ANIS 23 10-11 Q!
Which one of the following statements is correct with respect to the liability coverage available under businessowners policies (BOPs)?
Certain liability coverage options are not part of most BOP programs because the insureds that need them generally do not qualify for BOPs.
Which one of the following is a characteristic of a site-specific environmental impairment liability policy?
It provides coverage on a claims-made basis.
An environmental insurance policy that covers the loss exposures of a contractor performing environmental remediation services on contaminated sites is a(n)
Contractors pollution liability policy.
A bond that guarantees that investors will be paid both the interest due on municipal bonds and the principal when the bond matures is a
Credit enhancement financial guaranty bond.
BOP eligibiilty rules are based on
Criteria that relate to business size and complexity of loss exposures.
A company that needs coverage for theft of money and securities resulting from computer fraud should choose which one of the following insuring agreements in a cyber risk insurance policy?
Cyber crime
Which one of the following statements is correct with respect to rating a businessowners policy (BOP)?
It is usually much simpler than rating a comparable commercial package policy.
Which one of the following statements is correct with respect to crop-hail insurance?
It may also cover harvested crops against named perils while being transported to the first place of storage.
Frederico is a punch press operator at Tillson-Jones Manufacturing (TJM). When his press malfunctions, Frederico's hand and arm are badly mangled and he suffers a below-the-elbow amputation. Frederico sues the manufacturer of the punch press for his injuries and is awarded damages. The manufacturer then sues TJM to recover the damages it paid to Frederico, alleging poor maintenance of the equipment, insufficient employee training, and negligence in not requiring employees to use safety guards. TJM is insured under a Workers Compensation and Employers Liability Insurance (WC&EL) Policy. Which one of the following best describes how TJM's insurer would respond?
It would deny coverage because the WC&EL policy responds only to suits by employees against their insured employer.
Which one of the following can be insured under Coverage E—Scheduled Farm Personal Property of the ISO Farm Property—Farm Personal Property Coverage Form?
Livestock
ISO has developed standard endorsements to help insurers comply with the provisions of the Terrorism Risk Insurance Act (TRIA). When a policyholder accepts certified acts of terrorism coverage, the ISOCommercial Lines Manual requires the insurer to attach a cap endorsement for the applicable coverages. The purpose of the cap endorsement is to
Identify the $100 billion cap on annual aggregate insured losses that can be paid by the federal government and to outline the limitations of the insurer's obligations under the law.
A multinational enterprise may purchase coverages and combine them with a difference in conditions (DIC) policy written to wrap around the admitted coverages, thereby accomplishing which one of the following?
Maintaining uniform coverage for all the insured's locations
Clarence entered into a contract bond that guarantees his insulation work will be free from defects in materials and workmanship for a specified period of five years after completion of the work. The type of bond used by Clarence is a
Maintenance bond.
Which one of the following best describes the "property not covered" provisions of the businessowners policy (BOP)?
Many of the "property not covered" items listed in the BOP are specifically excluded because they relate to types of businesses that are not eligible for BOP coverage.
Which one of the following is true with regard to the coverage limits in the liability section of the businessowners policy (BOP)?
Maximum limits are more restricted than the CGL; few insurers offer per occurrence limits over $2 million in their BOPs.
Except for policies covering airlines, aircraft policies cover which one of the following?
Only the plane or planes specifically described in the policy
Which one of the following property coverages is often included or available as an option in a businessowners policy (BOP)?
Outdoor signs
Most insurers that offer businessowner-type policies for contractors rate the liability coverage for eligible contractors separately from the property coverages by applying a separate liability rate to the insured's
Payroll, receipts, or number of full- and part-time employees.
Officials generally required to obtain public official bonds include those whose duties involve which one of the following?
Seizing or disposing of property.
Which one of the following statements is true regarding insurance coverage for foreign operations?
Small to mid-sized businesses in the United States frequently must concern themselves with foreign exposures.
Which one of the following statements is correct with respect to eligibility for coverage under a businessowners policy (BOP)?
Some insurers have expanded the eligibility for their BOP programs to include restaurants and contractors.
A network administrator assists a client in performing upgrades to its computer hardware. The administrator makes several errors during the process and the client loses money when its system malfunctions repeatedly for the next two weeks. The client sues the network administrator and his company for loss of business income. Which one of the following insuring agreements is necessary to cover the administrator and his company against the suit under a cyber liability insurance policy?
Technology errors and omissions liability
Which one of the following statements is correct with respect to the businessowners policy (BOP)?
The available limits for certain property such as money orders are often quite low with minimal or no options for higher limits.
Which one of the following statements is correct regarding the maintenance of underlying insurance condition of an umbrella liability insurance policy?
The condition obligates the insured to monitor the required underlying coverages to ensure that they remain in force.
Even when the duty to select investments for an employee benefits plan has been delegated to others, such as in a mutual fund or brokerage firm, the fiduciaries may be responsible for which one of the following?
The errors or negligence of the investment managers
Aircraft passenger voluntary settlement coverage, also known as admitted liability coverage, pays benefits to a passenger only if the passenger released the insured from bodily injury liability and if
The insured asks the insurer to pay them.
A commercial airplane is taxiing on the approach to the runway when it collides with a stationary object, causing damage to its wing. The plane is insured by an all risks-ground and flight aircraft hull policy. Which one of the following statements is true regarding coverage for damage to the plane's wing?
The loss is covered because the all risks-ground and flight policy covers losses while the plane is in motion.
When insurers offer to sell new policies or offer to renew existing policies that are reinsured under the Terrorism Risk Insurance Act (TRIA), the law requires that certain disclosures be made to the policyholder at the time the offer is made. Which one of the following is a required disclosure under TRIA?
The portion of the policy premium that is attributed to certified acts of terrorism
Which one of the following statements best describes the purpose of a remediation stop-loss policy?
The purpose of remediation stop-loss insurance is to facilitate real estate sales where there is known pollution contamination on the property, but the total cleanup costs are unknown.
Which one of the following statements is correct regarding the maintenance of underlying insurance condition of an umbrella liability insurance policy if the underlying insurance is not kept in force?
The umbrella policy would cover claims that exceed the limits of the underlying policies as if they had been kept in force.
How are businessowners policies rated?
They are rated based on the amount of coverage provided.
Which one of the following is true with regard to Coverage E—Scheduled Farm Personal Property, Coverage F—Unscheduled Farm Personal Property, and Coverage G—Barns, Outbuildings and Other Farm Structures of the ISO farm program?
They provide coverage for true farming exposures.
One of the purposes of the Terrorism Risk Insurance Act (TRIA) aggregate limit endorsement is to limit the insurer's exposure. What is the other purpose of the TRIA aggregate limit endorsement?
To provide limited coverage for acts of terrorism at a reduced premium
Which one of the following is a type of excess insurance that is broader than ordinary excess liability insurance?
Umbrella policy
Peter has a Commercial Package Policy (CPP) that has a Building and Personal Property Coverage Form (BPP) with a Causes of Loss - Broad Form covering his building with a $750,000 limit. A tropical storm struck the area near Peter's building and the strong winds tore most of the shingles from the building's roof and shattered multiple windows with flying debris. An outside fixture also sustained heavy damage due to the wind. The total amount of damages was $40,000 for the windows and shingles; and $10,000 for the outside fixture. How much will Peter's insurer pay for damage to his outside fixture?
$10,000
Joe has a Business Auto Coverage Form with a $100,000 policy limit. In a claim that results in an $80,000 court award along with $50,000 for expenses due to defending the claim, what is the total amount that will be paid under Joe's Business Auto Coverage Form?
$130,000
Like auto liability insurance, aircraft liability coverage is usually not subject to which one of the following?
An aggregate limit
Which one of the following types of farm insurance is essentially term life insurance on animals?
Animal mortality
Which one of the following statements is correct with respect to the liability coverage provided by the businessowners policy (BOP)?
BOP liability coverage closely resembles the coverage provided by the occurrence version of the CGL coverage form.
Why are some of the "property not covered" exclusions in the Building and Personal Property Coverage Form (BPP) not included in the BOP?
Because some of the "property not covered" exclusions apply to types of businesses that are not eligible for a BOP.
Which one of the following statements is correct with respect to the liability coverage available under a businessowners policy (BOP)?
Both ISO and AAIS offer BOP endorsements adding employee benefit liability coverage and employment practices liability coverage.
Which one of the following statements is correct with respect to the business income and extra expense coverage provided by the businessowners policy (BOP)?
Business income loss and extra expenses are usually payable for up to 12 months following a covered loss.
Which one of the following property coverages is often included or available as an option in a businessowners policy (BOP)?
Employee dishonesty
CGL coverage differs from the liability coverage afforded to physicians as it relates to the source of liability. A physician's professional liability usually arises for professional practices or failure to act in a professional manner. An example of a medical error that causes injury and can result in liability is which one of the following?
Failing to properly diagnose a disease
Professional liability insurance is now available for more than just the technical professions. These occupations range from chemists to veterinarians, all of which entail liability for which one of the following?
Failure to use the degree of skill expected of a person in a particular field
Which one of the following types of property can be insured under Coverage E—Scheduled Farm Personal Property of the ISO Farm Property—Farm Personal Property Coverage Form?
Farm products, materials, and supplies
The businessowners policy (BOP) offers a major benefit for smaller insureds because
For an insured that owns no automobiles, the availability of hired and nonowned auto coverage under the BOP eliminates the need to obtain a separate business auto policy.
To meet the needs of firms with foreign loss exposures, some insurers offer a variety of specialized coverages, including all of the following, EXCEPT:
Foreign pollution liability
ABC, Inc., is a large, national retailer that sells a variety of consumer goods. ABC carries a Commercial Package Policy that includes Insurance Services Office's Commercial Crime Coverage Form (Loss Sustained) with the following insuring agreements: Employee Theft; Forgery or Alteration; Inside the Premises—Theft of Money and Securities; and Inside the Premises—Robbery or Safe Burglary of Other Property. The limit of insurance for each one of these insuring agreements is $100,000 and the deductible per occurrence for each one of these insuring agreements is $1,000. The policy year is 20X1.On June 5, 20X1, a thief entered ABC through an open window while the store was closed and stole $2,500 worth of electronic merchandise. The thief also broke into a safe causing $1,500 damage to the safe and stole $3,000 in cash from the safe. Under which insuring agreement would the damage to the safe be covered?
Inside the Premises—Theft of Money and Securities
In many cases, the law of a particular nation requires that coverage for properties in that nation be purchased from which one of the following?
Insurers licensed to engage in the insurance business in that nation
ISO and NCCI have developed endorsements to help insurers comply with the provisions of the Terrorism Risk Insurance Act (TRIA). Which one of the following statements about workers compensation endorsements created to implement TRIA is most accurate?
Unlike the disclosure endorsements developed by ISO for other lines of business, the NCCI disclosure endorsement includes acts of war among the losses that would be covered by workers compensation insurance under TRIA.