Exam FX

Under a personal auto policy, in which of the following locations would a vehicle primarily garaged in California be covered?

Any other state

The part of a property policy that shows the amount of insurance, premium, and policy term is the

Declarations.

Which of the following is an example of an unfair claims settlement practice?

Failure to promptly settle a claim when liability has been clearly established

Which federal act provides benefits to injured civilians who are employed by the federal government?

Federal Employees Compensation Act

Which of the following is NOT covered by the condominium unit owners endorsement?

Furniture in the building

Fiduciary responsibilities apply in which of the following situations?

Handling client premiums

Which of the following is NOT true regarding a Premium Fund Trust Account?

It could be used as a claim payment account.

When does the coverage begin under the builders risk form?

On the date construction starts

All policy applications must identify which of the following?

Producer who solicited the applicant's business

What type of license does an individual need to obtain in order to solicit and sell insurance?

Producer's license

Under the coverage of which of the following liability policies may an insured require the insurer to defend a claim?

Professional liability

Which of the following liability policies is usually written on a "claims-made" form?

Professional liability insurance

When the amount of insurance written in a property policy is not subject to any coinsurance provision and that amount is paid in the event of a covered loss, the coverage is said to be written as

Stated amount.

Who is NOT considered an employee in a commercial general liability (CGL) policy

Temporary worker

If a nonresident if applying for a license in Illinois and his home state does not require continuing education for Illinois residents,

The continuing education requirement will be waived in Illinois.

All of the following are correct regarding misrepresentation EXCEPT

The fines for misrepresentation range from $50 to $1,000.

When will a Plan Administrator bind coverage for Assigned Risk Insurance?

The first day following the date postmarked on the premium payment

Which of the following circumstances would be EXCLUDED under medical payments coverage of a personal auto policy?

The insured is injured while driving his motorcycle on his resident premises.

In Illinois, when a fire policy is cancelled, the insured must be notified of his or her eligibility for insurance through the FAIR plan, unless

The reason for cancellation was nonpayment of premium.

An insurance financing company must provide to insured, full and complete disclosure of the terms and conditions of the finance agreement not later than

The time the first payment notice is sent to the insured.

When a vehicle travels from one state to another, what happens to the limits of policy liability in a personal auto policy?

They do not change.

In forming an insurance contract, when does acceptance usually occur?

When an insurer's underwriter approves coverage

Alan has a Personal Auto Policy with Part C limits of $100/$300 Uninsured/Underinsured Motorist. Alan is injured by Ben who has Part A limits of $50/$100. The police determine that Ben is at fault for the accident and Alan's $125,000 of medical expense. How much will Alan's Part C pay?

$50,000

An insured hits a deer and crashes his car into a tree. The total damage to the vehicle is $6,000. How will this loss be covered?

$6,000 would be paid under other-than-collision coverage.

How long is the policy period for NFIP flood insurance?

1 year

Within how many days may a person who is being examined by the Director for nonfinancial business practices request a hearing after receiving the examination report?

10 days

Following a vehicle accident, if a claimant or their attorney requests the dollar amount of liability coverage under an insured's personal auto policy, the insurer must disclose the limits within

30 days.

If it is determined that an owner has registered a motor vehicle without having a liability insurance policy, the Secretary of State must notify the owner that the vehicle registration will be suspended how many days after the date of the mailing of the notice?

45 days

An insured has a homeowners policy and is required to be a member of the homeowners association in her neighborhood. The association's community house has burned down, and the insured has been assessed $1200 for her share of the rebuilding cost. How much of the assessment will her homeowners policy pay?

$1,000

What is the maximum fine for a violation of a cease and desist order?

$1,000

What is the maximum amount an insurer will pay under the equipment dealers pollution cleanup and removal extension of an inland marine policy?

$10,000 for all expenses incurred during a 12-month period

The regular National Flood Insurance Program would insure an eligible single-family dwelling for up to

$250,000.

A business insurance policy generates a premium of $2,000 annually. The policyowner is financing the premium with a premium financing company. In addition to the premium balance and interest on that amount, the finance company may assess a carrying charge that may not exceed

$40

Johanna purchased a National Flood Insurance policy 10 days after her community entered an emergency program. When would her coverage be effective?

12:01 am the day after the application and premium payment are mailed

If an insured requests forms that are necessary to present a claim, within how many working days must the insurer provide the forms?

15

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

2 weeks.

Prior to requesting renewal of an insurance producer's license, how many hours of continuing education must a producer

24 hours

A producer receives notice that his license has been terminated. If the producer wants to have the charges reviewed in court, within what time period must the request be made?

30 days

A potential applicant for a personal auto policy must be given a nonbinding oral estimate of premium charges based on information provided to a producer who maintains an office within any municipality with

500,000 or more inhabitants.

No person may act as a premium finance company or hold himself out to be engaged in the business of financing premium, without obtaining a license. Which of the following would be deemed to be a premium financing activity?

A producer who allows partial payments and schedules the balance for payments that are paid throughout the policy term.

What are common carriers required to issue to every shipper that it transports goods for?

A uniform bill of lading

Which of the following would be considered an uninsured vehicle?

A vehicle fleeing a hit-and-run accident

An uninsured motor vehicle includes all of the following EXCEPT

A vehicle owned and operated by a self-insurer.

In which of the following types of property valuation will the policy pay the full value as specified on the policy schedule, regardless of the insured property's appreciation or depreciation?

Agreed value

Which of the following types of valuation works best for property whose value does not fluctuate much?

Agreed value

n which of the following types of property valuation will the policy pay the full value as specified on the policy schedule, regardless of the insured property's appreciation or depreciation?

Agreed value

Which of the following is a method of claim settlement used in casualty insurance when the insured and insurer cannot agree on how to settle a claim?

Arbitration

According to the common policy conditions for a commercial package policy, if the insured dies, the policy rights and duties

Automatically transfer to a legal representative.

What are the two major sections of commercial crime policies?

Commercial entities and government entities

A plasterer has finished a job. What kind of liability coverage would protect him if the plaster falls and hurts someone because he did not do the job correctly?

Completed operations

When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?

Consideration

Which of the following examples of losses paid under an HO-3 also would be paid under an HO-2 homeowners policy?

Damage to the dwelling caused by ash or dust from a volcanic eruption

With which entity must a corporation register before it will be allowed to operate as an insurance agency?

Director

What is the purpose of the coinsurance clause found in property insurance policies?

Encourage the insured to insure the property closer to its full value

A nonresident producer in Illinois just relocated to Indiana and became a resident producer in that state. What must the producer do to satisfy one of Illinois' requirements for nonresident producers?

File a change of address within 30 days

Replacement cost is defined as

Full replacement of property at its current cost, new and without reduction for depreciation.

All of the following are conditions commonly found in the insurance policy EXCEPT

Insuring agreement.

Which of the following statements is true concerning Uninsured Motorist Property Damage Coverage written in Illinois?

It must be offered on all policies insuring private passenger and recreational vehicles which are not covered for collision damage under the policy.

How does the mobilehome endorsement affect the other coverage of law or ordinance in a homeowners policy?

It removes the coverage.

In Illinois, a cancellation provision must be included in all of the following types of insurance policies, EXCEPT

Marine.

Symbol 9 - nonowned autos only

Mechanical breakdown

A bond is written for a set limit, and the surety will be liable only for this amount of the limit. This limit is known as the

Penalty.

While an insured was towing a utility trailer with his auto, the trailer came loose and ran into a store front. What part of the insured's auto policy would pay for the damage to the store?

Property damage liability

All of the following are true regarding rebates EXCEPT

Rebates are allowed if it is in the best interest of the client.

The Federal Fair Credit Reporting Act

Regulates consumer reports.

What type of information would be found in a policy's insuring agreement?

Renewal dates

Which of the following correctly explains the equipment exclusion in auto policies?

Standard and optional equipment is covered on an auto policy, unless an endorsement excluding coverage for specific named equipment has been signed and dated by the insured.

Which one of the following symbols used in business auto coverage is correctly described?

Symbol 9 - nonowned autos only

Which of the following would be grounds for an insurer to surcharge or refuse to issue an automobile insurance policy?

The applicant fails to provide the insurer with their loss experience with the prior carrier within 21 days after the application is filed.

Which of the following is NOT settled on an actual cash value basis while covered under the business property coverage form?

Valuable papers and records

The insured with a claims-made commercial general liability (CGL) policy may request in writing claim and occurrence information from the insurer at any time up to 60 days after the policy period ends. The insurer must provide the information

Within 45 days.

Coverage under a Floor Plan Merchandise form is written on a reporting form basis that requires the insured to file reports with the insurer. What is the time frame for those reports?

Within 30 days after the end of each month