final exam 2
A disability that prevents an employee from doing any work, and from which the employee is not expected to recover, is known as a: A Permanent total disability B Temporary total disability C Permanent partial disability D Temporary partial disability
A
All of the following are requirements for premium financing, except: A A premium finance agreement is prohibited from financing additional premiums to be added to the initial premium finance agreement B A premium finance agreement may include some of the fees that a surplus lines broker charges C A premium finance company helps pay for insurance premium D A premium finance company must register with the Commissioner before engaging in premium financing
A
Boatowners policies typically provide which of the following coverages? A Open perils coverage for physical damage to the hull and equipment B Named perils coverage for physical damage to the hull, trailer, and related equipment C Open perils coverage for damage to the hull and motor, with exclusions for losses to personal effects D Open perils coverage for damage to the hull and named perils coverage for damage to equipment and accessories
A
Casualty insurance policies may contain any of the following conditions, except: A Coinsurance B Other Insurance C Severability D Premium Audit
A
G owns a two-unit residential dwelling that is used exclusively as a rental property. G can obtain property coverage for their interest in the property through which coverage form? A Unendorsed DP-1 B DP-3, but only by adding an endorsement C HO-6 D Commercial Unit-Owners Coverage Form
A
In Maryland, a personal policy may not be cancelled: A Due to the insured changing their occupation B For fraud or material misrepresentation C For nonpayment of premium D For a change in risk substantially increasing the hazard
A
Insureds who have collision and comprehensive coverage for a covered auto under Part D of their Personal Auto policy are subject to: A One deductible for collision losses and a separate deductible for comprehensive losses B A deductible applicable only to losses covered by comprehensive coverage C A deductible applicable only to collision losses D A single deductible applicable to any loss under Part D
A
Personal information may not be disclosed about an individual pursuant to an insurance transaction without the individual's written authorization, unless: A The information is needed to determine eligibility for an insurance benefit B The individual has provided verbal approval C The information is needed for marketing purposes D The information is being purchased
A
The Loss Assessment Additional Coverage provided by Section II of a Homeowners policy will cover the insured's share of loss assessments charged by any of the following, except: A A governmental body B A homeowners association C A corporation of property owners D An organization of homeowners
A
Under the commercial property coverage part of a Commercial Package policy, the Causes of Loss - Broad Form will insure against all f the following perils, except: A Governmental action B Weight of ice, snow, or sleet C Falling objects D Water damage caused by the accidental discharge of water
A
Which of the following is not a condition found in Section IV of the Commercial General Liability Coverage Form? A Inspection and Surveys B Bankruptcy C Premium Audit D Other Insurance
A
Which of the following is not true regarding Maryland Workers' Compensation requirements? A The insurer requires the employer include policy deductibles B Minors are required to have a work permit C The employer and insurer act as one regarding notification of an injury D A person guilty of violating insurance statutes may be fined $1,000
A
Which of the following statements is correct with respect to appointments? A An appointment is an agreement between a producer and insurer under which the producer may sell or negotiate policies issued by the insurer B A business entity is not required to be appointed by an insurer C If a producer fails to renew their license, and the license is reinstated, the insurer may reappoint the producer as of the date the license is reinstated D A producer may transact business for an insurer prior to being appointed by that insurer if the producer is appropriately licensed
A
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 D's policy has 25/50 limits for bodily injury? A $55,000 B $50,000 C $75,000 D $45,000
B
Section II of a Homeowners policy would not provide liability coverage for: A The insured's liability for bodily injury to a guest B Damage to the property of others arising out of the insured's business pursuits C The insured's liability for damages to property belonging to a neighbor D A stranger's medical expenses after a bodily injury arising from the non-business activities of an insured
B
An HO-3 policy provides coverage on which basis? A Broad Form perils coverage on both the dwelling and personal property B Open perils coverage on both the dwelling and personal property C Open perils coverage on the dwelling and named perils coverage on personal property D Named perils coverage on both the dwelling and personal property
C
An insured has a Commercial Package policy with the Building and Personal Property Coverage Form. After a covered loss to a commercial building, the insured incurs increased expenses to repair the building due to the enforcement of an ordinance regulating repair. These increased costs of construction are covered by: A An endorsement that must be added to the policy B All three Causes of Loss forms C An Additional Coverage D The Causes of Loss - Special Form only
C
If an application for homeowners insurance is made by telephone, the insurer must provide a notice stating the policy does not cover flood losses within _______ days after the date of the application. A 10 B 5 C 7 D 3
C
Medical payments coverage under the Commercial General Liability coverage part includes reasonable medical expenses incurred and reported within: A Three years of the accident B Nine months of the accident C One year of the accident D Ninety days of the accident
C
A Personal Auto policy is designed to cover: A Only an individual and their spouse's liability for the personal use of an automobile B Only physical damage to an auto personally used by an individual or their family members C Personal and commercial autos that are owned by an individual or family D An individual's or their family's personal use of an auto
D
All of the following vehicles are considered mobile equipment by the CGL, except: A Forklifts B Bulldozers C A vehicle with a permanently attached power crane D A pickup used on a farm
D
Which of the following statements is true with respect to an adviser? A An adviser may not conduct business as a corporation B An insurance adviser license expires every year on June 30th, unless renewed C An adviser may receive compensation from a producer for the placement of insurance D A nonresident must pass the Maryland Adviser exam if the resident state does not issue an adviser License
D
Which of the following statements regarding minors covered under Maryland Workers' Compensation is false? A Insurers must notify employees that work permits for minors are required B If the employer does not have a work permit for an injured minor employee, then twice the normal compensation may be awarded C A minor is a covered employee D The insurer is solely liable for any compensation or death benefit increases due to failure to have a work permit
D
A party that willfully violates any general provision of the Maryland insurance law may be fined up to _______ upon conviction. A $100,000 B $50,000 C $75,000 D $15,000
Maybe A
An insured has an unendorsed HO-3 policy. The policy provides liability protection in the event that someone is injured while the insured uses which watercraft? A A 50-horsepower inboard motorboat owned by the insured B A 50-horsepower outboard motorboat owned by the insured C A 17-foot canoe D A 30-foot sailboat
Maybe A
An insurer requires an applicant to purchase insurance only through a particular producer as a condition to qualify for a loan. This is an example of what unfair trade practice? A Boycott, coercion, and intimidation B Twisting C Rebating D Misrepresentation
Maybe A
The Maryland Property and Casualty Guaranty Corporation is an example of what? A Insurers insolvency fund B Unauthorized insurer C Risk retention group D Blanket insurance
Maybe A
Which of the following is not a coverage provided by any of the Farm Property coverage forms? A Coverage G - Farm Autos B Coverage A - Dwellings C Coverage E - Scheduled Farm Personal Property D Coverage D - Loss of Use
Maybe A
For a personal injury claim covered by a Personal Umbrella Liability policy, the Umbrella insurer provides a defense, covered in addition to the policy limits. Defense expenses include reasonable expenses incurred by the insured for assisting the insurer with the defense, up to: A 5% of the personal injury liability limit B $250 per day C $250 total D $100 per day
Maybe B
K has a Homeowners policy with a $100,000 Coverage E limit and a $1,000 Coverage F limit. A guest falls in K's house, and their injuries result in $1,500 of medical expenses incurred over three months. How much will K's policy pay? A $500 B $1,000 C Nothing until K's negligence is legally established D $1,500
Maybe B
Uninsured motorist coverage provided by a Personal Auto policy covers insureds while they occupy or use which of the following vehicles? A A vehicle being driven without permission B A covered vehicle owned by the named insured C A vehicle being used as a taxi D A vehicle being used to carry property for a fee
Maybe B
Which of the following is not correct regarding the licensing of a business entity? A The designated producer must prepare and maintain a list of locations where the entity's records are maintained B Only the designated producer may transact business on behalf of the business entity C A business entity must designate a licensed insurance producer as its principal contact with the Maryland Insurance Administration D Any changes to designated producer's information must be provided to the Administration within 10 days
Maybe B
Additional acquired livestock must be reported to the insurer within how many days to be covered by the Livestock Coverage Form? A 60 days B 45 days C 15 days D 30 days
Maybe D
If an insured adds the Automatic Increase in Insurance Endorsement to their Broad Form Dwelling policy, what effect does it have on the policy? A It increases policy limits for all coverages B It increases policy limits for the dwelling, other structures, and personal property only C It increases policy limits for the dwelling only D It increases policy limits for the dwelling and other structures only
Maybe D
The Equipment Breakdown Protection Coverage Form would not cover which of the following? A Accidental smoke damage to a machine caused by an employee B Spoilage of refrigerated materials following a transformer failure C Explosion of a steam boiler or steam engine D An air conditioning unit intentionally disabled by an employee
Maybe D
Which of the following statements about insurance producers in Maryland is true? A An insurance producer may not qualify for a life and health license if they qualify for a property and casualty license B An insurance producer may not qualify for a license for portable electronics C An insurance producer may not qualify for a property and casualty license if they qualify for a life and health license D A producer may not qualify for any kind of insurance not permitted by Maryland insurance laws
Maybe D
A commercial ship is used to transport a business firm's cargo to a buyer. To protect the ship, Hull and P&I insurance should be purchased by the: A Shipowner B Shipper C Seller D Buyer
maybe A
Which of the following statements is false concerning terminating a commercial motor vehicle liability policy issued in Maryland? A An insured can request additional information within 30 das of receiving the statement of actual reason B The statement of actual reason can use general terms, such as "poor morals" C When terminating a policy for nonpayment of premium, the insurer must provide 10 days' notice D Insurers must provide a statement of actual reason for termination for reason other than nonpayment
maybe B
In property insurance, the direct cause of loss is known as the: A Proximate cause B Immediate peril C Efficient peril D Concurrent cause
A
The Equipment Breakdown Protection Coverage Form would consider which of the following losses to be a breakdown? A Mechanical or electrical failure of pressure equipment B Damage to the foundation supporting covered equipment C Malfunction of equipment during calibration D Defects or errors in computer equipment
A
Under a Business Auto policy with physical damage coverage for specified causes of loss, which peril is not covered? A Glass breakage B Flood C Earthquake D Malicious mischief
A
An insured covers their commercial property on the Building and Personal Property Coverage Form. A salesperson employed by the insured attends a trade show and must take property off the insured premises. Coverage for this property is: A Not provided by the policy B Provided as a Coverage Extension C Provided while it is in transit to the trade show, but not while at the trade show itself D Provided as an Additional Coverage
B
For a named driver exclusion on a personal auto policy issued in Maryland, which of the following statements is false? A A policy may be endorsed to specifically exclude all coverage for any named excluded driver B An insurer may refuse to issue a policy because of the claim experience of all the individuals under the policy C An insurer may cancel, non-renew, or increase the premiums on an auto policy because of the claim experience or driving record of one or more, but less than all of the individuals insured under the policy D The premiums charged on a policy excluding a named driver may not reflect the claim experience or driving record of the excluded named driver
B
The DP-3 would exclude coverage for partial damage to the dwelling resulting from all of the following perils, except: A Termite infestation B Falling objects C Deterioration D Settling foundation
B
The HO-3 covers losses to other structures causes by which of the following perils? A Smog or rust B Abrupt collapse from defective construction materials C Wear and tear D Smoke from agricultural smudging
B
Which of the following workers would be covered by the Jones Act? A A railroad worker B A sailor C A shipbuilder D An employee of the federal government
B
A casualty policy offering medical payments coverage would pay for all of the following expenses, except: A Expenses for X-rays and prosthetic devices after an injury accidentally caused by an insured B Necessary ambulance and hospital expenses following an injury in an accident on the insured premises C Necessary medical expenses and lost wages incurred because of a physical injury sustained because of the insured's inaction D Funeral expenses after a guest on the insured premises dies after sustaining bodily injuries
C
An insured does not need a collision damage waiver when renting a passenger car for a period of _______ days. A 45 B 60 C 30 D 90
C
Which of the following terms best describes the crime of taking of property from inside the premises or a locked safe or vault by a person who commits forcible entry? A Shoplifting B Theft C Burglary D Robbery
C
A cease and desist order may be issued by the Commissioner in which of the following situations? A To a producer has not yet been appointed B Immediately to a producer before a hearing is held C After a required hearing to an insurer causing the public irreparable harm D To an insurer is conducting business that threatens its solvency
D
After comparing the cost of paid claims and related expenses to the total earned premiums for the previous year, an insurer determined that it needed stricter underwriting to increase profitability. This was determined by calculating a: A Experience modification factor B Loss reserve C Expense ratio D Loss ratio
D
Under the Farm Property coverage forms, the definition of farm personal property includes: A Silos and other structures used in the farm operation B Registered motor vehicles owned by the insured and used in the farm operation C Household furnishings of the farm dwelling occupied by the insured D Equipment, supplies, and products of farming
D
What is the name of the provisions in Workers' Compensation insurance that states a worker cannot sue an employer for a work-related injury as long as they receive benefits? A Employer's promise B Benefits payable C Subrogation D Exclusive remedy
D
A Commercial Crime policy with Outside the Premises coverage would protect the insured against: A Disappearance of money in the care of a messenger B Theft of money by an employee submitting unauthorized instruction to a bank from the employee's home C Physical damage to an armored vehicle while it is transporting the insured's property D The seizure of property by governmental action
Maybe A first
The Builders Risk Coverage Form includes all of the following conditions, except: A The form includes an 80% coinsurance requirement B Losses are settled on an actual cash value basis C Payments for covered losses are subject to a deductible stated in the Declarations D The insured may not abandon property to the insurer
A
The following are all Additional Coverages provided by Homeowners policies, except: A Governmental Action B Loss Assessment C Credit Cards, Electronic Fund Transfer Card or Access Device, Forgery, and Counterfeit Money D Collapse
A
Under Workers' Compensation laws, vocational training benefits are a type of: A Rehabilitation benefit B Disability benefit C Survivor benefit D Medical benefit
A
Under a Personal Umbrella Liability policy, the insurer covers all of the following defense expenses in addition to the limit of liability, except: A Expenses incurred by an underlying insurer that defends the insured against a covered claim B Postjudgment interest C Reasonable expenses incurred by the insured while assisting with the Umbrella insurer's defense D Premiums on bonds
A
Under the BOP, which of the following is not an Optional Coverage? A Electronic Data B Outdoor Signs C Money and Securities D Employee Dishonesty
A
Which of the following statements is false concerning license reinstatement? A If a producer's license lapses they may apply for reinstatement for up to 60 days B A producer whose license has expired may not conduct any insurance business until the effective date of reinstatement C A producer whose license has been expired for over 1 year must apply for a new license D The Commissioner may waive the reinstatement requirements for a producer who is unable to comply due to military service
A
Who among the following may not charge a fee? A A producer, not exceeding 15% of the premium, for replacing insurance if commissions are paid by the existing insurer with an existing insurer B A surplus lines broker C A producer, not exceeding 15% of the premium, for replacing insurance with an existing insurer if commissions are not payable D An insurance advisor
A
With regard to financial examinations, the Commissioner: A Must conduct a financial examination of an insurer at least once every 5 years B May, but is not required to examine insurance companies C Must conduct a financial examination of an insurer at least once every 10 years D Must conduct a financial examination of an insurer at least once every 3 years
A
H is the named insured on a Special Form Homeowners policy. H owns a structure, separate from the dwelling, that is being rented to a family friend for use as a private garage. If the garage sustains a fire loss, how will the insurer respond? A The insurer will provide coverage after the family friend's insurance policy pays B Coverage is provided under Coverage B of H's policy C Coverage is provided up to the Coverage A limit of H's policy D The insurer denies coverage
B
Homeowners policies would cover all of the following theft losses, except: A Electronics stolen from the dwelling by a burglar B The insured's camper stolen from an off-premises campsite C The insured's trailer stolen from their detached garage D A 19-year-old insured's personal property stolen from their dorm room
B
Property losses covered by a Basic Form Dwelling Policy are settled on which basis? A Salvage value B Actual cash value C Functional replacement cost D Replacement cost
B
Under an Ocean Marine policy, hull coverage written on a named perils basis typically covers all of the following perils, except: A Piracy B Normal wear and tear C Heavy weather D Jettison of cargo
B
Uninsured motorist coverage provided by a Personal Auto policy covers insureds while they occupy or use which of the following vehicles? A A vehicle being driven without permission B A covered vehicle owned by the named insured C A vehicle being used as a taxi D A vehicle being used to carry property for a fee
B
When the Commercial Crime coverage part is written on the Loss Sustained Form, covered losses must occur: A Any time, including occurrences that take place prior to any Commercial Crime coverage issued to the insured B During the policy period C During the policy period or within 2 years of policy termination D During the policy period or within 1 year of policy termination
B
Which of the following is NOT correct with respect to approval of policy forms? A Application forms must be filed for approval B The Commissioner has 90 days to approve or disapprove or request a change to the filing C An insurer may not issue or use a form after the effective date of withdrawal of approval by the Commissioner D An insurer must submit the filing 60 days prior to use
B
Which of the following statements is not correct concerning Workers' Compensation laws and regulations in Maryland? A All Workers' Compensation policies must be approved by the Maryland State Workers' Compensation Commission B An employer's bankruptcy or insolvency relieves the insurer from payment of compensation for injury or death of a covered employee C If the employer receives notice of the occurrence of an accidental injury, occupational disease, hernia, or hearing loss, the insurer is deemed also to have received the notice D The State Workers' Compensation Commission may enforce the insurer's liability for payment of compensation
B
Commercial General Liability policies would cover all of the following personal and advertising injury claims against the insured, except: A Wrongful eviction of a tenant committed by the insured landlord B An insured businessowner slandering another company's services in an oral publication C Defamation of a company resulting from an incorrect price description contained in the insured's advertisement D A company infringing on another company's copyright in an advertisement
C
Once an insurer has received satisfactory proof of a PIP claim in Maryland, when must all benefit payments be made? A 60 days B 12 months C 30 days D 6 months
C
The purpose of the Maryland Automobile Insurance Fund is to: A Cover a person for excess liability limits B Provide a market for insuring motorcycles C Provide insurance for a person who is unable to obtain insurance through the standard market D Cover an insured's claim if the insurer is insolvent
C
Under a Dwelling Policy, an insured tenant may use up to what percentage of the Coverage C limit of insurance for a covered loss to improvements, alterations, and additions made at the insured's expense to that part of the described location occupied by the named insured? A 20% B 0% C 10% D 5%
C
What is the cancellation notice requirement if an insurer is cancelling an auto policy for other than nonpayment of premium? A At least 15 days' written notice of cancellation B At least 30 days' written notice of cancellation C At least 45 days' written notice of cancellation D At least 10 days' written notice of cancellation
C
Which of the following is an insured's duty in the event of loss covered by a Personal Auto policy? A Call the police if legal papers are received B Contact the at-fault party C Promptly notify the police in the event of a hit-and-run accident D Refer the claim adjuster to an attorney
C
Which of the following is true with regard to binders? A An insurer may cancel a binder issued to satisfy a lender's requirement for property insurance by giving the insured at least 30 days' written notice B A binder must be made in writing C A binder is no longer valid after the policy as to which it was given is issued D A binder or policy is subject to a 30-day underwriting period
C
Which of the following losses would be covered under all Dwelling forms? A Collapse due to settling B Damage caused by a sewer or drain backup C Fire damage to building materials and supplies that are located on the insured premises D Damage caused by subsidence of land the dwelling is sitting on
C
Which of the following statements is not correct with regard to penalties? A Anyone who willfully violates any provision of Maryland insurance law for which a greater penalty is not specifically provided by other state laws is guilty of a misdemeanor B Fines for violating the insurance laws are not less than $100, but not exceeding $100,000 for each violation C Monetary fines are in lieu of any administrative penalty otherwise applicable such as loss of authority or license to conduct business or orders to pay restitution to injured parties D Instead of, or in addition to suspending or revoking the license, the Commissioner may require the licensee to pass an examination and file a new application before the suspension is lifted
C
An insured adds the Business Pursuits Endorsement to their Homeowners policy. The insured may elect to add coverage for: A Bodily injury resulting from using saddle animals B Bodily injury arising out of rendering professional services related to beauty services C Bodily injury arising out of the negligent supervision of motor vehicles D Bodily injury resulting from corporal punishment
D
An insured protects a small fishing boat under a Boatowners policy. Which of the following coverages is not provided? A Medical payments coverage for passengers B Physical damage coverage for the hull, motor, and trailer C Bodily injury liability coverage D Personal injury liability coverage
D
Commercial General Liability policies would cover all of the following, except: A Loss of use of a customer's property caused by the insured's defective completed operations B Sickness arising out of the insured's contractual liability under an insured contract C Property damage arising out of the insured's fire legal liability D Bodily injury arising out of the insured's dram shop liability
D
If a covered employee suffers a second injury that causes a substantially greater disability, what is the employer liable for? A For both injuries B Only for the initial injury C For neither injuries D Only for the subsequent injury
D
The Emergency Program of the National Flood Insurance Program (NFIP) is intended for: A Communities with finalized rating maps developed by the NFIP B Communities with established floodplain management standards C Property owners who need flood insurance, but are located in a community that denied NFIP participation D Communities in the earliest stages of NFIP participation
D
The standard minimum limit of liability for underlying primary insurance that a Commercial Umbrella Liability policy will require is: A $2 million B $5 million C $10 million D $1 million
D
Under Inland Marine insurance, controlled lines refer to forms that: A Are not standardized by any rating bureau B Are not approved by the National Association of Insurance Commissioners C Must be tailored to the individual insured by endorsement D Are filed with state insurance departments
D
Under the Dwelling Program, which Other Coverage is not included on the Basic Form? A Property Removed B Worldwide Coverage C Improvements, Alterations, and Additions D Trees, Shrubs, and Other Plants
D
When a property is difficult to replace or value, like fine art pieces, insurers will often use which valuation basis to settle covered losses? A Functional replacement cost B Guaranteed replacement cost C Market value D Agreed value
D
Which of the following entities would not undergo an examination of books and records by the Commissioner? A A company promoting a new insurer B Public adjuster C Rating organization D Unauthorized insurer
D
Which of the following is not an example of personal and advertising injury, as understood by the CGL? A Misappropriation of a title or slogan B Infringement of copyright C False imprisonment D A broken leg
D
Which of the following is not something an individual needs to become a qualified surplus lines broker in Maryland? A Property and casualty license B Certificate of qualification C File a $10,000 bond with the state D Pass a written exam
D
A surety bond company provides a license and permit bond to a licensee to protect a government entity from potential financial loss. The government entity acts as which party? A Guarantor B Principal C Obligee D Surety
Maybe C
With respect to solvency, which of the following statements is false? A The Commissioner may require actuarial studies and audits to determine the financial solvency of each self-insurance group B The Commissioner may require an annual report that may include payroll audit reports, summary loss reports, and quarterly financial statements to assure solvency C An insolvent insurer may receive, sue for, and recover the income from the cash and government securities deposited by the insurer D The Commissioner may assess each self-insurance group annually amount to be used for actuarial studies and audits
Maybe C
The named insured's spouse will not be considered an insured on the named insured's Personal Auto policy if: A It has been 60 days since the spouse moved to a different residence away from the named insured B The spouse lives in the same household, but does not have a driver's license C The spouse lives in the same household, but insists they will not operate the auto D It has been 90 days since the spouse moved to a different residence away from the named insured
Maybe D
Which of the following is not included in the definition of mobile equipment provided by a Business Auto policy? A Bulldozer B Vehicle on crawler treads C Forklift D 1,500-pound pickup
Maybe D
Who among the following is considered to be a person at risk for lead poisoning? A Any person who spends at least 24 hours per week in a property affected by lead-contaminated dust B Any person who spends at least 24 hours per day in a property affected by lead-contaminated dust C Children under 16 years of age who spend at least 24 hours per week in a property affected by lead-contaminated dust D Children under 6 years of age who spend at least 24 hours per week in a property affected by lead-contaminated dust
Maybe D
Which of the following statements is false with respect covered employees by Maryland's Workers' Compensation laws? A An individual while in the service of an employer under an express or implied contract of apprenticeship or hire is a covered employee B A casual employee is a covered employee C A prisoner may not be considered a covered employee D A salaried officer of a corporation or a member of a limited liability company is a covered employee
Maybe c
