and property damage liability B. They include the cost of bail bonds up to 250 C. They pay defense costs incurred by the insurer D. They reduce the limits of insurance

D. They reduce the limits of insurance

All of the following are covered perils under the Extended Coverage Endorsement to the DP-1, except: A. Windstorm B. Volcanic eruption C. Vehicles D. Weight of ice, snow, or sleet

D. Weight of ice snow or sleet

The _________ endorsement covers the loss of money, securities, or property that results from a threat made to the insured, so long as the threat is reported to law enforcement

Extortion

What term includes pain and suffering, disfigurement, and mental anguish?

General Damages

A loss caused by which of the following would be covered under a BOP?

Increased cost of construction

After a lightning storm, the electrical transformer in B's town fails and she has no electricity for 3 days. The damage caused by the loss of electricity:

Is not covered

Section I of the Boatowners policy provides which type of coverage and settlement option?

It provides an open perils coverage, and losses are settled on an actual value basis.

A bird hits and breaks a windshield of an insured vehicle. This is covered under which of the following coverages of the PAP?

Other than collision

Policy owner P has just finished painting the interior walls in his home, and stores leftover paint thinner in the basement near the furnace. What kind of hazard does the stored paint thinner present?

Physical

The person whose responsibility it is to fulfill the obligation of a surety bond is the:

Principal

Which of the following types of property would be covered by the Guests' Property endorsement to a commercial crime policy

Property stored in a hotel safety deposit box by someone renting a room

What section of the Garage Coverage Form provides physical damage coverage for the insureds covered autos?

Section IV

The basic causes of loss form under the commercial property coverage part would not cover what

Steam boiler explosion

Who is the obligee on a Fidelity Bond?

The employer

Choose the correct statement regarding the BOP Protective Safeguards Endorsement.

The insured is required to maintain the safeguards listed in the endorsements such as automatic sprinkler systems, automatic fire alarms and/or security services

When an insurer policy is not clear, the court will usually interpret in favor of the insured because of which characteristic?

The policy is a contract of adhesion

FOB (Free on Board) point of destination is best described as which of the following?

The seller is responsible for the property being transported until it has been delivered.

Which of the following is NOT sufficient grounds for the revocation or suspension of a producer's license?

Unkowingly accepting business from an unlicensed individual.

The Basic (DP-1) Dwelling Form does not include which coverage?

additional living expenses

An example of _________ is charging a lower rate to one individual who lives in a certain geographic location in which others are charged the correct higher rate.

discrimination

The Legal Liability Coverage Form would not cover which of the following losses?

fire damage to the cash register

Which type of standard policy includes coverage options that would not exclude damage by flood?

personal auto

When the insurance company and insured cannot agree upon the amount of the loss, the person selected to help the two hired appraisers is called a(n):

umpire

A guest falls in K's house and is injured in an amount of $1,000. How much will K's Homeowners Policy pay regardless of fault, if the Coverage F limit is $1,500?

$1,000

The occurance form does not have

A retroactive date

HO-8 dwelling is valued on which basis

Actual cash value

Which statement is false regarding inland marine policies?

The Bailees' Customers Form covers the insured's property when he/she has property of others in his/her care, custody and control