Insurance Licensing Exam
The phrase, "put to its intended use," describes a) completed operations b) occurrence c) personal operations d) operations
A
The standard deductible for the businessowners policy is a) $500 b) $1000 c) $1,500 d) $2,000
A
What type of bond is used to guarantee that supplies will be furnished at an agreed-upon price and time? a) Supply bond b) Bid bond c) Completion bond d) Payment bond
A
Which of the following CGL coverages would apply if one of the insured's competitors sues the insured for slander on social media? a) Coverage B b) Coverage C c) Coverage A d) Coverage D
A
Which of the following commercial auto coverages covers automobiles in the insured's care? a) garagekeepers b) comprehensive c) business auto d) liability
A
Which of the following is not included in the business auto coverage form? a) Uninsured motorist coverage b) Collision c) Liability coverage d) Comprehensive physical damage coverage
A
Which of the following perils in not included in the business auto coverage form's specified causes of loss coverage? a) Collision b) Earthquake c) Flood d) Theft
A
Which of these conditions describes how losses will be settled by the insurance company? a) The valuation condition b) The actual cash value condition c) The duties in the event of a loss condition d) The loss payment condition
A
Which one of the following bonds is purchased to protect an employer from the actions of dishonest employees? a) Fidelity b) Performance c) Corporate d) Surety
A
Which part of the Workers' Compensation and Employers Liability Policy coverage provides automatic coverage for states not specifically listed on the information page for Part One Coverage? a) Part three b) Part five c) Part two d) Part four
A
Which of the following covers medical payments for farm insurance? a) Coverage I b) Coverage J c) Coverage H d) Coverage G
B
Which of the following is a contract bond? a) Judicial bond b) Performance bond c) Public official bond d) Fidelity bond
B
Which of the following is not an exclusion in the commercial auto policy liability section? a) Contractual liability b) Bail bonds c) Completed operations d) Care, custody, and control
B
The Business Auto Coverage Form uses symbols to denote the vehicles to which each of the policy's coverage applies. Which symbol is the most restrictive? a) Symbol 9 b) Symbol 2 c) Symbol 7 d) Symbol 1
C
The condominium commercial unit-owners coverage form covers all of the following except a) personal property of others in the insureds care b) unity owner's personal property c) the building d) the building's contents
C
The garage coverage form includes all of the following except a) liability (casualty) b) physical damage coverage c) medical payments d) garagekeepers (property)
C
The largest office building risk that may be eligible for a businessowners policy is a) 3 stories and 75,000 square feet b) 6 stories and 75,000 square feet c) 6 stories and 100,000 square feet d) 3 stories and 50,000 square feet
C
The term breakdown includes all of the following types of loss except a) failure of pressure or vacuum equipment b) mechanical failure c) damage to any vacuum tube, glass tube, or brush d) electrical failure
C
Unlike surety bonds, fidelity bonds are purchased by a) the principal b) the surety c) the obligee d) the obligee, surety, and principal
C
What is another name for the scheduled farm personal property form coverage? a) Coverage F b) Coverage H c) Coverage E d) Coverage G
C
Where can the insured find the coverage provided in the equipment breakdown coverage form? a) The insuring agreement b) The conditions c) The declarations d) The exlusions
C
Which marine policy would an owner of goods most likely purchase to insure a single shipment of property from Chicago to Los Angeles? a) Cargo liability b) Bailee's customers insurance c) Trip transit insurance d) Inland marine block
C
Which of the following coverage extensions is not provided by business auto physical damage coverage? a) Transportation expenses b) Towing and labor costs c) Electrical breakdown d) Loss of use
C
Which of the following insuring agreements of the commercial crime coverage form would best protect an insured from losses caused by an employee's deceit? a) Forgery or alteration b) Inside the Premises - theft of money and securities c) Employee theft d) Inside the Premises - robbery or safe burglary of other property
C
Which of the following conditions is used to resolve other areas of disagreement besides value of loss between the insured and insurance company and is typically used before an insured seeks legal advice? a) The umpire condition b) The appraisal condition c) The arbitration condition d) The alternate dispute condition
C
Which of the following is a common commercial property coverage form? a) General liability form b) Farm liability form c) Business income form d) Crime form
C
Which of the following unendorsed policies provides open perils coverage on Coverage C - Personal Property? a) HO-5 b) HO-2 c) HO-8 d) HO-3
A
An insured purchases a commercial property policy with a Causes of Loss - Special Form that covers risks of direct physical loss. The policy has a $5,000 deductible. An earthquake causes $150,000 in damages to the property. What amount will the policy pay? a) $150,000 b) $0 c) $100,000 d) $145,000
B
Anita has a split limit liability policy that has limits of 100/200/50. Anita caused an accident that caused $75,000 of property damage. What is the maximum that her liability policy will pay for the property damage? a) $25,000 b) $50,000 c) $75,000 d) $100,000
B
Automobile comprehensive coverage insures all of the following perils EXCEPT a) theft b) collision c) glass breakage d) fire
B
Which of the following pays all necessary medical expenses to others incurred within 3 years of an accident that causes bodily injury? a) Coverage A b) Coverage F c) Coverage E d) Coverage B
B
Which of the following properties is excluded from coverage in the building and personal property coverage form? a) Outdoor furniture b) Underground pipes c) Completed additions d) Outdoor fixtures
B
Which of the following properties would not be excluded under the building and personal property coverage form? a) Driveway b) Animals held for sale c) Lawn d) Cost of excavation
B
The insurance limit for Coverage B - Other Structures, in Homeowners, is a) 10% of Coverage B b) 30% of Coverage A c) 10% of Coverage A d) 50% of Coverage A
C
All of the following statements regarding surplus lines insurers are correct EXCEPT: a) surplus lines insurance is placed with an admitted carrier by a surplus lines agent b) surplus lines insurance covers high risk exposures c) surplus lines insurance is place with a nonadmitted carrier by a surplus lines agent d) states keep a list of acceptable surplus lines insurers
A
An insured has a $60,000 Special Form (DP-3). When a covered loss in the amount of $10,000 damages the attached garage, how much of that amount is paid under the Coverage B - Other Structures? a) $10,000 b) $1,000 c) $6,000 d) $0
D
Building coverage of the Building and Personal Property Coverage Form insures all of the following things EXCEPT a) floor coverings b) permanently installed fixtures c) personal property used to service the premises d) desks and office equipment
D
Comprehensive coverage pays for all of the following damages EXCEPT a) hitting a deer b) explosion c) glass breakage d) overturning of the auto
D
Under an HO-2 policy with a coverage limit of $50,000 on the dwelling, which is the amount of personal property coverage that would be available? a) $50,000 b) $30,000 c) $20,000 d) $25,000
D
When does flood insurance take effect? a) As soon as the policy is issued b) As soon as the insured pays the 1st premium c) As soon as the agent binds coverage d) 30 days after the date of application and payment of premium
D
Coverage for the loss of business income over a period of time that results from a direct physical loss is also known as a) suspension b) time element coverage c) extra expense coverage d) business loss coverage
B
Jimmy was driving over the speed limit and almost caused a major accident. According to the definition of establishing negligence, Jimmy would be a) legally liable b) not legally liable c) strictly liable d) legally negligent
B
Loss caused by sprinkler leakage is covered under which commercial property causes of loss form? a) Special b) All of these c) Broad d) Basic
B
Under the regular program, what are the maximum limits for flood insurance coverage on a residential building? a) $35,000 b) $250,000 c) $500,000 d) $100,000
B
What part of the personal auto policy covers losses caused by malicious mischief, vandalism, hail, or floods? a) liability b) other than collision c) property damage d) collision
B
According to the Gramm-Leach Bliley Act, anyone who has an ongoing relationship with a financial institution is considered to be a) a consumer b) an insured c) a customer d) an insurer
C
All of the following statements about aleatory contracts are true EXCEPT: a) in an aleatory contract, the insured may pay premiums for many years and never receive any money from the insurer b) in an aleatory contract, the insured may pay only a few premiums and the insurer will be paying much more for a claim c) aleatory contracts have an equal value d) aleatory contracts have an unequal value
C
An applicant for insurance must accept or reject a contract as written. For this reason insurance policies are: a) aleatory contracts b) unilateral contracts c) contracts of adhesion d) utmost good faith contracts
C
An insured suffers a covered loss to some rental property that forces the tenant to move to another location. Under which section of the dwelling policy would the insured receive payment during the time the property is being repaired? a) Coverage A - Dwelling b) Coverage B - Other Structures c) Coverage D - Fair Rental Value d) Coverage E - Additional Living Expense
C
Bernie and his insurer came up with a price value of his grandfather's baseball card collection that he now owns. If a loss occurs to this collection, what will be the amount that the insurer will pay? a) The actual cash value b) The replacement cost value c) The agreed value d) The market value
C
Credit card fraud is covered under a homeowners policy to a maximum of what amount? a) $1,000 b) $100 c) $500 d) $2,000
C
Depending on the circumstances, a passenger injured in an automobile accident may be able to recover under all of the following coverages EXCEPT a) medical payments b) liability c) collision d) uninsured motorist
C
How does the dwelling policy provide theft coverage? a) It is automatically included in the policy b) It is included in the DP-3 only c) It must be added by endorsement d) It is only included in the DP-2 and DP-3
C
Regina chose to add the outdoor property coverage extension to her building and personal property coverage plan. There was a horrible storm that destroyed her fence and the estimate to repair it is $3,000. What amount will the insurer pay to Regina for this damage? a) $1,500 b) $2,000 c) $1,000 d) $3,000
C
Bill and Marge have an HO-2 policy insuring their main residence for $150,000. How much coverage do they have for personal property kept at their summer cottage? a) $75,000 b) $15,000 c) $7,500 d) $30,000
C
For personal property coverage, who is NOT insured by a homeowners policy? a) A live-in housekeeper requested by the named insured b) The named insured c) A nonresident uncle d) A 20-year old resident
C
Information that is given on an insurance application that is not true and would affect the insurer's decision to accept the contract is known as: a) a warranty b) a misrepresentation c) a material misrepresentation d) a concealment
C
Mary's purse was stolen from her as she walked down the sidewalk. She has an HO-2 policy. Will Mary's policy cover this loss subject to the deductible? a) No-theft is not a covered peril in the HO-2 b) Yes-if Mary has added the scheduled personal property endorsement to her policy c) Yes-theft is a covered peril under all of the homeowners forms d) No-the loss occurred away from the insured premises
C
Under the cancellation condition, the insurer can cancel for any reason with 10 days' written notice to the insured during a) the first 180 days of a policy term b) the first 365 days of a policy term c) the first 60 days of a policy term d) the first 90 days of a policy term
C
Which business income coverage form covers expenses that the insured incurs to reduce loss? a) Business income with extra expense coverage b) Personal effect and property of others coverage c) Business income without extra expense coverage d) Builders risk coverage
C
Which of the following has special loss valuation requirements under the building and personal property coverage form? a) Buildings b) Exterior signs c) Glass d) Furniture and fixtures
C
Which type of endorsement would be used to insure a recreational vehicle under the personal auto policy? a) joint ownership coverage b) motor home endorsement c) miscellaneous type vehicle endorsement d) extended vehicle endorsement
C
Part D - coverage for damage to your auto covers all of the following EXCEPT a) other than collision b) direct and accidental loss to the covered auto c) collision d) personal property in the vehicle
D
The dwelling policy will provide how much additional coverage for a fire department service charge? a) $750 b) $1,000 c) $250 d) $500
D
The penalty for early cancellation of an insurance policy by the insured is applied on a) a prorated basis b) a discounted basis c) a cancellation basis d) a short-rated basis
D
The personal auto policy covers both property and liability coverages. Which of the following covers property coverage? a) Part A b) Part C c) Part B d) Part D
D
The personal auto policy uses the words you and your in the declarations. This is referring to a) all resident licensed drivers b) the named insured and resident relatives c) the named insured, including a nonresident spouse d) the named insured and resident spouse
D
Which homeowners endorsement is use to insure high-value items of personal property? a) Personal property replacement cost b) Personal effects c) Business pursuits d) Scheduled personal property
D
Which of the following commercial property cause of loss forms does not cover collapse? a) limited b) special c) broad d) basic
D
Which of the following loss conditions gives the insurer the right to repair or replace the damaged property with material or property of like kind within 30 days of the insured's statement of loss? a) The recovered property condition b) The loss payment option c) The loss settlement option d) The our option condition
D
Which of the following is an example of real property? a) Inventory b) Fixtures c) Machinery d) Office buildings
D (the rest are business personal property)
According to the loss settlement condition in the DP-2 and DP-3, as long as the insured carries insurance equal to 80% or more of the full replacement cost of the building at the time of loss, the loss to the dwelling or other structures will be paid on a) a replacement cost basis b) a depreciation value basis c) an actual cash value basis d) a market value basis
A
All of the following are commercial casualty coverage forms EXCEPT a) ocean marine b) general liability c) crime d) farm liability
A
All of the following coverages may be part of a commercial package policy except a) personal auto b) crime c) inland marine d) farm
A
All of the following items are excluded from the open peril personal inland marine form EXCEPT a) property damaged while being transported inland b) property damaged due to wear and tear c) property damaged by gradual deterioration d) property damaged by insects
A
All of the following statements about mobile home insurance are correct EXCEPT a) The HO-4 form can be used to cover the mobile home and the contents in the mobile home b) In order for a mobile home to be eligible under the dwelling policy, it must be permanently placed c) Only the basic form can be used for mobile home coverage d) The dwelling policy can be used to provide coverage for mobile homes
A
The following perils may be insured against under a basic dwelling policy EXCEPT: a) flood b) lightning c) fire d) vandalism and malicious mischief
A
The insured must send a signed statement of loss to the insurance company within how many days? a) 60 b) 30 c) 45 d) 90
A
The personal articles floater provides coverage for all newly acquired property, except fine art, for up to a) 30 days b) 180 days c) 60 days d) 90 days
A
Which of the following coverages is covered under Part D - Coverage for Damage to the Insured's Auto a) flood b) freezing c) mechanical breakdown not resulting from total theft d) wear and tear
A
Which of the following is NOT a peril covered under the personal property coverage in the HO 3 - Special Form? a) Water damage b) Malicious mischief c) Freezing d) Hail
A
Which of the following is covered in the DP-1-dwelling basic form? a) Fire department service charge b) Property removed for up to 30 days c) Collapse d) Trees, shrubs, and other plants
A
A promise to pay and perils covered is described in: a) The exclusions section b) the conditions section c) the insuring agreement d) the declarations section
C
Coverage D in homeowners insurance is for what type of loss? a) Personal property b) Dwelling c) Loss of use d) Personal liability
C
Susan decides to drive fast in a horrible snowstorm because she knows that if she gets in an accident that her insurance will cover her. This is an example of a) a physical hazard b) a moral hazard c) a morale hazard d) a situational hazard
C: physical = wet floor, fallen down tree, ice on sidewalk; morale = carelessness; moral = dishonesty
All of the following statements regarding mutual insurers are correct except: a) mutual insurers pay dividends to policyholders b) a mutual insurer is owned by its policyholders c) mutual insurers do not guarantee dividends d) a mutual insurer has stock and stockholders
D
True or false: Personal liability coverage must be added by endorsement to the dwelling policies if desired, but it is automatically included in the homeowners policy.
True
Which homeowners policy would be written to cover personal property only? a) HO-4 b) HO-2 c) HO-3 d) HO-5
A
Who would use a HO-6 homeowners form? a) Owner of a rental house b) Tenant of a rental house c) Owner of a duplex d) Owner of a condominium
D
Which of the following is NOT included on the basic cause of loss form? a) Lightning b) Fire c) Internal explosion d) Weight of ice, snow, or sleet
D (covered under the broad form)
All of the following are included in the basic farm property cause of loss form except a) attacks on covered livestock by wild animals b) smoke c) explosion d) earthquake or flood loss to livestock
A
All of the following losses of cattle would be covered under a Broad Form farm policy except a) loss due to disease b) loss due to attacks by wild animals c) loss due to accidental shooting of the cattle by a neighbor d) loss due to an accident while loading into railroad cars
A
Customers' autos left with the insured for services, repair, storage, or safekeeping is covered by a) Symbol 30 b) Symbol 48 c) Symbol 31 d) Symbol 49
A
Domestic shipments inland marine transportation forms cover shipments traveling by all of the following except a) car b) train c) air d) mail
A
The difference between Coverage E and Coverage F in the farm personal property coverage form is a) Insurance is scheduled under Coverage E but a blanket limit applies to Coverage F b) Coverage E is for liability while Coverage F is for medical payments c) Coverage E is a reporting form but Coverage F is not d) Coverage E applies to other private structures while Coverage F applies to loss of use
A
The direct physical loss that causes damage to covered equipment and necessitates its repair or replacement is known as a) breakdown b) damage c) malfunction d) defect
A
The garage coverage form is designed specifically for all of the following except a) rental car companies b) truck dealers c) auto dealers d) a repair shop on the dealer's lot
A
Yacht policies provide physical damages and liability coverage. What is the liability section called? a) Protection and indemnity insurance b) Protection liability insurance c) Owners protection and indemnity insurance d) Protection and medical payments insurance
A
A particular state gives employers the option of purchasing workers' compensation insurance from a state fund or a private company. This is an example of a) a monopolistic state fund b) a competitive state fund c) a self-insurance state fund d) a compulsory state fund
B
Which of the following bonds is specifically used to protect individuals from possible losses pending civil court proceedings? a) Fiduciary bond b) Judicial bond c) Court bond d) Surety bond
B
An insured who owns a convenience store arrives at the store one morning and finds the door unlocked. There is no sign of forced entry, but several items - including money in the cash register - are missing. Based on this information, the insured has suffered a a) robbery b) theft c) disappearance d) burglary
B
Insurance contracts include 2 parties: the insured and the insurance company. Bonds are a contract between a) 2 parties b) 3 parties c) 4 parties d) 5 parties
B
Kurt works for a jewelry store and his sole responsibility is to have care and custody of all of the property inside the store. Which of the following terms describes Kurt's role? a) Kurt is a security guard b) Kurt is a watchperson c) Kurt is a messenger d) Kurt is a custodian
B
The Federal Employers' Liability Act (FELA) covers which of the following types of workers? a) Corporate CEOs b) Railroad employees c) Harbor workers d) Crews of ocean-going vessels
B
The commercial crime forms may include coverage for all of the following except a) employee theft b) slander of an employee c) guests' property d) forgery or alteration
B
Which coverage allows, on a blanket basis, a total value to be taken from a detailed inventory of a farm personal property? a) Coverage A b) Coverage F c) Coverage B d) Coverage E
B
Which of the following is not excluded under businessowners liability coverage? a) Pollution losses caused by the insured b) Liability assumed under an insured contract c) The cost of recalling the insured's product because of a suspected safety hazard d) Damage to the insured's own work
B
Which of the following is not required in a CGL coverage part? a) CGL declarations b) Causes of loss form c) One or more CGL coverage forms d) Common policy conditions
B
Which one of the following exposures to loss is not covered by the equipment breakdown protection coverage form? a) Spoilage damage b) Fire or combustion explosion c) Business income d) Utility interruption
B
Which one of the following is NOT covered under the inside the premises - robbery or safe burglary of other property? a) Loss of property from a safe or vault b) Money and securities c) Damage to the exterior of the building that is a result of the robbery d) Damage to the interior of the building that is a result of the robbery
B
Which one of the following is not a benefit that is paid under workers' compensation laws? a) Disability income b) Pain and suffering c) Medical d) Rehabilitation
B
Which portion of the garage coverage form covers liability for damage to property of others in the insured's care, custody, or control? a) Liability b) Garagekeepers c) Physical damage d) Garage physical damage
B
Who would be the principal in a contract bond? a) The insured b) The contractor c) The insurance company d) The surety
B
A business that wants coverage for its liability for employment-related acts can obtain it by purchasing a) commercial general liability insurance b) workers' compensation and employers liability insurance c) employment practices liability insurance d) any of these
C
All of the following are common exclusions in the businessowners policy except a) water, including flood and sewer backup b) damage caused by insects, rodents, or birds c) collapse d) earth movement
C
Armed individuals tie up convenience store workers and lock them in a back room. The individuals then load up on money, lottery tickets, cigarettes, and liquor, then leave the premises. This is an example of a) burglary b) safe burglary c) robbery d) theft
C
In a commercial inland marine policy, the property's value is determined a) at the time of the repair b) on the policy effective date c) at the time of the loss d) at the time of the application
C
Which of the following is a federal law that allows members of a ship's crew to sue the ship owner for injuries caused by the ship owner's negligence? a) Longshore and Harbor Workers' Compensation Act b) Federal Employers Liability Act c) The Jones Act d) The Ship Act
C
Which of the following is covered by the jewelers block coverage form? a) Property in transit by mail (unless registered mail) b) Property exhibited in a showcase away from the premises c) Property that is sold but not delivered d) Property being worn by the insured
C
Which of the following is excluded in the equipment breakdown coverage form? a) Failure of pressure or vacuum equipment b) Mechanical failure c) Leakage at any valve d) Electrical failure
C
Which of the following professional liability policies is an insurance agent most likely to have? a) Fiduciary liability b) Internet liability c) Errors and omissions (E&O) d) Employment practices liability
C
Which of the following would not be covered under the business income and extra expense insuring agreement found in internet liability and network protection coverage? a) An extortion threat b) A malicious computer instruction c) A hard drive crash d) A virus
C
Which symbol covers a customer's auto left with the insured for service? a) Symbol 32 b) Symbol 31 c) Symbol 30 d) Symbol 33
C
Who does a surety bond protect? a) Principal b) Surety c) Obligee d) Obligor
C
Who of the following would not be considered an insured under business auto liability coverage? a) The named insured b) Others while using a covered auto with permission c) The owner of a borrowed auto d) An employee of the insured
C
Your right to claim and occurrence information condition provides that the insurer will give the first-named insured information relating to the CGL during the previous a) 1 year b) 2 years c) 3 years d) 5 years
C
All of the homeowners forms provide identical a) property coverage b) peril coverage c) exclusions d) liability coverage
D
An insured who needs coverage against the breakdown of boilers and other machinery and equipment should purchase a) comprehensive general liability coverage b) commercial property coverage c) difference in conditions coverage d) equipment breakdown coverage
D
Aviation liability insurance includes coverage for all of the following except a) bodily injury liability to persons other than passengers b) bodily injury to passengers c) medical payments d) the aircraft
D
Fiduciary bonds and judicial bonds are both a type of a) fidelity bond b) contract bond c) license and permit bond d) court bond
D
If an insured has a loss history that is better than average, what will be applied to reduce the workers' compensation premium? a) Deposit premium b) Experience rating c) Classification rating discount d) Experience modification factor
D
If an insurer decides to not renew the CGL policy, how many days' notice of nonrenewal must be provided to the first named insured? a) 10 b) 7 c) 15 d) 30
D
If the insurance company requests a proof of loss on a commercial inland marine claim, the insured must submit it within a) 30 days b) 10 days c) 90 days d) 60 days
D
Mechanical breakdown coverage is a) not available in a BOP b) automatically provided in a BOP c) a coverage extension of the BOP d) an optional BOP coverage
D
The builders risk coverage form requires that the insured has limits equal to a) 80% of actual cash value of the building under construction b) replacement value of completed building c) actual cash value of completed building d) actual cash value of the building under construction
D
The insured has an accounts receivable coverage form added to the commercial inland marine coverage form. When a fire destroys the insured's records, coverage is provided for all of the following except a) uncollectible sums b) reconstruction of records c) extra collection fees d) bad debts
D
Tim purchased an auto policy for his new car. There are no other insureds listed on the declarations. Tim is considered the a) insurer b) first named insured c) additional insured d) named insured
D
When an employer has employees use their own autos in connection with the employer's business, the employer should purchase a) hired auto liability b) third-party auto liability c) extended employee liability d) nonowned auto liability
D
Which auto symbol is used for leased or rented autos? a) Symbol 9 - nonowned autos b) Symbol 7 - specifically described autos c) Symbol 1 - any auto d) Symbol 8 - hired autos
D
Which of the following forms is designed for companies that transport their own goods and provides direct damage coverage instead of liability coverage? a) Trucker coverage form b) Motor truck cargo on trucker's form c) Motor truck cargo on carrier's form d) Owner's goods on owner's truck form
D
Which of the following is NOT a common feature of inland marine coverages? a) The property does not have to be a specific location when the loss occurs b) They are often called "floaters" because the insurance goes with the property as it moves c) They are written with open peril coverge d) They are written with named peril coverage
D
Which of the following is not included under the physical damage coverage portion of the business auto coverage form? a) Hail b) Earthquake c) Flood d) Mechanical breakdown
D
Which part of the Workers' Compensation and Employers Liability Policy coverage explains how the cost of the policy is determined? a) Part three b) Part four c) Part two d) Part five
D
True or false: Buildings under construction are considered vacant
False
As it relates to property insurance, the person or business that has temporary possession of someone else's property is known as a) the bailee b) the custodian c) the bailor d) the fiduciary
A
Brady and his wife Julie had an insurance policy that was cancelled by the insurer before the expiration date. They will receive a portion of their premium back on: a) a prorated basis b) a short-rated basis c) a flat basis d) an unearned basis
A
Damage caused by burglars is excluded under which of the Dwelling Forms? a) Basic Form b) Broad Form c) All forms exclude damage caused by burglars d) Special Form
A
Depending on the circumstances, a passenger injured in an automobile accident may be able to recover under all of the following coverages EXCEPT a) collision b) medical payments c) uninsured motorist d) liability
A
In the Dwelling Forms, damage from vandalism is not covered if the building has been vacant for more than a) 60 consecutive days b) 90 consecutive days c) 30 consecutive days d) 14 consecutive days
A
John's dog bites a friend who is visiting John's house. Which part of John's homeowners policy, if any, would cover the visitor's ensuing medical expenses? a) Either Coverage E or Coverage F b) Coverage F only c) Loss is excluded because it was caused by an animal owned by the insured d) Coverage E only
A
Which of the following is not covered under flood insurance? a) Personal property in a basement b) Business personal property c) A commercial building d) A dwelling
A
Which of the following states that a policy may not be transferred to anyone else without the written consent of the insurer? a) The assignment condition b) The estoppel condition c) The transfer condition d) The indemnification agreement
A
Which one of the following types of property is NOT covered by a dwelling policy? a) Farm dwellings b) Mobile homes on permanent foundations c) 3 apartment dwellings d) Row houses
A
Which section of the CPP varies based on the lines of coverage included? a) The coverage parts b) Declarations c) Exclusions d) Conditions
A
William and Joan need to purchase dwelling insurance for their vacation home. They want to insure the dwelling itself and their personal property in the vacation home. Which of the following coverages should they purchase? a) Coverages A and C b) Coverages B and C c) Coverages A and B d) Coverages A and D
A
A dwelling policy can insure all of the following types of personal property EXCEPT a) lawnmowers b) sailboats c) furniture d) motorized wheelchairs
B
A therapist owns office space in a commercial office building that is legally organized as a condominium. Which of the following best protects the therapist's business personal property? a) Unit owners form (HO-6) b) Condominium commercial unit owners form c) Condominium association coverage form d) Commercial package policy (CPP)
B
ABC Insurance company is licensed to sell insurance in Wisconsin. When the company is licensed in a state it is considered: a) an approved insurer b) an admitted insurer c) a foreign insurer d) a domestic insurer
B
Actual loss of business income payments by an insurer may include the following except a) net income that would have been earned b) amount required to repair property damage that caused suspension of business c) continuing normal operation expenses d) payroll expenses
B
Airborne volcanic blasts or shockwaves, ash, dust, particulate matter, and lava flow is best described as a) lava action b) volcanic eruption c) volcanic explosion d) volcanic action
B
All of the following perils are covered under the DP-2 Broad Form EXCEPT: a) freezing of pipes b) earthquake c) loss caused by fireplace smoke d) falling objects
B
All of the following statements about supplementary payments in a liability policy are true EXCEPT a) expert witness fees are covered by supplementary payments b) first aid to others is covered by supplementary payments up to a year after the accident c) loss of earnings for the insured is covered by supplementary payments d) premiums for bail bonds are covered by supplementary payments
B
All of the following statements about unilateral contracts are true EXCEPT: a) as long as insured pays premiums, the insurer is required to pay for the loss b) the insured cannot stop paying premiums or abandon the insurance without approval from the insurer c) the insured can stop paying premiums and abandon the insurance at any time d) insurance policies are unilateral
B
An insured buys a business income policy with a maximum limit of $100,000 and a 25% monthly limit of indemnity. How much can the insured collect if the lost income is $40,000 in the 1st month and $10,000 in the 2nd month? a) $50,000 b) $35,000 c) $25,000 d) $65,000
B
The insured has a home with a replacement cost of $200,000 but has insured it for only $100,000. An 80% coinsurance provision is present in the policy. When an $80,000 loss occurs, the policy will pay a) $100,000 b) $50,000 c) $40,000 d) $80,000
B
Under the Building and Personal Property Coverage Form, how much will an insurer pay for fire department service charges? a) Up to $500 b) Up to $1,000 c) Up to $2,000 d) Actual charges
B
Which of the following additional coverages is only included in certain homeowners forms? a) Fire department surcharge b) Collapse c) Property removed d) Trees, shrubs, and other plants
B
Which of the following is not part of the underwriting process: a) accepting or rejecting applications b) evaluating premium expense loads c) assessing risks and exposures d) determining premium and coverage amounts
B
Which part of the policy states the rules of conduct, duties, and obligations that are required for coverage? a) The declarations section b) The conditions section c) The insuring agreement d) The endorsements
B
Under the DP-1-dwelling basic form, property that is removed from the premises to protect it against loss is covered for how many days? a) 30 days b) 5 days c) 45 days d) 60 days
B (in DP-2 and DP-3 this coverage is for 30 days)
At the state level, the government is involved in: a) providing war risk insurance b) providing flood insurance c) providing unemployment insurance d) providing federal crop insurance
C
An insured has a commercial property policy with a Causes of Loss-Broad Form with a $250 deductible. During a snowstorm, a $750 rooftop sign is destroyed. How much will the policy pay for the sign? a) $1,000 b) $750 c) $500 d) $0
C
An insured may be reimbursed on a damaged items repair cost when the repair cost is less than a) The stated amount b) The agreed value c) The actual cash value d) The market value
C
Doug, who is 7 years old, accidentally throws a baseball through the neighbor's kitchen window. Which part of the homeowners policy will pay for the damages to the window? a) Part B b) Part D c) Part F d) Part E
D
If a dispute arises over whether an insured is entitled to uninsured motorists coverage, what process is used to settle the dispute? a) Subrogation b) Appraisal c) Negotiation d) Arbitration
D
Julia purchases a new car for her daughter. How many days does she have to add it to her policy? a) 45 b) 30 c) 10 d) 14
D
