Guarantee Exam
In a CGL policy, under Coverage Part A - BI and PD, coverage is provided for what? (employers, premises, or machinery?)
premises
True or false: The company will reimburse the insured for all loss of earnings under the liability coverage of a BAP.
false
True or false: A strawberry patch owned by the insured is considered an insured location under their HO policy
false; insured location cannot include farmland or any premises used for business purposes
if an ins'd has the add'l covg provision, how does it affect the policy premium?
there is no add'l premium
The ordinance or law covg endorsement serves what purpose?
to remove the exclusion of losses resulting from ordinance or law
True or false: Agreement in an insurance contract is when one party accepts the exact terms of the other party's offer.
true
True or false: An outdoor sign will be covered under a bldg & personal prop covg form
true
True or false: Fire legal liability in a Gen'l Liability Policy is NOT subject to the aggregate limit
true
True or false: For an additional premium, the extended coverages written on the basic form DP would cover riots.
true
True or false: Stock insurers are owned by shareholders
true
True or false: Stock insurers issue nonparticipating policies
true
True or false: The limited theft endorsement designed for a landlord does cover theft of a lawnmower the owner keeps at one of his rental properties.
true
An applicant for property insurance owns a building in which combustible materials are stored in the furnace room. From an underwriting standpoint, this risk would likely be considered what type of hazard?
morale
How many hours of continuing education must licensees complete every renewal period on the subject of ethics?
3
What policy would a business owner whose business fills scuba tanks most likely need to insure unfired pressure vessels and compressors?
Equipment breakdown
The _____________ describe the insurer's responsibility for payment under a policy, as stated in the common policy provisions
limits of liability
For there to be a negligent liability, all of the following must exist except?
a reasonable expectation that the act may cause injury or damage
Define accident
a sudden, unplanned and unexpected eventm not in control of the ins'd, resulting in injury or damage
An insured has $5,000 of medical coverage under a PAP at the time of a covered accident. The insured and 3 passengers are injured. The Ins'd's medical expenses are $8k, the 1st passenger's total $4k, the 2nd passenger's total $6.5k, and the 3rd passenger's total $1.2k. How much will the policy pay under the medical payments coverage?
up to $5,000 per person; a total of $15,200
When an ins'd's gardener was spraying weeds in his lawn, he failed to notice that the wind was drifting the spray to the neighbor's yar, thereby damaging their flower bed. The insured was found to be legally liable via what kind of liability?
vicarious liability
When does an insurer's duty to defend a suit or claim end in a commercial general liability policy?
when loss payments equal the applicable limit of insurance
You are at fault in an auto wreck out of state. How does your company adjust?
At least to the minimum required by that state
2 men are partners in a moving co. They have 2 trucks used to move prop. of others. They should insure those trucks under a
Business auto policy
Under what circumstances will a worker be paid for the first 7 days of being unable to work?
If the worker misses more than 21 consecutive days
GA law requires that every Fire insurance policy covering prop. located in the state conform to the provisions of
The Standard Fire Policy
If the premiums collected by an ins'r participating in the WYO flood program are insufficient to cover losses, what would be true?
The ins'r will be reimbursed for the excess costs by the NFIP
What are the three categories of insurable interest?
business, blood, and financial
An insured's home catches fire. As a result, the insured's family must stay in a motel until the home is repaired. The cost of the motel stay would be considered what type of loss?
consequential loss; indirect loss
What element of an insurance contract requires paying premium and providing a statement of good health?
consideration
The suppl. payments section of the CGL policy would cover
court costs assessed against the ins'd in a suit
If a fire erupts in the kitchen and spreads to an upstairs bedroom, what kind of loss is that?
direct
True or false: a corporation is insured under a CGL policy and is named in a lawsuit to recover expenses for BI and PD from a claim. The insurance company is obligated to provide coverage for spouses of officers and stockholders in this suit.
false
True or false: in an HO policy, Covg E and/or Covg F would respond to a claim arising from the ins'ds 14 y.o. son throwing rocks at the neighbor's house, breaking several windows
false
True or false: policy dividends issued by mutual companies are guaranteed and not taxable
false
True or false: the equipment breakdown coverage form provides coverage for bodily injury liability
false
An insured's diner suffered a fire loss. In addition to the damage caused by the fire, the floor covering had to be replaced because of the water damage. It took 4 weeks for repairs to be completed, during which time the insured was without income. The insured's policy includes both direct and indirect loss coverage. What part of the loss would be paid as indirect loss?
the loss of income for the time the diner was closed
The defendant being released on a surety bail bond is what party?
the principal; the defendant has made a promise to perform (to show up in court at the specified time)
If an applicant submits the initial premium with an application, which action constitutes acceptance?
the underwriters approve the application
True or false: Under a BOP, business income losses are payable for 12 consecutive months following the occurence
true
True or false: insurance written in support of public policy can best be described as having legal purpose
true
An insured and his spouse were traveling down an icy road and hit a sign, accumulating $1,350 damage to their car. They have a $250 deduct. How much will they collect on this claim?
$1,100
The BOP extension coverage form for personal property off-premises is limited to ______
$10,000
The BOP extension covg form for pers prop off-premises is limited to
$10,000
What is the limit of liability for a BOP regarding the debris removal coverage?
25% of the sum of the direct loss payment + the deductible amount
What type of authority is found in the agent's contract? (express, implied, or assumed)
express
Under the employee theft covg, if an employee is found to have participated in a dishonest act, the covg on that employee will terminate when?
immediately
How does insurance distribute the financial consequences of individual losses?
it transfers the risk to all persons insured
An agent's license has been suspended, but he continues to transact insurance for his existing clients. This would be considered what category of crime?
misdemeanor
Medical benefits under worker's compensation statutes are provided to what limit?
no limit; the limit does not exist
What document notifies the insurer of events that may lead to a possible claim?
notice of claim
Policy limits are the max amnt an ins'd may collect, or for which an ins'd is protected under the terms of the
policy
True or false: your farm wagon being towed by your pick-up truck would be considered a covered auto on your PAP
true