NYS License Exam Study Guide
Prior to an insurance policy paying on a claim, an insured must pay a certain dollar amount on the claim. This is referred to as
A deductible.
Under a personal auto liability coverage, damages to a vehicle may be covered if the person driving the insured vehicle is
A family member in the same household.
Workers compensation rating is developed by applying a Rating Bureau's job classification rate to what increment of payroll?
$100
In insurance, the term "loss" is defined as
The reduction, decrease, or disappearance of value of the person or property insured in a policy, by a peril insured against.
All of the following are perils covered under the broad form dwelling policy EXCEPT
Theft.
Aleatory in nature refers to:
Unequal exchange by two parties
An unidentified hit-and-run driver would be considered an
Uninsured motorist
A coverage extension under a commercial crime policy may cover theft by employees outside of the coverage territory for
Up to 90 days.
Under the Motor Carrier Act of 1980, haulers transporting oil must maintain liability limits of at least
$1,000,000
The businessowners policy liability coverage will pay for necessary medical expenses of others incurred within what maximum time limit?
1 year
A workers compensation policy cannot be cancelled prior to its expiration date unless a notice of policy cancellation has been sent to the insured at least how many days in advance?
10 days
When the health insurance policy premium is paid monthly, the grace period is
10 days
A person who knowingly obtains information on a consumer from a consumer reporting agency under false pretenses may be imprisoned for up to how many years?
2 years
An insured's homeowners policy covers an antique dining set. After a water pipe bursts, the insured moves the set to a storage shed to protect it from water damage. What is the longest period of time the homeowners policy will extend coverage to the dining set?
30 days
According the cancellation and nonrenewal condition in homeowners policies, if an insurer needs to cancel a policy due to a change in risk after the policy has been in effect for more than 60 days, the insurer must provide the insured a notice of cancellation of at least
30 days.
How long is a temporary license valid in New York?
90 days
Which of the following actions would be considered an offer?
An applicant submitting the application
Which of the following is an example of an indirect loss?
An insured not being able to stay in the home and having to stay in a hotel because of the fire damage to the home
Which of the following best describes a proximate cause?
An unbroken chain of events resulting in a loss
An agent accepts the premium payment 35 days after it is due, telling the insured that the policy will continue to remain in force. This is an example of what type of agent authority?
Apparent
Under the businessowners property coverage form, which common policy condition addresses what will happen if the insured and the insurer do not agree on the amount of damage?
Appraisal
First aid costs for others injured on the insured's premises
Are paid in addition to the liability limit.
How soon after the aggregate limit have been met on a liability policy would the limit be restored?
At the policy anniversary date
In an auto insurance policy, what does the first limit represent in split liability limits?
Bodily injury to one person in a single accident
Which of the following commercial property causes of loss forms explicitly covers damages from falling objects?
Broad form
Which of the following constitutes forced entry into another person's premises with felonious intent?
Burglary
Which special liability policy would cover claims for wrongful acts committed by a general manager of a corporation?
Directors and officers liability
Under the Affordable Care Act, all of the following are the required essential benefits EXCEPT
Disability income coverage
Which of the following perils would NOT be covered under a BOP form?
Earth movement, power failure, and flood
Which of the following would protect an employer from legal action resulting from a work-related sexual harassment claim
Employee practices liability insurance
Which of the following watercraft will be covered under Section II - Liability Coverage of a businessowners policy?
Nonowned watercraft less than 51 feet long
Which of the following types of policies are issued by stock companies?
Nonparticipating
Which of the following commercial forms would cover costs associated with a temporary worksite while damages to an office building are being repaired?
Extra expense
Which of the following would NOT be covered under the supplementary payments provided under Coverage A - Bodily Injury and Property Damage of a CGL policy?
Up to $500 a day for loss of income
Liability where proof of fault or negligence is not required is defined as
Absolute.
An agent who solicits and files applications for the sale of life insurance represents
The insurer.
The voluntary compensation endorsement in workers compensation coverage provides statutory coverage for which types of employees?
Farm workers
If an insured changes their name, the change may be reflected on the insurance policy by attaching what to the policy?
A signed endorsement
Which of the following would guarantee the performance of another person or entity?
A surety
Which of the following would be covered under Coverage C - Personal Property of a dwelling policy?
Canoes
Which of the following would NOT be used by an insurer when determining the premium rate of a workers compensation policy?
Claims experience
Declarations Page
has first named insured
The maximum amount of money the insurance company will pay for a particular loss, or for loss during a period of time is known as what?
Limits of liability
A transportation network company driver must maintain a primary automobile policy with minimum coverage of at least
$75,000/$150,000/$25,000.
Which of the following is used to determine the actual cash value of property?
Replacement cost
How are premiums affected if an insurance policy has the additional or supplementary coverage provision?
The premium is not affected.
Which of the following must be provided to every insured for each excess line policy?
A total cost form
Which of the following businessowners policy (BOP) endorsements provides coverage for the inability to collect monies due from customers as the result of a covered cause of loss?
Accounts receivable
What type of law requires employers to provide workers compensation coverage to employees?
Compulsory
Which of the following provisions requires an insurer to receive an insured's approval, prior to paying out a professional liability policy claim?
Consent to settle a loss
What insurance principle means something of value that each party gives to the other?
Consideration
Which of the following limits shown in the declarations of a Businessowners policy applies to medical expenses?
Per person
An insured has an HO-8, modified coverage form. While the insured is on vacation, his $1,500 laptop is stolen. How much coverage is provided under the HO-8 for this loss?
Nothing; HO-8 forms do not cover theft of personal property off premise.
Which party to a surety bond is the person or entity to whom a guarantee is made?
Obligee
When would uninsured motorist (UM) coverage apply?
Only when the other party is legally liable but has no insurance
Commercial property policies written together into a single contract are referred to as
Package policies.
Over several years, a policyowner paid $10,000 in premiums for his insurance policy. When he suffered a loss, the insurance company paid out $50,000 in benefits. What characteristic of an insurance contract does this describe?
Aleatory
Which of the following damages is the most subjective when determining compensation?
General damages
Which of the following is NOT a feature of broad theft coverage under a dwelling policy?
It is automatically covered under DP-3 - Special Form.
When is liability coverage included in a homeowners policy?
It is included automatically
A homeowner lives in a 150-year-old adobe building that is on the National Register of Historic Places. The homeowner has HO-8 coverage. If a fire destroys part of the roof, which of the following describes the insurer's responsibility?
Partial roof replacement to current code specifications
Which of the following refers to the upper limit a liability policy will pay out for all claims that arise from a single accident?
Per occurrence
Government insurance programs are funded by
Taxes.
According to the general rules of agency, an agent represents
The insurer.
In insurance contracts, consideration on the part of the insured is
The payment of premiums and representations made in the application.
An insured driver has a personal auto policy with a medical payments coverage limit of $20,000. If the driver sustains $20,000 in bodily injuries and a passenger sustains $25,000 in injuries, how much would the policy pay each injured person?
$20,000
In a liability policy with split limits of 20/40/10, what is the maximum amount payable for bodily injury to two or more people per occurrence?
$40,000
Records pertaining to a transportation network company's trips must be maintained for a period of at least
6 years.
What percentage of a person's weekly wage will workers compensation benefits provide for loss of income?
66 2/3%
Which of the following would NOT be covered under a dwelling property policy?
A farm used to raise and sell cattle
Which of the following would be eligible for Coverage F - Medical Payments in the event of injury at the insured's premises?
A full-time maid
Of $10,000 in premiums a producer wrote over the past year, $3,000 came from sales to a business which employs the producer's spouse. This is considered
A legal practice.
Which of the following homeowners forms would be best for a person renting half of a duplex?
Contents broad form (HO-4)
Under the Commercial General Liability form, which of the following coverages provides protection for bodily injury and property damage suffered by third parties?
Coverage A
When an insured wishes to add a personal property replacement cost endorsement to a homeowners policy, an insurer may require the insured increase the amount of
Coverage C
Which of the following commercial liability policies would protect an insurance agent from providing incorrect advice to customers?
Errors and omissions liability
In group health insurance, which of the following terms applies to the calculation of premiums based on the experience of the group as a whole?
Experience rate
Which of the following is NOT an insured's duty after an accident or loss?
Hire an appraiser to evaluate damages
An insured operates a photography studio in an outbuilding in the backyard of the insured's house. What endorsement would be added to the homeowners policy to cover this business?
Permitted incidental occupancies
Which of the following is NOT a coverage part of a commercial package policy?
Personal articles floater
Section I of a homeowners policy would cover which of the following?
Personal property
The Guaranty Association is formed to protect which of the following?
Policyowners
Limited fungi, wet or dry rot, or bacteria endorsement in HO policies applies to
Property and liability losses.
What is the purpose of requiring licenses for persons who transact insurance?
Protect the general public
Which of the following is NOT required of an insured after a loss in a homeowners policy?
Replace lost property within 30 days
In insurance, the uncertainty of an individual sustaining a loss in the future is classified
Risk.
An insured's child ran into a neighbor's planter on his bicycle and broke the planter and ruined the plants. The cost of replacement is $400 for the planter, and $100 for the plants. Which section of the insured's homeowners policy would pay?
Section II with no deductible
Which of the following standards is used to determine premium rates under the Affordable Care Act (ACA)?
Family composition
Which special liability insurance is designed to protect a business from financial mismanagement claims?
Fiduciary liability
Which of the following commercial auto coverage forms provides coverage to businesses that repair vehicles?
Garage coverage
Which of the following perils is excluded in all dwelling policy forms?
Government action
All of the following types of property may be covered under Coverage E of a farm policy EXCEPT
Growing crops
A couple has just purchased a condominium. Which of the following policies would they use to insure their dwelling?
HO-6
Which of the following principles describes creating or increasing the chance of loss?
Hazard
The principle of negligence is defined as
The failure to use the care that a reasonable person would have taken under the similar circumstances.
In which of the following situations would a property be considered unoccupied?
The insured went on vacation for a month while the house remained empty.
Which of the following is true regarding commission sharing by insurance agents?
Commissions can only be shared with a person authorized and licensed in the same line of authority.
A license and permit bond is designed to guarantee a recipient
Complies with laws and regulations associated with their profession.
An employer has agreed to be legally responsible for all work-related injuries and diseases. In return, the employees know that they will not be able to sue the employer for work-related incidents caused by the employer's negligence. This is called
Exclusive remedy
The provision in workers compensation coverage that requires an employer to pay compensation without regard to negligence and according to a compensation schedule set by law, and for the injured employee to agree to limit the employer's responsibility to the amount of workers compensation to which he or she is entitled, is called
Exclusive remedy.
What is the maximum amount an employers liability insurable policy would pay for the bodily injury of an employee in any one accident?
$100,000
An employee is injured working in a state other than her home state. This injury will be covered
If the state in which the injury occurred is listed in the other states' insurance section of a workers compensation policy.
