Insurance Exam Practice Test Questions

The Commercial Crime Coverage form offers how many types of insuring agreements? A. 8 B. 2 C. 4 D. 6

A. 8 This form has 8 insuring agreements, but the insured can choose one, several, all, or none.

Under the Commercial Property policy, vacancy is allowed for how many days before the peril of vandalism coverage is suspended? A. 60 B. 90 C. 30 D. 120

A. 60 The risk of loss by vandalism increases greatly in vacant property. Therefore, insurance policies end coverage for vandalism losses after 60 days of vacancy, unless special arrangements are made with the company.

The Builder's Risk Coverage form automatically ends at the earliest of all of the following, except: A. 60 days after construction is complete B. Policy expires C. Property is abandoned D. Property is sold

A. 60 days after construction is complete The coverage automatically ends 90 days after construction is completed.

Which of the following is not considered an uninsured motorist vehicle under the Personal Auto Policy? A. A hit and run vehicle B. A vehicle for which there is no liability policy C. A vehicle newly acquired by the named insured that has not been reported to the insurer D. A vehicle insured by a bankrupt insurance company

A vehicle newly acquired by the named insured that has not been reported to the insurer

A single-family dwelling may purchase up to what amount of flood insurance in the NFIP's Emergency program? A. $35,000 B. $100,000 C. $50,000 D. $250,000

A. $35,000 The Emergency NFIP program covers up to $35,000 on a single-family dwelling.

Company A's per person Limit of Liability is $100,000 and Company B's is $200,000 for the same insured. How much will Company B have to pay for a covered $6,000 loss caused by the insured? A. $4,000 B. $6,000 C. $2,000 D. Zero

A. $4,000 If other auto liability insurance applies, each policy will pay its proportionate share of the loss. Company B's limit is 2/3 of the total coverage by both policies. 2/3 of the total loss of $6,000 = $4,000.

ABC industries has insured a factory building for $80,000. The replacement value is $150,000. If the commercial property policy insuring the building has an 80% coinsurance clause, how much will ABC's insurer pay for a $12,000 covered loss? A. $8,000 B. $12,000 C. $9,600 D. $10,000

A. $8,000 The coinsurance clause requires insurance at 80% of the replacement value, or $120,000. Because the policy limit of insurance is only $80,000, or 2/3 of $120,000, the claim payment would be 2/3 of $12,000, or $8,000.

Reasonable medical expenses incurred and reported within how many years following an accident are covered under Medical Payments coverage (coverage C) of the CGL? A. 1 B. 3 C. 5 D. 2

A. 1 The time to incur and report medical expenses is limited to 1 year under this policy.

Under the BOP, the insurer may examine and audit books and records at any time during the policy period and up to how many years following policy termination? A. 3 B. 5 C. 1 D. 7

A. 3 The insurer may examine and audit the books and records as they relate to the policy during the policy period and up to 3 years afterward.

The Association covers existing claims prior to the determination of insolvency or that are submitted within how many days after the determination of insolvency? A. 30 B. 90 C. 10 D. 60

A. 30 Covered claims must be submitted no later than 30 days after the determination of an insurer's insolvency.

For the purposes of crime policies, how long is a person an employee after employment is terminated, regardless of the reason for termination? A. 30 days B. 60 days C. 180 days D. 15 days

A. 30 days An employee is a person in the insured's service and compensated for that service for 30 days after termination.

The Director may conduct a financial examination of an insurer whenever necessary but no less often than every _____ years. A. 5 B. 10 C. 3 D. 7

A. 5 The Director or authorized examiner may examine any insurer as often as deemed appropriate, but each Missouri insurer must be examined at least once every 5 years.

In order to be considered a SINGLE OCCURENCE, the Earthquake endorsement covers all earth movement that occurs within what time period? A. 72 Hours B. 48 Hours C. 36 Hours D. 12 Hours

A. 72 Hours

Each of the following individuals is an insured under the BOP, except: A. A sole proprietor's minor child B. The insured's legal representative if the insured dies C. Any person acting as the named insured's real estate manager D. The manager of a limited liability company

A. A sole proprietor's minor child The named insured, executive officers and directors, and stockholders of any covered organization other than a partnership, joint venture, or limited liability company are covered.

Which of the following is not an insured contract under CGL? A. An advertising contract B. Elevator maintenance agreement C. Sidetrack agreement D. Lease for a new store location

A. An advertising contract An advertising contract is not one of the insured contracts.

Which of the following would be not covered by a Business Auto Policy? A. A manager's spouse drives the company car B. The Director of Sales rents a vehicle for sales visits C. An employee is injured while driving a covered auto D. The named insured leases a car for client visits

A. An employee is injured while driving a covered auto Workers' Compensation insurance would cover the injuries of employees.

Which of the following conditions would not be found in Section IV of the CGL? A. An insured's insolvency relieves the insurer of any obligations under the policy B. The insured cannot sue the insurer until all terms of the policy have been fully complied with C. The insured must maintain records necessary so the insurer may compute the premium D. Insurance applies as if each named insured were the only named insured, and separately to each insured against whom the claim is brought

A. An insured's insolvency relieves the insurer of any obligations under the policy

Which type of Commercial Auto policy would be best suited for a business that wished to cover its owned and hired autos against property damage only? A. Auto Physical Damage Coverage Form B. Garage Coverage Form C. Business Auto Coverage Form D. Truckers Coverage Form

A. Auto Physical Damage Coverage Form

Which type of Commercial Auto policy would be best suited for a business that wished to cover its owned and hired autos against property damage only? A. Auto Physical Damage Coverage Form B. Business Auto Coverage Form C. Garage Coverage Form D. Truckers Coverage Form

A. Auto Physical Damage Coverage Form The Business Auto Physical Damage Coverage Form contains virtually the same language as Section III of the Business Auto Coverage Form and only provides physical damage coverage.

Which of the following is NOT a penalty for refusing to testify in a Department hearing? A. Being assessed a civil penalty up to $5,000 per violation B. Being required to appear before the Director C. Being ordered to testify in circuit court D. Being held in contempt

A. Being assessed a civil penalty up to $5,000 per violation The circuit court may impose a civil penalty up to $50,000 for each violation.

Which of the following is not a type of personal and advertising Injury under the CGL? A. Breach of contract B. Infringement of copyright C. Slander D. Malicious prosecution

A. Breach of Contract Breach of contract is excluded from the definition of personal and advertising injury.

The Equipment Breakdown Coverage does not cover which of the following? A. Breakdown test B. Expediting expenses C. Business income D. Spoilage damage

A. Breakdown Test Equipment Breakdown coverages include property damage, expediting expenses, business income, spoilage damage, newly acquired premises, ordinance or law, errors and omissions, and brands and labels.

The Named Perils endorsement: A. Changes the open perils coverage to named perils coverage B. Excludes hired and non-owned auto liability coverage C. Provides coverage for damage caused by the interruption of power to the insured premises D. Extends bodily injury and property damage liability to the use of any non-owned auto

A. Changes to open perils coverage to named perils coverage

Which of the following indicates the taking of property from the care and custody of a person by someone who has threatened bodily harm to that person? A. Assault B. Burglary C. Robbery D. Theft

C. Robbery

The Running Down Clause would cover which of the following claims? A. Collision damage to another vessel when the insured is liable B. Collision damage to the insured vessel when it collides with a pier or fixed object C. Collision damage to the insured vessel when it collides with another vessel D. Damage to the insured vessel caused by running aground

A. Collision damage to another vessel when the insured is liable A Collision and Running Down Provision is contained in the standard Hull Policy to cover liability incurred for damage to another vessel or structure.

Which of the following is correct regarding products liability under the CGL? A. Coverage applies to the bodily injury (BI) and property damage (PD) the product causes, but not to the product itself B. Products liability coverage commences immediately upon sale of the product, before the purchaser leaves the insured's premises C. Coverage applies to BI and PD caused by the product, and to damage to the product itself once in the purchaser's care, custody and control D. Products liability coverage includes dram shop liability insurance

A. Coverage applies to the bodily injury (BI) and property damage (PD) the product causes, but not to the product itself Products Liability Coverage under Commercial General Liability Insurance covers damage or injuries caused by the product, but does not cover damage to the product itself.

Which of the following is false under the Personal Auto Policy? A. Coverage is provided for theft under property damage liability B. No-fault coverage is provided in states that require it C. Coverage for damage to an insured vehicle is provided without regard to liability D. Medical payments may be provided for up to 3 years following an accident

A. Coverage is provided for theft under property damage liability Theft is covered under Physical Damage (Part D), not property damage liability (Part A).

Which of the following is true regarding Business Income Coverage under a BOP? A. Coverage is provided for up to 12 months after the direct loss, with no limit on the amount of monthly indemnification, and no limit of insurance B. The monthly limitation is 1/12th of the limit of insurance applying to Buildings and Business Personal Property C. The monthly limitation is 1/12th of the limit of insurance applying to Buildings D. Coverage is for 12 months after the direct loss, starting 24 hours after the direct loss

A. Coverage is provided for up to 12 months after the direct loss, with no limit on the amount of monthly indemnification, and no limit of insurance

All of the following statements about the Fine Arts Floater are true, except: A. Coverage is written on a replacement cost basis B. It covers such items as paintings, rare manuscripts and antiques C. Coverage applies only to scheduled items D. It has a 90-day automatic coverage for newly acquired items

A. Coverage is written on a replacement cost basis Fine arts floater is written on a VALUED BASIS

All of the following are true of an Umbrella Liability Policy, except: A. Damage to property in the care and custody of the insured is covered B. Coverage is excess over the underlying policy C. Specific minimum limits for underlying coverage are required D. Coverage is worldwide

A. Damage to property in the care and custody of the insured is covered

A producer who makes a derogatory statement about a competing insurer's financial condition is guilty of what unfair trade practice? A.Defamation B. Twisting C. Intimidation D. Coercion

A. Defamation Defamation consists of false or maliciously critical statements regarding the financial condition of any person, with the intent to injure such person.

Which of the following statements regarding Commercial Crime Coverage is incorrect? A. The definition of robbery includes forcible entry into locked premises B. Employee Dishonesty Coverage will cover new employees automatically C. A watch person is any person retained to have care and custody of property inside the premises, and has no other duties D. Employee Dishonesty Coverage covers property other than money and securities

A. Definition of robbery includes forcible entry into locked premises

Which of the following coverages is not included in either of the Utility Services endorsements? A. Direct loss to electronic data B. Direct loss to covered property C. Loss due to interruption of water supply coverage D. Indirect loss due to Business Income loss

A. Direct loss to electronic data The Utility Services Direct Damage endorsement covers a direct loss due to the interruption of water supply, and the Time Element version covers Business Income or Extra Expense coverage for the same type of loss.

When an employee is injured by a product manufactured by the employer, the Employers Liability will provide coverage under which of the following? A. Doctrine of Dual Capacity B. Third-party Action Claim C. Consequential Injury Fund D. Loss of Services

A. Doctrine of Dual Capacity Doctrine of Dual Capacity applies when an employee is injured by a product the employer manufactures.

Which of the following is not an unfair property and casualty claim settlement practice? A. Failure to complete a claim investigation within 15 days if reasonable to do so B. Deny a claim because the insured would not give access to the claim adjuster C. Require the insured to release the insurer from total liability in exchange for a smaller settlement D. Require the first-party claimant to sign a release extending beyond the claim

A. Failure to complete a claim investigation within 15 days if reasonable to do so It is an unfair property and casualty claim settlement practice to fail to complete a claim investigation within 30 days when it is reasonable to do so.

The Legal Liability Coverage Form would not cover which of the following losses? A. Fire damage to the cash register B. Fire damage to a common wall C. Fire damage to the roof D. Fire damage to a permanent awning

A. Fire damage to the cash register This form is most commonly written for the tenant of a commercial building who is legally liable for damage to the building. The cash register is personal property owned by the insured (or tenant) and is not covered.

The earthquake endorsement is fairly broad but does not cover damage from: A. Flood B. Tremor C. Mudslide D. Sinkhole

A. Flood The earthquake endorsement also covers earth movement, land shock waves, landslide, mudflow, and the rising, sinking, or shifting of the earth.

A travel agency discovers that it has been charged for payments to a print shop drawn on checks written by an unknown third party masquerading as the travel agency comptroller. Under which Commercial Crime insuring agreement would this loss be covered? A. Forgery or Alteration B. Fund Transfer Fraud C. Outside the Premises D. Money Orders and Counterfeit Money

A. Forgery or Alteration Forgery or Alteration insures against the forgery or alteration of checks, drafts, promissory notes, and similar items regarding the payment of a sum of money that are made or drawn by the insured or someone acting on behalf of the insured.

Which of the following is not an Aviation Insurance Cause of Loss? A. Ground taxi only B. Ground including taxi C. Ground only D. All risk

A. Ground taxi only All risk covers when the aircraft is on the ground, during taxi, and in flight.

All of the following are covered injuries occurring during the course of employment, except: A. Injury occurs while the employee is playing in a company softball game B. The employee is performing regular job duties C. Injury must occur while the employee is at work D. Illness is contracted on the job

A. Injury occurs while the employee is playing in a company softball game While it is a company game, it does not occur while working, performing the assigned jobs, during the designated work hours, and it is not reasonably related to employment.

Which of the following is true of Employers Liability insurance? A. It covers actions brought against the insured in a capacity other than as an employer B. It covers only executive officers C. It covers employees only if working in a state not listed on the information page D. It is excess coverage over Workers' Compensation benefits

A. It covers actions brought against the insured in a capacity other than as an employer Employers Liability covers actions brought against the insured in a capacity other than as an employer, such as consequential injury.

Choose the statement that is false about the FAIR plan. A. It provides property coverage to both residential and farm dwellings B. Agents cannot bind FAIR plan coverage C. FAIR means Fair Access to Insurance Requirements D.It provides basic property coverage to those who have been rejected in the standard market

A. It provides property coverage to both residential and farm dwellings Farm property is not eligible for coverage under the FAIR plan

A commercial crime policy form written with the Robbery or Safe Burglary of Other Property insuring agreement would cover which of the following? A. Jewelry store windows and glass display cases are destroyed during a burglary B. An employee breaks into the company safe and steals precious metal C. A messenger is robbed while transporting high end computer components D. A masked gunman confronts a cashier and demands money

A. Jewelry store windows and glass display cases are destroyed during a burglary

When an insured's boat is in storage, which warranty allows for a return on premium? A. Lay Up B. Dry Dock C. Storage D. Houseboat

A. Layup

The Legal Action Against Us under Part F - General Provisions of the Personal Auto Policy, states which of the following? A. Legal action may not be brought against the insurer until the insured has complied with all the terms of the policy B. Legal action brought against the insurer must be brought within 90 days of the loss C. Legal action against the insurer is permitted only when arbitration is unsuccessful D. Legal action brought against the insurer must be brought within 180 days of the loss

A. Legal action may not be brought against the insurer until the insured has complied with all the terms of the policy The insured first must comply with all the terms of the policy before any legal action may be taken against the insurer.

Which of the following would be included under Scheduled Farm Personal Property? A. Livestock B. Fences C. Trees D. Chutes

A. Livestock

Which type of Workers' Compensation do not have a limit? A. Medical benefits B. Scheduled injuries C. Temporary Total Disability benefits D. Death and survivor benefits

A. Medical Benefits

Which of the following has the care and custody of the insured's property outside the premises? A. Messenger B. Employee C. Custodian D. Watchperson

A. Messenger the messenger can be the insured or any of the insured's partners or employees

The BOP's optional coverage for money and securities will cover which of the following? A. Money and securities against theft, disappearance or destruction B. Business personal property C. Loss of money or securities resulting from dishonest acts of employees D. Accounts receivable records necessary to prove amounts owed the insured

A. Money and securities against theft, disappearance and destruction The optional coverage for money and securities is necessary to provide coverage for these items, since money and securities are listed as property not covered under the policy proper.

Under the Equipment Breakdown Protection Coverage Form, the __________________ condition will apply if the covered equipment is subject to a dangerous exposure. A. Suspension B. Covered property C. Period of restoration D. Cancellation

A. Suspension The Suspension condition allows the insurance company to immediately suspend coverage against the loss.

Following a large fire that requires several weeks of down time due to rebuilding, the Business Income Coverage Form will pay for: A. Net income plus continuing expenses of the business B. Gross income, less taxes C. Property that is spoiled because of loss of utility service D. Property that is not covered under the Building and Personal Property Coverage Form

A. Net income plus continuing expenses of the business The formula of net income plus continuing expenses is intended to restore the insured as nearly as possible to his/her income status before the loss.

The Business Auto Coverage Form is intended for which of the following businesses? A. Owned, leased, hired or borrowed private passenger autos, trucks, trailers and semi-trailers B. Owned or hired trucks, trailers and semi-trailers only C. Owned, leased, or hired trucks, trailers and semi-trailers only D. Owned, leased, hired or borrowed private passenger autos only

A. Owned, leased, hired, or borrowed private passenger autos, trucks, trailers, and semi-trailers

Under the Equipment Breakdown Coverage Form, which of the following describes expediting expenses? A. Payment for repairs which accelerate the period of restoration B. Payment for property on exhibition at fairs and trade shows C. Payment for damage caused by hazardous substances used to hasten the repair of the damaged equipment D. Payment for newly acquired property necessary to replace damaged property

A. Payment for repairs which accelerate the period of restoration

The Workers' Compensation Insurance Schedule of Benefits applies to: A. Permanent Partial disabilities B. Temporary Partial disabilities C. Permanent Total disabilities D. Temporary Total disabilities

A. Permanent Partial Disabilities The Schedule of Benefits applies for specific Permanent Partial disabilities such as the loss of an eye, hand, limb, etc. These benefits are usually paid in addition to other income benefits.

Which of the following perils is covered under the Personal Umbrella? A. Personal injury B. Intentional injury C. Bailee D. Aircraft

A. Personal Injury Personal injury perils are covered under the Umbrella policy, and will drop down to cover from the first dollar if personal injury coverage is not covered on the primary policy.

Which of the following is true concerning the Premium Audit condition of the Commercial General Coverage Part to the Commercial Package Policy? A. Premium audit determines what the earned premium will be at the end of the policy period B. Premium Audit is the comparison of the insured's premium with the average premium in the insured's rating classification C. Premium Audit is the action taken by the insurer to see that the insured's rating is properly classified D. Premium Audit refers to the right of the insured to contest the premium after policy issuance

A. Premium audit determines what the earned premium will be at the end of the policy period The insured must keep records sufficient for the insurer to compute premiums based upon sales, receipts, or payroll. After an audit, an additional premium is required if these records show that these items are greater than the estimates that developed the deposit premium.

Commercial Crime policies are written for which of the following commercial enterprises? A. Private B. Volunteer C. Publicly held D. Government

A. Private The Commercial Crime Coverage Forms (both Loss-Sustained and Discovery) are designed for private businesses. The insuring agreements of these policies and forms contain one limit of insurance for all types of employee theft.

Choose the FALSE statement about an Umbrella Liability Policy. A. Property in the care and custody of the insured is covered B. After underlying coverage is exhausted, coverage is excess C. Certain losses excluded by the primary policy may be covered D. Specific minimum limits for underlying coverage are required

A. Property in the care and custody of the insured is covered

Which of the following is true about the National Flood Insurance Program? A. Property removed to protect it from flood is covered for 45 days at other locations B. Coverage on trees, shrubs, and plants is limited to $500 for any one tree, shrub, or plant C. For dwelling structures, coverage includes direct and indirect loss D. Coverage is available for above ground buildings, wharves, piers, and docks

A. Property removed to protect it from flood is covered for 45 days at other locations Property removed to protect it from flood is covered at other locations for 45 days, but only for the peril of flood.

When an underlying policy doesn't cover a particular loss, the umbrella will drop down and cover the entire loss, after payment by the insured of a: A. Retention B. Copayment C. Premium D. Commission

A. Retention Similar to a deductible, a retention is an amount paid by the insured before the insurer's obligation to pay takes effect.

The Condition that states that the insurance applies separately to each insured is called __________________. A. Severability B. Insured's Right C. Other Insurance D. Legal Action

A. Severability Several suits against several insureds do not increase the insurance for that occurrence or policy period.

Which of the following is an insured under the CGL policy? A. Spouse of a partner B. Trustee's spouse C. Spouse of LLC members D. Spouse of volunteer worker

A. Spouse of a partner

Under the PAP, which of the following is not considered OCCUPYING an automobile? A. Standing by the car exchanging insurance information B. Slamming fingers in a closing door C. Jumping off the hood D. Getting out of the car

A. Standing by the car exchanging insurance information Occupying means in or on a vehicle, which includes getting in, getting out, and jumping off.

Which disability income benefit covers an injury that allows an employee to do some work, but is unable to earn his or her usual wage until full recovery? A. Temporary Partial B. Scheduled Injury C. Temporary Total D. Permanent Partial

A. Temporary Partial Temporary Partial benefits are generally calculated as a percentage of the difference in wages.

Which of the following is not included in the definition of an insured contract? A. Tenant agreement B. Sidetrack agreement C. Contract for lease of premises D. Easement agreement

A. Tenant Agreement The insured contract describes the liability assumed by the insured and also includes an obligation to indemnify a municipality, an elevator maintenance agreement, and an agreement in which an insured assumes tort liability.

Which of the following is true of the Transfer of Your Rights and Duties Condition under CPP? A. The insured's rights may not be transferred without written consent of the insurer B. The insured's rights may be transferred by written request of the First Named Insured C. The insured's rights may not be transferred to others D. The insured's rights may be transferred by written request of any insured

A. The insured's rights may not be transferred without written consent of the insurer Any transfer of the insured's rights and duties must be with the written consent of the insurer. If the insured dies, the insured's right and duties will be transferred to the insured's legal representative.

Choose the true statement regarding Out of State Coverage in the Personal Auto Policy. A. The limit of liability will be the same as the coverage provided in the home state or the minimum liability requirements in the state where the covered auto is being used, whichever is greater B. When being used in any state other than the one in which the vehicle is licensed, the liability limits are automatically the minimum financial responsibility limits of the state in which the vehicle is licensed C. The liability limits of the policy will be the lesser of home state coverage or the minimum liability requirement of the state in which the vehicle is being used D. The insured should be sure that the liability limits of the policy equal or exceed the minimum limits of the compulsory insurance or financial responsibility laws of any other state where the vehicle might travel

A. The limit of liability will be the same as the coverage provided in the home state or the minimum liability requirements in the state where the covered auto is being used, whichever is greater When the covered auto is operated in a state other than that in which it is licensed, the limits of the policy are not less than the contracted amounts or the minimum required by the state in which the vehicle is being used.

Which of the following is false regarding the Building and Personal Property Coverage Form? A. The policy covers vehicles licensed for road use B. Business personal property includes property that is either in the building or within 100 feet of the building C. Trees, shrubs and plants are covered up to $1,000 with a sublimit of $250 for any one tree, shrub or plant D. Newly acquired or constructed property is automatically included for 30 days, not exceeding $250,000 for each building

A. The policy covers vehicles licensed for road use Autos for sale and those licensed for road use are excluded.

Employee W suffered a work-related back injury at a previous job. After being hired by a new company, W fell down a flight of stairs at work and reinjured his back? Which of the following is true regarding Employee W's benefits? A. The Second Injury Fund will pay compensation to the extent the prior disabling injury contributed to the second injury B. The Second Injury Fund will only pay compensation for the new injury minus any prior claim C. The new company's Workers' Compensation carrier will pay the entire loss D. The new company's Workers' Compensation carrier will not pay for any of the loss

A. The second injury fund will pay compensation to the extent the prior disabling injury contributed to the second injury The Second Injury Fund pays that portion of the loss attributed to the prior disabling injury. The purpose of the fund is to relieve an employer of the portion of claims related to prior injuries that are simply made worse by the employee's current work.

All of the following are true of the extended reporting period, except: A. The supplemental extended reporting period must be purchased at the beginning of the policy period B. Under the mini tail, the insurer must be notified of a claim within 60 days after the end of the policy period C. The extended reporting period does not increase the policy limits D. Under the supplemental extended reporting period, the insured must request coverage within 60 days after the end of the policy

A. The supplemental extended reporting period must be purchased at the beginning of the policy period The supplemental extended reporting period can be purchased up to 60 days after the end of the policy term.

Policyholder G wants her PAP to insure her sedan, primarily used for sales calls, her husband's SUV for car-pooling, the station wagon that their daughter uses to drive to school, and the van their son uses part-time to deliver dry-cleaning. Which of the following cars will G's agent tell her is not eligible? A. The van B. The sedan C. The station wagon D. The SUV

A. The van While car-pooling and sales calls are acceptable business uses under the personal auto policy, business deliveries are not.

Which Statement is true regarding a Difference In Conditions Policy? A. There is no standard form B. The standard deductible is $250 C. There is a pro rata clause D. There is always a coinsurance clause

A. There is no standard form There is no coinsurance or pro rata clause and the standard deductible is in the range of $10,000.

Which of the following is true about specialty or professional liability insurance? A. They are written on non-standard forms B. They protect businesses with few liability exposures C. They provide excess coverage over the CGL policy D. Volunteer workers are excluded from coverage

A. They are written on non-standard forms Specialty liability insurance is available for businesses with a higher than average exposure for being legally liable for a loss. These policies are written on non-standard forms with unique policy provisions and conditions. Executive officers and directors, stockholders and trustees, and volunteer workers and employees are included as insureds named in the declarations

Which of the following is true about specialty or professional liability insurance? A. They are written on non-standard forms B. They protect businesses with few liability exposures C. They provide excess coverage over the CGL policy D. Volunteer workers are excluded from coverage

A. They are written on non-standard forms Specialty liability insurance is available for businesses with a higher than average exposure for being legally liable for a loss. These policies are written on non-standard forms with unique policy provisions and conditions. Executive officers and directors, stockholders and trustees, and volunteer workers and employees are included as insureds named in the declarations.

Which statement is false about Commercial Property insurance? A. Time element losses and direct losses are the same B. Loss of commissions due to interruptions of a manufacturing business is a time element loss C. The Builder's Risk Reporting Form insures a building under construction for an amount that increases with the increasing value of the building D. The Condominium Association Form will cover refrigerators, air conditioners and cooking ranges that are owned by the named insured

A. Time element losses and direct losses are the same Time element losses are indirect losses, not direct losses.

A person wishing to insure a single shipment would be best served by which form? A. Trip Transit Form B. Owner's Form C. Shipper's Form D. `Annual Transit Form

A. Trip Transit Form The Trip Transit Form is used by those who do not make regular shipments.

In personal insurance transactions, producers must do all of the following EXCEPT: A. Use professional designations to instill confidence about advising senior clients B. Handle applications and amendment requests as soon as reasonably possible C. Inform the applicant if coverage cannot be secured within 30 days of application D. Inform the insured if the insurer needs information before renewal or policy change

A. Use professional designations to instill confidence about advising senior clients It is an unethical and dishonest business practice to use a professional designation implying special certification in advising senior clients as a sales tactic.

Which of the following is covered on a Basic Cause of Loss Form? A. Windstorm B. Water damage C. Falling objects D. Weight of ice, snow, and sleet

A. Windstorm

Policyholder J's PAP includes Other Than Collision coverage, but no Collision coverage, with a $200 deductible. After her parked car rolls downhill and hits a tree incurring $500 in damage to the car, $150 of which is from glass breakage, how much will her insurance company pay? A. Zero B. $350 C. $150 D. $500

A. Zero Without collision coverage, the accident is not covered under the policy. Glass breakage can be covered by Collision or Other Than Collision at the insured's option, but in this case, the loss is less than the deductible, and would not be claimed.

A producer's license may be revoked or suspended for all of these reasons, except: A. Being charged with a felony B. Knowingly violating a state insurance law C. Having an insurance license suspended or revoked in another state D. Being convicted of a crime involving moral turpitude

A. being charged with a felony Revocation or suspension requires that the licensee is CONVICTED , not merely charged.

The passage of the Motor Carrier Act of 1980 resulted in all of the following, except: A. Increase in truckers wages B. Deregulation of the trucking industry C. Mandatory minimum liability limits D. Prohibition of rating bureaus to develop the rates

A. increase in trucker wages As a result of this Act, the number of motor carriers doing business increased and the consumer costs associated with trucking decreased, thus reducing trucker wages.

The Personal Articles Floater is used to do which of the following? A. Insure individual personal property on a scheduled basis B. Replace Coverage B of the Homeowners Policy C. Insure personal property on a blanket basis D. Provide replacement cost coverage on personal property

A. insure individual personal property on a scheduled basis

All the following terms describe a loss covered by a commercial crime policy, except: A. Mysterious disappearance B. Burglary C. Alteration D. Theft

A. mysterious disappearance The term of mysterious disappearance indicates the loss of an item without evidence of a crime. Alteration on the other hand, is a criminal act involving unauthorized changes to checks or other documents in order to secure or money or other valuable property or rights.

What coverage is not included under the Yacht policy? A. Personal Injury Coverage B. Personal Property coverage C. Protection and Indemnity D. Towing

A. personal injury coverage In addition to providing property and liability coverage, a yacht policy also offers protection and indemnity coverage for the insured's legal liability for bodily injury and damage to property of others, personal property coverage for property on the yacht, and coverage for fuel spills, commercial towing, and dinghies. Personal injury is not covered.

Which of the following statements about the Commercial Umbrella Liability policies is false? A. Policies generally cover first-party claims B. Specific minimum limits for underlying coverage are required C. If the Umbrella Policy provides broader coverage than the underlying policy, the umbrella will cover the entire loss, less a retention D. Commercial Umbrella policies are excess policies

A. policies generally cover first-party claims Umbrella policies are liability policies and therefore cover third-party claims.

Which of the following work-related injuries might not be covered by Workers' Compensation insurance? A. An employee suffers his/her second injury in the same year B. An employee from accounting is injured while assisting an assembly line worker C. An employee is injured when a fellow employee pushes him/her into heavy machinery D. An employee is injured despite the extensive safety measures taken by the employer

An employee from accounting is injured while assisting an assembly line worker An covered injury does not include an injury to an employee performing duties he/she was not hired or trained to do.

Which of the following workers would be covered by the Jones Act? A. An employee of the Federal government B. A sailor injured by the negligence of others C. A railroad worker D. A shipbuilder

B. A sailor injured by the negligence of others The Jones Act or Merchant Marine Act of 1920 applies to sailors injured by the negligence of others.

A guest falls in K's house and is injured in an amount of $1,000. How much will K's Homeowners Policy pay regardless of fault, if the Coverage F limit is $1,500? A. $500 B. $1,000 C. Nothing D. $1,500

B. $1,000

What is the limit of coverage for business personal property away from the premises under the Business and Personal Property coverage form? A. $15,000 B. $10,000 C. $5,000 D. $1,000

B. $10,000 $10,000 is the limit of coverage for PROPERTY OFF-PREMISES

Intrepid Industries carries a CGL with a General Aggregate Limit of $300,000 and an Occurrence Limit of $100,000. After an occurrence resulting in a $200,000 loss, followed by a second occurrence resulting a $100,000 loss, how much of the General Aggregate Limit remains available against future claims? A. $300,000 B. $100,000 C. None D. $200,000

B. $100,000 Following the first occurrence, the policy would pay $100,000 of the $200,000 loss, because the occurrence limit is $100,000. The second loss of $100,000 would be paid in full, leaving $100,000 in the Aggregate limit.

On a commercial property coverage form, outdoor signs attached to the building are covered up to what amount? A. $1,000 B. $2,500 C. $3,000 D. $5,000

B. $2,500 The CPP provides coverage for attached signs up to $2500.

K has a 10-piece antique fountain pen set that is insured with a pair and sets clause and is valued at $10,000. Each pen alone is only worth $500. If one pen is destroyed in a covered loss, how much will the policy pay? A. $10,000 B. $5,500 C. $4,500 D. $9,500

B. $5,500 The remaining value of the 9 pens is $4,500 ($500 X 9). The loss of 1 pen has reduced the value of the set from $10,000 down to $4,500. Therefore, the policy will pay the difference of $5,500.

What is the maximum the insurer will pay for a covered transportation expenses claim? A. $400 B. $600 C. $200 D. $800

B. $600 Transportation expenses are paid up to $20 per day and a maximum of $600 for temporary transportation expenses for the total theft of a covered vehicle.

Company Z's CPP has a Products and Completed Operations aggregate limit of $100,000, with a $20,000 limit for each occurrence. Following an occurrence that results in $25,000 in damages, and second occurrence that results in $15,000, how much of the aggregate remains available for completed operations losses? A. $60,000 B. $65,000 C. $100,000 D. $20,000

B. $65,000 $20,000 of the $25,000 loss is paid by the policy. The $15,000 loss is paid in full. Together these payments reduce the $100,000 aggregate limit to $65,000.

The Additional Coverage for business income pays for the actual loss of business income for up to how many months after the date of the direct physical damage to the property? A. 24 B. 12 C. 6 D. 18

B. 12 Ordinary payroll expenses, however, are only paid for 60 days following the loss unless the insured requests additional time and it is stated in the Declarations.

How much can be paid under the Business and Personal Property Coverage Form for debris removal due to a covered loss? A. $5,000 B. 25% of the loss C. 15% of Coverage A D. $1,000

B. 25% of the loss 25% of the coverage applies to direct loss

Within how many days must an insurer notify the Director of the appointment of an agent? A. 45 B. 30 C. 15 D. 60

B. 30 Each insurer must maintain a register of all producers it has appointed and notify the Director within 30 days of appointment.

How many days after an employee's termination by an insured would a crime loss committed by the former employee be covered under a Commercial Crime policy? A. 20 B. 30 C. 10 D. 45

B. 30 For the purposes of the Commercial Crime policy, a person remains an employee for a period of 30 days after termination.

A building is considered vacant unless what percentage of the building's total square footage is rented or used to conduct customary operations? A. 10% B. 31% C. 26% D. 20%

B. 31% A building is considered vacant unless 31% of the building's total square footage is rented or used.

The Businessowners Protective Safeguards endorsement requires the insured to notify the insurer if an automatic sprinkler system is off for how long? A. 72 hours B. 48 hours C. 96 hours D. 24 hours

B. 48 Because a premium reduction is granted for the protective systems listed in the Protective Safeguards Endorsement, the insurer insists upon being notified if the systems are not functional.

If disciplinary action against a producer resulted in monetary relief of $200 or less, the producer's record will be expunged after ______ years. A. 7 B. 5 C. 10 D. 3

B. 5 For disciplinary actions against a producer which result in forfeiture of $200 or less and impose no other legal sanction, all records will be expunged after 5 years.

Which vehicle would not be eligible for a Business Auto Coverage Form? A. A trailer that is used to carry a backhoe B. A forklift used in the business C. A van that is used by a delivery firm D. A private passenger auto that is used in the business

B. A forklift used in the business Being mobile equipment, a forklift is not eligible for auto coverage, other than by endorsement.

A Mobile Home Insurance Policy is most similar to: A. A Tenants policy B. A Homeowners Policy C. A Travel Trailer policy D. An Auto policy

B. A homeowners policy Mobile Home policies include Section I - Property and Section II - Liability, which are similar to the corresponding sections in a Homeowners policy.

The self-insured retention in the Umbrella policy is described as which of the following? A. Excess coverage B. A method of cost-sharing C. An Endorsement D. Primary coverage

B. A method of cost-sharing

The Miscellaneous Type Vehicle Endorsement attached to a Personal Auto Policy allows eligibility of a motorcycle by: A. Adding motorcycles to the list of eligible vehicles B. Amending the definition of 'your covered auto' and 'newly acquired auto' to include any miscellaneous type vehicle C. Altering the four-wheel requirement D. Specifically naming it in the Declarations

B. Amending the definition of 'your covered auto' and 'newly acquired auto' to include ANY miscellaneous type vehicle The endorsement amends the definition of covered vehicle to include motorcycles.

Which of the following autos is covered under Symbol 9 of the Business Auto Coverage Form? A. Any auto not used in the insured's business B. An auto owned by the insured's employee while used in the insured's business C. An auto borrowed by the insured D. An auto leased or hired by the insured

B. An auto owned by the insured's employee while used in the insured's business Non-owned Autos Only Coverage, Symbol 9, provides coverage for only those autos the insured does not own, lease, hire, rent or borrow, which are used in connection with the insured's business. This includes autos owned by the employees or members of their household.

The insured would be required to pay which of the following in the event of a Workers' Compensation claim? A. Expenses the insured spends to appear in court to assist the defense B. Any excess amounts incorrectly paid by the insurer C. Interest applied to the final judgment for the delay in payment D. Premiums for the appeal bonds when the insurer appeals to a higher court

B. Any excess amounts incorrectly paid by the insurer

Which of the following is true about the Individual Named Insured endorsement? A. Protects the named insured who does not own a car B. Applies to all resident family members C. Coverage is provided only to those individuals listed on a schedule D. Adds business coverage to a personal private passenger auto

B. Applies to all resident family members The Individual Named Insured endorsement adds all resident family members to the Business Auto Coverage form in order to allow family member permission to drive business autos.

Under Marine Policies, the term uncontrolled means forms that: A. Are not approved by the National Association of Insurance Commissioners B. Are not standardized by any rating bureau C. Are filed with the State Insurance Department D. Must be tailored to the individual insured by endorsement

B. Are not standardized by any rating bureau Uncontrolled forms are developed by individual companies to meet the needs of the company and its target market. They will normally differ from insurer to insurer.

Which of the following is NOT one of the five symbol designations on the Business Auto Physical Damage Coverage form? A. Hired autos only B. Autos left for service C. Owned autos only D. Specifically described autos

B. Autos left for service The other two symbols are owned private passenger autos only and owned autos other than private passenger autos only.

Which of the following is not true of the supplemental extended reporting period under the Claims-Made Form of the CGL? A. The one time premium may not exceed 200% of the annual premium for the coverage part B. The insurer may void it after the premium has been paid by the insured C. It is an optional extended reporting period of unlimited duration D. It must be purchased within 60 days after the end of the policy

B. B. The insurer may void it after the premium has been paid by the insured Once the premium has been paid, the Supplemental Extended Reporting Period Endorsement cannot be terminated.

How often does a producer's license renew? A. Quinquennially (once every 5 years) B. Biennially (once every 2 years) C. Annually (once a year) D. Triennially (once every 3 years)

B. Biennially (once every 2 years) Producer licenses renew biennially (every 2 years) on the anniversary of their issue date.

The uniform document that common carriers are required to issue to the shipper of the goods being transported, is called a: A. Bill of Transportation B. Bill of Lading C. Bill of Acceptance D. Shipping Receipt

B. Bill of Lading The Bill of Lading is a receipt for the goods being shipped that sets forth the basic agreement between the carrier and the shipper.

Under the Garage Coverage Form, covered autos are usually written on which of the following basis? A. Specific B. Blanket C. Scheduled D. Comprehensive

B. Blanket By writing coverage on a blanket basis, the insured may be sure that all autos used in the business are covered, whether they are owned, non-owned, customers cars, or other.

Which of the following is not a peril covered by personal injury? COMMERCIAL GENERAL LIABILITY A. Libel B. Breach of contract C. Wrongful eviction D. Malicious prosecution

B. Breach of Contract Libel, slander, misappropriation of advertising ideas or style of business, infringement of copyright, title, or slogan in the insured's advertisement, and violation of privacy are also personal injury perils.

Which commercial crime policy will cover any occurrence that took place during policy period, even if it was not immediately discovered? A. Claims-made form B. Loss-Sustained form C. Occurrence form D. Discovery form

B. Loss sustained form

Which of the following legal liability exposures is covered if bodily injury or property damage is caused by the insured's negligent or faulty work? A. Contingent liability B. Completed operations C. Products D. Premises and Operations

B. Completed Operations Coverage is for the bodily injury or property damage caused by negligent work by the insured, but this policy does not cover the actual work.

A consumer electronics business discovers that someone has used computer software to fabricate security passes, which were then used to gain access to their warehouse and steal several cases of smart phones. Under which Commercial Crime insuring agreement would this loss be covered? A. Money Orders and Counterfeit Money B. Computer Fraud C. Forgery or Alteration D. Inside the Premises Theft of Money and Securities

B. Computer Fraud

What is required if the insured adds the Extortion endorsement to the Commercial Crime form and wants coverage for a kidnapping? A. Immediately contact a newspaper or TV for help in identifying the kidnapper B. Contact a law enforcement agency C. Name the persons to be covered by the endorsement D. Agree to a personal background check when requested by the underwriter

B. Contact a law enforcement agency

Which of the following would be found in Section I of a CGL? A. List of insureds under the policy B. Coverage for bodily injury and property damage C. The Commercial General Liability conditions D. The policy definitions

B. Coverage for bodily injury and property damage

Which statement about the Builders Risk form is not correct? A. Coverage terminates 90 days after construction is completed, when a policy expires, is canceled, or 60 days after the owners fully occupy the dwelling, whichever is soonest B. Coverage is always written on an open peril basis C. There is no vacancy provision D. Coverage does not apply to outside radio and television antennas

B. Coverage is always written on an open peril basis Coverage may be written with any of the Cause of Loss Forms (Basic, Broad, or Special).

Each of the following is true of a Discovery crime coverage form, except: A. Covers a loss that was discovered during the policy period B. Covers a loss that was discovered within one year of the termination of the policy period C. Might require the use of a Retroactive Date D. Covers a loss that did not necessarily occur during the policy period

B. Covers a loss that was discovered within one year of the termination of the policy period The Loss Sustained form provides coverage for a loss that both occurred and was discovered during the policy period or was discovered within one year of the termination of the policy period.

Under Part A of the Personal Auto policy, which of the following would be covered? A. Damage to a neighbor's lawn mower in the care of the insured B. Damage to a parked car C. Damage to property being transported by the insured D. Damage to the home the insured owns

B. Damage to a parked car Liability coverage is not provided for: Damage to property owned, being transported, or in the care of the insured.

ll of the following are covered under the Basic Causes of Loss to the Farm Property Coverage Form, except: A. Lightning loss to livestock B. Electrocution of Livestock C. Flood loss to livestock D. Earthquake loss to livestock

B. Electrocution of Livestock

All of the following are true of a Businessowners Coverage Form, except: A. The most the insurer will pay for loss or damage arising out of any occurrence is the limit of insurance shown in the Declarations B. Employee dishonesty is automatically included in each policy C. Section III of the coverage form contains the Common Policy Conditions D. Land, including land on which the property is located, is not covered

B. Employee dishonesty is automatically included in each policy Employee Dishonesty is not automatic. It is an option that must be selected.

Which crime coverage form does a bank need to cover the theft of money from a bank cash drawer by an employee? A. Robbery or Safe Burglary B. Employee Theft or Dishonesty C. Theft of Money and Securities D. Theft Collusion by Employees

B. Employee theft or Dishonesty

Under the Farm Property Coverage Form, the definition of Farm Personal Property includes which of the following? A. Licensed vehicles owned by the insured and used in the farm operation B. Equipment, supplies, and products of farming C. Household furnishings of the farm dwelling occupied by the insured D. Silos, grain bins, and fences used in the farm operation

B. Equipment, supplies, and products of farming Household furnishings, covered under Coverage C, are not considered Farm Personal property, nor are silos, grain bins, and fences, which are covered under Coverage G. Licensed motor vehicles are covered under an automobile policy.

Which of the following would NOT be found in the Common Policy Declarations page of a Commercial Package Policy? A. The insured's name and address B. Exclusions C. The inception and expiration date D. The policy premium

B. Exclusions The Declarations page of an insurance policy contains the information that adapts the policy to a specific insured and property. The Exclusions are provisions that apply to all policies and policyholders.

After being rejected by an insurer due to underwriting guidelines an applicant may request homeowners coverage under which of the following? A. Write Your Own Homeowners Program B. FAIR Plan C. A DP-3 Special Dwelling Plan D. An Umbrella policy

B. FAIR plan

Which of the following is not eligible for coverage under a Fair Access to Insurance Requirements program? A. Uninsured dwelling property B. Farm property C. Homeowner D. Rental dwelling

B. Farm Property

Producers in Missouri are held responsible in a __________ capacity for any money collected from an insured. A. Banking Legal B. Fiduciary C. Trust D. Banking

B. Fiduciary Producers have fiduciary responsibilities to both their insurers and clients under MO insurance code and must be held responsible for any money collected or received on behalf of an insurance company, insurance applicant, or policyholder in a trust or fiduciary capacity.

Missouri law requires what standard of fiscal care and conduct of producers? A. Financial duty B. Fiduciary responsibility C. Legal capacity D. Care of a trustee

B. Fiduciary Responsibility Producers have fiduciary responsibilities to both their insurers and clients.

Which of the following is the sole representative under the policy? A. Company legal representative B. First Named Insured C. Named Insured D. Employer and his partners

B. First named Insured The First Named Insured will receive any cancellation notice and receive any unearned premium.

The most the insurer will pay during the policy period for medical expenses under Coverages A, B, and C is which of the following limits of liability? A. Per Occurrence Limit B. General Aggregate Limit C. Personal and Advertising Injury Limit D. Medical Expense Limit

B. General Aggregate Limit

Which of the following is considered an insured's product? A. Goods shipped to a retailer to be sold B. Goods sold by the insured at a trade show C. Remodeled building D. Merchandise held by the insured as inventory

B. Goods sold by the insured at a trade show A covered product is one manufactured and sold by the insured and transferred to the possession of a buyer.

Which of the following is not considered a product liability exposure? A. Goods manufactured and sold to customers B. Goods stored on the insured premises C. Product consumed by a person at a restaurant D. Product distributed to customers

B. Goods stored on the insured premises A product exposure involves the manufacture, sale, handling, distribution, or disposal of insured property away from the insured premises.

In bonding, the surety is also known as the: A. Obligor B. Guarantor C. Obligee D. Principal

B. Guarantor

Which of the following is NOT an exclusion in the CGL policy? A. Impaired Products B. Host Liquor Liability for those with incidental exposure C. Insured's Product D. Insured's Work

B. Host Liquor liability for those with incidental exposure Host Liquor Liability is provided for those who only have incidental exposure. For example, if the insured is an insurance agency and is hosting its annual Christmas party, the exclusion won't apply. However, if the insured is a restaurant that serves alcohol and is hosting its annual Christmas party, the exclusion WILL apply.

Company D's cashier is robbed of $500 in currency. This loss would be covered under which insuring agreement? A. Inside the premises: Robbery or safe burglary coverage B. Inside the premises: Theft of money and securities C. Outside the premises D. Computer fraud

B. Inside the premises: Theft of money and securities Theft of money and securities coverage covers theft, disappearance, or destruction of money and securities inside the insured's premises, or inside a banking premises, when committed by a person present on the premise. It also covers loss or damage to a locked safe, vault, cash register, cash box, or cash drawer that results from actual or attempted entry into such property.

Which statement is true of the Equipment Breakdown Protection Coverage Form? A. Defects, erasures, errors, limitations or viruses in computer equipment are included in the definition of a breakdown B. It can be written as a coverage part on the Commercial Package Policy C. Every form automatically includes Business Income and Extra Expense Coverage D. Explosion and damage during testing are covered

B. It can be written as a coverage part on the commercial package policy

Which statement is true about Crop/Hail Insurance? A. It only covers the peril of hail B. It covers only one growing season C. It is reinsured by federal government D. It is not subject to any deductible

B. It covers only one growing season Crop/Hail Insurance coverage ceases when the crop is harvested.

All of the following are true of Protection and Indemnity, except: A. It covers damage to fixed objects B. It does not cover injuries to sailors from the vessel's lack of seaworthiness C. It covers cargo if lost or damaged through negligence D. It covers injuries caused by negligence

B. It does not cover injuries to sailors from the vessel's lack of seaworthiness Protection and Indemnity covers injuries to sailors, as well as the other items.

Under the Motor Carrier Coverage Form, Trailer Interchange Coverage would cover which of the following losses? A. Joe's company is legally liable for bodily injury sustained by an employee B. Joe's company is legally liable for physical damage sustained by a non-owned trailer C. Joe's truck sustains damage in a collision D. Joe's truck causes property damage in a collision

B. Joe's company is legally liable for physical damage sustained by a non-owned trailer. Trailer Interchange Coverage is physical damage coverage for non-owned trailers and their equipment if they sustain a loss and the insured is legally responsible for the damage.

Which of the following is true of the Towing coverage provided under Section III of the BAP? A. Only towing costs are covered B. Labor must be performed at the place of disablement C. Towing coverage is only available for an added premium D. Coverage applies to all vehicle types

B. Labor must be performed at the place of disablement The policy automatically pays for the costs of towing and labor incurred each time a covered private passenger type auto is disabled. Labor must be performed at the place of disablement.

Each of the following is covered under the Legal Liability Coverage Form; except: A. Loss of use B. Loss of income C. Defense costs D. Damage to real or personal property owned by others when it is in the insured's care

B. Loss of income Loss of income is not covered by this coverage form

Making a false statement about the benefits or the nature of an insurance policy is what unfair trade practice? A. Defamation B. Misrepresentation C. Twisting D. Unfair discrimination

B. Misrepresentation Making any false statement about the benefits or true nature of an insurance policy is misrepresentation.

Private Insurers are not allowed to write Workers' Compensation Insurance in which of the following states? A. Voluntary B. Monopolistic C. Competitive D. Compulsory

B. Monopolistic Monopolistic States are states that provide Workers' Compensation benefits only through a state fund. These states do not allow private insurers to compete with the state fund.

Which of the following is not considered a theft loss? A. Robbery B. Mysterious disappearance C. Attempted theft D. Burglary

B. Mysterious Disappearance Mysterious disappearance is the loss of property when the cause of loss cannot be determined.

Which of the following vehicles is covered by Liability coverage under the Personal Auto Policy? A. Motorcycle B. Non-owned golf cart C. Company car D. Uninsured owned vehicle

B. Non-owned golf cart Non-owned golf carts are exempted from the exclusion on off-road vehicles, and liability arising from their use would be covered under the policy.

Which covered causes of loss form is used for the BOP (business owners policy)? A. Replacement Cost B. Open perils C. Stated Value D. Actual Cash Value

B. Open Perils Basis Unless the loss is excluded, the loss to a covered building and business property is the risk of direct physical loss, or open perils.

Which of the following is NOT excluded under Part A of the CGL form? A. Product recall B. Operation of mobile equipment C. Discrimination D. Damage to insured's work

B. Operation of mobile equipment The mobile equipment exclusion applies to the transportation of mobile equipment by the insured. However operation of mobile equipment is not excluded unless for racing or stunting.

The Business Auto Coverage Form is intended for which of the following businesses? A. Owned, leased, hired or borrowed private passenger autos only B. Owned, leased, hired or borrowed private passenger autos, trucks, trailers and semi-trailers C. Owned, leased, or hired trucks, trailers and semi-trailers only D. Owned or hired trucks, trailers and semi-trailers only

B. Owned, leased, hired, or borrowed private passenger autos, trucks, trailers and semi-trailers

Which statement is false regarding Supplementary Payments under the Commercial General Liability policy? A. Coverage only applies to Coverages A and B B. Payments made under this section reduce the limits of the policy C. Claim related expenses are included D. The cost of bail bonds is included up to $250

B. Payments made under this section reduce the limits of the policy Payments for Supplementary Payments do not reduce the limits of the policy.

The Condominium Commercial Unit-Owners Coverage covers each of the following, except: A. Appliances B. Personal property C. Fixtures D. Improvements

B. Personal Property The unit-owners' appliances cannot be owned by the insured to qualify for coverage, but the business personal property of the insured is covered.

When considering insurability of a commercial property for renewal, the insurer can use: A. Price of company stock B. Physical inspection C. Police records D. Lie detector test

B. Physical Inspection

All of the following are true of Ocean Marine Insurance, except: A. Coverage is voided if implied warranties are violated B. Policies are standardized C. Property coverage must be written to full value to avoid a penalty D. General average refers to a partial loss where the loss is shared

B. Policies are standardized

An insured who goes to client's offices and homes for appointments would need coverage for which liability exposure? A. Contingent Liability B. Premises and Operations C. Products D. Completed Operations

B. Premises and Operations Premises and operations exposure includes the insured's legal liability for bodily injury or property damage arising out of his/her business premises or operations (away from the premises).

Which of the following legal liability exposures is covered if the employee of a business causes bodily injury to another person while working at the insured's business location? A. Contingent liability B. Premises and Operations C. Completed operations D. Products

B. Premises and Operations This exposure involves an insured business that conducts its operations on premises, either described or elsewhere, and covers occurrences that take place during the policy period and in the policy territory.

Which of the following perils cannot be insured under a professional liability insurance policy? A. Discrimination B. Property Damage C. Cyber risks D. Fraud

B. Property Damage Professional liability insurance does NOT provide coverage for bodily injury or property damage.

An insurer is permitted by law to pay commissions to each of the following, except: A. Licensed producer with a compensation agreement based on loss experience B. Property and casualty producer for the sale of life insurance C. Licensed producer who negotiates an insurance contract D. P&C producer for the sale of surplus lines insurance

B. Property and casualty producer for the sale of life insurance Commission can only be paid to a producer duly licensed for the appropriate line.

Which of the following incidents would not be considered theft? A. Missing merchandise and a broken store window discovered by a manager when opening the store for the day B. Quarterly inventory shows a shortage of 3 stock items C. Merchandise stolen while the store is open and caught on video tape D. A cashier being handed a threatening note to hand over all the cash in the cash register

B. Quarterly inventory shows a shortage of 3 stock items

Which of the following statements about producer licenses is TRUE? A. An individual initiating sales over the telephone is exempt from licensing B. Resident producer licenses are issued for 2 years C. Resident and nonresident producer licenses renew every 3 years D. An employee who processes claims and does not get paid commission is required to obtain a producer license

B. Resident producer licenses are issued for 2 years Resident producer licenses renew every 2 years in missouri

What is the taking of property from the care of a person by threatening bodily harm? A. Burglary B. Robbery C. Attempted theft D. Mysterious disappearance

B. Robbery Robbery is the THEFT (stealing) using threat of violence

The Personal Articles Floater is similar to which Homeowners endorsement? A. Guaranteed Replacement Cost B. Scheduled Personal Property C. Personal Property - Replacement Cost D. Special Personal Property

B. Scheduled Personal Property The PAF and the scheduled personal property endorsement to the homeowners policy are nearly identical

All of the following regarding Commercial Auto coverage are true, except: A. The Business Auto Coverage Form will cover liability from transporting mobile equipment B. Section II of the Garage Coverage Form does not include completed operations coverage C. The most frequently used commercial auto policy is the Business Auto Coverage Form D. Section II of the Garage Coverage Form does not provide physical damage coverage to a customer's car

B. Section II of the Garage Coverage Form does not include completed operations coverage The Garage Coverage Form- Section II DOES cover completed operations

Livestock is not eligible for coverage on which Farm policy? A. Basic Cause of Loss Form B. Special Cause of Loss Form C. Broad Cause of Loss Form D. Livestock Coverage Form

B. Special Cause of Loss Form The Special Cause of Loss Form specifically excludes coverage for livestock. The Basic form covers flood and earthquake loss to livestock and the Broad form covers electrocution of covered livestock.

A manager started receiving anonymous messages threatening damage to the company's facilities unless it changed its hiring practices. The manager chose not to report the threats to the insurer to minimize publicity and dealt the problem privately until the threats escalated to an incident of vandalism that caused significant damage to the company premises. How would the insurer respond to this loss? A. The damage would be excluded because no one was kidnapped B. The damage would be excluded because the insured did not report the extortionist's demands C. The damage would be covered under the extortion endorsement of the company's commercial crime insurance policy D. The damage would be excluded because vandalism related to a prior crime is not covered

B. The damage would be excluded because the insured did not report the extortionist's demands

Which of the following statements about the DP-3 Policy is false? A. Losses to the dwelling are paid on a replacement cost basis B. The dwelling and contents are both covered on an open perils basis C. Mobile homes are not eligible D. The insured dwelling must be used principally for dwelling purposes

B. The dwelling and contents are both covered on an open perils basis

All of the following are true regarding medical expenses coverage under the BOP, except: A. Medical expenses incurred within one year of the date of the accident are covered B. The policy excludes funeral expense C. Payment of medical expenses is made regardless of who is at fault D. Accidents on premises the insured owns or rents, or due to the insured's operations are covered

B. The policy excludes funeral expenses Medical expenses coverage pays necessary medical, surgical, x-ray and dental services, including prosthetic devices; and necessary ambulance, hospital, professional nursing and funeral expenses.

Under a Commercial Crime policy written on a discovery form, what is the latest date that a covered loss can be discovered? A. 2 years following policy expiration B. The policy expiration date C. 1 year following policy expiration D. 5 years following policy expiration

B. The policy expiration date

Which statement is FALSE regarding the National Flood Insurance Program? A. The policy will not provide coverage on buildings that are in, on, or over water B. The policy provides unlimited coverage for qualified property owners C. For contents to be covered, they must be inside a fully enclosed building D. It is administered by the Federal Insurance Administration under FEMA

B. The policy provides unlimited coverage for qualified property owners There are maximum limits for both the Regular and Emergency programs.

Which statement is false regarding the Building and Personal Property Coverage Form? A. Coverage does not apply to money or securities B. The standard deductible is $100 C. If either the insurer or the insured submits a written demand for appraisal, each will choose and pay for his or her own appraiser D. The Peak Season Endorsement can be provided for a specified increase for a certain period

B. The standard deductible is $100 The standard deductible is $500

All of the following are true regarding the Personal Umbrella Policy, except: A. The policy is written for higher liability limits B. The Umbrella acts as a contributory liability policy C. The policy requires underlying coverage for automobiles and homes D. The Umbrella can provide broader coverage than the primary policy

B. The umbrella acts as a contributory liability policy The Umbrella acts as an excess liability policy over the limits of the underlying policies.

Which section of the BAP provides auto medical payments coverage? A. Section II B. This coverage is available by endorsement only C. Section I D. Section III

B. This coverage is available by endorsement only Commercial auto policies do not automatically provide medical payments coverage, which must be added by endorsement.

Which of the following forms is designed to insure a single shipment of goods? A. Bailee's Customers Policy B. Trip Transit Policy C. Motor Truck Cargo Owners Form D. Transportation Floater

B. Trip Transit Policy The Trip Transit Policy only covers a single shipment.

The Nationwide Marine Definition includes all of the following classes of property, except: A. Personal Property Floaters B. Umbrella C. Imports D. Instrumentalities of Transportation

B. Umbrella The other three classes are exports, domestic shipments and property in transit, and commercial property floater.

The outdoor property coverage extension will not pay for which of the following? A. Up to $1,000 for any one tree, shrub, or plant B. Up to $5,000 for fences C. Unattached signs D. Radio, and television antennas

B. Up to $5,000 for fences

Which of the following conditions under a Building and Personal Property Coverage Form determines how losses will be paid? A. Appraisal B. Valuation Clause C. Loss Conditions D. Deductible

B. Valuation Clause

Which of the following is used by an employer who wants to provide Workers' Compensation benefits even when it is not required? A. Other Insurance Endorsement B. Voluntary Compensation Endorsement C. Stop-Gap Endorsement D. Secondary Injury Fund

B. Voluntary Compensation Endorsement The voluntary compensation endorsement is used when an employer wishes to provide Workers' Compensation benefits to employees, although the law does not require the employer to provide coverage.

Under the Building and Personal Property Coverage Form, coverage applies to all of the following, except: A. A tenant's interest in a built-in wall cabinet B. Windstorm damage to outdoor signs not attached to the building C. Materials that are within 75 feet of the premises D. Personal property used to service and maintain the building

B. Windstorm damage to outdoor signs not attached to the building

All of the following are methods of complying with Workers' Compensation laws, except: A. State Assigned Risk Plans B. Employee contribution plans C. Self-insurance D. Private insurers

B. employee contribution plans There is no Workers' Compensation plan that involves employee contributions.

Which of the following is NOT an "insured" under the Business Auto Coverage form? A. Person using a borrowed auto with permission of the insured B. Fellow employee C. Person liable for the conduct of the insured D. Named insured

B. fellow employee Under Section II - Liability coverage bodily injury liability coverage does not apply to a fellow employee.

Which of the following is true regarding the Boatowners Policy? A. It provides named perils coverage, and losses are settled on an actual cash value basis B. It provides open perils coverage, and losses are settled on an actual cash value basis C. It provides open perils coverage, and losses are settled on a replacement cost basis D. It has a standard deductible of $250

B. it provides open perils coverage, and losses are settled on an actual cash value basis

Which of the following is not included in the Personal Effects and Property of Others Extension under the Building and Personal Property Coverage Form? A. Personal effects owned by any partner or member of the insured B. Loss by theft of personal effects C. Personal effects owned by the insured D. Personal property of others in the insured's care

B. loss by theft of personal effects Personal effects of the insured, and of others that is in the insured's care, custody, or control, are covered up to $2,500. Coverage does not include loss by theft.

Which of the following coverage forms covers property of others that is held by the insured for servicing or repair? A. Contractor's Equipment Floater B. Equipment Dealer's Coverage Form C. Bailees Customers Form D. Installation Floater

C. Bailees Customers Form

Under Ocean Marine Coverage, breach of each of the following implied warranties will void the contract, except: A. Seaworthiness B. No deviation in voyage C. Express D.Legality

C. Express Express warranties are those that are written into the policy contract

An insured who has coverage under the NFIP with a $500 deductible for the dwelling and contents sustains flood damage to both their home and personal property. What is the maximum the insured will have to pay for damages assuming the loss is under the policy limits? A. $1,500 B. $500 C. $1,000 D. Nothing

C. $1,000 The deductible applies separately for the dwelling and the contents, therefore the insured is responsible for $1000 in deductibles.

The insured may extend up to how much of the insurance for business personal property to property located off-premises? A. $7,500 B. $1,000 C. $10,000 D. $2,000

C. $10,000 This Coverage Extension applies to the business personal property while in transit or at a property not owned, leased, or operated by the insured.

The unendorsed Businessowners Policy will pay no more than what amount for the theft of jewelry? A. $5,000 B. $7,500 C. $2,500 D. $3,500

C. $2,500 The theft of jewelry, watches, pearls, precious and semi-precious stones, bullion, gold, silver, platinum, and other precious alloys or metals is limited to $2,500 in any one loss.

If property under a Personal Floater risk is insured at a $5,000 valued basis, how much would the insured receive if the item is a total loss, the actual cash value is $4,000, and an auction is selling the same item for $3,500? A. $4,000 B. $4,000 less the deductible C. $5,000 D. $3,500

C. $5,000 If an item is insured on a valued basis, that is how much the policy will pay for a loss.

A wine store discovers that someone has vandalized their display shelves, causing $1,500 in damage to inventory. Further inspection reveals evidence of forcible entry to the store safe, causing another $500 in damage, and the loss of $5,000 in currency. How much will the store's crime policy pay under the Inside The Premises Theft of Money and Securities insuring agreement? A. $5,000 B. Zero C. $7,000 D. $5,500

C. $7,000 All these losses would be covered. The Inside The Premises Theft of Money and Securities insuring agreement provides coverage for theft, disappearance, or destruction of money and securities inside the insured's premises, damage to the insured's premises when caused by an attempted or actual theft, and loss or damage to a locked safe, vault, cash register, cash box, or cash drawer that results from actual or attempted entry into such property.

After an employee of a service station failed to tighten the oil filter, the leaking oil caused $700 in damage to the engine. Section II of a Garage Coverage Form would pay: A. Nothing B. $700 less the $250 mandatory deductible C. $700 less the $100 mandatory deductible D. $700 only if the employee is proven negligent

C. $700 less the $100 mandatory deductible A $100 deductible applies to all losses resulting from property damage to an auto as a result of work performed on that auto by the insured.

Which Business Auto Symbol provides the broadest coverage? A. 2 B. 9 C. 1 D. 3

C. 1 Symbol 1 includes any auto, whether owned or not by the insured if it is used in the insured's business. The other choices refer only to owned autos only (2 and 3) or non-owned autos only (9).

How many hours of approved continuing education must Missouri insurance producers complete during a license renewal period? A. 14 B. 12 C. 16 D. 24

C. 16 Producers must complete 16 hours of continuing education each 2-year renewal period.

Of the following boats, which can be added to the Homeowners Policy for liability protection? A. Racing cruiser B. Private yacht owned by the insured C. 20' sailing boat D. Rented pontoon boat to entertain business clients

C. 20' sailing boat

Under the BOP, if coverage for business property equals 100% of the average monthly values for the preceding 12 months, an automatic increase of what amount is provided to offset seasonal variations in stock values? A. 15% B. 5% C. 25% D. 10%

C. 25% The Businessowners Policy includes an automatic seasonal increase business personal property of 25% if the insured maintains insurance equal to 100% of the average monthly values for the preceding 12 months.

Under a Building and Personal Property Coverage Form, up to what percent of a partial loss would be available for debris removal? A. 10% B. 15% C. 25% D. 5%

C. 25% The policy will pay up to a maximum of 25% of the coverage applying to the loss. In the event of a total loss, the policy will pay up to an additional $10,000 for debris removal.

The guaranty association will cover existing claims prior to the determination of insolvency or arising within how many days after the determination of insolvency? A. 60 B. 90 C. 30 D. 10

C. 30 Thirty days after the determination of insolvency, the guaranty association will pay claims that are unpaid as a result of the insolvency of a member insurer, but will not pay if a claim is made over 18 months after the insurer becomes insolvent.

Which of the following will be paid by Supplementary Payments under Part A of the Personal Auto Policy? A. Medical expenses when the insured's daughter is injured in an auto accident B. A judgment against the insured up to 10% above liability limits C. A $250 bail bond D. $1,000 for loss of earnings when the insured is disabled

C. A $250 bail bond Of these choices, only bail bonds is a Supplementary Payment. The policy limit is $250.

Which of the following injuries would not be covered under CGL Medical Payments? A. A carpet installer accidentally staples a customer's hand while installing carpet B. A retail customer slips and falls from a leaking pipe in the store's restroom C. A child accidentally overdoses on cough medication he drank from his parent's medicine cabinet D.A customer is injured by a flying lug nut while a mechanic is changing her flat tire

C. A child accidentally overdoses on cough medication he drank from his parent's medicine cabinet An overdose of a product is not covered under medical payments as it did not result on the insured's premises and was not caused by the insured's operations.

Which of the following properties would not be eligible for a Businessowners Policy? A. An office building that has a total of 75,000 square feet B. A shoe store that has a total of 15,000 square feet C. A dry cleaning plant that has a total of 45,000 square feet D. A residential condominium association

C. A dry cleaning plant that has a total of 45,000 square feet

Which form would cover a business owner who operates out of a temporary location during restoration? A. Expediting Expenses B. Business Income C. Extra Expense D. Contingent Business Interruption

C. Extra Expense This provides coverage for extra expenses, such as operating out of a temporary location for up to 12 months after the date of physical loss or damage.

A crime insurance policy written with a discovery form will cover which of the following losses? A. A loss discovered after the policy termination B. A loss that took place during the policy period and was discovered within one year after the termination of the policy period C. A loss that occurred and was discovered during the policy period D. A loss that occurred and was discovered prior to the policy period

C. A loss that occurred and was discovered during the policy period The discovery form provides coverage for losses discovered during the policy period if the loss occurred between the policy's retroactive date and the policy termination.

Which of the following is a covered auto under Personal Auto liability? A.The insured's ATV B. A vehicle owned by the insured's employer C. A new vehicle purchased 7 days ago to replace an old vehicle but not yet reported to the insurer D. An airport shuttle van which charges a fee to passengers

C. A new vehicle purchased 7 days ago to replace an old vehicle but not yet reported to the insurer A replacement auto for another is covered for liability and medical payments for the remainder of the policy period even of the insured does not report the replacement.

Of the following, which is covered under Part D - Coverage for Damage to Your Auto? A. Radar and laser detection devices B. Custom painting on a van C. A newly acquired vehicle added to the policy within 14 days D. Road damage to tires

C. A newly required vehicle added to the policy within 14 days

Which of the following losses would not be covered under a NFIP policy? A. Tidal waters flood a coastal home following a hurricane B. Mudslides cover a garage on the banks of a major river following torrential rains C. A water main in the street breaks, flooding the insured's basement D. A home on a seaside cliff falls to the beach resulting from swift erosion

C. A water main breaks in the street breaks, flooding the insured's basement A water main break does not meet the definition of a covered flood.

Under the Building and Personal Property Coverage Form, when is abandonment allowed? A. Abandonment is allowed only in the cases of total loss B. Abandonment is allowed only after written notice to the company C. Abandonment is never allowed D. Abandonment is allowed whenever the insured and insurer fail to reach agreement on the amount of a loss

C. Abandonment is never allowed

The Inside the Premises: Theft of Money and Securities insuring agreement covers each of the following types of loss, except: A. Damage to the insured's premises or its exterior caused by a theft or attempted theft B. Theft of money inside the insured's premises committed by a person present on the premises C. Accounting errors D. Damage to a locked safe, vault, cash register, box, or draw caused by a theft or attempted theft

C. Accounting Errors Accounting errors are not covered. Vandalism losses, if not related to a theft, are also excluded. Resulting fire loss from vandalism, theft, burglary, or robbery is not covered by crime forms, since it is covered under the standard property forms.

Which of the following is a duty required of the insured in the event of a loss under the PAP? A. Give notice of the accident to the insurer within 5 days B. If the vehicle was stolen, contact the insurer for permission to report the theft to the police C. Allow an inspection and appraisal of the damage before an auto is repaired D. Immediately initiate repairs to the vehicle to protect it from further damage

C. Allow an inspection and appraisal of the damage before an auto is repaired Under Part E - Duties After a Coverage D Loss, the insured must also allow and inspection an appraisal before the damage is repaired and promptly notify the police if the car was stolen.

A claims adjuster would not pay which of the following Employers Liability claims? A. An injured employee's daughter claims mental anguish over her father's injury at work B. A single mother claims reimbursement expenses for the housekeeper she hired while she remains on strict bed rest as the result of a work injury C. An employee is injured while playing softball at a company picnic at a nearby park D. An employee claims reimbursement expenses for the transportation service her daughter takes to school, after suffering a work-related injury that prevents her from driving Good Job!

C. An employee is injured while playing softball at a company picnic at a nearby park An injury must arise out of actual employment to provide cause for a claim under the Employers Liability section of the Workers' Compensation policy.

Which of the following would not be covered under Coverage A of the CGL? A. While working at a trade show, an insured's employee started a small fire B. An insured's client was injured when she slipped on a loose rug on the insured's premises C. An insured's employee is injured when a bookcase in the office falls on her D. An insured was visiting a client in Canada, who was injured after he tripped over the insured's briefcase

C. An insured's employee is injured when a bookcase in the office falls on her Workers' Compensation insurance will cover the injuries to an employee arising out of work activities.

The Business Auto Coverage Form covers all of the following, except: A. Automobiles owned by employees used for business purposes B. Mobile equipment registered to drive on public roads C. Automatic coverage for physical damage to trailers D. Owned private passenger autos

C. Automatic coverage for physical damage to trailers Owned trailers used by businesses may be covered for physical damage coverage but it is not automatic coverage.

What is the difference between the policy forms covering 'computer fraud' and 'fund transfer fraud'? A. Computer fraud coverage applies to losses due to dishonest IT employees; fund transfer fraud coverage does not B. Computer fraud coverage applies to damage to computers due to criminal activity, and fund transfer fraud coverage applies to the loss of funds C. Computer fraud applies when a computer is used to illegally transfer money, and fund transfer fraud applies when a computer generates a fraudulent funds transfer order D. Computer fraud coverage applies when a computer is used to falsely instruct a bank to transfer of funds, whereas funds transfer fraud does not involve computers

C. Computer fraud applies when a computer is used illegally to transfer money, and fun transfer fraud applies when a computer generates a fraudulent funds transfer order Computer fraud coverage applies when a computer is the direct instrument used for a crime. Fund transfer fraud coverage applies when instructions cause a fraudulent transfer to occur, regardless of the means by which the instructions are received. Neither covers losses due to dishonest employees.

What type of insurance indemnifies the legal liability of an insured for the actions of the insured's subcontractors? A. Contractors Liability Insurance B. Contractual Liability Insurance C. Contingent Liability Insurance D. Completed Operations Insurance

C. Contingent Liability Insurance

A large department store leases space from a shopping mall and is responsible for the actions of parties as specified in the language of the lease. A. operations B. Contigent Liability C. Contractual Liability D. Products

C. Contractual Liability

Which of the following bonds is not a type of Fidelity Bond? A. Blanket B. Individual C. Court D. Name Schedule

C. Court A Court Bond is a Surety Bond required by the court to enforce certain behavior.

The Farm Liability Insurance policy covers each of the following, except: A. Coverage H - Bodily Injury and Property Damage B. Coverage J - Medical Payments C. Coverage K - Non-farming Liability D. Coverage I - Personal and Advertising Injury

C. Coverage K - Non-farming Liability There is no coverage K

Which of the following is true regarding Extra Expense Coverage under a BOP? A Extra Expense coverage is provided until the Property Limit of Insurance is exhausted B. There is a monthly limitation equal to 1/12th of the Property Limit of Insurance C. Coverage is for 12 months after the direct loss D. Extra Expense coverage is not available to commercial tenants

C. Coverage for 12 months after the direct loss As with Business Income, there is no limit for coverage on Extra Expense that is incurred within 12 consecutive months of the date of the direct physical loss or damage.

Which statement is FALSE regarding the completed operations exposure? A. It includes risks of defective installation, construction or repair B. The exposure must occur away from the insured's premises C. Coverage includes replacement of the work that caused the loss D. It begins after the insured's operations are completed and the insured leaves the job site

C. Coverage includes replacement of the work that caused the loss Coverage will pay for bodily injury and property damage caused by negligent or faulty workmanship by an insured, but will not pay for the cost to replace the work that caused the loss.

An insured's employee who has custody and care of property inside the premises is called a: A. Messenger B. Janitor C. Custodian D. Watchperson

C. Custodian

On his way to work, Employee G carries the cash needed for the operational needs of his company's retail outlet. At the point where G enters the store and meets with the onsite manager, G would be considered a: A. Superintendent B. Messenger C. Custodian D. Watchperson

C. Custodian While en route to the bank, G would be considered a messenger. Once arrived at the premises, G would be considered a custodian.

Bonds are contracts that involve all of the following parties, except: A. Obligee B. Surety C. Director D. Principal

C. Director The insurance company issuing the bond is the surety or guarantor, the party owing the duty is the principal or obligor, and the party who is paid by the surety if the principal fails to perform is the obligee.

Which of the following crime forms requires the use of a Retroactive Date? A. Occurrence Form B. Claims-made form C. Discovery Form D. Loss Sustained Form

C. Discovery Form The Discovery Form covers losses that are discovered during the policy period but did not necessarily occur during the policy period. Claims-made and occurrence forms are used with Commercial General Liability policies, not Commercial Crime.

The Equipment Breakdown Protection Coverage Form does not provide which of the following types of coverage? A. Errors and omissions B. Property damage C. Earth movement damage D. Spoilage damage

C. Earth Movement Damage The types of coverage also include expediting expenses, business income and extra expense, newly acquired premises, ordinance or law, errors and omissions, and brands and labels.

Which of the following is not covered under the BOP(Business owners policy)? A. Electronic data valued at $10,000 B. Interruption of computer operations caused by a virus C. Errors or Omissions D. Business income

C. Errors or omissions Errors or omissions are excluded from coverage under the BOP.

The Common Policy Conditions in commercial property insurance include all of the following, except: A. Changes B. Transfer of Rights and Duties C. Fire Department Service Charge D. Inspections and Surveys

C. Fire Department Service Charge

The BOP may be cancelled by which of the following insureds? A. Named insured B. Owner C. First named insured D. Any partner

C. First named insured The First Named Insured may cancel the policy by mailing or delivering an advance notice of cancellation to the insurer.

Which of the following covers the insured's legal obligations for damage to a customer's car? A. Physical damage B. General Liability C. Garagekeepers D. Auto Liability

C. Garagekeepers Garagekeepers coverage is the Garage Coverage form to eliminate possible coverage gaps.

During a company golf retreat, the property of several guests is stolen from the golf resort's safe deposit boxes. Under the resort's commercial crime policy, which insuring agreement or endorsement would pay for this loss? A. Inside the Premises: Robbery or Safe Burglary B. The guests would need to file a claim for this loss under their own homeowners policies C. Guests' Property D. Outside the premises

C. Guests' Property The Guests' Property endorsement to the Commercial Crime Policy covers property of guests while it is in a safe deposit box on the premises of the insured, such as a hotel, motel, or lodging facility. If some of the resort's business property was also stolen in the same occurrence, this loss would be covered under the Inside the Premises: Robbery or Safe Burglary insuring agreement.

The purpose of Part Two of the Workers' Compensation Policy is to: A. Handle suits brought against the employer by an employee injured outside the scope and course of his/her employment B. Handle suits alleging employment discrimination by the employer C. Handle suits against the employer for damages arising from an injury to an employee when those damages are not covered by Workers' Compensation D. Handle suits brought against the employer by members of the general public

C. Handle suits against the employer for damages arising from an injury to an employee when those damages are not covered by Workers' Compensation Part Two of the Workers' Compensation Policy is Employers Liability Insurance, which provides the employer coverage for employees' bodily injury claims that do not fall within the scope of the Workers' Compensation Law.

All of the following are true about a newly acquired additional vehicle, except: A. It must be reported to the insurer within 14 days of purchase B. It may be used on a farm C. It can be used to transport goods for hire if receipts are less than $10,000 D. Coverage is as broad as the broadest coverage on any vehicle under the policy

C. It can be used to transport goods for hire if receipts are less than $10,000 Vehicles used to carry goods for hire cannot be insured under a Personal Auto Policy.

Which of the following is true regarding the Yacht Policy? A. It covers damage to the hull and fittings. Liability coverage may be attached by endorsement B. It is designed for boats that can be towed by automobiles C. It has navigational limits that describe the area where the yacht is allowed to operate D. It is written on an Inland Marine form

C. It has navigational limits that describe the area where the yacht is allowed to operate The Yacht policy is designed for larger vessels such as yachts, excursion vessels, etc. It is written on an Ocean Marine Form and includes Hull, Protection and Indemnity, Medical Payments and Jones Act coverages.

During an inventory check, Company RST discovers a shortage of product and materials. No evidence of a crime is found either at the warehouse or in the electronic record. Which of the following describes Company RST's likely course of action? A. It files a claim with its insurance company seeking coverage under the mysterious disappearance clause of their burglary coverage B. It files a computer fraud claim on the assumption that the computer system was flawed C. It has to absorb the loss, since no evidence of a crime existed D. It files a claim under the employee theft insuring agreement

C. It has to absorb the loss, since no evidence of a crime existed

All of the following regarding the Garage Coverage Form are correct, except: A. It provides automobile liability, physical damage, and general liability insurance for auto businesses B. Coverage is typically written using a blanket limit of insurance C. It provides coverage for product recall D. It provides physical damage coverage for covered autos the named insured owns, hires, rents, leases, or borrows

C. It provides coverage for product recall The Garage policy DOES NOT COVER property in the care and custody of the insured, injuries covered by Workers' Compensation, and liability arising from pollution or product recall.

Which of the following Workers' Compensation programs applies to sailors injured due to the negligence of others? A. Federal Employer's Liability Act B. Defense Base Act C. Jones Act D. Harbor Workers' Compensation Act

C. Jones Act FELA applies to interstate railroad workers, the Harbor Workers' Act applies to workers who load, unload, build or repair ships, and the Defense Base Act applies to workers on military bases outside the United States.

Protection and Indemnity (P&I) Insurance (marine coverage) is similar to which of the following coverages? A. Medical payments B. Uninsured motorist C. Liability D. Physical damage

C. Liability Protection and Indemnity, or P&I, is purchased by the ship owner to protect against cargo lost due to the insured's negligence, damage to other property when not caused by collision, damage to property on board caused by collision, and injuries to seamen resulting in unworthiness of the vessel.

Crop/Hail Insurance is a specialized policy that: A. Guarantees there will be an abundant yield B. Protects against reduced yield because of conditions after harvesting C. Protects against reduced yield because of a covered loss before crops are harvested D. Will replace any lost yield with like produce when reduced by a cover

C. Protects against reduced yield because of a covered loss before crops are harvested

Which of the following is covered under Aircraft Liability Insurance? A. The incidental auto liability exposure of private pilots B. Owners of private, municipal, and commercial airports C. Liability claims arising from the ownership, maintenance or use of an aircraft D. Legal liability of owners and operators of aircraft hangers and aircraft repair shops

C. Liability claims arising from the ownership, maintenance or use of an aircraft Aviation Insurance Liability includes Aircraft Liability, Airport Liability and Hangerkeepers' Liability. Aircraft Liability insurance covers claims arising from the ownership, maintenance, or use of an aircraft.

Each of the following is a characteristic of an eligible risk for the BOP, except: A. Apartment building B. Small business C. Manufacturing occupancy D. Building occupies 20,000 square feet of area

C. Manufacturing occupancy Other ineligible risks include automobile repair or service stations, dealers, garages, places of amusement, and restaurants and bars that do not meet the restaurant eligibility rules.

Under a Businessowners policy, if an insured acquires a building on April 1st, it is automatically covered until which date? A. April 21 B. April 10 C. May 1 D. June 1

C. May 1 Newly acquired or constructed property is a policy coverage extension covering each new building up to $250,000 for up to 30 days.

Which of the following is covered under the Outside the Premises crime insuring agreement? A. Vandalism B. Transfer of property without authorization C. Money in the hands of a messenger D. Armored car stolen during a robbery

C. Money in the hands of a messenger This endorsement insures money and securities taken from a messenger or armored car service caused by theft, disappearance, or destruction; and the other choices are specifically excluded.

Which 1980 regulation deregulated the trucking industry? A. Trailer Interchange Act B. Motor Carrier Public Liability Act C. Motor Carrier Act D. Trucking Reform Act

C. Motor Carrier Act This regulation requires certain vehicles carry minimum liability limits ranging from $750,000 to $5,000,000 depending on the type of merchandise transported.

Aircraft All Risk coverage includes which of the following levels? A. On the ground and not in motion only B. Taxiing and in flight only C. On the ground, taxiing, and in flight D. Taxiing and on the ground and not in motion only

C. On the ground, taxiing and in flight

Section I of the Boatowners policy provides what type of coverage for the hull? A. Replacement cost B. Actual cash value C. Open perils D. Stated value

C. Open Perils The hull, motor, trailer, equipment, and marine accessories are covered on an open peril basis.

All of the following are excluded from the Workers' Compensation Law, except: A. Farm Labor B. Domestic Servants C. Part time employees D. Casual Workers

C. Part Time employees Farm labor, domestic servants, and casual workers are excluded from the law in most states. Casual workers are those whose work is nonrecurring or irregular.

An Aircraft Hull Policy provides all the following coverage, except: A. Damage to the insured aircraft while it is in flight B. Damage to the insured aircraft while it is not in motion on the ground C. Passenger Liability Coverage D. Damage to the insured aircraft while it is in motion on the ground

C. Passenger Liability Coverage The Hull policy provides coverage against risk of physical loss or damage while it is on the ground and while it is in flight.

Which of the following is NOT a qualification for obtaining an insurance producer license? A. Not committing a prohibited act B. Passing a licensing exam C. Paying a $200 license fee D. Being at least 18 years old

C. Paying a $200 license fee the producer license fee is $100

B is traveling to Europe for a month's vacation. Which of the following coverages might her agent recommend to cover personal items? A. Camera floater B. Personal articles floater C. Personal effects floater D. Scheduled personal property

C. Personal Effects Floater

Hull insurance on an ocean marine policy covers the vessel for which of the following? A. Seaworthiness B. Cargo damage C. Physical damage D.. Liability

C. Physical Damage Hull coverage covers physical damage to the vessel and is written on a named perils basis which includes perils of the sea, jettison, piracy, fire and explosion, and lightning.

Multi-Peril crop insurance covered causes of loss include all of the following, except: A. Insects B. Earthquake or volcanic eruption C. Pollution D. Fire

C. Pollution Multi-Peril causes of loss include: adverse weather conditions, fire, insects, plant disease, wildlife, earthquake, and volcanic eruption.

An insured who goes to client's offices and homes for appointments would need coverage for which liability exposure? A. Completed Operations B. Contingent Liability C. Premises and Operations D. Products

C. Premises and Operations Premises and operations exposure includes the insured's legal liability for bodily injury or property damage arising out of his/her business premises or operations (away from the premises).

Which of the following is true regarding the Self-Insured Workers' Compensation Program? A. Self-insurance for Workers' Compensation is most generally used by smaller employers, who cannot afford to purchase Workers' Compensation insurance B. Benefits under self-insurance differ from those provided by Workers' Compensation insurers C. Sometimes large employers are attracted to self-insurance plans because losses can be predictable and benefits are capped by statute D. Self-insurance is allowed in all states

C. Sometimes large employers are attracted to self-insurance plans because losses can be predictable and benefits are capped by statute Self-Insurance is most attractive to larger employers, particularly those in hazardous industries, who feel that they can pay and administer benefits for less than the cost of purchasing insurance.

All of the following are true of Supplementary Payments under the Commercial General Liability Coverage Forms, except: A. Insurer's claim-related expenses are included B. They do not reduce the Limit of Liability C. Supplementary Payments apply to all Section I coverage D.The cost of bail bonds is included up to $250

C. Supplementary Payments apply to all Section I coverage Supplementary Payments only apply to Coverages A and B; not C.

All of the following are true of the Building and Personal Property Coverage Form, except: A. Personal property of others that is in the insured's care, custody, and control is automatically included up to $2,500 B. Building Coverage includes the building structure, completed additions, permanently installed fixtures, machinery and equipment C. Tenant's improvements that are not legally removable are included in the Personal Property of Others Coverage D. Personal property owned and used to service the building is included in the building coverage

C. Tenant's improvements that are not legally removable are included in the Personal Property of Others Coverage Tenants Improvements & Betterments are covered under Business Personal Property, not Personal Property of Others Coverage.

Which cancellation reason regarding the commercial line of business requires 90 days' notice? A. Insurer's insolvency B. Violation of policy terms C. Termination of a line of business D. Loss of reinsurance

C. Termination of a line of business An insurer may terminate an entire line or class of commercial casualty insurance by giving the Director 90 days' notice before mailing notices to the insured(s). The other choices require only 60 days' notice to the insured.

Which of the following is true regarding the Medical Payments coverage under the Business Auto Policy? A. Coverage is limited to medical expenses incurred in the first year after the accident B. Medical Payments coverage pays loss of income during disability arising from a covered accident C. The BAP does not automatically include Medical Payments coverage D. Medical Payments coverage is designed to provide medical payments coverage for employees

C. The BAP does not automatically include Medical Payments Coverage Commercial medical payments coverage is available by endorsement. The coverage is not automatically included in the commercial auto forms.

All the following are true regarding commercial property coverage, except: A. Vandalism coverage is limited to 60 days if the property is vacant B. The Broad Causes of Loss Form does not include settling, cracking, bulging or expansion C. The Basic Causes of Loss Form covers water damage D. The Special Causes of Loss Form covers open peril of direct loss except those specifically excluded

C. The Basic Causes of Loss Form covers water damage

Which statement about the Personal Effects/Personal Articles Floater is TRUE? A. There is no difference between the PEF and the PAF B. Both floaters offer open-peril coverage worldwide with no exceptions C. The Personal Effects Floater covers personal items carried by travelers, and the Personal Articles Floater covers high-value items of personal property D. The Personal Effects Floater covers high-value items of personal property, and the Personal Articles Floater covers personal items carried by tourists

C. The Personal Effects Floater covers personal items carried by travelers, and the Personal Articles Floater covers high-value items of personal property The Personal Effects Floater covers personal items carried by travelers. It does not provide coverage for items at the insured's home. The Personal Articles Floater is typically used to provide rare or high-value items higher levels of coverage than are offered by standard policies.

Each of the following standard limitations under the BOP's Section I - Property limits of insurance is correct, except: A. A loss or damage occurrence is limited to the applicable limit of insurance shown in the Declarations B. The Business Personal Property limit will increase by 25% yearly, subject to the average monthly values of the past year C. The Buildings limit of insurance will automatically increase by 10% each year D. $1,000 per outdoor sign attached to the building per occurrence

C. The buildings limit of insurance will automatically increase by 10% each year The limit of insurance for buildings will automatically increase by 8%.

Employers Liability applies under which of the following circumstances: A. Punitive damages awarded because an employee was employed in violation of law B. An obligation imposed by a Disability Benefits law C. The employee is allowed to sue the employer for negligence D. Liability is assumed under a contract

C. The employee is allowed to sue the employer for negligence

Choose the false statement regarding the Value Reporting Form. A. Late reporting or under-reporting will result in a penalty in the event of a loss B. Reports may be filed either daily, weekly, monthly, or quarterly C. The insured is only required to report up to 80% of value of the property D. The insured pays an advance premium at the beginning of the policy period

C. The insured is only required to report up to 80% of the value of the property Reporting of 100% of values is required to guarantee that adequate insurance is being provided and charged.

All of the following are true of the Occurrence Form, except: A. For coverage to apply, the injury or damage must occur during the policy period B. As long as the injury or damage occurred during the policy period, the claim date is immaterial C. The length of the retroactive date will depend upon the insurer D. Supplementary payments are automatically included

C. The length of the retroactive date will depend on the insurer The occurrence form DOES NOT have a RETROACTIVE DATE

Which of the following describes the coverage provided by a crime policy that included the insuring agreement for burglary? A. The taking of property from inside the premises by a person who has caused or threatened bodily harm B. The mysterious disappearance of property C. The taking of property from inside the premises by a person who hid inside a storeroom during the day and broke a window to get out at night D. The taking of property from inside the premises by a person who has entered through an unlocked window

C. The taking of property from inside the premises by a person who hid inside a storeroom during the day and broke a window to get out at night Burglary must include forcible entry or exit. An unlocked window does not constitute forced entry.

All of the following are true of Supplementary Payments under the CGL, except: A. They apply to bodily injury and property damage liability B. They pay defense costs incurred by the insurer C. They reduce the limits of insurance D. They include the cost of bail bonds up to $250

C. They reduce the limits of insurance

What is the purpose of the Missouri Basic Property Insurance Inspection and Placement Program? A. To provide a mean to purchase high valued property insurance when it cannot be obtained through standard markets B. To provide a means to purchase competitive commercial general liability insurance C. To provide a means to purchase basic property insurance when it cannot be obtained through standard markets D. To provide a means to purchase competitive property insurance

C. To provide a means to purchase basic property insurance when it cannot be obtained through standard markets The FAIR Plan is designed to provide a means to purchase basic property insurance when it cannot be obtained through standard markets.

What coverage under the Motor Carrier Coverage form provides physical damage coverage for non-owned trailers and equipment in the event of an at-fault accident? A. Commercial Truckers Coverage B. Truckers Physical Damage Coverage C. Trailer Interchange Coverage D. Other Insurance Clause

C. Trailer interchange coverage This coverage is included because truckers and motor carriers may hire independent operators to drive the owned vehicle.

All of the following are true of the Business Auto Coverage Form, except: A. Coverage may be written on owned private passenger autos B. Medical payments coverage may be added by endorsement C. Uninsured Motorist Coverage is included in Section II D. Coverage is primary on owned autos and excess on non-owned autos

C. Uninsured Motorist Coverage is included in Section II Section II of the BAP provides liability coverage. Uninsured Motorist coverage is provide by optional endorsement.

Which of the following is excluded under the Basic Causes of Loss form? - commercial property insurance... A. Sprinkler leakage B. Volcanic action C. Utility services D. Sinkhole collapse

C. Utility Services Utility services are not covered under the basic cause of loss form.

Fine arts and antiques are classes of property insured on a: A. Actual cash basis B. Replacement cost basis C. Valued basis D. Market value basis

C. Valued Basis Fine arts are typically insured on a valued basis, whereby the insured and insurer agree, at time of insuring, on an amount of insurance to be paid in the event of a loss.

Any person employed by the insured specifically for the purpose of having the care and custody of property inside the premises is defined as a: A. Partner B. Messenger C. Watchperson D. Custodian

C. Watchperson Watchpersons are hired to watch over property. It is their duty. By contrast, the definition of custodian applies to all employees that at one point or another may have custody of company property on the premises as a result of their duties.

When must a producer notify the Director of any change in legal address? A. Within 90 days B. Never C. Within 30 days D. Within 15 days

C. Within 30 days Producers must notify the Director of any change in legal address within 30 days of the change.

Some flood policies are written in the voluntary property market as a result of which program? A. Standard B. National Flood Cooperative C. Write Your Own D.Emergency

C. Write your own A Write Your Own (WYO) company may structure its flood business according to guidelines and regulations of the NFIP and within its existing personal lines business.

The Difference in Conditions Policy is a special form used to fill in gaps of a property policy. Which of the following is true regarding this policy? A. It is written with a minimum of 80% co-insurance B. It is written with a Standard Deductible of $1,000 C. It is generally written on an open perils basis, excluding losses by perils that are covered under standard property forms D. The Standard DIC form is developed and filed by the NAIC

C. it is generally written on an open peril basis, excluding losses by perils that are covered under standard property forms The Difference in Conditions Policy is designed to provide coverage for all perils not covered under standard property forms. Because of the very broad coverage at the DIC, each insurer writing this form develops its own policy form.

Under Workers' Compensation insurance, the insured is responsible for paying benefits for: A. When the insured incurs expenses requested by the insurer B. Taxes on litigation C. Knowingly hiring an employee in violation of the employment law D. Appeal bond premiums

C. knowingly hiring an employee in violation of the employment law The insured must also pay because of his serious or willful misconduct, failure to comply with safety regulations, or discrimination.

The Personal Articles Floater is written: A. Only on a replacement cost basis B. Only on a named perils basis C. Only on moveable property D. Only as an endorsement on the Dwelling policy

C. only on moveable property

The Workers' Compensation Policy Conditions Section includes which of the following? A. The list of states where coverage applies B. The supplementary coverages C. The cancellation policy D. Name, address, and type of business of the insured

C. the cancellation policy Part Six - Conditions of the Workers' Compensation Policy includes the cancellation requirements.

Which of the following would NOT be found in the Common Policy Declarations page of a Commercial Package Policy? A. The mortgagee B. The named insured C. The occurence form D. The expiration date

C. the occurence form

What is the difference between the policy forms covering 'computer fraud' and 'fund transfer fraud'? A. Computer fraud coverage applies when a computer is used to falsely instruct a bank to transfer of funds, whereas funds transfer fraud does not involve computers B. Computer fraud coverage applies to damage to computers due to criminal activity, and fund transfer fraud coverage applies to the loss of funds C. Computer fraud coverage applies to losses due to dishonest IT employees; fund transfer fraud coverage does not D. Computer fraud applies when a computer is used to illegally transfer money, and fund transfer fraud applies when a computer generates a fraudulent funds transfer order

Computer fraud applies when a computer is used to illegally transfer money, and fund transfer fraud applies when a computer generates a fraudulent funds transfer order Computer fraud coverage applies when a computer is the direct instrument used for a crime. Fund transfer fraud coverage applies when instructions cause a fraudulent transfer to occur, regardless of the means by which the instructions are received. Neither covers losses due to dishonest employees.

Which Commercial auto symbol is unique to the Garage Coverage Form? A. 40 B. 10 C. 20 D. 30

D. 30 There are two unique symbols under the Garage Coverage Form: Symbol 30 designates autos left with the insured for service, repair, storage, or safekeeping. Symbol 31 designates physical demise coverage for dealers' autos.

S carries a Personal Auto Policy with Liability limits of 50/100/25. What is the maximum the policy will pay if S struck another vehicle causing injury to the occupants as follows: Driver - $70,000; Passenger 1-$30,000; Passenger 2-$50,000 and property damage to the other vehicle - $20,000? A. $170,000 B. $125,000 C. $150,000 D. $120,000

D. $120,000 Coverage is as follows: Driver - $50,000; Passenger 1 - $30,000; Passenger 2 - $20,000, since the policy will only pay $50,000 per person and a total of $100,000 per accident. The property damage is fully covered, totaling $120,000.

What is the maximum the Supplementary Payments coverage of a BAP (Business Auto Policy) will pay for the cost of bail bonds? A. $200 B. $2,500 C. $250 D. $2,000

D. $2,000

At what age will the child of an employee who died due to a work-related injury no longer be eligible to receive benefits from Workers' Compensation? A. 18 B. 21 C. 21 if not a full-time student D. 18 if not a full-time student

D. 18 if not a full time student

If the Department of Insurance denies a producer license application, the applicant may request a hearing within how many days of the denial? A. 45 B. 15 C. 60 D. 30

D. 30 The applicant may request a hearing within 30 days of the receipt of denial of a license by the Department of Insurance.

In the Business Income Coverage Form, Period of Restoration begins _______ after the time of loss. A. 86 years B. 100 months C. 55 days D. 72 hours

D. 72 Hours The Period of Restoration begins 72 hours after the time of loss, and ends on the earlier of the date when the property should be repaired or rebuilt with reasonable speed, or the date when business is resumed at a new permanent location.

Under Section II - Liability & Medical Expenses, who is covered for medical expenses after being injured while at an insured premises? A. A tenant of the insured B. A person taking part in athletics C. A cleaning crew hired by the insured D. A client of the insured

D. A client of the insured A person taking part in athletics, renters and a person hired to do work on behalf of an insured are excluded.

Which of the following would be covered by a law firm's professional liability policy? A. A lawyer causes bodily injury to a witness B. An angry client sideswipes a lawyer's car C. A lawyer causes property damage when visiting a client's home D. A client sues a lawyer for purposely losing his case

D. A client sues a lawyer for purposely losing his case Professional Liability Insurance protects professionals from losses that arise specifically out of their professional conduct. It covers losses other than BI or PD, such as: Fraud or breach of contract, Conflict of interest, Malpractice or neglect, Government investigation, and Errors and omissions.

All of the following statements regarding a common carrier covered under the Truckers and Motor Carrier Coverage form are correct, except: A. A trucker that transports goods belonging to several customers at the same time B. A common carrier can also use the Motor Carrier Coverage Form C. A business individual that carries the general public from one place to another for a fee D. A common carrier must use the Trucker Coverage Form

D. A common carrier must use the Trucker Coverage Form A common carrier (TRUCKERS) can use either the Trucker Coverage Form or the Motor Carrier Coverage Form.

All of the following are insured under the CGL (commercial general liability), EXCEPT: A. A stockholder B. A volunteer worker acting on behalf of the insured C. A partner D. A person participating in an athletic event

D. A person participating in an athletic event Others covered are those named in the Declarations, including employees other than executive officers or managers.

Which of the following would be included in the definition of burglary? A. A robber threatens the cashier with a gun and leaves with the money from the cash drawer B. A cashier steals money from the cash drawer C. A customer shoplifts merchandise from a store D. A thief breaks down a door to enter store and steal merchandise

D. A thief breaks down a door to enter store and steal merchandise The act of breaking and entering classifies a crime under the definition of burglary.

Which of the following vehicles is not considered an uninsured vehicle under Part C of the PAP? A. A vehicle that disappears after a collision B. A vehicle whose coverage is denied by its insurer C. A vehicle insured for less than the state's minimum required coverage D. A vehicle owned by the government

D. A vehicle owned by the government Other vehicles that are not uninsured vehicles are company cars, self-insured, operate on rails or crawler treads, off-road vehicles, and those used as a residence.

Under the Commercial Property policy, debris removal and fire department service charge coverage are examples of: A. Exclusions B. Optional coverages C. Endorsements D. Additional Coverages

D. Additional Coverages

Which coverage is not available under the Garage Coverage Form? A. Product liability B. Garagekeepers C. Physical damage D. Advertising liability

D. Advertising Liability Advertising Liability would be available under a CGL (COMMERCIAL GENERAL POLICY) policy

Which of the following claims would not be covered under Workers' Compensation Insurance? A. An employee injured by machinery in the work place B. An employee who becomes ill because of exposure to chemicals used in the employee's workplace C. An employee injured on the job by a product of the employer D. An employee who contracts a cold in the winter

D. An employee who contracts a cold in the winter

Which of the following incidents is not covered under the Inside The Premises Theft of Money and Securities Form? A. Damage to the bank itself caused during a theft B. Disappearance of money by a customer C. Damage to a locked safe D. Attempted robbery of a custodian

D. Attempted robbery of a custodian Attempted robbery of a custodian, would be covered under the Inside Robbery or Safe Burglary form.

General Conditions in the business auto policy apply to which of the following? A. Appraisal B. Legal action against the insured C. Transfer of rights D. Bankruptcy

D. Bankruptcy The other choices are Loss Conditions, and also included as General Conditions are concealment, misrepresentation, or fraud, liberalization, other insurance, premium audit, policy period, and territory.

A boat and trailer worth $20,000 is damaged at a lake when the insured drove over a log. The physical damage is covered under which of the following policies? A. Homeowners B. Dwelling C. Umbrella D. Boatowners

D. Boatowners Physical damage to the boat will only be covered under the boatowners policy

All of the following underlying coverages must be purchased in order to qualify for the Umbrella and Excess Liability policy, except: A. CGL B. Employer's Liability C. Liquor Liability D. Workers' Compensation

D. Workers Compensation Commercial Auto Liability is also a required underlying coverage to qualify for the Umbrella policy.

Which of the following is covered by Medical Payments under the CGL? A. Bodily injury to a person on a part of the premises that the insured owns or rents and that the person normally occupies B. Bodily injury to a person hired to do work for the insured C. Bodily injury to an insured that is injured while playing tennis D. Bodily injury to an insured's customer while shopping on the insured's business premises

D. Bodily injury to an insured's customer while shopping on the insured's business premises

The Condominium Association Coverage Form is used in place of which coverage form when insuring a condo building insured by the association? A. Condominium HO-6 policy B. Dwelling property C. Homeowner Policy D. Building and Personal Property Coverage form

D. Building and Personal Property Coverage Form

M and C both have Personal Auto policies with liability limits of 20/30/10. If M borrows C's car and injures a pedestrian, causing injuries that will cost $5,000 to treat, which policy will provide coverage for the injured party? A. M's policy B. Both policies will share the loss pro-rata C. Neither policy, since C's car was not on M's policy D. C's policy

D. C's Policy The owner's coverage is primary (insurance follows the car not the driver). Coverage for a non-owned vehicle is excess.

Which source of liability would a trucker be liable for under a Motor Carrier Coverage Form? A. Exercise of Public Authority B. Faulty packing by a Shipper C. Acts of God D. Cargo damage from overturn

D. Cargo damage from overturn The Motor Carrier Coverage Form provides Trailer Interchange Coverage, which protects against physical damage such as comprehensive and/or collision coverage (OVERTURN)

Which of the following is excluded under both the Limited Pollution Liability coverage form and Pollution Extension endorsement? A. Threatened discharge of pollutants B. Escape of pollutants C. Waste disposal leaks D. Clean up costs

D. Clean up costs Government imposed clean up costs incurred from environmental damage caused by a pollution incident are covered under the Pollution Liability coverage form, but not the Limited Pollution Liability coverage form or Pollution Extension endorsement.

Which of the following is not covered under Comprehensive Coverage under the Business Auto Coverage Form? A. Theft B. Fire and Lightning C. Glass Breakage D. Collision

D. Collision Comprehensive Coverage under the Business Auto Coverage Form is an open perils coverage that covers damage from perils not excluded. Collisions are excluded.

Collapse is not covered under which of the following property forms? A. DP-3 B. Commercial Broad Cause of Loss Form C. HO-2 D. Commercial Basic Cause of Loss Form

D. Commercial Basic Cause of Loss Form

ABC Industries contracts with municipal governments to build bridges, viaducts, and similar engineering projects. If a bridge completed in the prior year by ABC Industries were to collapse, which kind of liability exposure would this be an example of? A.Contingent liability B. Premises and operations C. Products D. Completed operations

D. Completed Operations

Which of the following would not be covered under an Installation Floater? A. Carpeting B. Elevators C. Electrical equipment D. Construction equipment

D. Construction Equipment The Installation Floater is designed to cover materials that will be installed in a newly constructed or renovated building. Construction equipment owned any maintained by the installer would be covered under the Equipment Dealers Floater.

Which of the following legal liability exposures is covered if a business employs an independent contractor? A. Completed operations B. Premises and Operations C. Products D. Contingent liability

D. Contingent Liability This legal liability occurs when a business is held responsible for the actions or failures of others through a binding contract or agreement.

Choose the false statement regarding the application of coverage under the Products Exposure Liability Coverage. A. Coverage applies to property damage the product causes B. Coverage applies to bodily injury occurring away from premises the insured owns or rents C. Coverage applies to bodily injury the product causes D. Coverage applies to damage to the product itself

D. Coverage applies to damage to the product itself

All of the following are true of medical payments under the Commercial General Liability Coverage Forms, except: A. Coverage applies to injuries that occur on the premises that the insured owns or rents B. Coverage applies to expenses that are incurred and reported to the insurer within 1 year of the accident C. Coverage applies to injuries that occur because of the insured's operations D. Coverage applies to the insured's injuries

D. Coverage applies to the insured's injuries Medical Payments coverage is not available for any insured.

Which of the following is false about the CGL's two coverage forms? A. The claims-made form covers losses that occur after the retroactive date and before the policy expiration date B. Coverage is triggered when an occurrence takes place during the policy period C. The retroactive date is unique to the Claims-Made form D. Coverage under the occurrence form is based on when the loss is reported

D. Coverage under the occurrence form is based on when the loss is reported With the Occurrence form it doesn't matter when the loss is reported, but the date the loss occurred must be during the policy period.

Which of the following is NOT a duty of the Director of Insurance? A. Conduct hearings B. Prescribe forms and procedures C. Regulate the Department of Insurance affairs D. Create Missouri insurance laws

D. Create Missouri Insurance laws The Director of Insurance does not create law. Instead, the Director has the authority to make any rules necessary to enforce the insurance laws passed by the state legislature.

The Farm Liability Policy would not cover which of the following? A. The insured is sued by a neighbor after falsely stating that the neighbor's livestock was diseased B. While visiting the neighbor's farm, the insured's son accidentally starts a fire that burns down a shed C. The insured's daughter sells tainted pecans in a farm stand at the end of the farm driveway D. A neighbor who is accidentally hurt on the insured's farm makes a claim for medical payments 4 years after suffering injury

D. D. A neighbor who is accidentally hurt on the insured's farm makes a claim for medical payments 4 years after suffering injury

Which of the following is false about Livestock Coverage Form? A. Poultry is not considered a type of livestock B. Mules are considered livestock C. Classes of animals may be subject to a sublimit D. Livestock are covered while in transit by common carrier

D. D. Livestock are covered while in transit by common carrier Livestock are not covered when being transported by common carrier.

Which type of loss does not reduce an aggregate limit within the Businessowners Coverage Form - Section II? A. Medical expenses B. Product/completed operations C. Premises and operations D. Damage to Premises Rented to You

D. Damage to premises rented to you The aggregate limits do not apply to losses that involve Damages to Premises Rented to You.

Each of the following is an exempt worker under Workers' Compensation statutes, except: A. Farm laborer B. Independent contractor C. Sole proprietor D. Employee in a company of 100 employees

D. Employee in a company of 100 employees Some states exempt workers of employers with fewer than three employees.

Exclusive remedy means that: A. Only full time employees are eligible for Workers' Compensation insurance B. The employer may decide which types of employee are eligible for coverage by a Workers' Compensation policy C. Once an employee has been compensated for an injury by Workers' Compensation, the policy will not pay for any subsequent injuries D. Employees covered by Workers' Compensation insurance cannot sue for work-related injury

D. Employees covered by Worker's compensation insurance cannot sue for work-related injury Workers' Compensation insurance is the exclusive remedy for workplace injuries. This means an injured worker cannot obtain other insurance for workplace injuries or their related medical expenses and lost wages. Injured workers are not permitted to sue an employer for injuries if covered by Workers' Compensation insurance.

Which of the following is correct about Difference in Conditions (DIC) Insurance? A. It is written on a standard form similar to the property form B. The Coinsurance Clause is included on all policies C. Fire and lightning are typical covered perils D. Flood is a peril that can be covered by this policy

D. Flood is a peril that can be covered by this policy This policy fills in insurance gaps and covers perils that are excluded under standard property policies (such as flood), and excludes perils that are covered under standard property policies.

A restaurant discovers that one of its suppliers has changed the amount payable on a check they issued. Under which Commercial Crime insuring agreement would this loss be covered? A. Fund Transfer Fraud B. Outside the Premises C. Money Orders and Counterfeit Money D. Forgery or Alteration

D. Forgery or Alteration

Ocean marine Hull Coverage and Cargo Coverage are written on which basis? A. Replacement Cost B. Actual Cash Value C. Market Value D. Full valued basis

D. Full valued basis Cargo and Hull Insurance are written on a full valued basis. The valuation of the cargo includes the stated value of the invoice, import duties, and freight charges.

The Association's funds are divided into 4 separate accounts. Which of the following is NOT one of those accounts? A. Automobile insurance account B. Workers' Compensation insurance account C. Missouri mutual and extended Missouri mutual insurance company account D. Homeowner insurance account

D. Homeowner insurance account No homeowners insurance account exists.

All of the following are coverage extensions under the Building and Personal Property Coverage Form, except: A. Personal effects and property of others B. Outdoor property C. Newly acquired or constructed property D. Inflation guard

D. Inflation Guard Inflation Guard is an optional coverage, not a coverage extension.

Company D's cashier is robbed of $500 in currency. This loss would be covered under which insuring agreement? A. Outside the premises B. Computer fraud C. Inside the premises: Robbery or safe burglary coverage D. Inside the premises: Theft of money and securities

D. Inside the premises: Theft of money and securities

The Employers Liability pays for all the following for which the insured is legally obligated to pay, except: A. Injuries claimed by a third party as a result of worker's injuries B. Consequential injury to dependents C. Care and loss of services D. Intentional injury by the employee

D. Intentional injury by the employee Employers must be legally obligated to pay and the employer is also responsible for injuries to employees that arise out of the employment, but claimed against the insured while the insured is in a capacity other than as employer. Intentional injury by the employee is not covered.

Advertising Injury Coverage includes all of the following, except: A. Misappropriation of advertising ideas or style of doing business B. Infringement of copyright C. Violation of copyright, title or slogan D. Wrongful entry

D. Wrongful entry

Choose the correct statement regarding preservation of property under the Building and Personal Property coverage form. A. It provides off-premises coverage from covered perils at any time the policyholder is temporarily away from the premises B. It stipulates how insured property must be protected when endangered by a covered peril C. It provides the same coverage as the preserved property would be insured against by the attached Causes of Loss Form D. It provides open perils coverage for 30 days on insured property being moved or temporarily stored at another location because of the endangerment of a covered peril

D. It provides open perils coverage for 30 days on insured property being moved or temporarily stored at another location because of the endangerment of a covered peril The purpose of the preservation of property additional coverage is to provide open perils coverage for property being moved because it is endangered, and to protect the property while it is removed from the premises for this reason. The property is covered for up to 30 days of removal.

Choose the correct answer regarding Coverage F of the Farm Property Coverage Form. A. It covers farm buildings, including silos and fences, as well as home furnishings and office furniture in a home office B. It does not cover unscheduled livestock, but does cover show horses and ponies, if scheduled C. Each item of farm machinery to be covered must be scheduled D. It will cover farm machinery both on and away from described premises

D. It will cover farm machinery both on and away from described premises Coverage F is the Unscheduled Farm Personal Property, that covers machinery, livestock, tools, supplies, and other farm personal property on a blanket (unscheduled) basis. It does not include household or other items usual to a dwelling.

The Ordinance or Law Coverage endorsement covers each of the following losses, except: A. Clearance of the undamaged parts of a building B. Increased cost of repairing damaged parts of the building C. Demolition of the undamaged parts of a building D. Loss of value in the damaged portion of the building

D. Loss of value in the damaged portion of the building This endorsement provides coverage if the enforcement of any building, zoning, or land use law results in the loss of value of the undamaged portion of the building.

Choose the false statement regarding the Businessowners Policy. A. Watercraft and associated equipment while afloat are not covered B. Named perils coverage is available by endorsement C. Pollution clean up and removal are covered as an Additional Coverage D. Manufacturers are eligible for coverage

D. Manufacturers are eligible for coverage Manufacturers are ineligible for coverage under the BOP.

Which of the following is covered under Section II of the Businessowners Coverage Form? A. Employers Liability B. Watercraft Liability C. Professional Liability D. Medical payments to volunteer workers

D. Medical payments to volunteer workers Employers liability, professional liability, and watercraft liability are all excluded under the policy.

Which of the following is not an exclusion under Section II of the Businessowners Coverage Form? A. Employers Liability B. Professional Liability C. Watercraft Liability D. Medical payments to volunteer workers

D. Medical payments to volunteer workers The policy does not exclude medical payments to a volunteer worker, only to a paid employee.

Each of the following provides buy back coverage for the insured, except: A. Limited pollution liability coverage B. Pollution extension endorsement C. Pollution liability coverage for designated sites D. Modified pollution extension endorsement

D. Modified Pollution extension endorsement The CGL policy excludes bodily injury or property damage arising from discharge, dispersal, seepage, migration, and release or escape of pollutants, and these three coverages are bought back for coverage on an individual account basis.

Which of the following types of Workers' Compensation laws is available through a state fund? A. Elective B. Compulsory C. Competitive D. Monopolistic

D. Monopolistic The Monopolistic law is only available through a state fund, and the Elective version allows employers to accept or reject the state Workers' Compensation law.

Which of the following is true regarding the Camera Floater? A. Blanket coverage is provided on cameras and lenses B. Automatic coverage is provided on newly acquired items for 90 days C. Automatic coverage is provided on newly acquired items for 60 days D. Newly acquired are covered up to 25% of the policy amount until reported

D. Newly acquired are covered up to 25% of the policy amount until reported Insured items are scheduled, with the exception that blanket coverage is provided on accessories. Automatic coverage is provided on newly acquired items for 30 days at a limit of insurance up to 25% of the limit designated on the schedule.

Which of the following is true about the Missouri insurance cease and desist order? A. It is the only recourse to stop an insurance unfair trade practice B. Violation may result in a minimum fine of $100,000 C. An alternative to a cease and desist order is federal court action D. Notice of intent to initiate administrative action must be served personally or by certified mail

D. Notice of intent to initiate administrative action must be served personally or by certified mail Violators are also subject to suspension/revocation of a license or certificate of authority.

Which form provides coverage for a loss that takes place during the policy period and is not required to be reported within a certain time frame? A. Special Coverage Form B. CGL C. Claims-Made Form D. Occurrence Form

D. Occurrence Form The occurrence form is appropriate when the insured knows that the loss occurred during the policy period, but not necessarily when it was reported.

Section I - Property of the BOP (Business owners property) covers which of the following types of property? A. Pet animals B. Accounts, bills, and other evidences of debt C. Land D. Outdoor furniture

D. Outdoor Furniture The BOP also covers buildings and business personal property located in or on or within 100 feet of the covered building.

The National Flood Insurance Program (NFIP) sells flood insurance in which of the following types of communities? A. Farm communities B. Communities that border a large body of water C. Communities with a population less than 300,000 D. Participating communities

D. Participating Communities Communities in flood-prone areas must have an approved flood control program in order to benefit from the NFIP.

What coverage is not included under the Boatowners Policy? A. Hull B.Property Coverage C. Medical Payments D. Personal Property Coverage

D. Personal Property Coverage Like the PAP, a boatowners policy does not cover loss or damage to personal property

The Garagekeepers Coverage of the Garage Coverage Form covers the liability of: A. Product liability exposures B. Owned vehicles that are used in the business C. Damage to autos held for sale D. Physical damage to a customer's car that is in the care and custody of an insured

D. Physical damage to a customer's car that is in the car and custody of an insured Garagekeepers coverage provides insurance for amounts the insured is legally obligated to pay for loss or damage to a customer's vehicle in the insured's care for servicing, repair, parking, or storing.

Which of the following is covered under the Electronic Data Processing Floater? A. Notebooks B. Accounts and records C. Laptops D.Printers

D. Printers Also covered are computers and their components and systems used exclusively in the insured's computer operation, such as air conditioning or electrical equipment; the other choices are exclusions.

Which of the following is NOT a type of coverage provided under a farm liability policy? A. Medical payments B. Personal and advertising injury C. Bodily injury and property damage liability D. Professional liability

D. Professional Liability

What is the method of property valuation used under the Businessowners Policy (BOP)? A. Actual Cash Value B. Depreciation C. Stated Value D. Replacement Cost

D. Replacement Cost Replacement cost is the valuation method for the building and business personal property as long as the limit of insurance for lost or damaged property at the time of the loss is at least 80% of the full replacement cost of the property.

The Controlled Inland Marine Coverage forms provide insurance for which of the following? A. Transportation floater B. Builders risk C. Installation floater D. Signs

D. Signs Signs, accounts receivable, commercial articles floater, jewelers block coverage, valuable paper and records, and equipment dealers coverage are controlled, or filed, forms; the other choices are uncontrolled, or unfiled forms and also include contractors equipment, electronic data processing, and installation floaters.

Which of the following is true regarding Personal Inland Marine Insurance? A. It covers direct and indirect loss arising from damage to, or loss of, personal property B. It is written in lieu of Coverage C of the Homeowners Policy C. It provides replacement cost coverage on personal property D. Since moveable property is also known as floating property, the policies are sometimes known as floater policies

D. Since moveable property is also known as floating property, the policies

Which of the following perils is not one of the three included on the Broad Causes of Loss Form? A. Water damage from accidental discharge B. Falling objects C. Weight of ice, snow or sleet D. Steam boiler explosion

D. Steam boiler explosion Steal boiler explosion is not covered under the broad cause of loss form

Which statement is false regarding the Businessowners Policy? A. Supplementary Payments do not affect the policy limits B. Auto dealers, banks and places of amusement are not eligible C. Hired and non-owned autos may be included by endorsement D. Supplementary Payments include first aid expenses

D. Supplementary Payments include first aid expenses First aid expenses are covered under Medical Expenses, not Supplementary Payments.

All of the following are true of the Building and Personal Property Coverage Form, except: A. Personal property of others that is in the insured's care, custody, and control is automatically included up to $2,500 B. Personal property owned and used to service the building is included in the building coverage C. Building Coverage includes the building structure, completed additions, permanently installed fixtures, machinery and equipment D. Tenant's improvements that are not legally removable are included in the Personal Property of Others Coverage

D. Tenant's improvements that are not legally removable are included in the Personal Property of Others Coverage Tenants Improvements & Betterments are covered under Business Personal Property, not Personal Property of Others Coverage.

Which statement regarding the Businessowners Policy is not correct? A. The bodily injury limit is written on a per occurrence basis B. The personal injury limit is written on a per person or organization basis C. The medical expense limit is written on a per person basis D. The Damage to Premises Rented to You limit is written on a per person basis

D. The damage to premises rented to you limit is written on a per person basis Damage to Premises Rented to You is written on a per occurrence (fire or explosion) basis.

The Equipment Dealer's Coverage Form covers which of the following? A. The office furniture and fixtures of equipment dealers B. The tools and equipment in the equipment dealer's repair shop C. The equipment dealer's building and contents D. The equipment dealer's stock, primarily consisting of mobile agriculture and construction equipment, such as forklifts

D. The equipment dealer's stock, primarily consisting of mobile agriculture and construction equipment, such as forklifts This form covers the Equipment Dealer's stock of mobile agricultural and construction equipment held for sale, and similar property of others in the Dealer's care, custody, or control.

Which of the following would not reduce the general aggregate limit under a CGL? A. A small fire in the insured's office causes damage to the leased premises B. The insured misappropriates the advertising slogan of a competitor C. A customer is injured on premises and the insured calls an ambulance to take the injured party to the hospital for treatment D. The insurer pays a claimant injured by a product made by the insured

D. The insurer pays a claimant injured by a product made by the insured Products claims are subject to the products-completed operations aggregate limit, and not to the general aggregate limit.

Which of the following is not required in the estimating process of handling a claim? A. An estimate prepared by the insurer must have the insured's permission B. If the insured chooses the insurer's repair shop, no additional cost will be charged to the insured C. The estimate must be based on aftermarket parts D. The person preparing the estimate must have a contractual relationship with the insurer

D. The person preparing the estimate must have a contractual relationship with the insurer The estimate must be prepared by a person or entity having no contractual relationship with the insurer.

Which of the following is not true of the Multi-Peril Crop Insurance? A. Tobacco is a covered crop B. Adverse weather conditions is a covered peril C. Cereal grains are a covered crop D. The residual market provides this coverage at the state level

D. The residual market provides this coverage at the state level This coverage is written by private insurers and is reinsured by the Federal Crop Insurance Corporation (FCIC) to cover primarily the corn and maize, cereal grains, soybeans, tobacco, and cotton crops.

What is the purpose of an Umbrella Liability Policy? A. To combine all the insured's insurance exposures under a single policy B. To provide professional liability coverage C. To provide liquor liability coverage D. To cover large and catastrophic losses

D. To cover large and catastrophic losses The Umbrella Policy is a policy with high limits covering over top of primary liability coverages, and subject to a self-insured retention (deductible), covering exposures otherwise uninsured.

Which of the following covers physical damage to non-owned trailers and their equipment? A. Truckers Coverage B. Interline Coverage C. Other Insurance Clause D. Trailer Interchange Coverage

D. Trailer Interchange Coverage

Which of the following is covered under Section III - Garagekeepers on the Garage Coverage form? A. Uninsured Motorists B. Garage Operations C. Completed Operations D. Vehicles and equipment owned by others in the care of the insured

D. Vehicles and equipment owned by others in the care of the insured Garagekeepers Coverage provides Comprehensive, Specified Causes of Loss, and Collision coverage for the vehicle and its equipment while in the care, custody, and control of the insured.

Which peril is excluded on the Crop and Hail Insurance policy? A. Freezing B. Insects and disease C. Drought D. Wildlife

D. Wildlife This policy also excludes failure to harvest a mature crop, share cropping, loss from injury to buds, blossoms, blooms, leaves, and vines unless the crop is affected.

When an employee is injured in an auto accident while on company business, he/she would be covered under: A. Garage Liability Form B. Company group health insurance C. Garagekeepers Form D. Workers' Compensation Insurance

D. Worker's Compensation Insurance

Which of the following is not a Symbol under Section I - Covered Autos? A. Any auto B. Owned Autos Subject to No Fault C. Specifically described on Declarations D. Dealers auto liability coverage

D. dealers auto liability coverage Symbol categories also describe only non-owned autos, hired autos, and owned private passenger autos only.

Which of the following is NOT TRUE of the Yacht Policy? A. It includes both property and liability coverage B. Lay up warranties are permitted C. Is written on an Ocean Marine form D. It provides coverage regardless of its territory

D. it provides coverage regardless of its territory A yacht is not covered if it is navigated outside the territory.

An employee carrying documents detailing his employer's trade secrets is assaulted and robbed of the documents on his way to a meeting. Which Commercial Crime insuring agreement would cover the loss? A. Inside The Premises: Robbery or Safe Robbery B. Employee Theft C. Forgery or Alteration D. Outside the Premises

D. outside the premises Outside the Premises coverage insures property in the custody of a messenger for direct loss or damage from actual or attempted robbery. It also covers money and securities in the custody of a messenger against theft, disappearance, or destruction.

When does coverage cease under a Crop/Hail Insurance Policy? A. At 12:01 am, 1 year from the date the policy is written B. At 12:01 am on December 31st of the year the policy was written C. Once the crop is clearly visible above the ground D. When the crop is harvested

D. when the crop is harvested Coverage ceases under a Crop Hail Policy when the crop is harvested. Coverage is written per growing season rather than on an annual basis.

Neither the Computer Fraud nor Funds Transfer Fraud forms cover which of the following claims? A. An electronic request to the bank computer to transfer money from a bank to an illegal account B. Loss of funds when a person directs a bank's online check system be transferred to him C. Damage to physical computer incurred while a customer is trying to illegally transfer money from the bank D. Loss of money transferred from a computer by a person who confiscated another person's banking online ID

Damage to physical computer incurred while a customer is trying to illegally transfer money from the bank Physical damage to a computer in the commission of a crime is a property damage loss, not a crime loss.

A temporary substitute vehicle is NOT a "your covered auto" under what coverage?>

Part D: Coverage for Damage to your Auto

Which of the following Part D claims would be denied under the Personal Auto Policy? A.Loss to permanently installed sound reproduction equipment of the covered auto B. Loss to electronic ignition equipment of the covered auto C. Earthquake damage to the covered auto D. Loss to the covered auto caused by road damage to tires

Loss to the covered auto caused by road damage to tires While the insuring agreement of Part D is very broad, many perils are excluded, including wear and tear, freezing, mechanical or electric breakdown, or road damage to tires.

All of the following must be listed on Form MCS-90, except: A. The policy number and policy dates B. The names of the motor carrier and the insurance company C. The limits of liability provided by the policy D. The policy premium amount

The policy premium

What are the territorial limits of the Commercial General Liability Coverage Part of the Commercial Package Policy? A. Only the United States, its territories and possessions B. United States, its territories and possessions, Canada, and Mexico C. United States, its territories and possessions, Puerto Rico and Canada D. The United States, Puerto Rico and Mexico

United States, its territories and possessions, Puerto Rico and Canada Coverage applies to occurrences that take place in the coverage territory, or if the products were made in the coverage territory and the suit is brought in the coverage territory.

A building with no physical contents and no occupants is said to be which of the following? A. Suspended occupancy B. Unoccupied C. Vacant D. Undetermined occupancy

Vacant

Which of the following is not an example of contingent liability exposure? A. Owners and Contractors Protective liability exposure B. Premises liability exposure C. Contractual liability exposure D. Liability exposure of an insured's sub-contractors

b. Premises Liability Exposure Contingent liability exposures exist when the insured is held liable for the actions or failure of actions of others. Premises liability is not a contingent liability exposure.

Which coverage form covers business exposures of motor carriers for hire who transport the goods of others? A. Contract Carrier B. Truckers C. Motor Carrier D. Symbol 30 under the Business Auto

b. Truckers

Physical damage coverage under a Business Auto Coverage Form includes all of the following, except: A. Comprehensive Coverage B. Uninsured Motorist Coverage C. Collision Coverage D. Specified Causes of Loss

b. Uninsured Motorist Coverage The three types of physical damage coverage under the BAP are collision, comprehensive, and specified perils. Uninsured Motorist is a separate coverage added by endorsement.

Coverage is open peril on the Jewelers Block Floater but there is no coverage for ___________ unless added as an optional coverage. A. Loss of market B. Off-hours C. Broken or smashed show windows D. Wear and tear

c. broken or smashed show windows

Which of the following statements about the CPP is incorrect? A. The first named insured may cancel the policy by mailing advance written notice of the cancellation B. The first named insured is responsible for the payment of all premiums C. The insurer may examine the insured's books and records at any time during the policy period D. The insured's rights and duties may be transferred to another party without insurer approval

d. The insured's rights and duties may be transferred without insurer approval

Policyholder J hit a deer with his Honda. J has collision coverage with a $250 deductible and Other Than Collision coverage with a $50 deductible. The damage to J's car was $450. How much will the policy pay? A. $400 B. Nothing C. $200 D. $150

A. $400 Collision with a bird or animal is covered by Other Than Collision coverage. The $50 deductible would apply.

An uninsured motor vehicle is any of the following, except: A. A company car B. A vehicle with liability limits less than the state requirement C. A vehicle insured by an insolvent insurance company D. A vehicle that does not have insurance

A. A company car

Select the person who is not considered an insured under an HO-3 policy? A. A friend who is renting a bedroom in the insured's house since it is only three blocks away from work B. A friend's 16-year-old daughter who is staying with the insured's family while going to school C. The insured's daughter away at college in another state D. The insured's resident uncle

A. A friend who is renting a bedroom in the insured's house since it is only 3 blocks away from work Since the friend is a tenant, not a relative or a person in the care of the insured, he/she would not be an insured under the policy.

Which statement is true of Section I of a Homeowners Policy? A. A special limit of $1,500 limit applies to watercraft B. Coverage is provided on owned golf carts and owned snowmobiles off premises C. Theft of a boat while away from the premises is covered D. Coverage on utility trailers is limited to $2,000

A. A special limit of $1,500 limit applies to watercraft A limit of $1,500 applies to watercraft of all types, including their trailers, furnishings, equipment, engines, and outboard motors. Loss resulting from wind or hail is excluded unless in a fully enclosed building.

Which of the following is not considered an uninsured motorist vehicle under the Personal Auto Policy? A. A vehicle newly acquired by the named insured that has not been reported to the insurer B. A hit and run vehicle C. A vehicle insured by a bankrupt insurance company D. A vehicle for which there is no liability policy

A. A vehicle newly required by the name insured that has not been reported to the insurer

What is the term for the idea that some risks are less desirable than average risks, and that these risks tend to seek coverage to a greater extent than more favorable risks? A. Adverse selection B. Estoppel C. Law of Large Numbers D. Sharing

A. Adverse selection

Which of the following is covered under Section II of a Homeowners Policy? A. An injury to a guest of the insured B. Liability arising from a business pursuit C. An injury to the insured's employee D. An injury to the insured's 10-year-old son

A. An injury to a guest of the insured An injury to a guest would be covered under Section II. Business pursuits, and injuries to insureds and their employees are excluded.

The rules and procedures to be followed by the insured and the insurer are found in which section of an insurance policy? A. Conditions B. Insuring Agreement C. Declarations D. Definitions

A. Conditions

Which of the following describes both the premium paid by the insured and the promise by the insurer to pay a covered loss and defend the insured in a lawsuit? A. Consideration B. Offer C. Legal Purpose D. Acceptance

A. Consideration

Choose the false statement about a Homeowners Policy. A. Earth movement is covered in all Homeowners policies B. Coverage C allows Coverage for loss due to theft of jewelry up to $1,500 C. Theft from a dwelling under construction is not included D. Trees, shrubs, and plants are covered up to $500 each Earth movement is excluded from all Homeowners Policies.

A. Earth Movement is covered in all Homeowners policies Earth movement is excluded from all Homeowners Policies.

A deer chews a hole in an insured's shed sitting next to a pond. Which of the following forms could cover this damage? A. HO-3 B. DP-1 C. HO-8 D. HO-2 The HO-3 Special Form covers everything except what is excluded. A deer is not a listed exclusion as it is not considered a bird, vermin, rodent, or insect.

A. HO-3

Construction material having a fire-resistance rating between one and two hours for walls, floors and roofs, is classified as: A. Modified fire-resistive B. Jointed Masonry C. Fire Resistive D. Non-Combustible

A. Modified fire-resistive

Rates that cannot be used until the Department or Division of Insurance approves them are referred to as: A. Prior approval rates B. File and use rates C. Open competition rates D. Use and file rates

A. Prior Approval Rates

For a loss to be covered under a standard property policy, the insured must do which of the following? A. Protect property from further damage B. Provide proof of loss within a year of the claim C. Contact an independent claims adjuster D. Obtain a written appraisal of the damages

A. Protect property from further damage

After an automobile policy has been in effect for 60 days, the insurer may cancel the policy for any of the following reasons, except: A. Submission of four or more claims during a single policy period B. Non-payment of premium C. Material misrepresentation of information on the application by the insured D. Suspension of the driver's license of the named insured's or household resident CORRECT!

A. Submission of four or more claims during a single policy period

Which of the following is not true concerning Section II of the Homeowners Policy? A. The Damage to Property of Others duplicates coverage that is included in Section I B. The coverage for Damage to Property of Others pays the replacement cost of the property damaged up to $1,000 per occurrence C. Payment under Damage to Property of Others is made regardless of negligence D. The coverage for Damage to Property of Others excludes property that is covered in Section I

A. The damage to property of others duplicates coverage that is included in section I The Damage to Property of Others Additional Coverage supplements the Property Damage Liability Coverage by providing limited Coverage for damage, caused by the insured, regardless of negligence. Coverage does not apply to property damage covered under Section I of the policy.

Which of the following is true about binders? A. The premium amount is not stated in a binder B. A binder will not end when the policy is issued C. A binder does not name the company providing coverage D. A binder always expires 15 days after its inception date

A. The premium amount is not stated in a binder A binder is a legal agreement that serves to effect insurance coverage temporarily until the actual insurance policy can be issued. It contains only the essential coverage information, except the premium amount.

Statements in the application that are guaranteed true, but later found to be false at the time of application, may result in which of the following? A. Voidance of the contract B. Nullification of the Warranty C. A waiver of the provisions of the warranty D. Establishment of a monetary penalty

A. Voidance of the Contract

All of the following are true of the Personal Auto Policy, EXCEPT: A.It is written only with split limits of liability B. It provides no coverage for personal effects in the vehicle C. It provides insurance for vehicles with a gross vehicle weight of 10,000 pounds or less D. It provides no-fault in states that require it

A. it is written only with split limits of liability Limits of liability may be either split or single. Personal effects would be covered by the owner's homeowners or renter's policy.

All of the following are true of automobile liability coverage, except: A. It pays up to $500/day for loss of income by the insured B. It provides third party protection C. It may be written with either split or single limits D. It protects the insured for losses when the insured is legally liable

A. it pays up to $500/day for loss of income by the insured Supplementary payments include compensation for loss of income up to $200/day.

Policyholder C's debit card is stolen, and $1,000 is subsequently stolen from his account. How much will his HO-3 pay for the loss? A. $1,000 B. $500 C. 0% D. $250

B. $500 Coverage up to $500 is paid for theft or unauthorized use of a credit card or electronic fund transfer card (debit card).

Under Part D, Within how many days must an insured report the purchase of a new vehicle that is replacing an existing vehicle covered by collision coverage? A. 15 B. 14 C. 5 D. 4

B. 14 If a vehicle covered by Part D coverages is replaced by a new car with the same coverage, the policy will automatically extend coverage for 14 days.

A Medical Payments claim will be paid by the insurer within how many months from the date of the occurrence? A. 60 B. 36 C. 18 D. 24

B. 36 A Medical Payments claim will be paid within 3 years for reasonable expenses for medical and funeral expenses regardless of fault.

The amount of insurance provided to cover personal property under Coverage C of a Homeowners Policy, is: A. 40% of Coverage A B. 50% of Coverage A C. 20% of Coverage A D. 60% of Coverage A

B. 50% of coverage A The basic amount of Coverage C insurance is 50% of the Coverage A Limit. This amount can be increased by payment of an additional premium.

Which of the following boats is covered under the Watercraft Liability endorsement? A. A jet boat B. A 20-foot sail boat C. A boat used to practice for a race D. A watercraft rented to another person

B. A 20-foot sail boat

Section II of a Homeowners Policy covers which of the following for medical payments? A. The named insured B. A guest of the insured on the residence premises C. A residence employee who is injured on the way home from work D. A tenant who lives in a portion of the insured's residence

B. A guest of the insured on the residence premises A guest would be eligible for medical payments. The residence employee would not be covered unless working in the course of employment by the insured.

The following statements regarding hazards are all correct, except: A. A moral hazard arises from a disposition for dishonesty B. A moral hazard arises from an attitude of indifference to loss C. Ice on a sidewalk is a physical hazard D. A gambling addiction could be a moral hazard

B. A moral hazard arise from an attitude of indifference to loss

The Homeowners Policy provides coverage for all of the following, except: A. A riding lawn mower pulling a two-wheel garden trailer B. A motorized golf car being driven on a public beach C. A motorized wheelchair D. An ATV on the insured's premises

B. A motorized golf car being driven on a public beach In order for coverage to apply, a motorized golf car must be used on a golfing facility or within a private residential community for approved purposes

First Aid Expenses under the Homeowners Policy would cover: A. Nonfamily residents of the household while on the premises B. A neighbor who gets injured while helping the insured install a carpet C. The Named Insured while on or off the premises D. Members of the insured's family while on or off the premises

B. A neighbor who gets injured while helping the insured install a carpet First Aid Expenses coverage applies to first aid to others caused by Bodily Injury covered under the policy, but does not pay for first aid to an insured.

Of the following, which is covered under Part D - Coverage for Damage to Your Auto? A. Radar and laser detection devices B. A newly acquired vehicle added to the policy within 14 days C. Custom painting on a van D. Road damage to tires

B. A newly acquired vehicle added to the policy within 14 days As long as a new car is added to the policy within 14 days, comprehensive and collision will be covered.

Which of the following vehicles is NOT CONSIDERED an uninsured vehicle under Part C of the PAP? A. A vehicle whose coverage is denied by its insurer B. A vehicle owned by the government C. A vehicle insured for less than the state's minimum required coverage D. A vehicle that disappears after a collision

B. A vehicle owned by the government Other vehicles that are not uninsured vehicles are company cars, self-insured, operate on rails or crawler treads, off-road vehicles, and those used as a residence.

An agent for ABC Insurance company is representing an insured in an insurance transaction. The principal in the agency relationship is: A. The agent B. ABC Insurance Company C. The insured D. The claimant

B. ABC insurance company

What is the name for an insurer authorized to write insurance policies in a particular state? A. Non-Admitted B. Admitted C. Domestic D. Foreign

B. Admitted

Which of the following methods of writing insurance is used to provide insurance on properties at different locations, using a single policy, and a single limit of insurance? A. Scheduled B. Blanket C. Unified D. Listed

B. Blanket

All of the following are methods of loss valuation, except: A. Actual cash value B. Blanket value C. Stated amount D. Replacement cost

B. Blanket Value

Under the Homeowners Forms, Coverage C includes which type of coverage? A. Other Structures B. Contents and Personal Property C. Special Damages D. Additional Living Expense

B. Contents and Personal Property

What is the purpose of the Extended Non-Owned Coverage for a Named Individual endorsement? A. Coverage is extended 25 miles into Mexico B. Covers non-owned vehicles furnished for the insured's regular use C. Covers an individual who does not own a car D. Extends coverage for a leased vehicle

B. Covers non-owned vehicles furnished for the insured's regular use

Which of the following statements regarding the Part A limit of liability under the Personal Auto Policy is FALSE? A. The limit of liability is the maximum the policy will pay in any one accident B. If the loss is covered under more than one Part of the policy, payment will be duplicated C. The limit of liability is the maximum the policy will pay regardless of the number of vehicles involved in the accident D. The limit of liability is the maximum the policy will pay regardless of the number of insureds

B. If the loss is covered under more than one Part of the policy, payment will be duplicated

Which coverage is not provided under Section II of a Homeowners Policy? A. Damage to property of others B. Medical expense of a boarder C. Personal injury liability D. Medical expense of a guest

B. Medical expense of a boarder Medical Expense coverage for a boarder (a person who receives regular meals when staying somewhere) or regular resident is excluded

When using a neighbor's lawnmower, the insured strikes a large rock and causes $2,000 in damage to the neighbor's automobile. Which policy section of the insured's Homeowners policy may pay for part of the damage? A. Loss of use B. Personal liability C. Personal property D. Dwelling, since the lawnmower is equipment used to service the residence

B. Personal Liability Section II Coverage E provides personal liability coverage for property damage to others due to actions of the insured. Under the additional coverage Damage to Property of Others, the limit is $1,000 of coverage.

Minimizing the chance of a loss is considered which of the following ways of managing risk? A. Sharing B. Reduction C. Avoidance D. Retention

B. Retention

Comprehensive covers all of the following losses, except: A. Contact with a deer B. Rollover C. Falling objects D. Theft

B. Rollover Rollover and hitting another vehicle or object are covered by collision coverage.

Which statement is true concerning Coverage D of the Homeowners Policy? A. The coverage will pay for all the insured's living expenses until the property is restored B. The coverage will pay for any increase in living expenses required to maintain the insured's normal standard of living C. If the insured must relocate permanently, payment will be made for 365 days, regardless of the time it takes the insured to settle at the new location D. The coverage will pay until the property is restored, plus 30 days relocation expense

B. The coverage will pay for any INCREASE in living expenses required to maintain the insured's normal standard of living

Choose the CORRECT statement regarding the HO-3. A. Coverages A, B, and C are all written on a Replacement Cost basis B. The dwelling and other structures are written on an Open Peril basis C. The contents are written on an Open Peril basis D. The dwelling and other structures are written on a Broad Form Perils basis

B. The dwelling and other structures are written on an Open Peril basis The HO-3 (Special Form) provides the broadest Coverage available on structures: Open Perils (or all-risk) Coverage.

Which of the following is true regarding eligibility of a Homeowners Policy? A. There may be no business occupancies in the dwelling B. The dwelling must be the principal residence of the insured C. The dwelling may be multi-family with up to 5 families D. The dwelling must be less than 30 years old

B. The dwelling must be the principal residence of the insured

An insured with a $500,000 HO-5 policy incurs $1,500 in damages due to a flood destroying the wood flooring. The policy will pay: A. $1,500 B. Zero C. $1,250 D. $1,000

B. Zero Flood is a section I EXCLUSION and is not covered

If the insured fails to use an available fire extinguisher to put out a shed fire that results in $1,000 damage, how much will an HO-3 Policy pay for the claim? A. $1,000 B. Zero C. $900 D. $500

B. Zero The neglect exlusion prevents coverage since the insured failed to use all reasonable means to save covered property

In Property and Casualty Insurance, when a form is attached to alter or add to policy provisions or conditions, it is known as: A. A warranty B. An endorsement C. An exclusion D. A consideration

B. an endorsement

Which of the following statements about the Personal Jewelry Floater is correct? A. Coverage is written on a replacement cost basis B. Automatic coverage for newly acquired items is only provided for 30 days C. The Pair and Sets Clause does not apply D. An appraisal of the item is optional

B. automatic coverage for newly acquired items is only provided for 30 days The Pair and Set Clause applies. Coverage is written on a valued or actual cash value basis and appraisal is required.

Which of the following is eligible to receive medical payments under Section II of a Homeowners Policy? A. The named insured's spouse B. A tenant who lives in a portion of the insured's residence C. A residence employee D.The named insured

C. A residence employee the residence employee is eligible, if injured in the course of employment

Under the Personal Auto Policy, medical payments do not apply to passengers occupying which of the following? A. A non-owned vehicle B. A van being used for shared car pools C. A van used in the insured's business in the course of employment D. A newly acquired vehicle

C. A van used in the insured's business in the course of employment Workers' Compensation coverage is an exclusive remedy for injuries incurred in the course of employment. Therefore, these injuries are excluded under Medical Payments coverage.

The limit of liability is the most paid by the insurer regardless of all of the following, EXCEPT: A. Number of vehicles involved B. Premiums shown C. Amount of surcharges to be applied to policy D. Number of insureds

C. Amount of surcharges to be applied to policy

Which of the following is used to resolve differences between the insured and the insurer? A. Subrogation B. Non-renewal C. Arbitration D. Liberalization

C. Arbitration

Which statement is false regarding uninsured motorist coverage under a Personal Auto Policy? A. Covered persons include the named insured, family members and any other person occupying the covered auto B. Coverage does not apply to a vehicle used primarily for use off public roads C. Coverage includes injuries suffered by someone using a covered vehicle without permission D. Coverage does not apply to any vehicle being used to carry property or persons for a fee

C. Coverage includes injuries suffered by someone using a covered vehicle without permission Coverage does not apply when a person is using the vehicle without permission.

Which of the following is false under the Personal Auto Policy? A. Medical payments may be provided for up to 3 years following an accident B. Coverage for damage to an insured vehicle is provided without regard to liability C. Coverage is provided for theft under property damage liability D. No-fault coverage is provided in states that require it

C. Coverage is provided for theft under property damage liability Theft is covered under Physical Damage (PART D), not property damage liability (PART A)

Which statement about the Homeowners Policy is false? A. Under Section II, coverage includes defense costs, at the insurer's expense, even if the suit is groundless B. The policy will not provide coverage for an insured that has intentionally concealed or misrepresented any material fact or circumstance C. First Aid Expenses include first aid to an insured in the event of an injury D. Under Section II, coverage applies only to bodily injury or property damage that occurs during the policy period Good Job!

C. First aid expenses include first aid to an insured in the event of an injury First aid expenses DO NOT APPLY to the INSURED OR RESIDENT OF THE HOUSEHOLD

Choose the physical damage claim that would be covered under the Personal Auto Policy. A. Mechanical breakdown B. Loss due to radioactive contamination C. Malicious mischief to the tires D. Loss due to war

C. Malicious mischief to the tires Malicious mischief is covered under Other Than Collision. The other items are excluded.

Which term describes the situation that occurs when two policies covering the same property contain different policy periods? A. Concurrent causation B. Coinsurance C. Nonconcurrency D. Blanket coverage

C. Nonconcurrecny

The HO-5 personal property coverages are insured on which basis? A. Broad Perils B. Basic Perils C. Open Perils D. Modified Perils

C. Open Perils The HO-5 is the broadest policy providing open perils coverage on Coverages A, B, and C.

Which of the following endorsements to the Homeowners Policy adds coverage for injury resulting from libel, slander, false arrest, defamation, invasion of privacy and other such offenses that could result in a personal liability suit? A. Additional Residence Rented to Others Endorsement B. Permitted Incidental Occupancies Endorsement C. Personal Injury Endorsement D. Business Pursuits Endorsement

C. Personal Injury Endorsement The personal injury endorsement provides coverage for injuries to others that are not of a physical nature

Which type of insurance provides coverage when insurance is not available from an admitted carrier? A. Foreign B. Residual C. Surplus D. Facultative

C. Surplus

All of the following statements regarding a property policy are correct, except: A. An indirect loss is an additional loss that results from a direct loss B. A deductible is a portion of a loss that an insured must bear C. The insuring agreement personalizes the policy, specifying the exact property being insured D. The conditions describe the responsibilities and obligations of the insurer and the insured

C. The insuring agreement personalizes the policy, specifying the exact property being insured

Which of the following best describes the Debris Removal coverage under the Homeowners policy? A. Debris Removal applies only to loss by fire, lightning, and windstorm B. The debris must be removed within 30 days of the loss C. The policy will pay the insured for removing debris from a covered loss D. Coverage is limited to 10% of the Coverage A Limit

C. The policy will pay the insured for removing debris from a covered loss Debris removal provides payment of the named insured's reasonable expenses for the removal of debris of covered property if a covered loss occurs.

Which of the following constitutes the acceptance of an offer? A. When the agent assures the applicant he or she will be covered B. When the insurer makes a counteroffer C. When an insurer issues a binder D. When the applicant completes the application

C. When an insurer issues a binder

What is the limit of insurance available under an HO-3 policy for a tree totally damaged in a hail storm? A. $250 B. $500 C. $1,000 D. 0%

D. 0% The most paid for a covered tree is $500 but coverage is not provided for windstorm or hail losses

A private passenger auto includes a leased vehicle as long as the lease contract is continuous for how many months duration? A. 12 B. 3 C. 9 D. 6

D. 6

Possibility of loss is called: A. A peril B. A hazard C. An insurable interest D. A risk

D. A risk

The Personal Auto Policy would not provide coverage for which of the following? A. A 5,000-pound pickup truck B. A vehicle used in a share-the-expense carpool C. A non-owned golf cart D. A vehicle with fewer than four wheels

D. A vehicle with fewer than four wheels The PAP does not provide liability coverage for vehicles with less than four wheels or designed for off-road use, except under certain circumstances.

Which of the following is covered under Part C - Uninsured Motorist Coverage? A. The insured is also covered by Workers' Compensation B. A family member is struck by an insured vehicle C. Punitive damages awarded for the insured D. Accident was caused by a hit-and-run driver

D. Accident was caused by a hit-and-run driver A hit-and-run vehicle can't be identified and is therefore considered uninsured.

Which of the following is not a duty of the insured if the insured's vehicle is damaged when it hit a tree? A. Submit to a physical exam B. Promptly notify the insurance company C. Submit a proof of loss D. Call the police

D. Call the police Calling the police is only a duty when seeking uninsured motorist coverage.

When a loss occurs as a result of two perils, one of which is excluded and the other of which is insured against, the situation is known as: A. Bilateral Causation B. Proximate Causation C. Supplemental Causation D.Concurrent Causation

D. Concurrent Causation

Under a Homeowners Policy, structures on the premises that are separated by a clear space from the dwelling, are covered under: A. Coverage C B. Coverage D C. Coverage A D. Coverage B

D. Coverage B

The HO-8 form settles losses to the building on what valuation method? A. Aggregate value B. Agreed value C. Replacement value D. Functional Replacement Value

D. Functional Replacement Value The loss valuation method for HO-8 is typically Actual Cash Value (ACV). However, if exact materials are not available, they may be replaced with materials that will perform the same function and have the same efficiency, even if they aren't of like kind and quality.

New home buyer S called his agent and told him that he wanted the broadest coverage available for his new home. Which policy would the agent be most likely to recommend? A. HO-2 B. HO-8 C. HO-3 D. HO-5

D. HO-5

The duties required of an injured person seeking coverage under Medical Payments to Others include all of the following, except: A. Promptly notify the insurer of any notice or demand B. Cooperate with the insurer C. Submit to a physical exam by the insurer's physician D. Help the insurer in settling the claim

D. Help the insurer in settling the claim An injured person isn't responsible for settling the claim

Which of the following claims would be covered under the Personal Injury Endorsement attached to an HO-3 Policy? A. Injury related to a business engaged in by the insured B. Civil activities for which the insured is paid C. Liability arising out of disputes between insureds D. Liability arising from publication of material that violates another person's right of privacy

D. Liability arising from publication of materials that violates another person's right of privacy

Which clause broadens coverage of an existing policy with no increase in premium? A. Loss payable B. Assignment C. Subrogation D. Liberalization

D. Liberalization

Which of the following is not a Supplementary Payment under Part A of the Personal Auto Policy? A. Reasonable expenses incurred at the insurer's request B. Up to $250 for the cost of bail bonds C. Payment for lost earnings up to $200/day D. Medical payments for an occupant of an insured vehicle

D. Medical Payments for an occupant of an insured vehicle

Which of the following is the broad term for an accident that also includes continuous and repeated exposure? A. Exposure B. Disaster C. Incident D. Occurrence

D. Occurence

Which of the following coverages is not included in a standard Homeowners policy? A. Bodily Injury liability B. Property Damage liability C. Medical Payments D. Personal Injury liability

D. Personal Injury Liability Coverage for Personal Injury (such as libel or slander) is not automatically provided in a Homeowners policy. It is available by endorsement.

Choose the use of an automobile that is not eligible for the Personal Auto Policy. A. Driving over 25,000 miles annually B. Transporting furniture for a neighbor who is moving to a new home C. Car pooling D. Pizza delivery

D. Pizza Delivery Delivery or commercial use of an eligible vehicle is ineligible under the Personal Auto Policy and requires a business auto policy.

The shifting of risk of loss to another party is known as which of the following? A. Risk avoidance B. Risk assumption C. Risk reduction D. Risk transfer

D. Risk Transfer

All of the following are true of a Homeowners Policy, except: A. Cemetery plots, burial vaults and vacant land are insured locations B. Coverage E is written on a single limit basis C. The language in Section II is the same in all Homeowners Policies D. Section II provides coverage for damage to the insured's property

D. Section II provides coverage for damage to insured's property

Gambling is considered which of the following types of risk? A. Pure B. Stable C. Insurable D. Speculative

D. Speculative

A ____________vehicle is a covered vehicle when Your Covered Auto is being repaired due to a covered loss. A. Replacement B. Conditional C. Substitute D. Temporary substitute

D. Temporary substitute

All of the following are true of the HO-2, except: A. The HO-2 covers owner-occupied dwellings B. The HO-2 pays for losses to the dwelling on a replacement cost basis C. The HO-2 covers the broad form perils D. The HO-2 pays for losses on an open peril basis

D. The HO-2 pays for losses on an open peril basis

An insured should not profit from an insurance transaction. This describes which of the following principles? A. The principle of utmost good faith B. The principle of subrogation C. The principle of personal aspect D. The principle of indemnity

D. The principal of indemnity

Under Coverage B of a Homeowners Policy, all of the following are included, except: A. A detached carport B. A building containing the insured's hobby woodworking shop C. The insured's garage rented to a neighbor for private garaging D. The renting of a garage to a neighbor for a woodworking business

D. The renting of a garage to a neighbor for woodworking business Most private structures on the residence premises are covered under coverage B IF THEY ARE NOT USED FOR BUSINESS PURPOSES

Which of the following is correct regarding Other Insurance under Part A of the Personal Auto Policy? A. The Personal Auto Policy is the primary policy in all cases of duplicate coverage B. If there is other liability coverage applicable to the insured auto, the policy will share the loss with the other policy on an excess basis C. There is no coverage for non-owned vehicles if there is other coverage applicable to such vehicles D. If there is other liability coverage applicable to the insured auto, the policy will pay the proportion that the limit of liability bears to the total of all limits

D. if there is other liability coverage applicable to the insured auto, the policy will pay the proportion that the limit of liability bears to the total of all limits Coverage A of the Personal Auto Policy shares with other applicable liability insurance on a proportional basis. However, it is excess over other insurance on non-owned autos.

Which of the following uses of a vehicle is NOT EXCLUDED under the Medical Payments coverage? A. An insured rides a motorcycle B. An insured drives a company car C. A neighbor uses the insured's car without permission D. Insured uses a truck for incidental purposes

D. insured uses a truck for incidential purposes

Each of the following is a Part A - Liability Coverage Supplementary payment, EXCEPT: A. Premiums on appeal bonds B. $250 for the cost of a bail bond C. $200 a day for loss of earnings due to an insurer request to assist in the trial D. Payment for all defense costs

D. payments for all defense costs Payment for all defense costs is part of the Part A - Liability Coverage Insuring Agreement, which also includes payment for bodily injury or property damage for which the insured is legally responsible.

Which of the following types of property are covered by the Personal Effects Floater? A. Paintings, etchings, and pictures B. Golfer's equipment C. Coin collections D. Personal property carried by travelers

D. personal property carried by travelers This floater covers a traveler's personal property on an open perils basis anywhere in the world EXCEPT at the insured's home. (The types of property listed in the other answer choices would require the Personal Articles floater.)

The insurer's limit of liability for a vehicle damaged by a loss under Part D is which of the following? A. Actual cash value B. Replacement value C. The greater of actual cash value and replacement value D. The lesser of actual cash value and replacement value

D. the lesser of actual cash value and replacement value

Limited Fungi, Wet or Dry Rot, or Bacteria Coverage Endorsement

The endorsement covers the insured's liability exposure in the event that a third party claims illness as a result of exposure to mold and the insured is deemed liable for the illness. The basic liability limit is currently $50,000 on an annual aggregate basis during the policy period for all fungi, wet or dry rot, or bacteria related damages. Insurers can also offer a higher optional liability coverage limit of $100,000.

Business Pursuits Endorsement

The endorsement extends liability coverage for the insured's involvement in a business that the insured does not own, have financial control over, or have a partnership interest in. The pursuit must be named in the endorsement, and is commonly added for those in the teaching, sales, and clerical professions.

Permitted Incidental Occupancies Endorsement

The endorsement modifies the Section II exclusions of liability and medical payments in connection with business pursuits of the insured to allow the necessary and incidental use of the premises for the business described on the endorsement. The premises must be occupied principally as the insured's residence; the business must be conducted by an insured; and there can be no other business conducted on the premises. The endorsement is commonly used for a studio, office, or private school type of occupancy. It does not cover bodily injury to any employee of the insured, except residence employees in the course of their employment.

If an insurer non-renews an insured's policy for underwriting reasons, what is the minimum number of days' notice to the insured? A. 45 B. 60 C. 30 D. 20

d. 20 days