State Farm

A property purchased 10 years ago for $100,000 has a replacement value today of $200,000. It has depreciated 3% each year. What is today's actual cash value?

$140,000

How long after theft of a vehicle will the transportation expenses be paid?

48 hours

A Builder's Risk policy automatically ends ___________ days after construction is complete.

90

Gaming

Gaming is a manipulation the solicitation and submission of applications to obtain compensation and or agent incentives. This type of activity is not in the best interest of the company of its policyholders and is strictly prohibited.

The Texas Property and Casualty Insurance Guaranty Association pays covered claims against which of the following?

Insolvent insurers

A person can purchase an insurance policy to cover losses from all the following, EXCEPT?

An operation of drug smuggling

Unapproved vendor

Any vendor that does not have an agreement in place with state farm, or services received from an approved vendor that are outside the scope of the vendors agreement with SF.

The Limit of Liability of Coverage D, Damage to Your Auto, under the Personal Auto Policy states that?

The Limit of Liability is the lesser of the actual cash value (ACV) of the vehicle or the amount necessary to repair or replace the vehicle with another of like kind and quality

A physical hazard describes which of the following?

The storage of flammables near a furnace

Which of the following statements is incorrect with respect to cancellation and nonrenewal of a personal auto policy?

The underwriting period is 30 days

The named insured is found in what section of a property policy?

Declarations

A binder would be which of these?

Temporary proof of insurance

All of the following are true of the Building and Personal Property Coverage Form, EXCEPT?

Tenant's improvements that are not legally removable are included in the Personal Property of Others Coverage

In a commercial package policy, the first named insured dies. What happens to the insureds right to the policy?

The policy automatically transfers to the insureds legal representative

What must be done to renew your Insurance License?

12 Hours of Continuing Education within 2 Years

Which of these would be an insured covered person in the Personal Auto Policy?

16-year-old unlicensed person of the household

In the commercial package policy, the Earthquake and Volcanic Eruption Endorsement covers an earthquake and all shocks or eruptions that occur within what period?

168 hours

An insurer may non-renew a homeowner policy if the insured submitted how many claims in the past 3 years?

3

T is the managing lawyer in his firm and wants professional liability coverage for his firm that would cover which of the following?

A client sues the lawyer for purposely losing his case

Which of the following is covered by the commercial crime form covering 'inside the premises', Robbery or Safe Burglary - of other Property?

A credit union held up at gunpoint

The Homeowners Policy excludes Coverage for which of the following?

A motorized golf cart being driven on a public road

Property insurance policies that apply coverage only to perils that are stated in the policy, are considered to be written on?

A named peril basis

Which would NOT be denied coverage under a personal auto insurance policy?

A person driving a borrowed car

Which of the following would not be eligible to purchase a Homeowners Policy?

A person who owns and lives on a farm

Which of the following is not a characteristic of a Mutual Insurance Company?

A policyholder is a voting member on the Board of Directors

Tie in sales

A practice requiring a customer to purchase one product or service in order to qualify for a different product or service.

Under Section II of the Homeowners Policy, all of the following would be considered an Insured Location, EXCEPT?

A secondary location that the insured used for a business

Unauthorized Vendor

A specific Vendor that State Farm has identified as not authorized to be used by SF or Sf agents due to the potential risks posed to SF by engagement with the vendor. Agents should not use an unauthorized vendor. If an agent uses an unauthorized vendor his could impact the relationship.

Which of the following is a robbery?

A thief demands money from a pedestrian after showing a handgun

Which of the following vehicles is not a "Your Covered Auto", in the personal auto policy?

A vehicle available for your regular use

When does a personal auto policy require the insured to notify the police?

After hit-and-run accidents and thefts

Which of the following is NOT found in a property insurance binder?

Amount of premium

In Property and Casualty Insurance, when a form is attached to further define certain policy provisions or conditions, or adds additional coverage, it is known as?

An endorsement

Errors and omissions insurance will NOT pay for which of the following claims?

Attorney inadvertently breaks a client's leg

Which of the following does not count as evidence of Financial Responsibility for an automobile?

Auto Registration

Which of the following statements about the Building and Personal Property Coverage Form in a commercial package policy is NOT true?

Automobiles held for sale or vehicles licensed for road use are covered

A personal umbrella policy will cover which of these?

Bodily injury liability

When a producer collects a premium on an insurance contract and deposits that in a trust account for the insurer. This makes the producer a?

Broker

Which of the following coverage forms pays for loss of income during the period a business is shut down due to a covered property loss in the Commercial Package policy?

Business Income

Texas Windstorm Insurance policies are sold on which of these properties?

Coastal properties

The section of a property policy that specifies the obligations and duties of the insured and the insurer is the?

Conditions

The Mobile Home insurance policy includes coverage for all the following, EXCEPT?

Cost to move Mobile Home

Which part of the HO-3 homeowners policy is open peril?

Coverage A

Which coverage is not found in the HO-6 homeowners policy?

Coverage B

J owns ABC clothing store. While moving items from the back of the store to the front he is robbed. He would be considered?

Custodian

The standardized policy structure for insurance policies does not include which of the following?

Duties

Umbrella policies provide coverage on which basis?

Excess

A newspaper concerned about being able to continue to provide papers while their location is being repaired due to a covered loss should buy?

Extra expense

A ___________ covers an employee in a position of private trust and protects an employer against loss caused by the employee's dishonesty.

Fidelity bond

Information used in underwriting a policy for an insured, is made available to in insured because of which of these?

Financial Services Modernization Act

In a Commercial Package Policy, which of these supplemental coverages is not subject to a deductible?

Fire Department service charge

Alpha Insurance Company does business in all fifty states, however its home office is located in Rhode Island. To their business in California, Alpha Insurance Company is?

Foreign

A property has obsolete parts damaged by a covered peril. How will the claim be paid?

Functional replacement cost

Before issuing a nonresident license, the Department must find that the applicant?

Has not committed an act for which a license may be denie

The Department of Insurance requires all of these for Licensing, EXCEPT?

High School Diploma or GED

All of the following are hazards for insurance underwriting, EXCEPT?

Incidental

Which of the following describes the Lay Up Warranty under the Yacht Policy?

It applies when the insured yacht is in storage and allows a return of premium due to the lower risk

If an insurance producer negligently fails to renew an insured's policy and a claim occurs, the wrongful action by the producer should be covered by which of the following?

It would be covered under the producer's Errors and Omissions Liability Policy

The Commissioner of insurance is responsible for all of the following, EXCEPT?

Make insurance laws when appropriate

Which of the following acts does not constitute Transacting Insurance?

Making phone calls to set up appointments

Which License is required for a person who supervises others for an Insurance Company?

Managing General Agent

A person had a vase insured for $3000 on a personal effects floater. All the following would be covered except?

The owner threw it

Inland Marine Policies are generally written on what basis?

Open Peril

Medical payments in the homeowners forms applies?

Per person

The Extra Expense form pays the necessary expenses incurred by the insured during which of the following?

Period of Restoration

Which of the following is covered under the Building and Personal Property Coverage Form?

Personal property of others in a vehicle within 100 feet of the business

Coverage C of a Homeowners Policy includes?

Personal property of the named insured and all members of the household anywhere in the world

The purpose of the Texas Fair Plan Association is to do which of the following?

Provide coverage to those who were cancelled by previous insurers

The immediate cause that sets other causes in operation is known as?

Proximate Cause

Agent Z is trying to sell a client a policy. Afraid of losing his sale he offers to give the client 10% of his commissions if the client will buy the policy. That agent would be guilty of which unfair trade practice?

Rebating

Rebating

Rebating is offering a prospect or customer a special incentive to purchase or continue a policy. This practice is illegal in most states and is against State Farm policy even in states where it is allowed.

How are losses paid for mobile homes in a Mobile Homeowners Policy?

Replacement Value

The commissioner of Insurance can do which of these?

Set continuing education requirements in Texas

Which of these is not added under the Broad Form of the Commercial Package Policy?

Sinkhole

All of these would be an insured under part A of the personal auto policy, EXCEPT?

Someone using the vehicle without the reasonable belief there are entitled to drive it

M hit F with his personal auto causing damages. F filed on his own policy and his insurer paid the damages. F's insurer will go after M and M's insurer for the paid damages. This is called?

Subrogation

___________ insurance is used to provide coverage when insurance is not available from an admitted carrier.

Surplus

Which association covers wind and hail losses in designated areas in Texas?

TWIA

The term 'robbery' specifically involves:

Taking of property from a person by someone who caused them injury

Which of the following is true regarding the HO-3 (Special Form)?

The dwelling and other structures (Coverages A and B) are written on an Open Peril Basis

Who is responsible for the premium payments in a commercial property policy?

The first named Insured

Under the Commercial Package Policy, who is responsible for premium payments?

The first named insured

Who is allowed under the Common Policy Conditions of a Commercial Package Policy to make changes with insurer consent?

The first named insured

Which of the following is incorrect in a commercial package policy?

The insured's rights and duties may be transferred to another without insurer approval

Choose the false statement about commercial property policies.

The insurer has the obligation to inspect the property

Who is allowed to cancel a commercial policy?

The insurer or the first named insured in the policy

Which risk management option, best describes insurance?

Transfer risk

In a Personal Auto policy Transportation Expenses are covered where?

Under Part D - Coverage for Damage to Your Auto

If an Agent makes incomplete comparisons of policies, that Agent would be guilty of?

Unfair Comparisons

Which of these is an insured location on an HO-2 homeowners policy?

Vacant land

The basic cause of loss form in the commercial property policy covers which of these?

Vandalism

T's agent told him the vehicle that hit him is not considered an uninsured vehicle. Which vehicle hit T?

Vehicle is owned by the government

A claimant told their insurer they were sure that a certain piece of property was in the building that burned. Made a?

Warranty

The Broad Causes of Loss Form in the commercial package policy adds which of these perils?

Weight of ice, snow, or sleet

When does the Texas Property and Casualty Insurance Guarantee Association pay covered claims?

When an Admitted Insurer becomes insolvent

Which of the following is not covered under the NFIP, flood policy?

Wind driven rain damage

Submission of an application for an insurance policy is best described as?

offer

Demonstrations

shows guaranteed premiums for a term policy. In addition it will include guaranteed cash values.

Illustrations

used as a tool to educate the customer concerning the features and provisions of policy options.