Insurance Exam

An insured has an automobile policy with limits of 100/300/50 and a deductible of $1,000. He is involved in an auto accident and crashes into another driver's auto. The other driver is awarded $125,000 for his injuries and $25,000 for the damage to his car. The insured's vehicle has damage in the amount of $1,200. The total payment made under insured's policy is:

$125,200

The mine subsidence insurance coverage premium rates, as set by the association, for coverage in a county within a designated area where coverage is mandatory, may not exceed:

$5

Using the pro rata method, if a property is covered by Company A for $20,000 and Company B covers the same property for $40,000, how much will Company A pay on a $24,000 loss?

$8,000

Which of the following would not be eligible for coverage under a personal auto policy?

A vehicle purchased 90 days ago

For negligent liability to exist, which is not a requirement?

An intervening cause

In a DP-1, if an insured elects to apply coverage B to detached garage, coverage A will:

Be reduced by 10%

Which of the following exclusions would specifically fall under Coverage E in homeowners insurance?

Contractual Liability

Other than perils, the difference in the three DP forms is in coverage provided. Which of the following coverage options is covered by the DP-2 and DP-3 but not DP-1?

Coverage E - Additional Living Expense

A scheduled personal property endorsement will be used to insure:

Higher limits of coverage for fine arts items

Which of the following terms refers to solicitation, negotiation, effectuation or advising related to an insurance contract?

Insurance Transaction

Fair rental value coverage in the dwelling policy is similar to which homeowners policy form?

Loss of Use

Which of the following exposures is not covered under a homeowner's policy?

Medical payments to an insured

The deductible under earthquake coverage is stated as what?

Percentage of loss

In reference to insurable interest, which of the following is NOT an element of insurable risk?

Personal

What does the homeowner's property coverage not cover?

Personal property of roomers not related to the insured

For an additional premium, the extended coverages written on the basic form dwelling policy would cover which of the following?

Riot

A licensed agent moves to another state on March 1st. He notifies the director of the change of address on March 15th and requests a nonresident license. Considering that all other requirements are met, which of the following are true?

The license will be changed to nonresident without any fees or additional applications

An automobile policy has limits of 100/30/50. This number 100 means:

The maximum limit of bodily injury claims that can be paid for one person

In terms of liability, what is the relationship between the limits written for uninsured motorist coverage and the limits written for underinsured motorist coverage?

Uninsured motorist coverage and underinsured motorist coverage must be written for the same limits of liability

Which of the following is not part of section II of the boatowner's policy?

Watercraft damage

Under coverage C, and at the request of the insured, personal property of a guest/residence employee is covered:

While it is in any residence premises occupied by an insured

An insured has the scheduled personal property endorsement attached to his homeowner's policy. If the insured acquires new works of art, when must the insurer by notified for the new works of art to be covered under the endorsement?

Within 90 days

If a car is stolen and left in a snow bank and the radiator freezes and does a lot of damage, is the damage covered by the auto policy?

Yes, freezing exclusion is removed if the car is stolen

Which of the following would be considered a covered auto on your personal auto policy?

Your farm wagon being towed by your pickup truck