GA P&C 4

Blake is covered by a Homeowners policy with a $50,000 Coverage C limit. Disregarding any deductibles, what is the most Blake can collect if his $1,500 boat is stolen from the insured premises?

$1,500

In Georgia, the Chief Deputy Commissioner must execute a bond in the amount of:

$15,000

In Georgia, the waiting period after receiving a failing grade on a licensing examination is:

2 weeks.

Tori owns a cabin in the Ozark Mountains that she rents to Vincent. Tori has the cabin covered under a DP-2 policy. One cold evening, Vincent started a large fire in the cabin's fireplace and left the room to start dinner in the kitchen. Vincent didn't realize that he forgot to open the chimney flue before starting the fire and by the time he came back into the living room, it was completely filled with smoke. Vincent immediately opened the doors and windows to "air-out" the cabin but when the smoke cleared, there was extensive soot damage to the walls, ceilings and furnishings in the room. Which of the following statements is true regarding how this claim will be handled?

The claim will be paid because the DP-2 extends the peril of "smoke" to cover smoke damage from a fireplace..

An insurance company that permits different rate classifications for individuals of the same class and same hazard may be guilty of:

Unfair discrimination.

Property with no occupants or contents is considered to be _______ whereas property with no occupants but with contents is considered to be _______.

Vacant/Unoccupied

If an insured intentionally conceals a material fact on an application for insurance, the coverage may be:

Voided.

In crop insurance, what is NOT considered to be a "coarse grain" crop?

Wheat

Under a Crime insurance discovery form, a loss is "discovered":

When the insured first becomes aware that a loss has occurred or gives notice of an actual claim of a covered loss.

The Insurance Commissioner in Georgia is:

elected by the citizens of Georgia

Joseph Jones purchased a new car stereo system from Dailey's Auto Enhancements. Daily's permanently installed the stereo system in the console area of the car, where he could access it easier while driving than the typical area in the dashboard. The cost of the new system, disregarding any installation costs, was $2,000. One year after installation, Joseph's car was broken into and the stereo was stolen. At this point, the ACV of the system had fallen to $1,700. Disregarding any deductible, how much will Joseph's policy pay on this claim?

$1,000. Part D of the Personal Auto policy provides for a limit of $1,000 for electronic equipment that reproduces, receives or transmits audio, visual or data signals that is permanently installed in an auto, but not in the location typically used by the auto manufacturer.

What is the maximum penalty per violation if a person willfully and knowingly or intentionally makes any false or misstatement for the purpose of obtaining or denying benefits or payment of workers compensation coverage?

$10,000

A non-residential building in Iowa in a community that was admitted to the NFIP Emergency Program would be provided _______ of coverage for the building.

$100,000

Under Coverage F - Unscheduled Farm Personal Property, the most that will be paid for a "head" of livestock (an adult animal, one year of age or older) is:

$2,000.

Aaron purchases a Homeowners insurance policy for $700,000 with a 4% deductible. A few months later, a heavy hailstorm destroys his roof, porch, and windows, causing $50,000 in damages. How much should Aaron expect to receive from the insurance company to pay for the damages?

$22,000 EXPLANATION: A 4% deductible is based on the coverage limit of $700,000. 4% of $700,000 is $28,000 which would be the deductible. Subtracting that from the $50,000 in damages, Aaron would receive a net of $22,000.

A farmer purchases a crop hail policy with a limit of $10,000 on 5000 acres that sustains a 30% loss. Coverage is written with a 5% minimum loss before the policy will pay. How much will the farmer receive?

$3,000.

Jim and Mary are celebrating their 50th wedding anniversary and are on a worldwide cruise. They carry a DP-3 policy with a personal property limit of $50,000. While off the coast of Africa the ship catches fire and their property is completely destroyed. How much, if anything, will they collect?

$5,000

All of the following are covered by the supplementary payments section of the Commercial General Liability policy, EXCEPT:

$500 for bail bonds

Fred owns two commercial buildings and carries NFIP coverage on them. The area where the buildings are located is a full-risk zone in the Regular Program. Both buildings are 30 years old and when they are damaged by flood, Fred finds that the cost to comply with the new Floodplain Management Ordinance will be quite expensive. What is the total amount of coverage Fred could receive for the Increased Cost of Compliance?

$60,000. EXPLANATION: The amount of coverage for ICC under the policy is $30,000 per building and no deductible applies. Therefore, Fred could receive $60,000.

An insured is covered under a CGL policy with a "per occurrence" limit of $4 million and an aggregate limit of $8 million. The insured also has a Commercial Umbrella policy with a $5 million aggregate limit and a $100,000 SIR. Two covered claims are submitted, one for $4 million and one for $5 million. What amount is the retained limit that will trigger the Umbrella policy to pay on the claim?

$8 million EXPLANATION: The total claim is for $9, but the CGL policy's aggregate limit is $8, so this is the "retained limit" of the CGL policy that will trigger the Umbrella policy.

At the time of fire damage to a covered auto under a business auto policy, the auto's actual cash value is $9,200. The cost to fully repair the damage would be $11,500. If the policy has a $250 comprehensive deductible, what amount will the insurer pay for the loss?

$8,950. EXPLANATION: The deductible that applies to comprehensive also applies to losses caused by fire or lightning under the business auto policy. Therefore, the insurer would pay the ACV of the vehicle less $250 or $8,950.

When a driver in Georgia takes a defensive driving course, they are given a premium discount on certain coverages within their automobile policy. What is the amount of that discount?

10%.

If the insured purchases a new aircraft to replace a scheduled aircraft, there is automatic coverage provided the insurance company is notified within ______ days of the purchase and premium payment is made.

30

Payment for a covered loss under the Standard Fire policy must be made within ____ days after a satisfactory proof of loss has been received by the insurer.

60

In Georgia, insurance binders are valid for a period not to exceed:

90 days

Which of the following businesses is NOT eligible to be covered by a Businessowners policy?

A credit union

Which of the following is NOT a hazard?

A fire started in a waste basket EXPLANATION: The fire in the waste basket is a peril. The other three responses are all hazards.

A surety bond is:

A form of credit.

A slippery floor is an example of:

A physical hazard.

Which of the following is not "mobile equipment" under the business auto policy?

A self-propelled vehicle with permanently attached street-cleaning equipment.

Watercraft that are eligible for coverage under the Watercraft endorsement of the Homeowners policy, include all of the following, EXCEPT:

A small fishing boat powered by an outboard engine of 15 horsepower or less.

Indemnify Insurance has been using a specific ISO Homeowners forms for several years in all the states where they are an admitted insurer. Indemnify Insurance has recently been admitted to an additional state, but the laws of that state contradict a few of the provisions in the ISO form. How is this situation likely to be handled?

A statutory form will be drawn up and attached to each Homeowners policy Indemnify Insurance writes in the state..

A personal auto policy provides coverage for all of the following drivers of an insured car, EXCEPT:

A thief who steals the car.

Melinda's insurance policy is cancelled because she has not paid the premium. In this scenario, which of the elements of a valid contract is missing?

A valuable consideration.

The federal crop program that covers the revenue of the entire farm as opposed to a specific crop is called:

Adjusted Gross Revenue

Which type of Crop insurance policy insures the entire acreage rather than an individual crop?

Adjusted Gross Revenue.

Under the comprehensive coverage of a Business Auto policy, which of the following would not be a covered loss?

After sliding on an icy pavement, a driver hits a guard rail.. EXPLANATION: Since the vehicle sustained damage by hitting the guard rail, it is considered a collision claim. This is because the definition of collision includes the upset of a vehicle, its impact with another vehicle or object; anything else would be other than collision and thus be covered by comprehensive coverage.

Under a surety bond, the "principal" is the party that:

Agrees to fulfill an obligation.

Which of the following would be covered under the "supplementary payments" of Section II - Liability of a Business Auto policy?

All post-judgment interest in a suit defended by the insurer

Adverse selection occurs when:

Applicants are accepted by the insurer with little or no attention given to underwriting. .

If the Commissioner determines that someone is guilty of unfair trade practices he or she may do all of the following, EXCEPT:

Ban the person from the insurance business for life.

An oral or written contract for temporary insurance is referred to as a:

Binder.

The limit of a bond is known as its:

Bond penalty.

Coverage D - Loss of Use on a farm policy will include coverage for: I. Additional living expenses incurred by the resident family. II. Loss of rental income of the owner for tenants who cannot live there due to a covered loss.

Both I and II

Dusty had been working as a steam boiler repairman for the past 30 years. He went to his doctor because he was experiencing a chronic cough. His doctor indicated that his cough was caused by asbestos exposure on the job. Dusty filed a workers compensation claim for occupational disease in June of 2018. In his career, Dusty had worked for the following companies: -- Boyle's Boilers, Inc. August 2017 to June 2018. -- Thermo Boilers, Inc. May 1997 to July 2017. -- Industrial Boilers, Inc. May 1988 to May 1997. Dusty would have been exposed to asbestos in all three jobs, and he lives in a state where workers compensation coverage is triggered based on the "last day of last exposure" rule. Using this information, select the statement below that best describes how the compensation will be paid.

Boyle's Boilers is responsible for the entire claim

Matilda has been injured by a blender that turned out to be unsafe when she used it. Matilda has decided to file a lawsuit against the manufacturer for damages. Which of the following is NOT grounds for which Matilda may bring the lawsuit?

Breach of contract..

Which of the following is not reflected in a privacy report?

Categories of medical information.

If the "other insurance" clause in a policy specifies that more than one policy will share equally in the loss until the lowest policy limit is exhausted and continue in that fashion until all policy limits are exhausted. This is known as:

Contribution by equal shares

All of the following statements regarding uninsured motorist coverage in Georgia are true, EXCEPT:

Coverage cannot be rejected

Which of the following would NOT be excluded in the Coverage A - Exclusions section of the Commercial General Liability policy?

Damage from a fire caused by the insured in his rented office space.

Which of the following is not an "additional coverage" under Homeowners Liability -- Section II coverage?

Damage to "property owned by the insured"..

Which of the following is required to calculate the estimated annual premium in a workers' compensation policy?

Estimated annual payroll and work classification(s).

The "Business Income" additional coverage under the standard Businessowners policy includes all of the following in its definition of "ordinary payroll expenses", EXCEPT:

Executive payroll.

Bill may be negligent if he:

Fails to do what a reasonably prudent person would do in the same circumstance.

Fernando is a railroad worker covered under the Federal Employers Liability Act (FELA). He has sustained an injury on the job, which of the following must be true in order for Fernando to collect on a claim?

Fernando must prove that his employer's negligence caused his injury..

The optional coverage for "Money and Securities" under a standard Businessowners policy provides for the loss of money and securities used in the insured's business as a result of all of the following, EXCEPT:

Fraud

Which of the following is a type of "voluntary loss" taken to save the property from further loss?

General Average Loss

Which of the following losses is NOT excluded under Part D of a standard Personal Auto policy?

Glass breakage.

Which of the following would NOT be covered under the specified cause of loss physical damage coverage under a Business Auto policy?

Glass breakage.

Helena has not paid her insurance premium for a significant amount of time. Which of the following is likely to happen in this scenario?

Her policy will be cancelled.

Which of the following situations would NOT be considered an unfair claim settlement practice according to the NAIC Model Act?

Indemnify Insurance pays thousands of claims per year, but on two of those claims they failed to accept or deny the claim within the time frame required by state law. EXPLANATION: The fact that Indemnify Insurance failed to meet the time frame for accepting or denying a claim on two of their claims would not result in a charge of an unfair claim settlement practice. The law states that the violation must be committed with such frequency as to indicate that it is a general business practice.

All of the following would be covered under Part B - Medical Payments of the Personal Auto policy, EXCEPT:

Injuries sustained by an elderly man riding in the insured vehicle after having paid the insured to take him to the grocery store. EXPLANATION: Coverage while using the vehicle as a public or livery service is excluded. This does not apply to share-the-expense car pooling.

Which of the following injuries would be covered under Part A of the Personal Auto policy?

Injuries to a pedestrian struck by the insured while driving the covered auto..

All of the following are true regarding the "Write Your Own" program of the NFIP, EXCEPT:

Insurers are required to participate in the program

All of the following are EXCLUDED under the Earthquake Endorsement to a Homeowners policy, EXCEPT:

Land shock waves.

Which of the following is the definition of "title" as it relates to title insurance?

Legal right of real property.

All of the following are included under the HO-3 "additional coverages" section of a Homeowners policy, EXCEPT:

Loss of a good renter or a favorable lease arrangement.

Garagekeeper's liability coverage excludes all of the following losses, EXCEPT:

Loss to a high-value audio system permanently installed in a covered auto. .

If the named insured is an organization as designated under a CGL policy, all of the following would be named insureds, EXCEPT:

Managers.

Which of the following is NOT a coverage of the Truckers form?

Medical payments EXPLANATION: Medical payments is not a coverage of the Truckers form. This coverage would need to be added by endorsement.

All of the following situations involve misrepresentation, EXCEPT:

Michael manages an insurance agency and posts the sales numbers of all agents publicly each month, to promote competition..

"Theft" as defined by a Crime insurance policy, includes all of the following, EXCEPT:

Mysterious disappearance.

Which of the following professional liability policies would cover a dishonest, fraudulent or criminal act of the manager of a LLC?

None of the policies cover these acts.

Domestic insurers, (one formed under the state laws of Georgia) must be examined at least:

Once every 5 years.

With regard to workers' compensation coverage, a "competitive" state is:

One where both private and government insurers write workers' compensation policies that compete against one another.

A NFIP policy has a policy period of:

One year term only

Sam and Dan are working to clean out the gutters around the roof on Sam's house. Sam and Dan are standing at the top of separate ladders that are propped against the side of Sam's house, when Dan's ladder begins to wobble and ultimately falls into Sam's ladder. Both men and their ladders crash to the ground. Whose injuries will be covered by Sam's Homeowners policy under Coverage E - Personal Liability?

Only Dan's injuries would be covered

Which insuring agreement of the Personal Auto policy would provide coverage for the damage caused to the other driver's car, when the insured was at fault in an accident?

Part A - Liability

The standard Personal Automobile policy provisions state that the insurance company has subrogation rights against any person permitted to use a covered auto, under all coverages, EXCEPT:

Part D EXPLANATION: The insurer would not have subrogation rights under Part D - Physical Damage, because this coverage applies to the insured that is covered by the company. Part D specifies that any person who has permission to drive the covered vehicle is considered an insured and cannot be subrogated against. This caveat does not apply to any other coverage of the Personal Automobile policy.

A contractor in need of a bid bond to obtain a contract is an example of a(n):

Principal

The Gramm-Leach-Bliley consumer privacy act requires:

Privacy notices to be delivered electronically only if the customer or consumer agrees..

All of the following are covered under the definition of money in commercial crime insurance, EXCEPT:

Proof of debt.

Under the "supplementary payments" section for Coverages A and B of a CGL policy, which of the following is TRUE?

Provides a specific limit of $250 for the cost of bail bonds..

Which of the following statements is TRUE regarding the sections of a Homeowners policy?

Section I coverages vary greatly between the different HO forms..

Which of the following is NOT a responsibility of the Insurance Commissioner in any given state?

Setting insurance rates

What coverage is provided under the BOP for a steam boiler explosion?

Steam boiler explosions are excluded unless the damage is a result of an explosion of gases or fuels within the object or flues.

Which of the following statements is true regarding a stock insurance company?

Stock companies pay a portion of their earnings to their stockholders (shareholders) as dividends.

What type of liability is imposed by law without regard to fault on those participating in certain activities or owning certain things that are considered especially hazardous?

Strict/Absolute EXPLANATION: Absolute or strict liability is liability without fault. It is occasionally imposed by statute on those participating in specified activities that are considered especially hazardous. For example, in some states, ownership of certain dog breeds places strict liability upon the owners in case of any damage or injury to others.

Which of the following workers' compensation scheduled disability classifications would allow the injured worker to perform "light duty" work while recovering?

Temporary partial disability.

An insured purchases a Commercial General Liability claims-made policy with an effective and retroactive date of January 1st, 2018. The insured renews that policy on January 1st, 2019 with a retroactive date of January 1st, 2018. If an injury occurs to a customer on February 15th, 2018 but the claim is not made until March 23rd, 2019, will the 2018 or 2019 CGL policy cover the claim?

The 2019 policy.

The Mobile Home endorsement may be attached to which of the following Homeowners forms?

The HO-2 or HO-3 only

Sarah is purchasing a 100-year-old home that hasn't had significant renovations. She has contacted her insurance company and requested coverage under an HO-3 form. Her insurance company has refused to place the coverage but offered to cover the home under an HO-8 form instead. All of the following statements provide a reasonable explanation for the insurance company's choice of the HO-8 form, EXCEPT?

The HO-8 form provides higher limits of coverage to replace items such as antique building materials to allow the home to remain true to its original design..

Which of the following individuals was NOT required to be in concurrence with certifying an act of terrorism under the Terrorism Risk Insurance Act of 2002?

The Secretary of Homeland Security.

All of the following statements regarding eligibility of self-storage facilities for a standard BOP policy are true, EXCEPT:

The facility cannot exceed more than 500 individual self-storage units..

Which of the following statements is TRUE regarding a Government Crime policy?

The policy permits the limit for employee theft to apply on either a "per occurrence" or "per employee" basis.

Which of the following statements BEST describes how coverage will apply under a Commercial General Liability policy when a product is manufactured in the United States and a claim occurs in Italy?

The policy will pay the claim but only if the lawsuit is brought within the policy's coverage territory..

All of the following are situations where a Commercial Umbrella policy would be triggered to provide coverage, EXCEPT:

The underlying liability policy limits are sufficient to pay the entire claim.

Which of the following perils is covered for earth movement under the DP-2 Dwelling form?

There are no perils covered for earth movement under the Dwelling forms.

Under Coverage B of the BOP, how are exterior signs covered?

They are listed as "property not covered" but they can be covered if they are scheduled on the policy.

If a licensee in the state of Georgia has placed his or her license on an inactive status, how long may the license remain inactive?

Two years