Property and casualty license
What are the four categories of uninsured motor vehicles?
1. no insurance or liability bond 2. insurance is less than what's required by the financial responsibility laws 3. a hit-and-run accident where the driver cannot be identified, and 4. the insured denies coverage or becomes insolvent
When a dwelling policy is canceled for nonpayment of premium, the insurer must give notice within how many days of the cancellation
10 days
Is an auto policy has split limits of 30/50/25. How much will the policy pay for damage property in a single accident?
25,000
An insured with a homeowners policy has remove property from the insured location to protect it from lost that could be caused by a covered peril the removal coverage applies for how many days
30 days
It's an auto policy has split limits of 30/50/25. What is the maximum amount the policy will pay for injuries to one person in a single accident?
30,000
Assuming the insurance and the insured agree on the amount, payable for a loss covered under a dwelling policy how soon after receiving the proof of lost, must the insurer pay the claim
60 days
Losses caused by vandalism and malicious mischief or excluded from coverage if a dwelling has been vacant for how many days
60 days
In dwelling policies, any volcanic activity will be considered part of one occurrence if it all happens within how many hours
72 hours
In order for forms HO - 2,HO-3 and HO - 5 to provide coverage adrenaline must be insured for at least what percentage of replacement cost
80%
Is an auto policy has liability limits of 40/60/20. What would be the equivalent combined single limit?
80,000 combined total coverage for bodily injury and property damage
What are the most common penalties for violations of insurance statutes?
A cease and desist order, a fine, and license suspension or revocation
What is burglary?
A forced entry into another's premises without felonious intent
Who is an insurance agent?
A person authorized to sell, solicit and negotiate insurance contracts
What is consideration on the part of the insurer?
A promise to pay in the event of a loss
What is additional coverage in an insurance policy?
A provision that adds more coverage for specific loss at no additional premium
what is a deductible in an insurance policy?
A specific dollar amount that the insured must pay before the insurer will pay the policy benefits
What is proof of loss?
A sworn statement from an insured notifying the insurer about a loss
What is a binder?
A temporary insurance contract that goes in effect prior to the policy issue
What would be considered a newly acquired auto
A vehicle acquired by the insured during the policy period
What is a covered auto
A vehicle shown in the policy declarations
In property and casualty policies, what is required for an assignment to be valid
A written consent of the insurer
Persons who are not names on the declaration page of a policy, but who are protected by the policy are known as what type of insured?
Additional insured
What are the four elements of an insurance contract?
Agreement (offer and acceptance) consideration, competent parties, and legal purpose
DP - three (special) is an open peril form. What does that mean?
All perils are insured, unless specifically excluded
How many owner occupied residences per covered home or allowed by homeowners policies?
An HO policy may insurer a property that has one- to four -family owner occupied residences
What is a warranty in an insurance contract
An absolutely true statement upon which the validity of the policy depends
Who is considered a non-resident agent
An agent who resides and is licensed in another state, but who is authorized to transact insurance in this state
What is subrogation?
An insurer's legal right to seek damages from third parties after reimbursing insureds for a loss
How are the dwelling and other structures covered in an HO-3 policy form?
An open peril basis
And personal auto policy to what geographical region does the out-of-state coverage apply?
Any US state or territory, as well as Canada
What type of property can be covered under inland marine insurance?
Any type of property that is portable on land as well as means of transportation and communication
Who is an insured and property and casualty insurance
Anyone covered under the policy, even if not specifically named
What process is used to settle a casualty claim with the insured in the insurer cannot agree
Arbitration
Under coverage seat of an HO - three policy what is the amount of insurance provided for personal property?
At least 50% of the coverage A limit (this applies to all policies, except for HO - four & HO - six)
In property insurance, when must insurable interest exist?
At the time of loss
If an insurer hold a certificate of authority it is known as what type of insurer
Authorized or admitted
If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered what type of insurer?
Authorized or admitted
What are three types of coverage available in dwelling policies?
Basic broad and special
What type of policy insurance all property at multiple occasions for a single amount?
Blanket policy
What type of policy insures all property at multiple locations for a single amount?
Blanket policy
What types of losses are indicated by the split limits in an auto insurance policy
Bodily injury per person bodily injury per accident and property damage per accident
What is the difference between cancellation and nonrenewal?
Cancellation is the termination of an insurance policy by either party prior to the policies. Expiration date non-renewal is the termination of a policy that and its expiration date by not offering a continuation of the existing policy.
Is the commissioner/superintendent find a license, engaging in an unfair method of competition or an unfair practices what order will be issued?
Cease and desist order
A state issued document empowering an insurance company to become an admitted. Insurer is called what
Certificate of Authority
What document is required for an insurance company to transact insurance?
Certificate of Authority
What are producers required to do in order to renew their license?
Complete continuing education hours and pay a renewal fee
Information about changes to the policy a return of premium can be found in which section of a policy
Conditions
What part of an insurance policy indicates the general rules or procedures, that the insurer and insured agreed to follow under the terms of the policy
Conditions
What is consideration in an insurance contract
Consideration is something of value that each party gifts to the other consideration on the part of the insurer is binding
What are the five coverages of dwelling policies?
Coverage A - Dwelling, Coverage B - Other structures, Coverage C - Personal property, Coverage D - Fair rental value, and Coverage E - Additional living expenses
what are the major coverages included in a homeowners policy?
Coverage A- dash dwelling, coverage B - other structures, coverage C - personal property, and coverage D-Loss of use
Which dwelling policy coverage will provide protection for contents damage by fire in an insured dwelling
Coverage C - personal property
And insured's house becomes uninhabitable uninhabitable due to damage by a fire. As a result, the insured has to rent an apartment, until repairs were made which type of coverage under the dwelling policy will pay for the expense of renting the apartment.
Coverage E Dash additional living expenses
What are the two liability coverage is included in homeowners policy forms
Coverage, E - personal liability, and coverage F - medical payments to others
How is the actual cash value of a property calculated?
Current replacement cost minus depreciation
How is the actual cash value of the property calculated?
Current replacement cost minus depreciation
Which of the 3DP forms provides the most limited coverage
DP - one (basic)
Which dwelling form provides open peril coverage on the building
DP - three (special)
Which dwelling form is called the broad form
DP - two
Which dwelling coverage forms will pay for the replacement cost of a dwelling
DP - two (broad) and DP - three (special)
What are additional coverages available in homeowners policies with additional premiums?
Debris, removal lawn/plants/shrubs and trees, removal reasonable repairs and fire department service charge
What part of a policy shows the amount of insurance, premium and policy terms
Declarations
What section 'personalizes' an insurance policy?
Declarations
If an insured Parral was the proximate cause of loss, what type of loss is it
Direct
How are direct and indirect costs related?
Direct losses can cause indirect losses
Two individuals who are in the same risk and age class or charge different rates at their insurance policies due to an insignificant factor what is this called?
Discrimination
Ensures are classified according to their domicile what are the three types of insurers
Domestic foreign an alien
What is dwelling policies insure
Dwelling only contacts only or both dwelling and Contant
In general, what the homeowners policies cover
Dwellings used primarily as private residences
What are some of the exclusions found in all three dwelling forms
Earth movement water, damage, power failure, neglect, war nuclear hazard, intentional loss, freezing of pump, plumbing, ordinance, or law and government action
What is negligence?
Failure to act as a reasonable prudent person under given circumstances
The requirement that agents must account for and promptly remit all insurance funds collected is known as what type of agent responsibility?
Fiduciary
Basic dwelling policy automatically provides coverage against what
Fire, lightning, and internal explosion
In commercial property policies who has control of the policy and who can cancel it
First name insured
How is the coverage usually written for HO - eight forms
For the market value of the property
What HO form covers a historic home with replacement cost more than the market value
HO - eight (modified homeowners)
What HO form ensures a tenant living in an apartment
HO - four (tenant board form)
What homeowners policy form is known as contents broad form
HO - four contents broad form
What homeowners policy form is known as a special form
HO Dash three special form
What HO form covers condominium unit owners?
HO-6 (condominium unit owners)
Why does the HO- four form not provide dwelling coverage?
HO-four is written for a tenant residing in a rented dwelling the tenant does not own the dwelling
Conditions that increase the chance of loss are known as what
Hazards
When is an appraisal needed? And how can it be requested?
If an insured and an insured disagree about the value of a property loss, either party can make a written demand for an appraisal
Under what conditions can broad that coverage be added to a dwelling policy
If the insured is the owner occupant of the dwelling
What insurance principle does pro rata liability, protect
Indemnity
What provision states that if a policy allows for greater benefits, and the financial loss incurred, insured may become compensated only for the amount lost
Indemnity
And insurance business is damaged by a fire and temporary shut down for repairs as a result the insured suffered some loss of income. What type of loss is the loss of income?
Indirect or consequential
What do individuals used to transfer the risk of loss to a larger group
Insurance
What do individuals used to transfer their risk of loss to a larger group?
Insurance
In general who can be excluded from producer licensing, an examination requirements
Insurance company, officers, directors, or any other employees who do not transact insurance and who do not receive commissions for their services (usually their responsibilities include administrative executive or clerical)
What is controlled business?
Insurance on the producer's own life or property, or the lives or property of the producer's family or business associates
What part of an insurance policy contains the insurance promise to pay a claim?
Insuring agreement
What losses are excluded from coverage in the liability section of the personal auto policy
Intentional injury or damage damage to property, owned, or transported by the insured use of a vehicle as a public conveyance or use of a vehicle without permission
What does an endorsement due to an insurance contract
It modifies the policies original terms
What are some of the exclusions from coverage and all of the homeowners forms
Land structure is used for business purposes, animal/bird/fish, aircraft, rented property, electronic data and motor vehicles
What type of coverage is included in homeowners policies, but is not available in dwelling policies
Liability coverage
What determines an insurance responsibility for payment as stated in an insurance
Limits of liability
Insurance is a contract that protects the insured from what?
Loss
The reduction decrease or disappearance of value of the person or property. Insured in a policy is known as what?
Loss
The reduction decrease or disappearance of value of the persons, our property and shirt and a policy is known as what?
Loss
(Insurance carried/insurance required)x loss amount=
Loss payment
On its advertisement, a company claims that it has funds, and it's possession that are in fact, not available for the payment of losses or gains. What is the company guilty of?
Misrepresentation
What illegal act does a producer commit when the producer represents a policy in a more favorable light than the policy really is?
Misrepresentation
What is mysterious disappearance?
Miss placement or loss of property without knowledge as to the location time and cause of the loss
And insured discovers an applicant for a policy has submitted a fraudulent insurance claim in the past what type of hazard
Moral
A person who does not lock the doors to his or her house shows in a different attitude what type of hazard does this represent?
Morale
Under absolutely ability does an injured party need to prove negligence
No absolute liability exist when a condition or conduct is inherently dangerous so proof of negligence is not required
What term describes a loss caused by continuous exposure to a condition
Occurance
Where is the policy. Stated in an insurance policy
On the declarations page
Is three volcanic eruption's happen within 48 hours in each contributes to property damage how many deductibles will apply in the dwelling policy
One deductible (all instances of volcanic eruption's that occur within a 72 hour period are considered one occurrence.)
When will damage to the interior of the building, the covered under the following objects peril in the broad form of the dwelling policy
Only if the interior damage is a direct result of exterior damage from a falling object
Where can national flood insurance be issued?
Only in participating flood prone areas
Who may share in the commission from the sale of an insurance policy?
Only producers properly licensed for the type of insurance transaction
Under coverage, C - personal property in the dwelling policy when will guests property be covered?
Only when the property is at the insured location
When would theft of property of gas and residents employees be covered under the HO - eight form
Only while on the insured premises
A policy that covers all causes of loss, except for those specifically excluded is known as what type of policy
Open parol, ( or special) form
What provision defines have a party will respond if there's more than one insurance policy written on the same risk
Other insurance
What personal auto coverage would pay for damages to a covered auto caused by a collision with a deer?
Other than collision (comprehensive)
Rental reimbursement endorsement is available. Only is an auto policy has what type of coverage.
Other than collision coverage
What personal auto coverage would pay for the insurance travel expenses and loss of earnings by the insured is involved in the settlement process of a covered loss
Part A: liability
Is an insured is injured while driving his own car what coverage in his personal auto policy will pay for the loss
Part B: medical payments
What sub limit in a liability policy puts a ceiling on the payment for all claims that arise from a single accident?
Per occurrence
What sublimit in a liability policy puts a ceiling on the payment for all claims that arise from a single accident?
Per occurrence
A tornado that destroy the property would be an example of
Peril
What is the term for causes of loss insured against in an insurance policy?
Peril
What are the three types of hazards?
Physical, Moral, Morale
What are the insured's duty after a loss?
Protect the damage property from further damage, prepare an inventory of damage property cooperate with the insured and settling a loss, notify police in case of theft and submit proof of loss
What term defines an exact direct in uninterpreted cause of loss
Proximate cause
A situation in which a person can experience only a loss and no gain presents what type of risk?
Pure risk
An agent offers a Client free tickets to a sporting event in exchange for the purchase of an insurance policy what is the agent guilty of
Rebating
Which method of loss valuation is contrary to the principal of indemnity
Replacement cost
In property insurance what is actual cash value?
Replacement cost at the time of loss, minus depreciation
Wagering on a sport event is known as what type of risk
Speculative
If a manufactured product is unsafe, what type of liability applies to the manufacturer?
Strict liability
What provision found in property policy, prevents and insured from collecting twice for the same Wass once for the insurance and again from the third party
Subrogation
Who must be notified of a producers change of address
The Department of Insurance (Commissioner/Director/Superintendent)
What type of license represents the insurance company?
The agent
According to the liberalization condition, if an insurer makes a change to broaden coverage in the newly issued dwelling policies. How will that change affect policies already enforce?
The change to apply automatically
What does form HO - five cover
The dwelling and other structures, as well as contents and personal property
What law protects consumers from the circulation of an accurate are obsolete information?
The fair credit reporting act
Underinsured motorist coverage will pay the difference between which two limits
The insured UIM limits and the asphalt drivers insurance bodily injury limits
Who is responsible for the cost associated with the examination of insurers
The insurer who is being examined
What is the limit of liability in part D: coverage for damage to your auto
The lesser of the actual cash value of a vehicle, or the amount needed to repair or replace the vehicle
What is a combined limit in an auto insurance policy?
The maximum amount the insurer will pay on a covered loss
What does the term "you"refer to in a personal auto policy?
The named insured shown in the declarations in the insured spouse. (if resident of the same household)
Who is considered insured under part A: liability of a personal auto policy
The vehicle owner, or his /her family member, or any person using the covered auto with permission
Both robbery and burglary can be considered what
Theft
Coverage for medical payments under a personal auto policy, applies to expenses, following a covered accident that are incurred and services rendered within what time period
Three years
To whom me a certificate of authority be issued?
To an insurer authorized to transact business in this state
and property insurance what is the purpose of a coinsurance clause?
To encourage and shreds to ensure property close to its value
in property insurance, what is the purpose of a coinsurance clause?
To encourage insureds to ensure property close to its value
What is the purpose of the national flood insurance program?
To fill the gap and flood coverage left by private insurance
Indwelling policies, what is the purpose of the automatic increase in insurance endorsement that increases the amount of insurance by an annual percentage
To offset the effects of inflation
What is the purpose of a cease and desist order?
To prevent a producer or insurer from further violating laws for transacting insurance
What does indemnify mean in insurance?
To restore an insured to the same financial status as Before a loss
what does indemnify mean in insurance?
To restore an insured to the same financial status before a loss
Which type of misrepresentation persuades an insured to the detriment to cancel lapse, or switch policies from one to another
Twisting
In dwelling policies, within how many years of a loss, may an insured bring a lawsuit against the insurer
Two years
What is risk?
Uncertainty of loss
What does the term unilateral contract mean?
Unilateral contract is a one-sided contract. This means only one party makes an enforceable promise
What is the difference between vacancy and an occupancy?
Vacancy refers to an insured structure in which no people have been living or working and no property has been stored for the specific period of time. Unoccupancy refers to an insured structure in which no people have been living or working within the required period of time but some property is stored.
What does the exclusion section of a policy specify
What perils are not insured against or what persons are not covered in a policy?
When does prorate a liability apply?
When an insured has more than one policy covering a loss
When would miss representation on an insurance application be considered fraud
When it is intentional and material
When is controlled business legal?
When the commissions from controlled business do not exceed the aggregate commissions on all the other business (specific limits may vary from state to state)
In insurance contracts, when is the offer usually made
When the insurance application is submitted
In insurance contracts, when does acceptance usually occur?
When the insure approves a prepaid application
When does the underinsured motorist coverage apply
When the motorist is at fault in an accident, but the limits of his/her auto insurance are not sufficient to cover the bodily injury to another motorist
When does uninsured motorist coverage apply
When the other party is legally liable but has no insurance
When can the Commissioner or Director examine insurers?
Whenever deemed necessary, but at least once every few years (please check your state regulations for specific time requirement)
What are extended covered perils on a basic dwelling policy?
Windstorm or hail, explosion, smoke, aircraft and vehicles, riot, or civil commotion, volcanic eruption and vandalism, and malicious mischief
in property insurance, when must insurable interest exist?
at the time of loss
Which dwelling policy coverage will ensure a garage not attached to the primary insured dwelling
coverage be - other structures
If a producer makes maliciously critical statements about another insurer what is this legal practice called
defamation
What type of insurer is formed under the laws of another state
foreign
what are the two types of Compensatory damages?
special and general
Who owns stock companies
stockholders
What type of auto coverage will apply in a hit-and-run accident where the driver cannot be identified?
uninsured motorist
