STIMULATE YOUR EXAM
Equipment breakdown coverage is written with a single limit of insurance per accident. What is the sublimit for hazardous substance cleanup or repair or replacement of contaminated property?
$25,000
An insured has a personal auto policy with both comprehensive (other-than-collision) and collision coverage. His car is stolen and recovered five days later. If the insured claims transportation expenses of $20 per day, how much will his policy pay? a) $45 b) $60 c) $75 d) $100
b) $60
Limited fungi, wet or dry rot, or bacteria endorsement in HO policies applies to a) Property and liability losses b) Specified losses c) Property losses only d) Liability losses only
a) Property and liability losses
The Commissioner is elected to a term that lasts for how many years? a) 3 b) 4 c) 5 d) 10
b) 4
In personal auto policies, the term "you" refers to a) Any person reading the policy. b) The insurer. c) The named insured. d) Any person injured in a covered accident.
c) The named insured.
Insurance companies may be classified according to the legal form of their ownership. The type of company organized to return any surplus money to their policyholders is a) A mutual insurer. b) A reciprocal company. c) A fraternal insurer. d) A stock company.
a) A mutual insurer.
Uninsured Motorist property damage coverage is subject to a deductible of a) $250. b) $500. c) $50. d) $100.
a) $250.
Which of the following dwelling policy forms primarily insures a structure on an actual cash value basis? a) DP-1 b) DP-2 c) DP-3 d) All DP forms
a) DP-1
All of the following statements describe the concept of strict liability EXCEPT a) It is imposed on defendants engaged in hazardous activities. b) Claimants may need to provide proof that a product defect caused an injury. c) It is imposed regardless of fault. d) It is applied in product liability cases.
a) It is imposed on defendants engaged in hazardous activities.
In which of the following situations is it legal to limit coverage based on marital status? a) It is never legal to limit coverage based on marital status. b) Excessive number of divorces, as defined by the Insurance Code c) Legal separation during the application process d) Divorce within the last six months of applying for insurance
a) It is never legal to limit coverage based on marital status.
Under the Fair Credit Reporting Act, individuals rejected for insurance due to information contained in a consumer report a) Must be informed of the source of the report. b) Are entitled to obtain a copy of the report from the party who ordered it. c) Must be advised that a copy of the report is available to anyone who requests it. d) May sue the reporting agency in order to get inaccurate data corrected.
a) Must be informed of the source of the report.
All of the following are additional liability coverages automatically provided in a homeowners policy EXCEPT a) Personal injury. b) Claims expenses. c) Damage to the property of others. d) Loss assessment coverage.
a) Personal injury.
The broad theft coverage endorsement on the dwelling form specifies all of the following limitations EXCEPT a) $1,500 on jewelry. b) $1,000 on silverware. c) $200 on money. d) $1,500 on securities.
b) $1,000 on silverware.
Workers compensation laws provide all of the following types of benefits EXCEPT a) Death benefits. b) Compensatory benefits. c) Medical benefits. d) Rehabilitation benefits.
b) Compensatory benefits.
Which of the following statements is true regarding the commercial general liability policy's Coverage C - Medical Payments? a) The coverage provides high limits of insurance for bodily injury losses. b) The coverage is considered good will because payments are made without regard to fault. c) The coverage applies to bodily injury to the named insured. d) The coverage is liability insurance because it pays only if the insured is legally liable.
b) The coverage is considered good will because payments are made without regard to fault.
A trucking company owns a large fleet of trucks that transport oil across state lines. According to the financial responsibility requirements set by the Motor Carrier Act of 1980, what is the minimum amount of insurance the company must carry on vehicles that transport oil? a) $500,000 b) $750,000 c) $1 million d) $5 million
c) $1 million
A producer has completed 40 hours of continuing education this licensing period. How many credit hours may be carried over to the next licensing period? a) 0 hours; carry overs are not allowed. b) 16 hours c) 10 hours d) 5 hours
c) 10 hours
Temporary licenses can last for how long? a) 60 days b) 90 days c) 180 days d) 365 days
c) 180 days
If a person demands a hearing, the Commissioner of Insurance must set the hearing within a) 60 days. b) 15 days. c) 30 days. d) 10 days.
c) 30 days.
The insured's mother-in-law broke her leg falling down the front steps of the insured's premises. The insured's homeowners medical payments coverage will a) Pay only if the mother-in-law has no health insurance of her own. b) Share equally in the cost with the mother-in-law's health insurance. c) Apply to injuries of any guests or visitors. d) Pay as excess over the mother-in-law's health insurance.
c) Apply to injuries of any guests or visitors.
Which of the following would NOT be considered an exception to the National Do Not Call List? a) Calls which are not commercial or do not include unsolicited advertisements b) Calls by or on behalf of tax-exempt nonprofit organizations c) Calls based from outside of the United States d) Calls for which the consumer has given prior written permission
c) Calls based from outside of the United States
Which of the following losses would be covered under the property damage liability coverage of a personal auto policy? a) The insured's vehicle is damaged when it collides with a deer. b) A passenger in the insured's vehicle is injured following an accident caused by the insured. c) The insured damages a rented garage when he failed to stop in time. d) A temporary substitute vehicle is damaged while the insured is driving it.
c) The insured damages a rented garage when he failed to stop in time.
If a resident producer or solicitor has a change of residential or business address, how soon must the licensee notify the Commissioner? a) As soon as possible b) Within 15 days c) Within 30 days d) At license renewal
c) Within 30 days
A temporary license in this state is valid for a) 30 days. b) 60 days. c) 90 days. d) 180 days.
d) 180 days.
A temporary license is good for a) 30 days. b) 60 days. c) 90 days. d) 180 days.
d) 180 days.
Mike Armstrong is a producer and wants to operate under the name The Insurance Palace. What kind of license would this require? a) Alias b) Transidentification c) Association d) Agency
d) Agency
The Association is obligated to pay up to $10,000 for claims seeking return of unearned premium on a) Property insurance policies. b) Casualty insurance policies. c) Workers Compensation policies. d) All of the above.
d) All of the above.
Which of the following statements is true concerning underinsured motorist coverage under a personal auto policy? a) It will pay up to the limits of insurance for any loss which involves an underinsured driver. b) Limits must equal the bodily injury limits of the policy. c) Limits may differ from the limits for uninsured motorist coverage. d) Coverage applies only to the extent that the underinsured motorist limits exceed the bodily injury limits carried by the operator of the other vehicle.
d) Coverage applies only to the extent that the underinsured motorist limits exceed the bodily injury limits carried by the operator of the other vehicle.
In the event of a member insurer's insolvency, the Association's obligation to pay a covered claim is the lesser of the amount of the loss, the limits of the insurance coverage, or a) $300,000. b) $10,000. c) $100,000. d) $150,000.
a) $300,000.
Which part of an insurance policy covers claims-related expenses, reasonable expenses incurred by an insured to protect damaged property from further loss, or defense expenses? a) Additional coverage b) Exclusions c) Declarations d) Insuring agreement
a) Additional coverage
Employers liability insurance, Part Two of a standard workers compensation and employers liability (WC&EL) policy form, excludes a) An intentional act that is caused by the insured. b) Liability to a third party for claims arising out of injury to an employee. c) Bodily injury caused by accident when the injury occurs during the policy period. d) Bodily injury caused by or aggravated by disease during the policy period.
a) An intentional act that is caused by the insured.
Which of the following could be covered by an HO policy? a) An oriental rug in an on-premises apartment b) Birds, fish, and animals c) A sports car kept in an attached garage d) Property of a tenant not related to the insured
a) An oriental rug in an on-premises apartment
An employee is injured while visiting the employer's out-of-state site. How will the workers compensation benefits be determined? a) Benefits will be provided if the state was listed on the policy information page. b) The legal system will determine which state's benefits apply to this particular loss. c) The state's benefits that pay the lowest amount will be selected by the insurance company. d) The employee may elect to receive benefits from both the home state and the state in which the injury occurred.
a) Benefits will be provided if the state was listed on the policy information page.
If an insurance company cancels a producer's appointment, the a) Commissioner must be notified within 30 days. b) NAIC must be notified within 10 days. c) Better Business Bureau must be notified within 30 days. d) Governor must be notified within 10 days.
a) Commissioner must be notified within 30 days.
Under which type of coverage does the insurer agree to pay for bodily injury or property damage liability which the insured has agreed to assume under a written contractual agreement? a) Contractual liability policy b) Personal liability policy c) Property damage liability policy d) Bodily injury liability policy
a) Contractual liability policy
Which of the following special liability coverages will provide protection to managers of a corporation for claims arising from a wrongful act committed by the manager while in an official capacity? a) Directors and officers liability b) Employment practices liability c) Errors and omissions insurance d) Malpractice insurance
a) Directors and officers liability
Which of the following is true regarding the Difference in Conditions (DIC) policies? a) Each DIC policy is an individually written contract that contains provisions unique to the particular risk that it covers. b) The DIC policy is a stand-alone contract; all perils are covered within it, and no further policies are needed. c) They must conform to the NAIC model. d) All DIC policies from a particular company must be identical to prevent unfair discrimination.
a) Each DIC policy is an individually written contract that contains provisions unique to the particular risk that it covers.
The insured owns an older home with lath and plaster walls. Following a kitchen fire, the insurance company pays to have the wall replaced with drywall that is just as functional, but costs less than lath and plaster. Which loss valuation allows the insurance company to have plaster replaced with drywall? a) Functional replacement cost b) Replacement cost c) Market value d) Actual cash value
a) Functional replacement cost
The Residential Condominium Building Association Policy (RCBAP) is used for residential condominium building associations to cover the entire building under one policy. Which of the following statements about RCBAP is true? a) It does not protect the individual owner from loss to personal property owned exclusively by the unit owner. b) It provides limited coverage for personal property owned exclusively by the unit owner. c) It is designed to provide exclusive coverage for the individual owner and provides not coverage for the unit owner. d) This policy form is not approved for use in the states of New York or New Jersey.
a) It does not protect the individual owner from loss to personal property owned exclusively by the unit owner.
According to the Nationwide Marine definitions, risks that may be the subject of inland marine insurance include all of the following EXCEPT a) Large pleasure boats. b) Property while stored at a warehouse. c) Shipments made by freight train. d) Cargo transported by truck.
a) Large pleasure boats.
Damage to insured property caused by earth movement or earthquake is covered under which of the following homeowners forms? a) None b) HO-2 c) HO-3 d) HO-5
a) None
Crunchy Flakes Cereal Company shipped some of its product in faulty containers that caused spoilage. This resulted in some consumers becoming ill. If the company is sued for this event, it would be an example of a a) Product liability claim. b) Premises and operations claim. c) Personal injury claim. d) Contractual liability claim.
a) Product liability claim.
The Gramm-Leach-Bliley Act was passed to a) Protect private customer information filed with a financial institution. b) Define insurance as interstate commerce. c) Allow consumers access to credit and private consumer reports. d) Allow insurance companies access to medical information for underwriting purposes.
a) Protect private customer information filed with a financial institution.
Local sportscaster Fred Fillmore states on the air during a news telecast that the local pro football coach has a lousy record, which is untrue. This is an example of a) Slander. b) No tort at all - freedom of speech. c) Invasion of privacy. d) Libel.
a) Slander.
What are the two types of compensatory damages? a) Special and general b) Pure and speculative c) Tort and general d) Normal and punitive
a) Special and general
All of the following people would be considered insureds under the liability section of a homeowners policy EXCEPT a) The 22-year-old niece of the insured who is visiting. b) A 15-year-old foster child residing in the premises. c) The mother of the insured who is residing in the household. d) The legal representative of a deceased insured.
a) The 22-year-old niece of the insured who is visiting.
A homeowner sells his house to a friend. The friend wants to keep the homeowner's current policy in effect. Under the assignment provision, which of the following is most likely? a) The homeowner will need to get written consent from the insurer before the policy can be reassigned. b) The policy will have to be cancelled. c) The homeowner should let the friend take over the premium payments. d) The friend will have to apply for coinsurance from another insurance company.
a) The homeowner will need to get written consent from the insurer before the policy can be reassigned.
On a DP-3 Dwelling Property Special Form policy, the coverage provided for personal property is a) The same as provided on the DP-2 Broad Form. b) All risk. c) Open peril. d) The same as provided on the DP-1 Basic Form.
a) The same as provided on the DP-2 Broad Form.
All of the following are essential elements of a commercial package policy (CPP) EXCEPT a) Valuations and/or settlement provisions b) Interline endorsements c) Declarations page d) Policy conditions
a) Valuations and/or settlement provisions
When a parent is required to pay for damages caused by his or her children, this is an example of a) Vicarious liability. b) Strict liability. c) Intervening cause. d) Assumption of risk.
a) Vicarious liability.
Which of the following would be included in the farm liability coverage forms? a) Bodily injury to an employed farmhand b) Bodily injury to a residence employee c) Any obligation of the insured under a workers compensation law d) Bodily injury to any person who is an insured
b) Bodily injury to a residence employee
A France-based insurer would like to do business in Louisiana. What document must it first receive? a) International Certificate of Incorporation b) Certificate of Authority c) Transcontinental Commerce Clearance d) Alien Insurer License
b) Certificate of Authority
An insured was involved in an automobile accident for which the insured was at fault. Which of the following coverages would pay for damage to the insured's automobile? a) Comprehensive coverage b) Collision c) Other-than-collision d) Property damage liability coverage
b) Collision
All of the following are supplemental payments found in liability policies EXCEPT a) Limited amounts for bail bonds and other bonds related to a claim. b) Costs the insured incurred in hiring an attorney. c) All expenses and defense costs incurred by the insurer. d) Reasonable expenses incurred by the insured.
b) Costs the insured incurred in hiring an attorney.
The part of a policy that clarifies terms in the policy is the a) Exclusions. b) Definitions. c) Insuring agreement. d) Conditions.
b) Definitions.
Another person has alleged that you are responsible for damage to their property. You notify your homeowners insurer. The insurer will a) Defend with the hopes of not paying damages. b) Either pay or defend as it decides. c) Pay the alleged damages. d) Proceed according to your request.
b) Either pay or defend as it decides.
How often must producer licenses renew in Louisiana? a) Every year b) Every 2 years c) Every 3 years d) Every 5 years
b) Every 2 years
The form of payment bond that protects an owner contracting for work against liens from subcontractors, suppliers, or laborers who are not paid for their services and materials by the general contractor is called a) Completion bond. b) Labor and material bond. c) Performance bond. d) Supply bond.
b) Labor and material bond.
Which of the following is the type of property NOT covered by the homeowners policy? a) Attached structures b) Land on which the property is located c) Dwellings d) Materials and supplies
b) Land on which the property is located
To comply with requirements for insurance for public liability under the Motor Carrier Act of 1980, which endorsement is added to motor carrier coverage form? a) MCS-70 b) MCS-90 c) MCS-80 d) Garage
b) MCS-90
Which of the following best describes the unfair trade practice of defamation? a) Refusing to deal with other insurers b) Making derogatory oral statements about another insurer's financial condition c) Assuming the name and identity of another person d) Issuing false advertising material
b) Making derogatory oral statements about another insurer's financial condition
A property insurance policy that insures a commercial building on a replacement cost basis includes the ordinance or law coverage endorsement. This endorsement will cover all of the following expenses EXCEPT a) Demolition and removal cost. b) Ordinance with which the insured was required to comply prior to the loss. c) Loss to the undamaged portion of the building. d) Any increased cost of repairs or reconstruction.
b) Ordinance with which the insured was required to comply prior to the loss.
All of the following are parts of a personal auto policy EXCEPT a) Liability coverage. b) Physical damage coverage. c) Medical payments coverage. d) Duties after an accident or loss.
b) Physical damage coverage.
A producer in another state wants to become a producer in Louisiana. The other state gives the same privileges to Louisiana producers wanting to be licensed in that state as it does to its own producers. Louisiana, therefore, extends the licensing privileges to the prospective producer of the other state. What is this called? a) Subrogation b) Reciprocity c) Fair exchange d) Controlled business
b) Reciprocity
According to the standard workers compensation and employer liability policy form, a state should be listed in Part Three - other states' insurance of the workers compensation and employers liability policy when a) The state has a monopolistic workers compensation fund. b) The insured expects to extend operations to that state. c) The insured has operations in the state where the policy is written. d) The insurer is not licensed to write workers compensation in that state.
b) The insured expects to extend operations to that state.
A temporary license may be issued without examination to all of the following, EXCEPT a) The surviving spouse of a deceased producer. b) The spouse of a retired producer. c) The legal guardian of a disabled producer. d) The designee of a producer entering active service in the U.S. Navy.
b) The spouse of a retired producer.
What is the name for the type of property damage coverage that protects the insured or the covered auto in an accident with someone who does not have coverage? a) Underinsured motorist b) Uninsured motorist c) Disaster coverage d) Calamity motor coverage
b) Uninsured motorist
What is the business auto coverage territory for? a) United States and Mexico b) United States and its territories, Canada, or worldwide for private passenger hired autos c) Only for the specific location of the business d) United States only
b) United States and its territories, Canada, or worldwide for private passenger hired autos
Under the business auto coverage form, mobile equipment is covered for liability insurance a) When coverage is written as Symbol 1. b) When being carried or towed by a covered auto. c) On an excess basis. d) When listed on the declarations.
b) When being carried or towed by a covered auto.
Personal business property out in the open is covered under commercial property policy only while a) Within 150 feet of the described premises. b) Within 100 feet of the described premises. c) Located on the described premises. d) Specifically described on the declarations.
b) Within 100 feet of the described premises.
Which of the following statements is true regarding the premium computation for workers compensation insurance? a) The insured pays a guaranteed premium based on an estimated value of the annual income received. b) The premium is set at the beginning of the policy period and will not change. c) A premium auditor has the right to examine the insured's compensation records at the end of the policy period to determine the actual premium basis. d) The premium basis for workers compensation insurance varies by the type of industry in which the insured is involved.
c) A premium auditor has the right to examine the insured's compensation records at the end of the policy period to determine the actual premium basis.
Should 2 or more insurers issue a combined Standard Fire Policy insuring a single risk, in the event of a loss, the insured must notify a) All insurers providing coverage. b) The insurer providing the larger amount of coverage. c) Any of the insurers providing coverage. d) None of the above.
c) Any of the insurers providing coverage.
Which of the following types of agent authority is also called "perceived authority"? a) Implied b) Fiduciary c) Apparent d) Express
c) Apparent
The garage coverage form is used to insure a) All types of organizations other than auto businesses and motor carriers. b) Owner-operators who use their own trucks to haul property for the motor carriers that hire them. c) Auto businesses, such as auto dealers, service stations, and auto repair shops. d) Businesses that use automobiles to transport property of others or their own property.
c) Auto businesses, such as auto dealers, service stations, and auto repair shops.
Any clause, condition, or provision contained in a fire policy contrary to the valued policy law will a) Void the policy. b) Be enforced instead of the valued policy law. c) Be considered to be null and void. d) None of the above.
c) Be considered to be null and void.
States with monopolistic state workers compensation funds a) Require all employers in their state to purchase workers compensation insurance regardless of their financial capacity. b) Sell workers compensation insurance through private insurers that are in the state and receive a kickback for all policies sold on an annual basis. c) Do not allow private insurers to be licensed to write workers compensation coverage d) Provide workers compensation insurance through managed risk plans
c) Do not allow private insurers to be licensed to write workers compensation coverage
Which of the following is not included in a binder or temporary contract for a Standard Fire Policy? a) Policy terms b) Policy endorsements c) Effective hour that coverage commences d) None of the above
c) Effective hour that coverage commences
What is the purpose of the coinsurance clause found in property insurance policies? a) Ensure that insureds do not overinsure their property b) Prevent insureds from profiting from a loss c) Encourage the insured to insure the property closer to its full value d) Encourage higher standards of care by requiring the insured to pay a portion of every loss
c) Encourage the insured to insure the property closer to its full value
Which of the following are the authorities that an agent can hold? a) Authorized and admitted b) Primary and secondary c) Express and implied d) Apparent and allowed
c) Express and implied
Which of the following statements would be an example of a product liability claim? a) Someone tampers with the insured's product causing the insured to have to recall all products that are on the shelf. b) The insured's product has to be recalled because of an expiration date. c) Faulty packaging of a cereal caused spoilage that resulted in someone getting sick. d) An insured, while delivering product to a customer, hits another car with the delivery truck causing bodily injury and property damage.
c) Faulty packaging of a cereal caused spoilage that resulted in someone getting sick.
A specialized type of insurance that guarantees the faithful performance of a trustee of employee benefit plans is called a) Directors and officers insurance. b) Employee benefit plan comprehensive coverage. c) Fiduciary liability insurance. d) Surety bond.
c) Fiduciary liability insurance.
In liability insurance policies, supplementary payments are made a) At the option of the insured. b) At the option of the insurer. c) In addition to the limit of liability. d) As part of the limit of liability.
c) In addition to the limit of liability.
According to agency law, the producer always represents the a) Public. b) State Insurance Department. c) Insurance company. d) Client.
c) Insurance company.
Which of the following terms refers to other insurance that is written on the same risk, but not on the same coverage basis? a) Pro rata b) Contribution by equal shares c) Nonconcurrency d) Primary and excess
c) Nonconcurrency
A situation in which a person can only lose or have no change represents a) Adverse selection. b) Hazard. c) Pure risk. d) Speculative risk.
c) Pure risk.
Which of the following would qualify as a competent party in an insurance contract? a) The applicant is a 12-year-old student. b) The applicant is under the influence of a mind-impairing medication at the time of application. c) The applicant has a prior felony conviction. d) The applicant is intoxicated at the time of application.
c) The applicant has a prior felony conviction.
Which of the following statements is true regarding a mobile equipment endorsement in commercial auto policies? a) Liability coverage is not provided on equipment that is being towed. b) Mobile equipment is covered for property insurance. c) The endorsement is available for additional premium. d) The endorsement is automatic.
c) The endorsement is available for additional premium.
If more than one person has an insurable interest in the property covered under a dwelling policy, a) All involved insurers must decide which one will be liable for the loss. b) All insureds must decide which one will be liable for the loss. c) The insurer will be liable for only the insured's interest in the damaged property. d) Liability will be split evenly among all people who have insurable interest.
c) The insurer will be liable for only the insured's interest in the damaged property.
Which of the following would NOT be considered part of the insured location under the liability section of a homeowners policy? a) A family cemetery plot b) A lakeside cabin rented by the insured for vacation c) Vacant farmland owned by the insured d) A residence where an insured is temporarily residing
c) Vacant farmland owned by the insured
In this state, an agency license must be obtained when a) You represent more than 7 companies. b) You are writing over $50,000 in premium. c) You are operating under a name other than your own name. d) You have more than 50 clients.
c) You are operating under a name other than your own name.
Which of the following is NOT considered an insured contract under the commercial general liability policy? a) An elevator maintenance agreement b) An obligation as required by ordinance to indemnify a municipality, except for work for a municipality c) A written lease agreement on the insured premises d) A written agreement which indemnifies a person for fire damage to the premises rented to the insured
d) A written agreement which indemnifies a person for fire damage to the premises rented to the insured
In a personal auto policy, the medical payments coverage is similar to a) Accident insurance, because it has the same limits. b) Bodily injury coverage, because it pays the insured's doctor bills. c) Bodily injury coverage, because it provides legal protection if the insured causes injuries to others. d) Accident insurance, because it pays medical expenses regardless of fault.
d) Accident insurance, because it pays medical expenses regardless of fault.
With regards to Uninsured/Underinsured Motorist Coverage, the named insured may a) Reject the coverage. b) Select a lower limit of coverage. c) Select economic-only coverage. d) Any of the above.
d) Any of the above.
Which bonds may be required when a person appeals to a higher court after a judgment already has been entered to guarantee that a judgment will be paid? a) Bail bonds b) Injunction bonds c) Cost bonds d) Appeal bonds
d) Appeal bonds
A state-issued document empowering an insurance company to become an admitted insurer is called a) Certificate of title. b) Certificate of deposit. c) Certificate of admission. d) Certificate of authority.
d) Certificate of authority.
Which of the following best describes liberalization clause in a policy? a) The insurer is relieved of its contractual obligations to the insured. b) The insured may assign the policy to any person without their written consent. c) The policy cannot be cancelled. d) Changes adopted by the insurer that broaden coverage automatically apply to the policy at no additional premium.
d) Changes adopted by the insurer that broaden coverage automatically apply to the policy at no additional premium.
When both parties to a contract must perform certain duties and follow rules of conduct to make the contract enforceable, the contract is a) Aleatory. b) Personal. c) Unilateral. d) Conditional.
d) Conditional.
According to the Fair Credit Reporting Act, all of the following would be considered negative information about a consumer EXCEPT a) Tax delinquencies. b) Late payments. c) Failure to pay off a loan. d) Disputes regarding consumer report information.
d) Disputes regarding consumer report information.
An employee drives a company auto, but does not own a vehicle herself. What endorsement could be added to the insurance policy covering the company auto that would provide coverage to the employee when she drives someone else's car for her personal use? a) Bobtail coverage b) Rental car coverage c) Personal injury protection d) Drive other car coverage
d) Drive other car coverage
Under which of the following conditions can broad theft coverage be added to a dwelling policy? a) If permission is granted by the department of insurance b) Broad theft coverage cannot be added to a dwelling policy. c) If the policy has been in effect for 60 days d) If the insured is owner-occupant of the dwelling
d) If the insured is owner-occupant of the dwelling
Which authority is NOT stated in an agent's contract but is required for the agent to conduct business? a) Apparent b) Assumed c) Express d) Implied
d) Implied
Several insureds have become liable because of a single loss. How will the policy's limit of liability be affected? a) Pro rata liability applies. b) A homeowners policy can have no more than one insured. c) The full limit applies to each insured individually. d) No more than the per occurrence limit applies, no matter how many insureds are involved.
d) No more than the per occurrence limit applies, no matter how many insureds are involved.
A customer was injured in a supermarket parking lot when a grocery cart collided with the customer's leg. Coverage for this claim would be provided under a) Completed operations. b) Contractual liability. c) Product liability. d) Premises and operations.
d) Premises and operations.
All of the following statements regarding a boatowners policy are true EXCEPT a) Watercraft liability protects up to specified limits for claims against a "covered person" for damages due to bodily injury caused by a watercraft. b) Physical damage coverage is provided on an actual cash value (ACV) basis. c) Perils are insured on an open-peril basis, providing that the insurer will pay for direct and accidental loss to the property insured. d) Replacements for the boat listed in the Declarations are automatically covered, if the insured notifies the insurer within 60 days and pays the additional premium.
d) Replacements for the boat listed in the Declarations are automatically covered, if the insured notifies the insurer within 60 days and pays the additional premium.
The National Do Not Call Registry was created to regulate a) Field underwriters. b) Insurers. c) Insurance solicitors. d) Telemarketers.
d) Telemarketers.
Who is NOT considered an employee in a commercial general liability (CGL) policy? a) Leased worker b) Full-time worker c) Part-time worker d) Temporary worker
d) Temporary worker
If a company wants to appoint a producer, which entity must it notify? a) The NAIC b) The Governor c) The Appointment Board d) The Commissioner
d) The Commissioner
The claims-made trigger is based on which of the following? a) The date the claim is first made in writing against an insurer for injury or damage that occurred after the policy's retroactive date b) The date the claim is first made orally against an insurer for injury or damage that occurred after the policy's retroactive date c) The date the claim is first made orally against an insured for injury or damage that occurred after the policy's retroactive date d) The date the claim is first made in writing against an insured for injury or damage that occurred on or after the policy's retroactive date
d) The date the claim is first made in writing against an insured for injury or damage that occurred on or after the policy's retroactive date
According to the Workers Compensation Act, if the deceased employee had no dependents and no dependent parents, who would be considered next in line to receive the benefit? a) The employer b) The insurance company c) The employee's estate d) The employee's brother or sister
d) The employee's brother or sister
A neighbor's tree has fallen into the insured's yard. The insured's homeowners policy will only pay to remove the tree if a) The damage is more than $1,000. b) The neighbor has no homeowners insurance. c) The tree has caused damage to the insured's vehicle. d) The tree is blocking the driveway.
d) The tree is blocking the driveway.
Which of the following statements is NOT true regarding mobile agricultural machinery and equipment coverage? a) It relates to devices used in the everyday farm operation. b) It covers detached parts and accessories of mobile devices. c) It insures eligible equipment for open perils. d) This coverage must be written as part of farm coverage.
d) This coverage must be written as part of farm coverage.
How much coverage can be available for watercraft damage in the homeowners policy? a) Unlimited amount b) No more than $1,000 c) Homeowners policies do not cover watercraft. d) Up to $1,500
d) Up to $1,500
All of the following are supplemental payments included in the liability section of a personal auto policy EXCEPT a) Up to $200 a day for loss of earnings due to attendance at hearings or trials. b) Premiums on appeal bonds in any suit the insurer defends. c) Up to $250 for bail bonds required because of a covered accident. d) Up to $100 for the cost to secure the release of a vehicle from an impoundment lot following a covered accident.
d) Up to $100 for the cost to secure the release of a vehicle from an impoundment lot following a covered accident.
When would uninsured motorist coverage apply? a) When the insured drives an uninsured car b) When the insured is legally liable, but does not have sufficient coverage c) When the insured is legally liable d) When the other party is legally liable but has no insurance
d) When the other party is legally liable but has no insurance
