Practice Test Attempt #1

An insured suffers a windstorm loss in which the insured's driveway is blocked by two of the insured's tree and two of the neighbor's trees. The total amount of the removal adds up to the following: three trees at $300 per tree, and one tree at $600. how much will the insurer pay for the loss?

$1,000

In this state, what is the maximum fine for transacting insurance without a license?

$1,000

The maximum penalty that may be assessed for a single nonwillful violation of the insurance code is:

$1,000

The insured purchased $200,000 extra expense policy. If the percentages applying to the limit of insurance are 40%, 80%, and 100%, what would the maximum payable for a 47-day loss?

$160,000

An insured has an auto policy with limits of 25/50/15. the insured is involved in an accident caused by her negligence and is held legally liable for bodily injuries of 3 persons in the other auto as follows: "A" $15,000, "B' $30,000, and "C" $35,000. how much will her insurer pay in total for all injuries?

$50,000

If a policy is cancelled due to nonpayment of premium, how man y days' advance notice must the insurer give the policyholder before cancellation?

10 days

What is the amount of coverage that would be available for a detached garage under the coverage B - other structures of as homeowners policy?

10% of coverage A

If drivers complete defensive driving courses, how long will the discount apply for their premiums

3 years

How long is a waiting period upon purchase of flood coverage through NFIP?

30 days

If the premiums for a policy will be increased by more than 15%, how much warning must the insured get?

45 days

What is a foreign insurer?

An insurer with a home office in another state

What term includes damage where the insured peril was the proximate cause of loss?

Direct loss

An insurance company is domiciled in Montana and transacts insurance in Wyoming. Which term best describes the insurer's classification in Wyoming?

Foreign

What type of compensatory damages will pay for pain and suffering disfigurement?

General

The part of the insurance contract that describes the covered perils and the nature of coverage of the contractual agreement between the insurer and the insured is called the?

Insuring agreement

When ABC appliance's marketing stated that its mowing machine was the only safe mower available for purchase in town, ABC was sued by XYS lawn and garden. ABC's coverage would come from which part of its general liability coverage?

Personal and advertising injury liability

Which method of loss valuation is contrary to the basic concept of indemnity?

Replacement Cost

A driver whose license is suspended for violating financial responsibility laws must:

Surrender their driver's license

Robbery is:

Taking of property by use of force, violence, or fear

Surety bonds are written for a definite limit called:

The bond penalty

Which of the following is true regarding single dwellings that are insured to at least 80% of the replacement value?

They are automatically provided with replacement cost coverage

With respect to auto insurance, the term owned autos includes all of the following EXCEPT?

A pickup or van titled to and used in the named insured's business

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

Agreed Value

In insurance, an offer is usually made when?

An applicant submits and application to the insurer

If an insured needs protection on property other than money and securities inside the premises from losses cause by breaking and entering after business hours, which of the following crime coverage forms should be purchased?

Inside premises - robbery or burglary of other property

Coverage A - bodily injury and property damage in the commercial general liability policy will cover?

Losses due to the insured's negligence

All of the following would be covered under the medical expense coverage of a business owners policy EXCEPT?

Mental health counseling

All of the following statements are FALSE regarding garage physical damage coverage EXCEPT?

No coverage is provided for any auto stored for more than 45 days at a location shown in the declarations

The insured's car was hit and damaged by a deer. Under which of the following coverages in a personal auto policy would this loss be paid?

Other-than-collision

If a person is using an auto with the belief that he is entitled to do so, subrogation rights under a personal auto policy would apply to all coverages EXCEPT?

Physical damage

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

Professional liability

A nonresident agent is allowed to conduct insurance transactions in Georgia because his home state allows Georgia residents to transact insurance business in it. This is known as a/n?

Reciprocity agreement

Insurance is the transfer of

Risk

Payment for medical expenses, loss of wages, funeral expenses, or the cost to repair or replace damaged property are known as what type of compensatory damages?

Special

An insured owns several buildings, each at a different location and insured on a separate policy. What type of coverage does the insured have?

Specific

Which of the following symbols is available to an insured with vehicles subject to no-fault coverage?

Symbol 5

The mail coverage form is always written on a reporting form basis; after the end of each reporting period shown in the declarations, reports are due within?

30 days

What is the coinsurance requirement for a theatrical property floater under and inland marine policy?

80%

An uninsured motor vehicle includes all of the following EXCEPT?

A vehicle owned and operated by a self-insurer

An insured is driving her car through a residential area when she loses control and crashes into a neighbor's front porch. The neighbor, who was sitting on the porch, is injured. The insured's liability policy has a limit of $500,000. this amount applies to the total of damages for any bodily injury and property damage resulting from on accident. Which type of limit of liability does the insured have?

Combined single

A professional who wants coverage for all liability exposures should purchase what form of liability insurance?

Commercial general and professional

In any case where there is a controversy or dispute between the insurance company and the insured, the soliciting agent is the agent of the?

Company

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

Declarations

Which of the following is a mandatory part of an insurance policy that varies with each individual policy?

Declarations

Older homes with replacement cost greater than ACV or market value are insured on?

HO-8

When is liability coverage included in a homeowners policy?

It is automatically included

Which of the following is NOT true regarding a certificate of authority?

It is issued to group insurance participants

Losses caused by continuous or repeated exposure to conditions resulting in injury to persons or damage to property that is neither intended nor expected is the definition of what term?

Occurrence

For insurance purposes, when an insured loses property to another because the person used violence or threat of violence to gain the property, this is defined as:

Robbery

Under the commercial property coverage program, the basic causes of loss form insures against loss cause by:

Sprinkler Leakage

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

Stated Amount

The commissioner of insurance is?

The chief officer of the department of insurance

All of the following statements concerning coinsurance are true EXCEPT?

The coinsurance formula will also be applied to total losses

The occurrence form trigger is based on which of the following?

The date when injury or damage occurs

All of the following statements concerning liability coverage are true EXCEPT?

The policyholder can sue the insurer whether or not all conditions and provisions of the policy have been met

Which of the following terms refers to the acts of soliciting insurance, making an insurance contract effective, and dealing with matters arising from that contract?

Transacting insurance

Which of the following would NOT be considered part of the insured location under the liability section of a homeowners policy?

Vacant farmland owned by the insured

Personal business property out in the open is covered under commercial property policy while:

Within 100 feet of the described premises

Rates for private passenger motor vehicle insurance on file with the Commissioner are considered approved after?

45 days

Jean owns a craft store. The protective safeguards endorsement of her BOP requires the store to have a functional automatic sprinkler system. A winter storm freezes the pipes to the sprinkler system, causing the system to shut down. How many hours does jean have to restore the system before she must notify the insurer?

48 hours

In commercial auto insurance, what type of coverage will pay for loss or damage t o a covered auto by any cause other than collision or overturn?

Comprehensive

Because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements EXCEPT:

Conditions

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

Consideration

A unique feature in a bailee form is that it covers?

Customers' property whether or not the insured has been negligent