Florida 2-20 Agents License Exam Questions
Joe has a Personal Auto Policy with one car with liability of 10/20/10, basic PIP, 10/20 UM and no Med Pay. His Florida neighbor has an identical policy on her car. Joe is driving her car, loses control, and hits a tree. Joe is hurt with $15,000 in medical bills. What is the maximum Joe can collect from UM from all sources from this accident?
$0
Joe has a Personal Auto Policy with one car with liability of 10/20/10, basic PIP, 10/20 UM and no Med Pay. His Florida neighbor has an identical policy on her care. Joe is driving her car, loses control; and hits a tree. Joe is hurt with $15,000 in medical bills. What is the maximum Joe can collect from UM from all sources from this accident?
$0
Sally insures her house with an unendorsed HO-3—Special Form (HO-3) with a Coverage A—Dwelling limit of $275,000, which is the replacement cost of the house. A fire destroys the house including a collection of blueprints belonging to Sally's employer, valued at $10,000. Sally was storing the blueprints at her home while her office was changing locations. Assuming no deductible applies, how much, if any, will Sally's HO-3 insurer pay to replace the blueprints?
$0
HO-8 can be broadened to include off-premises theft losses up to:
$1,000
What is the standard deductible for Citizens homeowners policies not including mobile homes?
$1,000 all other perils/2% hurricane
The basic limits for loss assessments for both Section I and II of the HO-3 are
$1,000 in both Section I and II
A Florida insured has a Personal Auto Policy providing PIP coverage with a $1,000 deductible. The insured is injured in his vehicle and sustains $15,000 in medical bills. How much will his policy pay under PIP?
$10,000
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. During 20X1, two employees, Beth and Jim, in collusion, stole money and merchandise from ABC. Beth and Jim stole money on May 1, 20X1 and August 13, 20X1. They also stole merchandise on January 15, 20X1 and September 29, 20X1. The amount of the money loss totaled $15,000 while the amount of the merchandise loss totaled $110,000. With respect to applying the limit of insurance applicable to the employee theft loss, how much will the insurer pay for the employee theft loss?
$100,000
What is the basic limit that applies to each occurrence for BI and PD under the CGL?
$100,000
What are the basic liability limits under Section II?
$100,000 per occurrence/$1,000 medical payments
All of the following are deductibles for FAJUA Physical Damage Coverage EXCEPT:
$2,500
What is the maximum amount available for expediting expenses under the Boiler and Machinery coverage form?
$25,000
Basic limits for Hospital Professional Liability are
$250,000/$750,000
Basic limits for the Hospital Professional Liability form are:
$250,000/$750,000
Under the Businessowners policy, mercantile, wholesaler, service or processing risks gross sales cannot exceed:
$3,000,000 in gross sales
Joe has a Personal Auto Policy with two cars and UM limits of 25/50 stacked. He also has basic PIP and $1,000 Med Pay. He is involved in an accident where a hit and run driver runs into his car. He has $42,000 in medical bills. How much would his UM pay?
$31,000
Frank has a Personal Articles Floater with a fine arts schedule covering a painting. Coverage is in the amount of $5,000. A three year old child comes in the house and ruins the painting by marking it up with a black marker. The painting is now worthless. The company has located the exact same painting for $2,000. What will the policy pay?
$5,000
If an agent violates any provision of the Unfair Methods of Competition and Unfair or Deceptive Acts statute they could be subject to the following fines:
$5,000 for each non willful violation and $40,000 for each willfull violation
The standard deductible in the Boiler and Machinery coverage form is:
$500
What is the standard deductible for Employee Theft?
$500
What is the standard deductible for Commercial Property insurance?
$500 except hurricane
What is the basic limit for Fire Damage Liability under the CGL?
$500,000
Business Income and Extra Expense under the Businessowners policy includes all of the following EXCEPT:
$500,000 limit
Joe has Personal Articles Floater covering a musical keyboard he uses for personal use only. While away on vacation in Europe the keyboard is stolen. He had it scheduled for $1,000. To purchase a new keyboard the cost would be $1,250. The company could get the same item at a used musical store for $750. What would the policy pay?
$750
Joe has a Personal Auto Policy with Liability of 25/50/25. He hits a car with four (4) occupants from Minnesota, all of whom are hurt. They all sue. The first sues for $20,000; the second sues for $35,000; the third sues for $22,000; the fourth sues for $18,000. The car Joe hit has $8,000 in damage. The company spends $20,000 on a law firm defense. Ignoring any PIP or Med Pay, what is the total cost to the company for Joe's claim?
$78,000
Which one of the following statements is correct with respect to the business personal property coverage provided by the Building and Personal Property Coverage Form (BPP)?
'Your business personal property' specifically excludes labor, materials, or services furnished by the insured on the personal property of others.
Florida law requires not less than a _________ day grace period for monthly premium policies.
10 day
Personal Inland Marine coverages are generally rated based on a rate per ______ dollars, varying by class.
100
The "maximum period of indemnity" endorsement is an optional endorsement in the Business Income Coverage form and it provides coverage after the period of restoration for what period of time:
120 days
To be eligible for Citizens, the applicant must certify they are unable to obtain and have not received an offer, for residential property insurance, from any authorized insurer that is less than ____________ percent higher than the price quoted through Citizens.
15
The valuation clause provides for placement cost coverage on all covered property, except if repair or replacement is not made within how long?
18 months
To qualify for a general lines license, the applicant must be:
18 years old
Business Auto policy extends to trailers with a load capacity of:
2,000 lbs of less
Florida Law requires not less than a ________ day notice for cancellation of a health insurance policy.
20 day
How long do appointments last?
24 months
Tier 1 rates are set at _________ above comparable voluntary market rates.
25 percent
The Florida Workers Compensation Joint Underwriting Association (FWCJUA) has how many different Tiers?
3
How many days does an agent have to notify the DFS if their contact information changed?
30 days
How many days does the Building and Personal Property Coverage form extend coverage for newly acquired buildings or new buildings under construction?
30 days
Once license, you have how long to obtain an appointment?
48 months
A policy with Citizens may be replaced with a policy from an authorized insurer at any time during the policy period with a ________day notice.
60
For claims to be considered to have been made on the last day of the policy period under the basic extended reporting period, the claim has to be received and recorded with how many days after the policy expiration?
60 days
For Business Income, the period of restoration begins:
72 hours after the date of the direct damage
Small Business Boiler and Machinery required property damage limits is:
80% of building replacement value
How many days of automatic coverage are provided for an accident to an object at a newly acquired location, subject to the highest limit and deductible as stated in the Declarations for the same type of object?
90
Joe has a standard DP-3 on his Florida home with the following coverages: A-$80,000; C-$20,000. Which of the following would be covered, ignoring a deductible:
A $3,000 TV set burns in a fire
Which one of the following types of risks generally would be eligible for the businessowners policy program?
A clothing store.
Which one of the following is an example of injury or damage arising from an occurrence that would be covered by the products and completed operations liability portion of the Commercial General Liability (CGL) Coverage Form?
A defective gas range manufactured by the insured explodes causing injury.
In the liability coverage agreement of the business auto policy, the insurer expresses its three distinct duties. Which one of the following is among these duties?
A duty to pay covered pollution cost
For commercial auto insurance, a truck, tractor, or trailer is non-zone rated if it is
A light truck operating over any distance.
What are Permanent Impairment benefits based on?
A medical impairment rating schedule approved by the Division of Workers' Compensation
Which one of the following claims would be covered under Coverage B - Personal and Advertising Injury Liability of the Commercial General Liability Coverage Form (CGL)?
A store manager accuses a young man of shoplifting, apprehends him, and locks him in a storage room until the police arrive. When it is discovered that the young man is innocent, he files a claim against the store.
Which one of the following would NOT be eligible for coverage with the FAJUA?
A tourist renting a moped
All of the following are not true regarding property coverages under the Businessowners policy EXCEPT:
ACV on personal property
This insurance provides coverage for expenses, including loss of income, arising from accidents.
Accident Insurance
This coverage is written as an adjunct to Passenger Liability, not applicable to passengers carried for hire.
Admitted Aircraft Liability Coverage
Physical damage insurance provided to cover loss or damage to an insured aircraft, in motion, not in motion or both, is___________ insurance.
Aircraft Hull
This coverage is written to cover public and passenger liability and property damage liability.
Aircraft Liability
This coverage provides protection very similar to premises and operations liability under a Commercial General Liability Policy.
Airport and Air Meet Liability
If the FWCJUA experiences a deficit in either Tier 1 or 2, funding would come from where?
An assessment for 1 year on all WC policies in the voluntary market
An example of when a permit bond may be required , would be:
An athletic event
Which one of the following would be covered under Part Two of the Workers Compensation and Employers Liability Insurance Policy?
An employee is exposed to disease during the policy period but symptoms don't appear until after the employee is fired.
Mitchell is a highway contractor whose company is covered with a workers compensation policy and an unendorsed business auto policy. Which one of the following losses would be covered by his business auto policy?
An employee runs over a subcontractor's equipment with an owned auto.
Which one of the following is correct with respect to the professional liability coverage available under the businessowners policy (BOP) and the Commercial General Liability (CGL) Coverage Form?
An important difference between the BOP's liability coverage and the CGL's is the availability of optional professional liability coverage endorsements for use with BOP.
Federal workers compensation statutes apply to which one of the following workers?
An interstate railroad worker
All of the following are controlled Commercial Inland Marine lines EXCEPT:
Annual Transit
This is an uncontrolled form that protects the shipper or receiver of goods against loss to goods in transit throughout the year.
Annual Transit Policy
Which one of the following types of business is usually eligible for coverage under a businessowners policy?
Apartment building
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.
This type of Bond guarantees the appearance of a defendant in court.
Bail Bond
The following are "Supplementary Payments" under the Personal Auto Policy EXCEPT:
Bail Bonds up to $300
What type of bond guarantees if a bid is accepted, the bidder will satisfy further bonding requirements?
Bid Bond
Temporary insurance is effected through:
Binders
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 Garage Insurance policy endorsement deletes liability coverage for damage to the insured's own products?
Broad Form Products
For a DP-2 policy, which is correct?
Building and contents are named peril.
Citizens homeowners does not include coverage on all the following EXCEPT:
Building under construction for named insured
What coverage option applies to those being relied upon to deliver materials or services to the insured?
Business Income from Dependent Properties
Work that is to be completed in not over 10 days for less than $500 and not in the employer's normal business is called:
Casual labor
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.
A _____________ is required in order for an insurer to transact insurance in Florida.
Certificate if Authority
All of the following are Optional Coverages under the Buisnessowners policy EXCEPT:
Collapse
All of the following coverages are available for FAJUA commercial vehicles over 10,000 lbs EXCEPT:
Collision
Liability coverage for loss exposures arising from a business organization's premises and operations, its products, or its completed work is typically provided by
Commercial general liability insurance.
A description of the property insured, a list of mortgagees, and the applicable coinsurance percentage(s) are shown on which one of the following documents?
Commercial property declarations
An animal damaged the interior of an insured's automobile while it was parked with the windows down. Which one of the following types of physical damage coverage under the Business Auto Coverage Form would cover this loss?
Comprehensive
The contract where the obligation of the insurer to perform may be conditioned upon the insured satisfying certain conditions is called:
Conditional contract
The Health provision that states the insurer can refuse to renew the policy under certain conditions is called:
Conditionally Renewable
Citizens provides commercial coverage for which one of the following?
Condo Associations
Which one of the following is not eligible for an HO-4?
Condo unit owners
When both the Condominium Association form and the Condominium Unit Owner apply to a loss, the claim is paid as follows:
Condominium Association is primary
What is a unique peril for Dry Cleaners?
Confusion of goods
All "keep-out" and "take-out" plans of Citizens are subject to the ___________ statute.
Consumer Choice
The contract wherein the parties are of unequal bargaining power and one party cannot negotiate the terms and has to take the offer as made is called:
Contract by Adhesion
The __________ is an uncontrolled form that covers heavy equipment, machinery and tools contractors used in the course of business.
Contractors Equipment Floater
Which one of the following statements is correct?
Contractors must usually provide evidence of liability insurance before a construction contract is granted.
All of the following are eligible for the PAP policy EXCEPT:
Corporations
All of the following are Major Medical Insurance exclusions EXCEPT:
Cosmetic surgery required by accident
This type of bond is furnished by both the plaintiffs and defendants in litigation to protect the opposing party from loss in the event the principal fails to show a legal entitlement to the remedy sought.
Court Bond
This is the fundamental purpose Medicare Supplement policies.
Cover medical costs not payable under the Federal Medicare Program
The XYZ Finance Company is insured under an ISO Commercial Crime policy. One month after the policy inception date, XYZ acquired ownership of a smaller finance company including its premises and employees. Which one of the following best describes XYZ's responsibility under the Consolidation—Merger or Acquisition condition of the policy?
Coverage applies automatically for 90 days, but XYZ must promptly notify the insurer and pay the appropriate additional premium for coverage to continue beyond that time.
The WB Bank (WBB) uses several outside companies to help process a large number of credit card transactions on a daily basis. WBB carries an ISO Commercial Crime Form with a Computer Fraud insuring agreement selected. After a recent audit, WBB becomes aware that a significant number of credit card transactions have somehow disappeared from the computer system. Which one of the following is most likely true regarding coverage under the Computer Fraud insuring agreement?
Coverage is excluded for credit or debit card transactions.
Which of the following is covered under "Extended Coverage" in a DP-1 policy?
Damage by aircraft
The Commercial Property Floater Dealer's policy covers primarily:
Damage to merchandise while on the business premises.
A claim under an ISO Commercial Crime Coverage Form is subject to the Valuation—Settlement condition. Which one of the following is true regarding this Valuation—Settlement condition?
Damaged property is valued at replacement cost or the insurer can repair or replace the property
Knowingly making false or maliciously critical comments to injure a person is known as:
Defamation
The Florida Comprehensive Hurricane Damage Mitigation Program was established within the
Department of Financial Services
After a loss the insured must do all the following except:
Discontinue premium payments
Which Business Auto policy endorsement covers the insured for use of autos they do not own?
Drive Other Car Coverage
Which one of the following property coverages is often included or available as an option in a businessowners policy (BOP)?
Employee dishonesty
In the Liability section of the Businessowners policy, the General Aggregate limit is:
Equal to twice the Liability and Medical Expenses limit
Under the HO-3—Special Form (HO-3) Section I—Conditions, the Loss Settlement condition
Establishes the process for determining the amount to be paid for a property loss.
If a loss is covered by recoverable insurance, the Crime policy will be:
Excess
All of the following are BI and PD exclusions under the CGL EXCEPT:
Excessive Liability
All of the following are exclusions under Garage Insurance Physical Damage coverage EXCEPT:
Expected losses
When there is damage to covered property, reimbursement will be provided for the cost of temporary repairs and to expedite permanent repairs or replacement, based upon this coverage extension:
Expediting Expenses
Named perils for the Aircraft include all of the following EXCEPT:
Explosion
Joe works for Tastee Burger, Inc. As part if his compensation package, he is supplied with a company car that he gets to take home each night. Joe wants to make sure that the Liability coverage under his own Personal Auto Policy covers him while driving the company car. What should he ask his agent to add to his own policy?
Extended Nonowned Liability coverage
Which additional insuring agreement, under the Crime Policy, covers threats to do bodily harm to the insured, employee, relative or invitee of either?
Extortion
Which of the following state-created markets provides coverage for employers who are unable to secure workers' compensation coverage?
FWCJUA
Which one of the following statements is true with regard to workers compensation statutes?
Federal government workers are excluded from workers compensation because they are covered under alternate plans.
What type of bond guarantees performance by a person appointed by the court?
Fiduciary and Court Bonds
How can a Corporate Officer be exempt from WC coverage?
File a notice with the Division of Corporations
How can partners and sole proprietors elect to be covered for WC?
File election form with the Division
Sam did not meet financial responsibility requirements at the time of his auto accident. To avoid penalties, Sam must meet all the following conditions EXCEPT:
Fill out a release report from the Department of Motor Vehicle
James is in the process of forming his own brokerage company which will include several employees. James will be best protected by purchasing which one of the following to cover the crime loss exposures of his company?
Financial Institution Bond.
All of the following Special Limits can be increased EXCEPT:
Firearms from $2,500 to $10,000
This is a market source in Florida for persons who are unable to purchase auto insurance through normal channels.
Florida Automobile Joint Underwriting Association
What type of Ocean Marine deductible has no payment until the loss reaches a certain limit?
Franchise deductible
Inside the Premises - Theft of Money and Securities covers loss of money and securities resulting from all the following EXCEPT:
Fraud
This provision allows the insured to return the policy within a certain number of days and receive a full refund.
Free Look
When cargo is shipped __________, the buyer assumes responsibility for the cargo once goods reach the designated point.
Free on Board (FOB)
Of the different roof types, which one does not receive any type of discount?
Gable
A term used to indicate a partial loss resulting from a sacrifice of cargo to save remaining property (jettison) Each party then shares in the loss in proportion to their total interest in property being transported
General Average
All of the following fall under the definition of sliding EXCEPT:
Giving the applicant a portion of the commission
If law enforcement officials seize an insured's personal computer to search for files that might be related to a crime, the insured under an HO-3—Special Form (HO-3) may be unsuccessful in claiming a theft loss on the computer due to the
Governmental Action exclusion.
The Health provision that requires the insurer to renew the policy to a stated age is called:
Guaranteed Renewable
The Health provision that states the company may not cancel during the policy term, but reserves the right to nonrenew the policy under its expiration is called:
Guaranteed Renewable
Which of the following is NOT a standard form that Citizens issues policies on?
HO-5
A condominium unit owner would use which form?
HO-6
All of the following forms will apply to owner-occupants of 1-4 family dwellings EXCEPT:
HO-6
Jim and Sue, a young married couple, are under contract to purchase a condominium unit. Which one of the following ISO policy forms is best designed to meet their homeowners insurance needs?
HO-6—Unit-Owners Form
This is a form of bailee insurance that covers the insured's liability for damage to aircraft stored for safekeeping or repair.
Hangarkeepers Liability Coverage
Which cycle usually spawns more unauthorized entity fraudulent activity?
Hard cycle
The Roof Deck Attachment must have all the following approvals EXCEPT:
Have roof inspected by DFS
A Commercial Package policy may include the following coverage types EXCEPT:
Health
Which one of the following best describes one of the major differences between liability coverage provided by the typical businessowners policy (BOP) and the Insurance Services Office (ISO) Commercial General Liability (CGL) Coverage Form?
Hired and nonowned autos liability coverage is usually offered by BOPs, either as part of the form or by endorsement.
This type of coverage pays a flat amount per day for hospitalization, regardless of expenses or other insurance.
Hospital Indemnity Insurance
This policy is designed to provide indemnification to the insured for basic hospitalization expenses of room and board in the hospital, nursing care, lab fees, operating room, medical supplies and related items.
Hospitalization Expense Insurance
The 3 categories of benefits under the WC law are all of the following EXCEPT:
Household services up to 60 days
Alterations or additions made to the building at the expense of an insured who does not own the building and who cannot legally remove them are referred to as
Improvements and betterments.
Sometimes the existence of insurance encourages losses. The result of this phenomenon is that it
Increases the total cost of insurance
The process of restoring an individual or organization to a pre-loss financial condition is the process of
Indemnification
This is a type of license bond that holds governmental body harmless from any injuries or damage caused by the principles activtities.
Indemnity Bond
The contract where one should not profit from the response by the policy is called:
Indemnity contract
This is a type of inland marine policy that is designed to cover equipment or machinery in transit to, or being installed in the course of construction or renovation:
Installation Floater
Florida law states this a contract whereby one undertakes to indemnify another or pay or allow a specified amount or a determinable benefit upon determinable contingencies.
Insurance
The Office of Financial Regulation regulates all of the following EXCEPT:
Insurance companies
Which one of the following statements is correct regarding the benefits provided by insurance?
Insurance helps reduce the financial burden to society by compensating accident victims.
Which of the following is a supplemental payment benefit under a Personal Auto Policy>
Interest accruing after judgement
Which one of the following is true regarding the ISO Commercial Crime Coverage Form Joint Insured condition?
It appoints the first named insured as an agent for all insureds.
Which statement is true concerning auto Physical Damage coverage in a Personal Auto Policy?
It can cover both an owned and nonowned auto
Which one of the following statements about employers liability coverage is true?
It does not cover punitive damages for injury or death of any illegally employed person.
Which statement is true concerning Liability coverage in a Personal Auto Policy?
It gives coverage only to those with the status of "insured".
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.
10% for a self-storage facility does not apply to personal property that is moved from the residence premises because:
It's being repaired
All of the following can be an insured under the Lawyers Professional Liability policy EXCEPT:
Lawyers for their services after termination
What satisfies the Florida Financial Responsibility Law for all situations other than DUI?
Liability of 10/20/10.
This insurance is designed to assist clients who are now dependable on others for care.
Long term Care
The Computer Store (TCS) brought a claim under the Employee Theft insuring agreement of its ISO Commercial Crime Coverage Form. TCS's claim is based on an inventory shortage. To overcome the inventory shortages policy exclusion, TCS must demonstrate that the
Loss can be established wholly apart from inventory computations.
Technical Corporation (TC) is covered by an ISO Commercial Crime Coverage Form with Inside the Premises and Outside the Premises insuring agreements. During a recent audit, TC discovered a significant monetary loss due to an accounting omission. Which of the following best explains the insurer's response to a claim presented by TC?
Loss due to accounting omission is excluded.
To coordinate with the Computer Fraud insuring agreement, the Funds Transfer Fraud coverage provided by the Computer Fraud insuring agreement of the ISO Commercial Crime Coverage Form excludes
Loss due to use of a computer to transfer money.
Which is true of the Broad Causes of Loss form?
Losses are covered on a "named peril" basis.
What type of bond is required to reissue a stock certificate?
Lost Instrument Bond
When Workers' Compensation benefits are payable, how is Part B-Medical Payments applied?
MP is excluded is WC payments are payable
Under the businessowners policy (BOP)
Many coverages that would require separate policies or coverage parts in the commercial package program are either included or available as options.
Which one of the following best explains why the premium discount plan for workers compensation insurance provides an increasing credit for premiums in excess of a certain minimum?
Many of the expenses of providing workers compensation insurance do not increase proportionately with increases in premium.
This coverage provides medical expenses for bodily injury by accident, without regard to legal liability.
Medical Payments Coverage
Which one of the following must an insurer pay on behalf of the insured according to Part One of the Workers Compensation and Employers Liability Insurance Policy?
Medical payments for a claimant who was exposed to a disease during the policy period but filed a claim two years after retiring
The PAP endorsement that covers motorcycles, golf carts, and all-terrain vehicles is called:
Miscellaneous Type Vehicle
Florida Valued Policy Law applies to:
Mobile Homes
The PAP endorsement that provides coverage for an individual who does not own a car is called:
Named Nonowner Coverage
"Additional Coverage", under a Commercial Property policy include all of the following except:
Newly acquired locations for up to 60 days
Northern Company (Northern) uses a large forklift in its operations. The forklift is subject to the state compulsory auto insurance law and has a license tag. In the process of moving some items on Northern's premises, the operator loses control of the forklift and runs into a car owned by a customer. Which one of the following statements is true regarding coverage for this loss under Northern's Commercial General Liability (CGL) Coverage Form?
No coverage applies under the CGL Coverage Form because the forklift is considered to be an 'auto,' and coverage would be provided by a commercial auto policy.
What is the coverage limit for nonowned trailers under Part D-Damage to Your Auto?
No coverage for nonowned trailers
What is the dollar limit applicable to defense of the insured from claims or suits arising out of covered occurrences.
No dollar limit
Keith commutes into the city in his car, and he provides a ride to two co-workers who live near him. Every other week, the co-workers take turns buying the gasoline for Keith's car. Does this activity create a public or livery conveyance situation that would preclude liability coverage under Keith's Personal Auto Policy (PAP)?
No, because Keith is involved in a share-the-expense car pool.
If a tenant is injured, would the CGL, Coverage C: Medical Payments pay for the injury?
No, if the tenant is on the part of the premises the tenant normally occupies
The Health provision that affords the greatest degree of continuation, agrees to not raise the rates, and agrees to renew at the option of the insured is called:
Noncancelable
Entities eligible for financial institution bonds are
Not eligible for the ISO Commercial Crime Forms.
All of the following are coverage extensions found in the Building and Personal Property Coverage form except:
Off premises sign coverage up to $2,500
Omicron Corporation currently does business in Colorado, Nebraska, and Kansas. These states are listed in Item 3.A on the Information Page of Omicron's Workers Compensation and Employers Liability Insurance Policy. The company is hoping to expand its operations into Utah, Arizona, and New Mexico during the next year. Which one of the following statements is correct with respect to workers compensation insurance in the states where Omicron hopes to expand?
Omicron should include Utah, Arizona, and New Mexico in Item 3.C on the Information Page and advise the insurer immediately if the company begins operations in any of those states.
Which one of the following statements is correct with respect to Property Not Covered under the Building and Personal Property Coverage Form (BPP)
Only contraband or property in the course of illegal transportation or trade is totally uninsurable by endorsement or in other policies.
Property coverage under the Businessowners policy is written:
Open perils/endorsed for named perils
The Business Auto Coverage form has no provision for what is known as "bobtailing." The motor carrier's coverage form does provide coverage for bobtailing. Which of the following activities is considered "bobtailing" as it relates to an owner-operator's liability coverage?
Operating a power unit without a trailer
Under this provision a health insurance company may not cancel during the policy term, but reserves the right to non-renew the policy at expiration.
Optionally Renewable
Which of the following would not be eligible under the Homeowners policy?
Owner of a mobile home
All of the following are eligible for a homeowners policy EXCEPT:
Owner-occupants of a 1-6 family dwelling
Which part of the Boiler & Machinery Coverage Form provides information pertaining to policy limits.
Part C
Which part of the Boiler & Machinery Coverage form lists the deductible provisions?
Part D
The workers compensation laws of some states are inapplicable to which one of the following?
Partners, sole proprietors, or executive officers.
Part D-Damage to Your Auto pays claims by
Paying the ACV or cost to repair
What type of bond guarantees all materials will be paid by the contractor upon completion?
Payment Bond
With only a few exceptions, the premium base for workers compensation insurance is
Payroll
Part One of the Workers Compensation and Employers Liability Insurance Policy provides that the insured will reimburse the insurer for which one of the following?
Penalties required under a workers compensation law because of the employer's willful misconduct.
The deductible for the Aircraft Hull policies is normally expressed as:
Percentage deductible
Liability coverage to individuals and families for bodily injury and property damage arising from the insured's personal premises or activities is typically provided by
Personal liability insurance.
A written contract that includes all clauses, riders, endorsements and papers is called:
Policy
Which of the following is not a clause found in the Ocean Marine policy?
Port of Call Clause
Morgan Company is involved in a lawsuit that is covered under its unendorsed Commercial General Liability (CGL) Coverage Form. Which one of the following would be covered under the supplementary payments section of the CGL policy?
Post judgment interest awarded by the judge
Upon entering a restaurant, a customer grasped a handrail that broke off, causing the customer to fall and break his wrist. This is an example of which one of the following types of commercial general liability loss?
Premises and operations liability
For a Dwelling Flood policy, which is correct:
Primary residences are covered at replacement cost on building losses.
The three parties to a contract suretyship are:
Principal, Obligee, Surety
This form provides coverage for manufactures and sales or repair organizations against liability claims that are attributable to defective products or work.
Product Liability
Any insurance wherein payment by the insurer will be paid directly to the insured or names interests is called:
Property insurance
What type of bond guarantees the principal will uphold the oath of office and faithfully perform the duties of office?
Public Official Bond
What type of bond guarantees the principle will uphold the oath of office and faithfully perform the duties of office?
Public Official Bond
Joe Motors, which services automobiles, wants to maintain the goodwill of its customers. This is best accomplished by
Purchasing garagekeepers insurance.
Sally is a recent college graduate who lives in the suburbs and drives to work daily in the city. She recognizes that owning a car creates both property damage and liability exposures for her and at the same time she has the burden of student loans. For someone in Sally's circumstances the most practical risk management technique for dealing with her auto-related loss exposures is
Risk transfer.
Joe is out for an evening cruise on his 100 ft yacht. The fog rolls in and he loses all visability. Then suddenly slams into another boat moored nearby. The damage to the other boat is roughly $20,000. Under what section of Joe's Ocean Marine Policy would there be coverage for the other boat?
Running Down Clause
All of the following are penalties under the Florida No-Fault Law EXCEPT:
SR 22 denied
Joe has a 1,000 acre farm where he grows corn. To keep in touch with his workers he installs a cellular radio tower. He wants to make sure his farm policy covers the antenna. Where would it be covered on the policy?
Section G
Which one of the following is a type of covered property under employee theft coverage?
Securities
Which of the following is NOT a required qualification for a General Lines Agent:
Seeking the license only to write controlled business
The commercial umbrella, when primary, is subject to a deductible known as:
Self-insured retention
Which one of the following is an exclusion unique to the Causes of Loss—Special Form?
Smog
One of the costs of insurance is said to be opportunity costs. This means that if capital and labor were not being used in the insurance business, they could be used elsewhere and making other productive contributions to
Society
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.
Which one of the statements is correct with respect to the Building and Personal Property Coverage Form (BPP)?
Some property, such as building foundations below the lowest basement floor, is excluded because it may not be subject to loss by the perils insured against.
The supplementary payments section of the Commercial General Liability (CGL) Coverage Form describes which one of the following?
Specific items to be paid in addition to damages.
Garagekeepers Insurance can be written all of the following ways EXCEPT:
Split limits
Which of the following is NOT a duty of the Office of Insurance Regulation?
Submit rate filings and underwriting rules for approval
This insurance covers fees of physicians for performing surgery, with a maximum amount payable for each procedure.
Surgical Expense Insurance
Sam's New Cars, Inc. has a standard Garage Policy with Symbol 21 for liability. All of the following claims would be covered under Sam's policy except:
Susie, a customer, (owns her own car that is fully covered) is test driving a new car. She runs a light and hurts Heather. Heather files suit against Susie.
Which of the following is not a valid Covered Auto Symbol in the Garage Coverage form?
Symbol 28 - Garage Service Operation Vehicles Only
Which of the following is/are not a "your covered auto" under a Personal Auto Policy for Liability?
The 1990 Chevy 22 days after you purchase it as an additional vehicle for your son who just got his license.
Which one of the following statements best describes how businessowners policies (BOP) coverages compare with those provided by commercial package policies?
The BOP coverages are similar to the coverages provided under commercial package policies.
How does Part D-Damage to Your Auto apply to a nonowned auto?
The Broadest coverage applicable on your covered auto on an excess basis
Crime loss exposures of financial institutions are covered by financial institution bonds. These policies were developed by
The Surety and Fidelity Association of America (SFAA).
Joan has a business auto policy. Which one of the following losses would be covered as auto physical damage?
The cost to repair vehicle damage that results from hitting a deer
All of the following are true of the Supplemental Extended Reporting Period (SERP) under a Claims-made CGL policy except:
The coverage is automatic and need not be requested by the insured.
Garage Insurance only covers rental car if:
The customer's auto is left for service or repair
In a Personal Auto Policy, which of the following statements is incorrect?
The maximum amount payable under the Supplementary Payments is $250
Retention is often used in combination with insurance as a way of treating loss exposures. One of the major downsides of individuals using retention alone is
The potential for financial ruin.
One of the main factors used in developing a base premium for a homeowners policy is
The public protection class.
Which one of the following statements is correct with regard to the Causes of Loss—Broad Form?
The weight of snow, ice, or sleet cause of loss does not cover damage to personal property in the open.
When a worker is required to travel to another state and is injured in that other state, which one of the following is a typical consideration in determining which state's law applies for the purpose of determining workers compensation coverage?
The worker's place of residence
Which one of the following statements is correct with respect to the Commercial Property Conditions?
They apply to all coverage forms included in a commercial property coverage part, unless a coverage form contains a condition to the contrary.
Before workers compensation statutes were enacted, what was the remedy for employees with work-related injuries?
They had to establish that the employer was at fault to recover damages.
How many parties are there in a surety contract?
Three
This Tier is for employers with an experience modification factor equal or greater than 1.0, but not greater than 1.10.
Tier 2
Part D-Damage To Your Auto has an additional benefit automatically included called:
Transportation expense
Which of the following can be a named insured?
Trust
The territorial limits for the Aviation policy includes all of the following EXCEPT:
US Possessions
Which one of the following statements is correct with respect to workers compensation premium adjustment through dividend plans?
Under a sliding-scale dividend plan, the size of the dividend varies with the insured's own loss experience.
The part of the PAP policy that provides coverage for bodily injury for a accident caused by a driver without liability or with liability limits that do not cover the insured's damages is called:
Uninsured motorist
What coverages are available in the Commercial Auto JUA?
Unlimited liability limits if such limits are required by statute, UM and PIP
An employer that decides to purchase specific excess insurance to cover catastrophic workers compensation losses must pay losses that are which one of the following?
Up to the retention for one occurrence.
The controlled _______________from reimburses the insured for the cost of replacing damaged manuscripts, films, maps, drawings, deeds, books or other printed, inscribed or written documents (other than money and securities).
Valuable Papers
Which one of the following is a covered cause of loss under the Causes of Loss—Basic Form?
Volcanic action
What is the order for claim payments if all of the following applied: Medical Payment, Workers' Compensation, Personal Injury Protection?
WC, PIP, MP
What are Temporary Partial benefits based on?
Wage loss formula up to 104 weeks of impaired earnings
This optional provision states that if the insured becomes totally disabled, premiums are waived but the coverage remains in force.
Waiver of Premium
Which of the following is an exclusion listed under Part B of the Boiler and Machinery Coverage form?
War and Nuclear Hazards
When can the Coverage Extensions apply for Building and Personal Property Coverage Form?
When the policy is being subject to 80% or more coinsurance
Under the CGL policy mobile equipment is not covered
While on a covered automobile
Employee Theft includes coverage for the following EXCEPT:
Work loss
Health Insurance does not include _________________.
Workers Compensation
Shady Stories, a tabloid newspaper, prints a false story about a local politician. Shady knows the story is false but thinks it will sell a lot of papers. The politician claims damages from Shady. Shady's Commercial General Liability (CGL) Coverage Form excludes coverage for this loss because the claim arose out of which one of the following?
Written material that was known to be false
If the insured is building a new home, is he eligible for a homeowners policy on the new home while under construction?
Yes
This is the authority given by an insurer or employer to a licensee to transact insurance or adjust claims on behalf of an insurer or employer
appointment
As per Florida law, this includes every person engaged as indemnitor, surety, or contractor in the business of entering into contracts of insurance or of annuity.
insurer
Homeowners Insurance is designed to protect all of the following EXCEPT:
legal liabilities for damages to home
The Florida Valued Policy Law applies to:
mobile homes
The Florida Surplus Service Lines Office (FSLSO) was created to
oversee the surplus lines industry in the state
Long Term Care has all f the following types of care EXCEPT:
remedial care
Worldwide Warehousing has a Building and Personal Property Coverage Form (BPP) with a $1,000,000 limit on a building and a $5,000 deductible. The warehouse suffers a $1,010,000 fire loss. Which one of the following amounts will Worldwide's insurer pay?
$1,000,000
Sam and Sophia insure their house with an unendorsed HO-3—Special Form (HO-3) policy. Sam stores a small fishing boat and trailer behind the house. While they are out for the evening, a fire destroys most of their kitchen and completely destroys the boat and trailer. Assuming Sam's boat and trailer are valued at $4,000 and ignoring any deductible that may apply, what amount will their HO-3 insurer pay for the loss of the boat and trailer?
$1,500
Tom and Martha insure their house with an unendorsed HO-3—Special Form (HO-3) with a Coverage A—Dwelling limit of $300,000, which is the replacement cost of the house. A thief breaks into the house while Tom and Martha are on vacation and steals the following items: •$500 cash•$50,000 stock certificates. Ignoring any deductible that may apply, how much, if any, will Tom and Martha's insurer pay for the loss of the items?
$1,700
Renee is an insured under an unendorsed HO-3—Special Form (HO-3) with a Coverage C—Personal Property limit of $100,000. She owns a secondary residence that contains $15,000 of personal property. Only her primary residence is listed on the declarations page of the HO-3 policy. A fire destroys all of Renee's personal property at her secondary residence. How much of this loss will be paid by Renee's HO-3 policy?
$10,000
Allen, a sole proprietor, is crossing the street when he is struck by a passing uninsured auto. He sustains $2,500 in medical bills, $3,000 damage to the laptop he was carrying, and $1,000 in lost wages. Allen's business auto policy has $100,000 liability limit and $5,000 medical payments limit. Assuming there is no other coverage, how much will his business auto policy pay?
$2,500
Bert and Maggie insure their house with an unendorsed HO-3—Special Form (HO-3) with a Coverage A—Dwelling limit of $300,000, which is the replacement cost of the house. A fire destroys their detached garage. The cost to replace the garage is $35,000. Ignoring any deductible that may apply, how much will Bert and Maggie's insurer pay to replace the detached garage?
$30,000
The owners of Uncle Reggie's Steakhouse are insured under a Building and Personal Property Coverage Form (BPP) that covers their building and business personal property for $350,000 and $100,000, respectively. The policy has a $2,500 deductible. A fire results in $350,000 worth of damage to the building and a $70,000 loss of business personal property. In what amounts should the policy provide coverage for this loss?
$347,500 Building and $70,000 Property
Coverage for other structures is automatically provided under the HO-3—Special Form (HO-3) policy with a limit that is
10 percent of the Coverage A limit
Under the Commercial General Liability (CGL) Coverage Form, medical payments coverage applies to which one of the following?
A volunteer worker of the named insured.
Adam and his insurer disagree on the amount of a loss covered by his homeowners policy. Adam wants the insurer to pay $10,000 toward the loss. The insurer's representative feels that the loss should be valued at $5,000. How could the appraisal process resolve this situation?
Adam and the insurer will each select an appraiser, and the two appraisers will submit their differences to an impartial umpire who will reach a resolution.
Carl's Cabinets sells and installs cabinets in apartment buildings. After installation but before an apartment is occupied, two of the cabinets are damaged when they fall from the wall as a result of improper installation. Carl's Commercial General Liability (CGL) Coverage Form excludes coverage for the damage to the cabinets because of which one of the following exclusions?
Damage to Your Work
A small business owner concerned about something happening and not being able to work or earn a living for an extended period of time due to an accident should purchase
Disability insurance.
A homeowners policy premium is determined by first developing the base premium. The base premium is influenced by certain factors, including which one of the following?
Dwelling location
An insured covers his owned auto with more than one Personal Auto Policy (PAP), each from a different insurer. In the event of a claim for medical payments coverage,
Each insurer pays its pro rata share based on the proportion that its limit of liability bears to the total of applicable limits.
Internet blogger Tom operates a public interest group on the Internet. In posting his opinions, Tom falsely accused the governor of his state of criminal behavior. Tom's Commercial General Liability (CGL) Coverage Form will most likely exclude coverage for any resulting damage based on which one of the following exclusions?
Electronic chatrooms or bulletin boards exclusion
Bilo Manufacturing is weighing whether to lease vehicles for its employees or have them drive their own autos while on company business. Which one of the following exposures is created if Bilo decides in favor of employee-owned autos?
Employer's Nonownership Liability
A storm causes power lines to break ten miles from the insured's premises. The loss of electrical power causes food in the insured's freezer to thaw and spoil. Coverage for this loss is
Excluded because the power failure occurred off the residence premises.
Property described in Coverages A, B, and C of an HO-3—Special Form (HO-3) that is destroyed, confiscated, or seized by order of any governmental or public authority is
Excluded.
Under which one of the following provisions of the Building and Personal Property Coverage Form (BPP) is the maximum payment $10,000 or five percent of the building limit, whichever is less?
Increased Cost of Construction additional coverage
A Commercial Package Policy (CPP) premium may be modified by a package modification factor. This factor
Is a discount justified by the greater efficiency in providing a package policy.
Which one of the following statements is correct with respect to the Newly Acquired or Constructed Property extension of coverage of the Building and Personal Property Coverage Form (BPP)?
It covers newly acquired buildings, provided the purpose of the newly acquired building is similar to the use of the building described in the declarations.
Which one of the following statements is correct with respect to the Non-Owned Detached Trailers coverage extension of the Building and Personal Property Coverage Form (BPP)?
It permits the insured to extend 'your business personal property' to include trailers leased to expand office space or to provide additional storage or work areas.
Oscar's custom-built vehicle looks like a sausage sandwich on wheels. He plans to drive it to special events at schools around the country where it will serve as a mobile billboard to promote his product. Oscar is surprised to learn that insurers are reluctant to insure his vehicle because it fails to meet one of the ideal characteristics of an insurable risk. Which characteristic is Oscar's vehicle least likely to meet?
Large number of similar exposure units
If an insured has failed to cooperate with an insurer in the settlement of a claim, which one of the following policy conditions prevents the insured from suing the insurer if the insured is not satisfied with the insurer's handling of the claim?
Legal Action Against the Insurer
The Insuring Agreement in Part A - Liability Coverage of the Personal Auto Policy contains descriptions of all of the following EXCEPT:
Limit of Liability
Martha drives her auto, which is insured under a Business Auto Coverage Form, outside the state in which it is licensed. The other state requires a $25,000 bodily injury limit for underinsured motorists coverage. Martha's policy does not provide underinsured motorists coverage but does provide a $15,000 liability limit for uninsured motorists coverage. How would Martha's Business Auto Coverage Form respond to a $30,000 underinsured motorists bodily injury claim in the other state?
Martha's policy would provide the $25,000 bodily injury limit required by the other state for underinsured motorists coverage.
Chuckie's chicken distributor researches the benefits of consuming chicken versus consuming beef. In November 2011, Chuckie's publishes a brochure outlining the potential health hazards of consuming beef and explaining why chicken is a healthier alternative. Chuckie continues to publish and distribute the same brochure for six months. In March 2012, several beef distributors file a suit against Chuckie's for personal and advertising injury. Which one of the following exclusions would apply to this claim under Coverage B of Chuckie's Commercial General Liability Coverage Form (CGL) with a policy period of January 2012 - January 2013?
Material published prior to the policy period
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.
An exclusion contained in the Causes of Loss—Basic Form eliminates coverage for damage caused by which one of the following?
Mechanical breakdown, including rupture or bursting caused by centrifugal force
Which one of the following statements is true regarding Coverage C—Medical Payments of the Commercial General Liability policy?
Medical payments coverage is a means of making prompt settlements.
Bob, an employee of Tank's Trucks, is backing one of Tank's trucks toward the loading dock on the insured premises. Bob accidentally strikes Alice, another employee, while she is directing Bob toward the loading dock. Alice sues Bob for her injuries. Is Bob covered under Tank's Trucks' unendorsed Business Auto Coverage Form for liability coverage?
No, because fellow employees' suits are excluded.
Betty's Birdhouses constructs and sells birdhouses. Betty discovered a fungus in the wood used to construct the birdhouses that would kill birds. Betty withdrew her entire stock of birdhouses to avoid any claims from environmental organizations for loss to wildlife. Does Betty's Commercial General Liability (CGL) Coverage Form cover the cost to withdraw the birdhouses and feeders?
No, because the cost to withdraw Betty's product is excluded
Insurance is not the only risk management transfer technique. When circumstances are appropriate, transfer can be accomplished through
Noninsurance transfer techniques.
Joe's New Cars, Inc. has a Business Auto Policy (BAP). The owner, Joe, owns no car himself since he always drives a company car. If you were the agent, what coverage would you add to the BAP to give Joe liability coverage while he drives a car not owned by the corporation?
Other Car coverage
The Department of Financial Services performs the following, EXCEPT:
Pays insurance claims
Wilson was driving his business auto when it was struck by a hit-and-run driver. He looked to his business auto policy for coverage for his injuries. Which one of the following symbols shown on his policy automatically provides such coverage?
Symbol 6-Owned Autos Subject to a Compulsory Uninsured Motorists Law
Which one of the following best describes the "property not covered" provisions of the businessowners policy (BOP)?
The BOP has a relatively short list of 'property not covered' because the insureds eligible for a BOP are generally lower-risk, more homogenous types of businesses.
Which one of the following statements is correct with respect to the Building and Personal Property (BPP) Coverage Form?
The BPP lists several types of classes of property that do not qualify as covered property.
The Causes of Loss—Basic Form differs from the Causes of Loss—Broad Form in which one of the following ways?
The Broad Form provides coverage for loss caused by collapse of a building or personal property resulting from specified perils.
Which one of the following statements best describes the Causes of Loss - Special Form?
The Special Form provides coverage for any risk of loss other than those that are specifically excluded.
Smith Construction Company is covered under an unendorsed Commercial General Liability (CGL) Coverage Form. While working at a job site, Smith ruptured a natural gas line causing a small fire to a neighboring retail store. The following claims have been made against Smith due to this occurrence: Fire damage to the neighboring store, Pain and suffering claimed by the store owner, Loss of income by the store owner until repairs are made to the store, and Fire damage to the backhoe owned by Smith. Which one of the following statements is correct?
The backhoe is property owned and is excluded.
The insured has a business auto policy. Vandals break a window in the insured's pickup truck. While the insured is waiting for the insurance company to appraise the claim, rain enters through the broken window and causes additional damage. What is the insurance company's liability for the loss?
The insurance company is liable for the damage by the vandals but not the damage from the rain.
Which one of the following losses would be covered by the business auto policy?
The insured has agreed to pay for liability losses caused by the insured's negligence that a shipper may incur while the insured is hauling goods for the shipper.
The Random Bookstore (Random) is covered by an unendorsed Commercial General Liability (CGL) Coverage Form. A customer in the store tripped over her untied shoelace and fell, breaking her right arm. Which one of the following is a reason Random's insurer might refuse to pay any damages under Random's CGL policy?
The insured must be legally obligated before the insurer has the duty of paying.
Which one of the following statements is correct with respect to the Building and Personal Property Coverage Form (BPP) deductible?
The insurer is not obligated to pay anything to the insured unless the loss exceeds the deductible.
Which one of the following is true of the supplementary payments in the Commercial General Liability (CGL) Coverage Form?
The obligation to pay these supplementary payments ends when the limit of insurance is exhausted.
Which one of the following has special limits of liability within Coverage C of the HO-3—Special Form (HO-3)?
Theft of firearms
From a risk management viewpoint, insurance is used to
Transfer the cost of losses.
Kenneth, the named insured under a Business Auto Coverage Form with symbol 1 shown for liability coverage, causes an automobile accident while driving a rental car on a business trip. Is Kenneth covered under the liability insuring agreement of his Business Auto Coverage Form for this accident?
Yes, because Kenneth, the named insured, is an insured for any auto.
International Toys (IT) manufactures toys in South Carolina and sells them to stores around the world. A customer in Europe is injured when one of the toys malfunctions and severs the customer's hand. The customer files suit in the United States. If IT is found liable, does its Commercial General Liability (CGL) Coverage Form cover the customer's claim?
Yes, because the toys were manufactured in the United States
Ralph has an unendorsed HO-3—Special Form (HO-3) policy. While coming home from a coin show, Ralph discovers that his automobile was broken into and a package containing $2,000 in coins, some tools, and groceries was stolen. Disregarding any deductible that may apply, will Ralph's HO-3 insurer pay for the loss of the coins?
Yes, the coins are covered up to a specified limit.
