NY Practice exam w/feedback
Adjuster Andy is trying to determine a final settlement amount for Bob's claim. Bob's house was destroyed in a fire and it will cost $220,000 to rebuild it. Bob's homeowners policy has a limit of $210,000 and a $1,500 deductible. How much should Adjuster Andy's final settlement calculation be? A. $210,000 B. $220,000 C. $208,500 D. $218,500
A. $210,000 -Because the cost of repairs is more than the policy limit, the final settlement amount is the full policy limit ($210,000) and the deductible is absorbed into the amount of the loss that exceeds the limit.
In the event of a hit-and-run, an injured person who is eligible for MVAIC benefits must submit a Notice of Intention (NOI) to MVAIC within: A. 90 days. B. 180 days. C. 30 days. D. 10 days.
A. 90 days. -the event of a hit-and-run, an injured person who is eligible for MVAIC benefits must submit a Notice of Intention (NOI) to MVAIC within 90 days.
Which of the following employees would be covered under the Disability Benefits Coverage Law? A. A construction worker B. A farm laborer C. A golf caddy D. A Catholic priest
A. A construction worker
Dr. Keaton had an Occurrence Medical Liability policy with ABC Insurance from March 1, 2010 until March 31, 2013, at which time he switched to XYZ Insurance and a Claims Made policy. The policy with XYZ Insurance was in effect from April 1, 2013 until April 31, 2015. Which lawsuit would trigger the ABC Insurance policy to pay? A. A man sues Dr. Keaton on August 18, 2014 for a botched hip replacement surgery performed on October 10, 2012. B. A woman sues Dr. Keaton on February 26, 2014 for a bungled face lift performed on December 1, 2013. C. A woman sues Dr. Keaton on April 15, 2011 for a failed hysterectomy performed on February 6, 2010. D. A man sues Dr. Keaton on March 5, 2010 for a mistaken amputation performed on January 30, 2010.
A. A man sues Dr. Keaton on August 18, 2014 for a botched hip replacement surgery performed on October 10, 2012.
Which of the following cases would most likely NOT be covered under Workers' Compensation insurance? A. An employee filed a claim for work-related stress after receiving a job transfer. B. After dealing with breathing problems that have progressed over the past year, an employee finally discovers that chemicals in the factory where she works have given her lung cancer. C. A distillery employee was intoxicated due to fumes in the workplace, fell over a railing, and broke her wrist. D. A news reporter was hit in the eye by a ball at a company softball game which he was covering for the local paper.
A. An employee filed a claim for work-related stress after receiving a job transfer.
Nature's Best Vitamins is ready to invest in a new lab for their growing company. The company wants to make sure they have insurance coverage that will protect their interest in the new building and the building materials while construction takes place. What coverage should Nature's Best purchase for that purpose? A. Builder's Risk B. Preservation of Property C. Extra Expense D. Business Income
A. Builder's Risk
This type of crop coverage only pays after at least a 50% loss to a crop, and it only pays 55% of the price of that crop. The insured is not required to pay premiums. A. Catastrophic Risk Protection B. Revenue Protection with Harvest Price Exclusion C. Yield Protection D. Actual Revenue History
A. Catastrophic Risk Protection -The Catastrophic Risk Protection Endorsement only kicks in if at least half of the insured crop is damaged, and it pays 55% of the value of the crop. The federal government pays the premiums for this coverage.
Lillian owns an antiques shop and Sandy works part time for her. One afternoon, while Sandy is decorating the window display, she loses her balance and falls backward off a step stool, breaking some very expensive lamps in the process. What policy condition in Lillian's commercial property policy provides evidence that this loss may be covered? A. Control of Property B. No Benefit to Bailee C. Liberalization D. Subrogation
A. Control of Property
Which of the following statements about aviation policy deductibles is FALSE? A. If a loss takes place while the aircraft is being transported, the loss is subject to a fixed deductible. B. There are separate deductibles for when the plane is "in motion" and "not in motion." C. The deductible does not apply to losses from theft or robbery. D. Partial losses are usually subject to a percentage deductible.
A. If a loss takes place while the aircraft is being transported, the loss is subject to a fixed deductible.
Which of the following would be covered under Coverage B of a typical Business Owners Policy? A. Inventory B. Stock certificates C. An outdoor antenna D. Permanently installed fixtures
A. Inventory
Which of the following perils would NOT be covered by a commercial property policy with a Causes of Loss - Special Form attached to the Building and Personal Property Coverage Form? A. LuLu's Fine Jewelry must shut down for a month to repair flood damage. B. When a riot breaks out in the town square, Sam's Boutique is looted and vandalized in the commotion. C. Izzy's Furniture loses an entire warehouse in a fire caused by a lightning strike at a nearby power plant. D. A tornado whips through town, leveling a warehouse belonging to Built Industries.
A. LuLu's Fine Jewelry must shut down for a month to repair flood damage. -Flooding is one of the universal exclusions in the commercial property policy, so Lulu's Fine Jewelry would not be covered during thier shut-down for flood damage repairs.
Which of the following is NOT one of the objectives accomplished by an insurance company's periodic cybersecurity risk assessment? A. Manually update the FBI's cybercriminal "most wanted" database B. Find and evaluate both inside and outside risks to private information that the company has in its system C. Identify and stop cybercriminal attempts D. Help the company recover from any damage caused by cybercriminals
A. Manually update the FBI's cybercriminal "most wanted" database
After a fire destroys Gale's kitchen, she files a claim with her insurer and hires a contractor. The contractor estimates it will take $42,250 to repair the damage, but the adjuster estimates it will only take $38,340. Which of the following is the best option for the adjuster's response to Gale's claim? A. Negotiate a settlement amount with Gale. B. Reject Gale's request and deny the claim. C. Allow Gale and her insurer to settle the claim in court. D. Accept Gale's request and pay the claim.
A. Negotiate a settlement amount with Gale
Gary has UM/UIM coverage on his Personal Auto Policy. Which of the following losses would be covered under this coverage? A. Sam, Gary's neighbor who has liability limits high enough to cover the damages, intentionally runs into Gary's car with his own during an argument. B. Gary borrowed Sam's car without his permission, and was struck by Tom, who doesn't have auto insurance. C. Gary's wife hits Gary's car while backing out of the garage. D. Gary's car, which he uses during his part time job as an Uber driver, is damaged by a hit-and-run driver.
A. Sam, Gary's neighbor who has liability limits high enough to cover the damages, intentionally runs into Gary's car with his own during an argument. -Gary's UM/UIM would cover the damage caused intentionally by Sam, since Sam's liability coverage will not pay for intentional losses. This would leave Sam "uninsured" as far as Gary's losses are concerned, so Gary's UM/UIM would kick in.
What kind of adjuster is employed by only one insurance company and is paid by salary? A. Staff adjuster B. Independent adjuster C. Emergency adjuster D. Public adjuster
A. Staff adjuster
Which of the following is NOT a "covered" employee with regard to Workers' Compensation insurance? A. Teacher at a non-profit educational institution B. Paid staff-member of a non-profit organization C. Public school aide D. Corporate officer in a company with four stockholders
A. Teacher at a non-profit educational institution -not covered employees under the NY WC law.
Under what circumstances does an Area Revenue Protection policy pay an indemnity to an insured farmer? A. When the entire county experiences low crop production, falling commodity prices, or both B. When a peril destroys all of the farmer's crop C. When the farmer's actual revenue from his entire farm falls below the average revenue for the area D. When the mayor of a rural town declares the area to be experiencing a natural disaster
A. When the entire county experiences low crop production, falling commodity prices, or both
All of the following lines of coverage may be offered in a Commercial Package Policy, except: A. Workers' Compensation. B. Equipment Breakdown. C. Professional Liability. D. Boiler and Machinery.
A. Workers' Compensation.
A pre-defined monetary portion of an insurance claim paid by a policyholder is a: A. deductible. B. premium. C. co-insurance. D. replacement cost.
A. deductible.
An adjuster's preliminary report would most likely not: A. include the settlement amount. B. establish a claim reserve. C. document the initial contact with the claimant. D. list any known liability issues.
A. include the settlement amount.
When the settlement difference between an insurer and a claimant is minor: A. it should be settled in favor of the claimant. B. it should be settled in favor of the insurance company. C. a third party should be brought in to help reach agreement. D. the adjuster will need to work harder to reach an agreement.
A. it should be settled in favor of the claimant.
Daily Constructions has been contracted by the City to renovate the historic courthouse building. Daily Constructions has also purchased a surety bond from KLM Insurance, as one of the requirements to get the job. If Daily Constructions were to fail to complete the job, KLM would be responsible for paying the City up to $150,000. This amount is known as the: A. penal sum. B. contract bond. C. collateral. D. fiduciary amount.
A. penal sum. -The penal sum is the specified maximum amount the surety will be required to pay, if the principal defaults.
A bid bond ensures that the principal, if selected, is capable of taking on the project and will obtain the required: A. performance or payment bond. B. fiduciary bond. C. completion and maintenance bonds. D. attachment bond.
A. performance or payment bond
Jared is fishing from his 22-foot sailboat when he is caught in a sudden hailstorm. His boat suffers extensive hail damage. When he files a claim against his homeowners policy, he is upset to learn that his claim is denied because: A. the boat was not fully enclosed inside a building during the hailstorm. B. damage to sail boats is not covered by a homeowners policy. C. a homeowners policy will only cover watercraft smaller than 20 feet. D. damage to sail boats is only covered by endorsement.
A. the boat was not fully enclosed inside a building during the hailstorm.
Jackie recently inherited a life-sized marble statue of her great-grandfather. It is an irreplaceable antique, and it is nearly impossible to determine the ACV. Which type of policy would best indemnify Jackie in the event that the statue was ever damaged?
Agreed value policy
A large tornado ripped through Ken's farm and destroyed $4,000 of his $10,000 corn crop. Ken is covered under an MPCI policy with a Catastrophic Risk Protection Endorsement. How much indemnification can Ken receive from the Catastrophic Risk Protection Endorsement for this loss? A. $2,000 B. $0 C. $2,200 D. $4,000
B. $0
Heather's house is fully insured with a DP-3 with a limit of $85,000. One day, the house is struck by lightning, and despite the fire department's efforts, it burns to the ground. She still had a balance of $20,000 left on her mortgage at the time of the fire. What is the maximum indemnification that would go to Heather, the fire department, and her mortgage lender respectively? A. $85,000; $1,000; $85,000 B. $65,000; $500; $20,000 C. $84,500; $1,000; $20,000 D. $64,500; $500; $20,000
B. $65,000; $500; $20,000 -Heather's insurable interest in her home is $65,000, while her mortgage lender has an insurable interest in the $20,000 mortgage balance that Heather has not yet paid off. The policy will also pay up to $500 to cover Heather's Fire Department Service Charge, in addition to the Coverage A limit.
Which of these businesses may qualify for a Business Owners Policy? A. An auto repair shop B. An apartment building C. A parking garage D. A nightclub
B. An apartment building
Which of the following is NOT an endorsement commonly added to a Dwelling Policy? A. Dwelling Under Construction B. Annual Depreciation C. Theft D. Liability
B. Annual Depreciation -Annual Depreciation is NOT a common endorsement to the Dwelling Policy.
Jill was forced to close her convenience store and evacuate because of a strong hurricane that hit her town. Jill was not allowed to reopen her store for two weeks, so she lost two full weeks of income. Which additional coverage would indemnify Jill for this loss? A. Law and Ordinance Coverage B. Business Interruption Insurance C. Business Owners Liability Insurance D. Extra Expenses Coverage
B. Business Interruption Insurance
Daily Constructions has been contracted by the City to renovate the historic courthouse building. Daily Constructions has also contracted with KLM Insurance, which has agreed to act as the surety, but requires that Daily Constructions deposit $90,000 into a bank account under KLM's control until the job is finished. If Daily Constructions fails to complete the job for the City, it will forfeit the $90,000. What is this $90,000 called? A. A guarantee B. Collateral C. An indemnitor D. A surety bond
B. Collateral -Collateral is cash or valuable property put into a reserve controlled by the surety. The surety holds the cash or property until the principal completes its obligation, at which point the surety returns the collateral to the principal.
Joe is looking for information in his Standard Fire Policy, relating to policy cancellation, assignment, and subrogation. In which section would he find this information? A. Insuring Agreement B. Conditions C. Declarations D. Exclusions
B. Conditions
All of the following are true of the liability coverage in a Business Owner's Policy, except: A. Coverage is provided for both bodily injury and property damage from business operations and premises. B. Coverage is provided on a "claims-made" basis. C. Coverage comes with a series of separate aggregate limits. D. Coverage is provided for product and operation liability.
B. Coverage is provided on a "claims-made" basis.
Which of the following is not true about Business Income from Dependent Properties, an Additional Coverage in a Business Owners Policy? A. It provides coverage for lost income when a key supplier suffers damage that affects the insured. B. It is also known as Extended Business Operations Interruption coverage. C. It provides coverage when a key customer suffers damage that affects the insured. D. Coverage is provided at no extra charge to the insured.
B. It is also known as Extended Business Operations Interruption coverage.
Which of the following people is NOT occupying a vehicle that would qualify as "your covered auto" on the declarations page of his Personal Auto Policy? A. Sam is driving his BMW that he purchased 2 days ago and has not yet added to his insurance policy. B. Patrick borrows his neighbor's 45,000 pound semi truck to help his neighbor move. C. George is standing in the trailer he bought last year. D. Alex is driving a rental car while his own car is being repaired.
B. Patrick borrows his neighbor's 45,000 pound semi truck to help his neighbor move. -Over the weight limit
A garage policy is almost identical to a BAP, but it covers which two additional hazards? A. Products & Completed Operations and Freezing B. Premises & Operations and Products & Completed Operations C. Mechanical Breakdown and Premises & Operations D. Mechanical Breakdown and Freezing
B. Premises & Operations and Products & Completed Operations
Which aviation coverage would indemnify a farmer for damage to his crop if a plane crashed on his farm? A. Admitted Aircraft Liability B. Property Damage Liability C. Bodily Injury Excluding Passengers D. Airport Liability
B. Property Damage Liability
An HO-3 policy is intended for a/an: A. corporation. B. individual. C. small business. D. government entity.
B. individual.
In order to be considered "fully insured" at 80% or more, Richard must carry at least $240,000 in insurance coverage on his home. What is the value of Richard's home? A. $192,000 B. $240,000 C. $300,000 D. $216,000
C. $300,000 300,000( Full home value)-80%(coinsurance)=240,000(Amount needed)
Which of the following could be covered by a homeowners policy? A. A home used as a shelter by the local community B. A multi-family townhome housing five families C. A large home currently under construction D. A home that has been converted into a veterinary clinic
C. A large home currently under construction
ABC Manufacturing is covered by an Equipment Breakdown Protection Coverage Form which includes Business Income coverage. Which of the following is a TRUE statement regarding the Business Income coverage? A. In the event of a covered loss, coverage is provided for lost business income for as long as it takes to make needed repairs, regardless of how long it takes. B. ABC Manufacturing must supply the insurer with a yearly report detailing the company's income and expenditures in order to avoid a coinsurance penalty in the event of a loss. C. ABC Manufacturing must supply the insurer with a yearly report detailing the values of all the covered equipment in order to avoid a coinsurance penalty in the event of a loss. D. This coverage pays for extra costs that ABC Manufacturing incurs while making temporary repairs and expediting permanent repairs after a breakdown of covered equipment.
C. ABC Manufacturing must supply the insurer with a yearly report detailing the values of all the covered equipment in order to avoid a coinsurance penalty in the event of a loss - Business Income coverage has a valuation condition that requires the insured to give the insurance company a yearly report detailing the values of covered equipment. If the insured fails to supply this report, the insurer may apply a coinsurance penalty on covered losses.
Mike, a restaurant chef, was severely injured in an accident at work. His injuries will require surgery and rehabilitation. Mike has a Major Medical plan, but it will not cover this accident. Why? A. Major Medical plans are limited to preventative medicine. B. Mike's Major Medical plan does not cover rehabilitative specialists. C. Because the accident occurred at work, it would be covered by a Workers' Comp policy. D. Major Medical plans do not cover accidents.
C. Because the accident occurred at work, it would be covered by a Workers' Comp policy.
Which of the following coverages is typically included in a BOP? A. Coverage for company owned vehicles B. Malpractice coverage C. Coverage for slander and copyright D. Professional liability coverage
C. Coverage for slander and copyright
Monique has been appointed to manage Gretta's finances because the court has deemed Gretta to be incompetent. Part of the court-order required that Monique be bonded. What type of bond does Monique need to buy? A. Court bond B. Contract bond C. Fiduciary bond D. Finance bond
C. Fiduciary bond
All of the following are requirements for operating as a Group Self-Insurer in New York, EXCEPT: A. Group must contain at least two members in the same industry B. Employers must apply with the Workers' Compensation Board's Office of Self-Insurance C. Group members must have a combined payroll of at least $250,000 D. Group members must have a combined net worth of at least $1,000,000
C. Group members must have a combined payroll of at least $250,000
What are the two main types of coverage usually found in an aviation insurance policy? A. Hull coverage and Cargo Liability insurance B. Passenger Bodily Injury and Bodily Injury Excluding Passengers C. Hull coverage and Liability coverage D. Admitted Aircraft Liability and Hull coverage
C. Hull coverage and Liability coverage -Aviation insurance differs from other kinds of insurance in that there are no "standard" policies used by all insurers. Some contracts will include coverages or exclusions that won't be found in other policies. In general, however, an aviation policy contains Hull coverage and Liability coverage.
New U, an upscale beauty shop, wants to purchase a Business Owners Policy. Which of the following is a typical requirement that New U must meet in order to qualify for a BOP? A. New U must have 25% or less of its floor space open to the general public. B. New U must make at least $1,000,000 per year in revenue. C. New U's sales must not exceed $3,000,000. D. At least 25% of New U's sales must be from retail operations.
C. New U's sales must not exceed $3,000,000. -Processing and Servicing businesses qualify for the BOP if total annual sales do not exceed $3 million, and no more than 25% of sales occur off-premises.
Farmer Barb has purchased a $200,000 tractor to help her conduct farm operations. Due to its high value, Barb wants an insurance policy that applies only to her new tractor. Which type of insurance would Barb most likely purchase to cover her tractor? A. Household Personal Property coverage B. Unscheduled Farm Personal Property coverage C. Scheduled Mobile Agricultural Machinery coverage D. Excess Machinery coverage
C. Scheduled Mobile Agricultural Machinery coverage
Dean has cancer and is covered under a major medical plan. Which of the following coverages, sold as a supplement to Dean's major medical plan, would help him pay the high out-of-pocket costs related to his cancer treatments? A. Disability Income Insurance B. Medicare C. Specified Disease Insurance D. Credit Disability Insurance
C. Specified Disease Insurance
After Cindy crashes into Nancy's mailbox while driving drunk, she gets out of her car, trips over Nancy's sidewalk, falls and breaks her arm. She then sues Nancy for the medical bills related to her broken arm. They are in a state that follows the doctrine of comparative negligence. What is the likely outcome of Cindy's lawsuit against Nancy? A. Cindy will not receive anything because she was partially responsible for her injury. B. The case will be dismissed because Cindy was intoxicated. C. The amount awarded to Cindy will be reduced by the percentage of her own negligence. D. Nancy's liability insurance will cover all of Cindy's medical bills.
C. The amount awarded to Cindy will be reduced by the percentage of her own negligence.
Payment on a Mechanical Breakdown claim is subject to which of the following conditions? A. The insured must have paid the full amount of the premium when the vehicle was purchased. B. The insured must have the vehicle inspected every year. C. The insured must have taken reasonable care to minimize the cost of repairs. D. The insured must only take the vehicle to an auto repair shop on the insurer's approved vendor list.
C. The insured must have taken reasonable care to minimize the cost of repairs.
Sandra rear-ended Randy's car when he stopped quickly for a yellow light that she was sure they were both going to make. The damage was minor, but Sandra was worried her premiums would increase if the accident was reported, so she gave Randy $500 in an effort to keep it just between the two of them. However, Randy filed the claim with his insurance company and received a settlement check for $750. What has Randy violated? A. The principle of insurable interest B. The principle of subrogation C. The principle of indemnity D. The principle of loss minimization
C. The principle of indemnity
Which of the following losses would NOT be covered under Part D-Coverage for Damage to Your Watercraft in a Personal Watercraft Policy? A. John has to pay transport charges to have his damaged craft delivered to a repair facility. B. Jack has to pay recovery charges to salvage his sunken craft. C. Tim damages another boat while cruising on a lake. D. Jennifer's $500 Nikon Camera is damaged when her boat starts taking on water.
C. Tim damages another boat while cruising on a lake. -The damages that Tim causes to another boat would fall under liability coverage, not Part D-Coverage for Damage to Your Watercraft.
"Hepatic" means having to do with the ___________. A. large intestine B. bladder C. liver D. kidneys
C. liver
In a farm policy, what is the limit of coverage for cash, platinum, or gold personal property? A. $1500 B. $2500 C. $1000 D. $200
D. $200 -Coverage C - Household Personal Property limits coverage for cash, platinum, or gold (other than goldware) to $200.
Which of the following adjusters is acting appropriately as a fiduciary agent? A. Kim tries to calm an angry claimant by telling him that she's sure his claim will be covered, even though she has not yet determined the cause of loss. B. Gail investigates the claim and determines the loss is not covered, but writes up her estimate in such a way that it would appear to be covered so she could pay the claimant anyway. C. Victor finds additional damage that seems to be related to the claim, but he leaves it off of his estimate because the claimant didn't notice it in the first place. D. Ernest knows the claimant can't possibly afford to pay for their extensive damages, but he denies the claim anyway because the cause of loss was not covered by the policy.
D. Ernest knows the claimant can't possibly afford to pay for their extensive damages, but he denies the claim anyway because the cause of loss was not covered by the policy.
Which of these homeowners policy coverages does NOT usually have a deductible? A. Sewer Backup B. Debris Removal C. Personal Property D. Fire Department Service Charge
D. Fire Department Service Charge -Coverage for Fire Department Service Charge does not usually have a deductible. Personal Property and Debris Removal are subject to the policy deductible, while Sewer Backup is excluded in the homeowners forms.
All of the following statements are true regarding Medicaid, EXCEPT: A. To qualify for coverage, applicants must pass a means test. B. The program provides medical coverage for qualified individuals. C. The majority of the program is funded by the federal government and the states fund the rest. D. It is designed to provide health insurance for everyone 65 years of age or older, persons of any age with permanent kidney failure, and certain disabled people.
D. It is designed to provide health insurance for everyone 65 years of age or older, persons of any age with permanent kidney failure, and certain disabled people.
Coverage E refers to which part of a HO policy? A. Additional Coverages B. Dwelling C. Loss of Use D. Personal Liability
D. Personal Liability
What document do insurance companies give to claimants when they think something in the claim is not covered by the policy, but they are not sure yet? A. Declaratory judgment action B. Coverage clause C. Non-waiver agreement D. Reservation of Rights letter
D. Reservation of Rights letter
__________ connect muscles to bones, whereas _________ connect bones to bones. A. Tendons; cartilage B. Cartilage; tendons C. Ligaments; cartilage D. Tendons; ligaments
D. Tendons; ligaments
If a restaurant employee in New York City dies in a work-related accident on January 15th, 2017, Workers' Compensation benefits will pay up to ________ for the employee's funeral expenses. A. $12,500 B. $10,500 C. $5,000 D. $6,000
A. $12,500
Lena is moving to Japan for two years in order to take advantage of a promotion at her job. She won't bring her 4-seater propeller plane with her. What kind of aviation insurance should Lena purchase for her plane while it's in storage and she is away? A. All Risks - Not in Motion B. Admitted Aircraft Liability C. All Risks - Ground and Flight D. Hangarkeepers Liability
A. All Risks - Not in Motion
Which of the following statements does NOT apply to subrogation? A. The exact amount of subrogation will usually be determined by a court of law. B. Subrogation prevents injured persons from collecting twice on the same damages. C. A policyholder forfeits his right of recovery up to the amount of indemnification. D. Subrogation transfers the rights of the policyholder to the insurer.
A. The exact amount of subrogation will usually be determined by a court of law.
Most health insurance policies exclude: A. cosmetic surgery expenses. B. cancer treatments. C. injuries incurred while on vacation. D. pregnancy and childbirth.
A. cosmetic surgery expenses.
Which part of a homeowners policy provides coverage for the medical expenses of third parties who are injured on your property? A. Coverage D B. Coverage A **dwelling C. Coverage F ** medical D. Coverage C **personal property limit
C. Coverage F -In a homeowners policy, Coverage F pays for medical expenses of third parties who are injured on the insured's property.
Which of the following statements about Inland marine insurance is FALSE? A. Inland marine policies are often known as "floaters." B. Inland marine insurance can provide coverage for tunnels. C. Personal articles floaters cover property on a named-peril basis only. D. An inland marine policy can provide coverage for goods shipped by train.
C. Personal articles floaters cover property on a named-peril basis only.
Which of the following is TRUE of the Stamp and Coin Collection Personal Articles Floater of Inland Marine Insurance? A. Only blanket policy coverage is available. B. Coverage excludes paper money and banknotes. C. Under blanket coverage, the policy will only pay up to $1,000 for any unscheduled coin collection. D. Under blanket coverage, the policy will only pay up to $500 for any individual item, such as a stamp or coin.
C. Under blanket coverage, the policy will only pay up to $1,000 for any unscheduled coin collection. -Under blanket coverage, the policy will only pay up to $1,000 for any unscheduled coin collection (and up to $250 for any individual item, such as a stamp or coin).
All private passenger insurance policies written under the New York Automobile Insurance Plan are required by law to include which of the following? A. Replacement cost coverage for the insured auto B. Liability limits of at least 50/100/50 C. Up to $1,000 in Medical payments coverage D. A $500 deductible
C. Up to $1,000 in Medical payments coverage
In connection with an insurance business transaction, an adjuster should never: A. begin a claim investigation later than 5 business days after receiving the claim. B. deny, in writing, any portion of a claim due to a specific policy provision. C. advise any person on questions of law. D. take special care to clearly represent the facts of a claim.
C. advise any person on questions of law.
In order to obtain auto liability coverage through the New York Automobile Insurance Plan, an applicant must: A. have no moving violations on his driving record. B. have been unable to get coverage in the voluntary market during the past 120 days. C. have a valid drivers license. D. be over the age of 25.
C. have a valid drivers license.
Zayden has just landed his plane and it is still moving very quickly down the runway when another plane crashes into the side of his plane and causes extensive damage. For the purposes of aviation insurance, this occurrence took place while Zayden's plane was: A. not in flight. B. not in motion. C. in flight. D. in transition.
C. in flight.
If the Superintendent serves a licensee a written notice of a hearing on the violation of insurance code, he must give the licensee _______ notice of the hearing. A. 5 business days' B. 14 days' C. sufficient D. 10 days'
D. 10 days'
This Ocean Marine insurance coverage protects the vessel owner in the event that cargo shipping costs are not paid. A. Protection and Indemnity B. Hull coverage C. Cargo coverage D. Freight insurance
D. Freight insurance
The primary purpose of the Insuring Agreement is to specify the ____________ of an insurance policy. A. policy period B. damages C. location D. coverages
D. coverages
Shaking a baby might cause all of the following, EXCEPT: A. diffuse brain injury. B. acquired brain injury. C. primary brain injury. D. focal brain injury.
D. focal brain injury.
Moriah's plane is damaged and is being towed to a repair facility. For the purposes of aviation insurance, her plane is: A. in flight. B. in motion. C. in transition. D. not in motion.
D. not in motion.
Janine's hair salon was already having a bad year when a client slipped, broke her hip, and sued the salon for $100,000. Relieved that she had just purchased an excess liability policy last month, Janine hopes she can use that, leaving her base liability policy untouched. This is not possible because: A. all excess liability policies have a 10% per occurrence clause. B. an excess liability policy pays only when the base policy limit has been exhausted. C. Janine's excess liability policy is a Stand Alone policy. D. there is an imposed waiting period of 45 days for all excess liability policies.
B. an excess liability policy pays only when the base policy limit has been exhausted.
The ___________ is the organ responsible for filtering out urine from the blood. A. liver B. kidney C. pancreas D. spleen
B. kidney
Coil springs are used on most cars and ________ springs are used on most truck and heavy duty vehicles. A. shock B. leaf C. kinetic D. suspension
B. leaf -Leaf springs are used on most truck and heavy duty vehicles.
In a Dwelling policy, Coverage A provides protection for: A. land surrounding the principal dwelling. B. construction tools left outside next to the building. C. structures attached to the principal dwelling. D. a detached garage.
C. structures attached to the principal dwelling.
Orlando's house was fully insured when it was completely destroyed by a tornado. All that's left is a huge pile of debris and a $167,000 mortgage balance. Orlando files a claim against his DP-3 with a $220,000 limit. Normally, the cost of debris removal is subject to the policy limit, but Orlando's total costs exceed his limit. Once all cleanup and repairs are completed, what is the maximum indemnification the insurer could end up paying for the dwelling and debris removal? A. $220,000 for the dwelling, plus up to $8,350 for Debris Removal. B. $167,000 for the dwelling, plus up to $8,350 for Debris Removal C. $167,000 for the dwelling, plus up to $11,000 for Debris Removal. D. $220,000 for the dwelling, plus up to $11,000 for Debris Removal.
D. $220,000 for the dwelling, plus up to $11,000 for Debris Removal. -Debris Removal coverage can pay up to an additional 5% of the coverage limit, when needed. Since Orlando's Coverage A losses exceeded his policy limit, his policy can pay up to $11,000 (since this is 5% of $220,000) over and above that limit for the cost of removing the debris of Coverage A property.
Jim's 16-year-old son Dan wants to get insurance for his expensive mountain bike. He calls ABC Insurance, and says he would like to purchase an Actual Cash Value policy on his $3,000 bike. When they are finished talking, the ABC Insurance informs Dan that they cannot sell him the policy. What is most likely the reason for this?
No. This is because, in order for a contract to be legally binding, both parties to the contract must be 'competent.' In many states, a person would not be considered legally competent until he is 18 years old.
After wrecking her car on an icy road, Lilly filed a claim with her insurer, ABM Insurance, who dispatched Richard to investigate her claim. Who is the principal in this scenario? A. ABM Insurance B. This information is not provided in the scenario. C. Lilly D. Richard
A. ABM Insurance
In a Commercial Package Policy, interline endorsements: A. apply to at least two coverages or lines of insurance within the policy. B. apply to only one line of insurance within the policy. C. allow businesses to add more lines of insurance than are usually covered by a Commercial Package Policy. D. allow payments to be made under one line of coverage in the policy before a settlement is reached under a different line of coverage.
A. apply to at least two coverages or lines of insurance within the policy.
When a licensee receives a letter notifying her that she has been fined by the Superintendent, how long does she have before the fine must be paid? A. 30 days B. 20 days C. 10 business days D. 14 days
B. 20 days
Caitlin works as a driver for a local oil company. She picks up the field workers and drops them at the wellsite. Then, once their shift is completed she brings them home again using the company van. Which endorsement provides the best coverage for Caitlin? A. Customized Equipment B. Extended Non-Owner C. Miscellaneous Vehicle D. Non-Owner
B. Extended Non-Owner
Which of the following is NOT one of the unfair claims settlement practices specifically prohibited by New York law? A. Failing to promptly acknowledge communications about a claim B. Failing to pay a claim settlement within 5 business days of receiving a proof of loss C. Not attempting in good faith to bring about a prompt, fair claim settlement when liability is reasonably clear D. Knowingly misrepresenting pertinent facts or policy provisions to a claimant
B. Failing to pay a claim settlement within 5 business days of receiving a proof of loss
Which of the following is NOT one of the disciplinary powers of the Superintendent of Financial Services? A. Issue a cease and desist order B. Impose a jail sentence of up to 1 year C. Impose a fine of up to $2,500 D. Revoke the license of any insurance adjuster or producer
B. Impose a jail sentence of up to 1 year
Skip's Convenience Store suffers severe fire damage after a gas pump explodes. The adjuster asks if the emergency shutoff system, which is required by the policy, was properly maintained and functional at the time of the accident. Skip says "yes," even though the system was actually broken at the time. Which of the following statements is true? A. Skip is guilty of concealment and violating a binder, so the insurer could deny the claim. B. Skip is guilty of misrepresentation and violating a warranty, so the insurer could deny the claim. C. Skip is guilty of misrepresentation and violating an estoppel, so the insurer could deny the claim. D. Skip is guilty of concealment and violating a warranty, so the insurer could deny the claim
B. Skip is guilty of misrepresentation and violating a warranty, so the insurer could deny the claim.
Jack is awaiting trial after his arrest, but he would rather wait at home than in jail. He cannot be let out of jail without a guarantee that he will show up to the trial, so he purchases a: A. fiduciary bond. B. bail bond. C. fidelity bond. D. contract bond.
B. bail bond.
When a storm rolled through town a month ago, John's home suffered substantial damage. He filed a claim, but his insurer has offered a settlement much lower than John feels is fair. Each party selects an appraiser, who in turn agree on an umpire, to help settle the claim. If two of the three parties agree, their decision is: A. suggested. Either party may walk away at any time. B. binding. C. only legally binding if both the insurer and the claimant agree to it. D. partially binding.
B. binding.
Every time Duke goes to the doctor, he has to pay $25 and his health insurer is billed for the rest. This $25 out-of-pocket expense is Duke's: A. capitation. B. copayment. C. deductible. D. coinsurance.
B. copayment.
In a Dwelling policy, the Glass or Safety Glazing Material Coverage will not cover: A. direct damage to covered items caused by broken glass. B. damage to abandoned buildings caused by broken glass. C. the breakage of a covered building's glass caused by earth movement. D. storm doors broken by earth movement.
B. damage to abandoned buildings caused by broken glass.
In order to qualify for disability benefits through Social Security, a person must: A. be a Federal employee. B. have a physical or mental condition that prohibits any type of work and is expected to last for at least one year or result in death. C. have worked for at least 15 years, and have 40 credits. D. have an injury that arose out of and in the course of employment.
B. have a physical or mental condition that prohibits any type of work and is expected to last for at least one year or result in death.
If a claim includes lost wages, an adjuster should: A. first determine when the injured party can return to work. B. verify the loss with the employer. C. prioritize it over other claims. D. make sure that lost wages are paid first.
B. verify the loss with the employer.
Oscar is covered for fire and lightning under his basic Standard Fire Policy, but he is concerned about facing financial losses related to other perils. Which of the following would be TRUE for Oscar? A. He must purchase a new policy that covers the additional perils for which he is seeking coverage. B. He can purchase endorsements for protection from additional perils, but only during the grace period between policy terms. C. He can purchase exclusions for protection from additional perils at any time. D. He can purchase endorsements for protection from additional perils at any time, with his insurer's agreement.
D. He can purchase endorsements for protection from additional perils at any time, with his insurer's agreement. -Oscar can add coverage for additional perils by adding endorsements to his policy, with his insurer's agreement.
Rosa's barn burned down when it was struck by lightning during a storm. The barn was insured for $45,000 under Rosa's Farm policy, which included a replacement cost endorsement with an 80% coinsurance requirement. At the time of the loss, the barn's Actual Cash Value was $35,000, but it will cost $60,000 to replace it. How will Rosa's insurer respond to her claim? A. The insurer will give Rosa one check for $35,000, and another for up to $21,250 once repairs are completed. B. The insurer will give Rosa one check for $35,000. C. The insurer will give Rosa one check for $45,000, and another for up to $11,250 once repairs are completed. D. The insurer will give Rosa one check for $35,000, and another for up to $10,000 once repairs are completed.
D. The insurer will give Rosa one check for $35,000, and another for up to $10,000 once repairs are completed. -Rosa's policy will pay the actual cash value of her barn first ($35,000). Then, once Rosa has finished rebuilding it and submits the receipts to her insurer, the insurer will pay the remaining expenses, up to her policy limit of $45,000. This means it can pay up to $10,000 more after she completes repairs.
Coverage L in a Personal Liability Supplement provides: A. coverage similar to Coverage E in a homeowners policy, but it doesn't cover the insured's legal defense. B. no-fault coverage for necessary, reasonable medical expenses for a third party injured on the insured's premises. C. at least $1,000 in loss assessment coverage. D. coverage for both bodily injury and property damage to a third party for which the insured is legally liable.
D. coverage for both bodily injury and property damage to a third party for which the insured is legally liable. -Coverage L in a Personal Liability Supplement provides coverage for both bodily injury and property damage to a third party for which the insured is legally liable. It also pays for the insured's legal defense costs in a covered claim.
In a typical Workers' Compensation policy, Part 2, Employer Liability insurance: A. has a limit of $50,000 per accident. B. states that Workers' Compensation is an exclusive remedy for employee injuries, thus employers are not liable for further damages. C. excludes coverage for employee injuries when the employer took on the risk of such injury via signed contract. D. covers the employer when employees claim injuries not subject to Workers' Compensation law.
D. covers the employer when employees claim injuries not subject to Workers' Compensation law.
