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An insured has a special form dwelling policy written for $100,000 on a dwelling. The dwelling's replacement cost is $115,000. Fire causes $75,000 in damage to the dwelling. $15,000 damage to a separate garage and kills 10 tress valued at $600 each. How much will the policy pay for the trees

$5,000

Equipment breakdown coverage is written with a single limit per accident. However, what is the sublimit for hazardous substance cleanup, or repair or replacement for contaminated property

$25,000

What is not true of National Flood Insurance

insurance provided by the flood program also is available in standard property policy

All the following statements describe the concept of strict liability except

it is imposed on defendants engaged in hazardous activity

A house insured under a dwelling policy has been vacant for 70 consecutive days. What statement is true

loss by vandalism and malicious mischief is excluded

What would not be considered a source of insurability information by an insurer

the applicant's marital status

Under the common policy conditions of a policy, all the following are true about changes in a policy except

the insurer must obtain permission from all named insureds to make a change

A dwelling policy has a standard deductible that applies to all property coverage, except fair rental value, additional living expense, and the fire department service charge. How much is this deductible

$250

A $100,000 house insured on a policy with an 80% coinsurance requirement has a fire the causes $40,000 of damage, the owner had a policy with $60,000 coverage. How much can the owner collect for his loss

$30,000

A liencsee is charged (at a hearing) with knowingly violating an insurance regulation. Along with a cease and desist order, wat will the licensee most likely be fined per charge

$5,000

Professional photographers and musicians may insure their equipment with

a commercial articles floater

The limited theft endorsement designed for a landlord excludes all the following except

a lawnowner the landlord owns and keeps at rented premises

What is material misrepresentation

a statement by the applicant that, upon discover, would affect the underwriting decision of the insurance company

The inspection and surveys conditions in a businessowners policy

allows the insurer the right to inspect the insured's premises

There is a particular type of insurance that no insurer in NJ offers. In order for NJ residents to obtain this insurance, they will need to be covered by

surplus lines insurers

Insurable property for the purpose of the FAIR plan means

tangible personal property which does not have an insurable value in excess of $1,500,000

Who financially backs up to NJ Insurance underwriting association

the NJ insurance development fund

An insurer decides to terminate the appointment of one of its producers and notifies the commissioner 29 days after the fact. On the 9th day after the decision, the producer violates a regulation of the insurance code. and a policyowner wants to hold the insurer legally responsible. What is true

the insurer will be help legally responsible

Each of the following may be insured under a HO-3 homeowners policy except

the owner-occupant of a condominium unit

What acts stated that the federal government would not regulate insurance as long as the states did an adequate job of regulating the industry

McCarran-Ferguson Act

Producer's and insurer's action relate to insurance transactions, from selling insurance to processing claims as referred to as

insurance-related conduct

What is not found in the common policy declaration of a commercial package policy

insuring agreement

All the following statements are true regarding fire department service charge additional coverage under the businessowners policy except

this coverage limit pays in place of the limit of insurance shown in the declaration

What is the purpose of NFIP

to fill the gap left by the private insurers in flood coverage

Both broad theft and limited theft endorsement on the dwelling programs exclude all following types of property except

watercraft

When does the federal emergency flood insurance program go into effect

when a community applies for the program

Personal business property out in the open is covered under commercial property policy only while

within 100 feet of the described premises

Who might receive dividends from a mutual insurer

policyholders

If a persona violates a cease and desist order, the Commissioner can turn the matter over to the NJ superior court for further legal action and can assess a find for each violation of up to

$5,000

The Commissioner investigates claim filed against a licensee and finds that the licensee has chronically violated several insurance regulations. The commissioner decides to hold a hearing. What is the minimum amount of notice that the licensee must be given for the hearing

10 days

The Earthquake and Volcanic Eruption Endorsement added to Commercial Property policies consider all earthquake shocks as one earthquake if they occur within what maximum time period

168 hours ( 7 days)

Under the additional expenses coverage, if a civil authority prohibits from using the dwelling because of direct damage to a neighboring location from a peril covered in the insured's policy loss would covered for up to

2 weeks

Who would be excluded as an insured under the liability section of a homeowners policy

22-year-old niece of the insured who is visting

In NJ, binders are issued for a short period of time. A binder will cease to exist in each of the following except in

30 days following the issue date of the binder

The company owes premium money to the insured. This insurer gave the funds to the producer to return to the insured. Within how many days must the producer pay the insured

5 business days

How long must producers and insurers maintain records of management of funds for insurance policies

5 years after the termination of coverage

Assuming the insurer and insured agree to the amount payable for a loss covered under a dwelling policy, how soon after the insured has received proof of loss must it make payment

60 days

An insured is the owner of a clothing boutique. She has a floor plan merchandise floater to cover the property that is financial until it is sold. At closing time a month ago, she notice that 3 very expensive dress had been stolen. However, she did not file a report to her insurance company until recently. How much will her insurer pay for this loss

90% of the limit written

For there to be negligent liability, all the following must exist except

a reasonable expectation that the act may cause injury or damage

What guarantees that the information explained in the insurance contract is true

a warranty

All the following statements concerning the NJ Insurance Underwriting Association are true, except

all insurers licensed in the State are members

Coverage D, additional living expenses, is intended to

allow the family to maintain their normal standard of living

What is a foreign insurer

an insurer with a home office in another state

Circulating deceptive sales material to the public is what type of Unfair Trade Practice

false advertising

To have insurable interest in the person or property covered by a property insurance policy, which of the following potential risks must the policyowner face

financial loss

Which valuation method takes into consideration what a willing buyer would pay for an insured property

market value

Insurance is regulated

mostly on the state level

Which form insurers both buildings and personal property on an open peril basis

HO-5

The main difference between an HO-4 and HO-6 is

HO-6 provides limited dwelling coverage as well as content coverage

ABC Trucking hauls products for Acme, Inc. as a contract carrier. On one shipment, the driver stopped at a truck stop for lunch. Leaving the truck in the parking lot, he made certain that the truck was locked before leaving it. Upon returning to the truck, he discovered that someone had broken into the truck and stolen the cargo. Is ABC legally liable for this loss?

No, the driver has taken the reasonable measures to protect the property by locking the truck

Insurable interest in a property policy must be proven

at the time of loss

What must an insurer obtain in order to transact insurance within a given state

certificate of authority

Forcing a client to buy insurance from a particular lender as a condition of granting a loan is defined as

coercion

An insured's limit of liability applies to a total damage for bodily injury and property damage resulting from one accident, which may be used in any combination of amount. not exceed the single limit. What type of limit does this insured have

combined single

All the following are classes of inland marine risks except

common carrier cargo liability

An insured has extended coverage on her dwelling that includes coverage for vandalism and malicious mischief. One evening, she is sitting in her living room when she hears a crash and a sound of glass breaking. She runs to the door and discovers a brick has been thrown through her glass door. To inform her insurer of a possible claim, she fills out a form detailing the event leading to the loss. What is the name of the form

notice of claim form

the declaration section in a homeowners policy provides all the of the following information except

policy exlcusion

What is a bailee responsible for

property of others in his custody

When one insurer buys insurance from another company to minimize the effect of catastrophic losses, they are

reinsuring

what method of loss valuation is contrary to the basic concept of indemnity

replacement cost

What could be insured with replacement coverage under the flood insurance program

single-family home

What is not a cause of loss for commerical property coverage

specific

A property insurance policy that is not subject to any coinsurance requirement but has a set amount of insurance scheduled for the property would use what loss valuation method

stated amount

A property insurance that is not subject to any coinsurance requirements but has a set amount of insurance scheduled for the property would use what loss valuation method

stated amount

All of the following professional designation are recognized by the department as acceptable substitutes for educational and examination requirements except

Professional insurance agent (PIA)

Frank's steaks furnished to steakhouses. An accident on the premises cause the building to lose refrigeration for 32 hours. The state inspectors will not allow the meat in the refrigerating units be sold for human consumption, and frank loses $18,500 in disposing of the meat. What coverage under Frank's BOP policy will cover the loss

Utility service - direct damage

What is not an example of a company's location of incorporation

authorized

During policy solicitation, an insurer exaggerates the financial condition of one of its competitors, and makes it sound worse than it is. This is an example of an unfair trade practice of

defamation

A licensed insurance producer may request a waiver of license renewal procedures under any of the following circumstances except

his renewal form were lost in the mail

A BOP (businessowners policy) is most similar to

homeowners