Insurance Test 2
Farmer Ellen is covered by a Farm Property policy. During a storm, two trees located on each side of the farmhouse front porch are blown down and cause roof damage. How much coverage does Ellen's policy provide to remove the trees?
$1,000 for any one loss regardless of the number of trees that have fallen but no more than $500 for the removal of any one tree.
The insured is covered under a standard Businessowners policy. She has several computers used in the business and the electronic data stored on them becomes corrupted as a result of lightning. The cost to research and restore this data is $20,000. How much will the policy pay for the electronic data?
$10,000
The annual agency license renewal fee in West Virginia is:
$200..
An insured has purchased a DP-3 policy to cover his dwelling that is valued at a replacement cost of $100,000. He insures it for $60,000 and later suffers a $30,000 fire loss. Which of the following amounts will be paid by the policy (if no deductible form is attached)?
$22,500.
An insured carries property insurance with a limit of $25,000 and an 80% coinsurance requirement. The covered building, however, is worth $40,000. How much would she collect in the event of a total loss?
$25,000
Henrietta has purchased a Personal Automobile policy and she sees the following under Part A: $25,000/$50,000/$30,000 Which of the following statements is TRUE regarding these numbers?
$30,000 represents the limit for property damage liability.
An insured is covered under an HO-2 form with a Coverage A limit of $125,000 and a Coverage C limit of $65,000. What amount will automatically be provided for Coverage D?
$37,500.
When an HO-3 is issued with a $75,000 Coverage A limit on a one-family dwelling, what is the automatic amount of insurance for Coverage B?
$7,500
An insured is covered under a DP-2 broad form Dwelling policy. A water pipe has frozen and burst and the insured has suffered floor and ceiling damage in his two-story home. The cost to remove and replace the walls to get to the pipe is $300. The cost to repair the floor is $400. The pipe that burst must now be replaced with a more expensive option to meet newer building codes. The cost to replace the pipe is $200. How much will the insurer pay?
$700.
Under a Personal Articles Floater, a pair of antique salt and pepper shakers is insured for $1,000. When one of the shakers is broken, the remaining shaker is worth only $200. How much will the insured receive for the loss without taking into account the deductible?
$800.
What is the limit of coverage provided under a Mobile Homeowners policy for detached structures?
10% of the Coverage A limit or $2,000 whichever is greater.
In West Virginia, when an insurer has received notification of a claim, that insurer must acknowledge having received such notification within:
15 days
Motels insured under an ISO Businessowners may not exceed how many stories?
3 stories
A Commercial Property policy has the "Protective Safeguards endorsement attached indicating that the insured has protective safeguards installed such as a sprinkler system. Should the system become inoperative, how long does the insured have to report this fact to the insurer?
48 hours.
Under the discovery Commercial Crime form, a loss will be covered up to _________ after the expiration date of the policy.
60 days.
For restaurants to be eligible for coverage by the standard BOP policy, they cannot exceed _______ in total floor area.
7,500 square feet
The standard BOP policy will provide coverage for all of the following incidental occupancies in a covered apartment building, EXCEPT:
A contractor whose office occupies 20% of the floor area of the building.
An auto is described in the schedule of the Hired Autos endorsement to a Business Auto policy. For purposes of Business Auto coverage, this auto will be considered:
A covered auto owned by the named insured.
The Insurance Commissioner/Director/Superintendent of a given state would refer to an insurance company formed under the laws of a different state as:
A foreign insurer.
Which of the following is NOT considered "your covered auto" under a standard Personal Auto policy?
A large truck used to transport manufactured goods for a corporation.
Coverage would be provided for trees, shrubs, or other plants under the additional coverages of the standard Homeowners policies in which of the following situations?
A neighbor, driving his own vehicle, accidentally runs over the insured's holly tree when he runs off his own driveway and into the insured's yard.
All of the following would be considered an "insured" on a Homeowners policy, EXCEPT:
A non-related tenant living in the insured residence.
A substandard risk rate under the West Virginia Automobile Insurance Plan is:
A rate or premium charge that reflects a greater than nominal exposure to loss for an insurer writing policies as part of the Plan..
All loss or damage to property other than money and securities under a Crime policy is settled on:
A replacement cost basis.
The Commercial General Liability policy excludes damages to the insured's own work but will cover that part of the work performed by:
A subcontractor
All of the following employers are NOT required to provide Workers Compensation coverage in West Virginia, EXCEPT:
A volunteer fire department.
Which of the following watercraft would be covered under Section II - Liability of the Homeowners forms?
A watercraft in storage
All of the following are included in the definition of "fungus" under the "Limited Coverage for Fungus, Wet Rot, Dry Rot, and Bacteria additional coverage of the Commercial Property cause of loss forms, EXCEPT:
Algae
Part D of the Personal Auto policy provides coverage for all of the following, EXCEPT:
All direct losses to the insured's covered auto..
All of the following statements are TRUE if Builders' Risk coverage is written on a completed value basis, EXCEPT:
All premiums must be paid up front before construction can begin
In order to be covered under Coverage C - Medical Payments of the Commercial General Liability policy, bodily injury must be caused by:
An accident..
All of the following are part of the "entire contract", EXCEPT:
An agreement made between the insured and the agent stated verbally, that the agent will personally service the insured's policy, and it will not be delegated to a staff member is part of the entire contract
In the insurance industry, which of the following terms refers to continuous or repeated exposure to conditions that may result in bodily injury or property damage neither expected nor intended?
An occurrence.
How often is the West Virginia Insurance Commissioner permitted by law to examine the affairs of authorized insurers or licensed producers in the state?
As often as the Commissioner deems necessary.
Philip has several vehicles that are all covered under Personal Automobile policies. He has several acres of land with a barn and chicken coup on the property. To drive around on the acreage, Philip has a very old truck that is not licensed or insured. One afternoon, Philip is driving out to check on his cows when he hits a rut and his head slams down on the steering wheel, injuring him severely. How will Part B - Medical Payments provide coverage for Philip's injuries?
Bodily injury sustained while occupying an uninsured auto owned by the insured is excluded under Part B, therefore no coverage would apply
A West Virginia producer who overcharges or fails to refund premiums to persons entitled to a refund is subject to:
Both a fine and/or license suspension or revocation.
What is generally excluded on the Condominium Commercial Unit-Owners form?
Building coverage.
Coverage E -- Personal Liability of the standard Homeowners policies covers the insured for all of the following, EXCEPT:
Business activities
Under the "Inside the Premises - Theft of Money and Securities" insuring agreement of a crime policy, which of the following situations would NOT be covered:
Cash that is stolen by employees.
All of the following statements regarding the Commercial Package Policy are correct, EXCEPT:
Commercial Package Policies can include Ocean Marine and Aviation Insurance coverage.
The amount of insurance countersigned, issued, or sold by an agent or producer to cover immediate family members, an employer, or employees is known as:
Controlled business.
Which of the following is included on all HO forms EXCEPT the HO-4 and the HO-6?
Coverage A
A bailee customers' policy:
Covers damage to customers' property when the insured is liable.
Homeowners insurance policies are designed to cover all of the following, EXCEPT:
Damage to the covered dwelling caused by the insured
All of the following are excluded under the Commercial Crime "Inside the Premises - Theft of Money and Securities" insuring agreement, EXCEPT:
Dishonest acts of customers.
Which would be a moral hazard?
Embezzlement
Which of the following statements is TRUE regarding fidelity and surety bonds?
Fidelity bonds are a contract between two parties and a surety bond is a contract between three parties.
An agent has been appointed to represent The Insurance Company and knows the carrier offers excellent customer service and has a good reputation in the area. This agent has been losing a considerable amount of business to another agent, and feels when biding on a customer's business she must now offer more than a good product and excellent service. She has checked with a local fitness center and has agreed to pay for a 3 month trial membership as a sign-on bonus for new business with any premium over $250 a year. Under West Virginia state statute, this agent:
Is guilty of rebating
Which of the following statements is NOT TRUE regarding Trailer Interchange coverage?
It covers damage to a trailer under the policy of the trucker who owns the trailer but was not in possession of that trailer at the time of the loss
Mike purchased a policy several years ago to cover him for liability. Last year, Mike determined that the limits of his liability policy were not high enough to cover him adequately should a loss occur, so he purchases an excess liability policy to provide more coverage. Mike experiences a loss, and discovers that his underlying liability policy had expired before the loss, but his excess liability policy is still in effect. How will this loss be paid?
It will be denied, due to nonconcurrency.
All of the following statements are true regarding the coverage of mobile or trailer homes under a Dwelling insurance policy, EXCEPT:
Mobile or trailer homes can be owner or tenant occupied
"Theft" as defined by a Crime insurance policy, includes all of the following, EXCEPT:
Mysterious disappearance.
Products being imported from Great Britain into the United States would be covered by
Ocean marine policies.
Coverage under the National Flood Insurance Program may be written:
Only in eligible communities.
Which of the following types of policies can be purchased to cover the vicarious liability of a general contractor for the acts of their subcontractors?
Owners & Contractors Protective Liability..
PS&D Liability policies include coverage for which of the following?
Partnership, Association or Corporation Professional Liability..
West Virginia statutes amend the appraisal condition of the standardized Homeowners policies to:
Permit a written demand for appraisal from either the insured or the insurer be made for an appraisal to move forward.
In West Virginia, certain licensees are exempt from the continuing education requirements. That exemption applies to:
Persons holding a resident license for any limited lines of insurance for which an examination is not required by the Commissioner.
A dead tree beside Jerry's home is best described as which of the following types of hazards?
Physical hazard.
A contractor in need of a bid bond to obtain a contract is an example of a(n):
Principal.
The Gramm-Leach-Bliley consumer privacy act requires:
Privacy notices to be delivered electronically only if the customer or consumer agrees..
The Businessowners policy excludes coverage for all of the following, EXCEPT:
Property of others in the insured's care, custody, or control..
Which of the following statements is NOT TRUE of a fidelity bond written on a "scheduled basis"?
Schedules a single amount to cover all employees.
Which of the following statements is TRUE regarding the sections of a Homeowners policy?
Section I coverages vary greatly between the different HO forms
According to the West Virginia insurance code, "to exchange a contract of insurance by any means, for money or its equivalent, on behalf of an insurance company", is the definition of:
Selling insurance
George went out for target practice one day with his handgun. He has practiced many times with the same target located in the woods behind his house. Unbeknownst to George, a neighbor was walking in the woods behind the target one day and was shot in the leg by George. Intentional acts are never covered by insurance, however, the claim filed by the injured neighbor may be covered under George's liability coverage. Which of the following is the most likely reason why?
Shooting the gun was an intentional act committed by George, but the consequences of act (his neighbor being shot) were not intended. .
An office building is limited in the number of stories it may contain and still be eligible for coverage under a standard Businessowners Policy. This number is:
Six stories.
Symbol 23 is designated on the insured's Garage Coverage form. This indicates that:
That owned private passenger autos only are covered.
The policy territory of a Commercial General Liability includes:
The United States and Canada.
Which of the following statements is NOT correct under Part A of a standardized Personal Automobile policy?
The aggregate limit of liability for supplementary payments is $250.
Which of the following cause of loss forms provides named peril coverage?
The basic and broad forms only.
All of the following claims would be excluded under the Homeowners Watercraft Endorsement, EXCEPT:
The bodily injury suffered by the insured while he was operating the covered watercraft, loses his balance and hits his head on the floor of the boat.
An insurance company is given a C++ rating by A.M. Best. This means:
The financial health of the insurance company is good.
Carol is covered under a Commercial Property policy with an Earthquake & Volcanic Eruption -- Sprinkler Leakage Only Endorsement attached. Which of the following statements is correct regarding Carol's deductible under the endorsement?
The flat dollar deductible for fire applies.
Which of the following parts of the insurance contract contains the "contractual agreement" between the insurance company and the insured?
The insuring agreement(s)
All of the following are true concerning Commercial Package policy modification factors, EXCEPT:
The numerical figure used as a modification is set within each coverage part of the standard policies that make up the package..
Which of the following statements is TRUE regarding a Government Crime policy?
The policy permits the limit for employee theft to apply on either a "per occurrence" or "per employee" basis
Which of the following statements is TRUE when determining the coverage limit for property damage under the standard Equipment Breakdown policy?
The value of all the insured's property plus the value of property of others must be included.
If an insured is covered under an HO-2 policy, damage caused by wind to his/her personal property would be covered if:
The wind created an opening in the structure, allowing the wind to damage the personal property inside.
Which of the following most accurately describes reinsurance?
When an insurance company buys insurance for some of the risks for which it has issued coverage.
Willies Widgets has been covered under a Crime policy for several years but has cancelled the policy in favor of purchasing another policy through a different insurer. Which of the following statements is CORRECT regarding the "Extended Period to Discover Loss" condition of the Crime policy?
Willie discovers a loss two weeks after the cancellation date of the policy. The effective date of his new policy is not for another month. Willie can expect his cancelled policy to pay for the loss.
West Virginia has specified certain types of commercial insurance as exempt from rate-filing requirements. All of the following are types of policies that are exempt from filing rates in West Virginia, EXCEPT:
Workers' compensation
Which of the following statements regarding Commercial Auto coverage is NOT TRUE?
the definition of "trucker" and "motor carrier" are the same in both the Truckers form and the Motor Carrier form
Which of the following Commercial Property conditions is meant to prevent "over indemnification" of the insured?
The "Insurance Under Two or More Coverages" condition.
All of the following sections of a Commercial General Liability policy are identical whether written on a claims-made or occurrence form, EXCEPT:
The coverage trigger..
Tara's hair salon was already having a bad year when a client slipped and broke her arm on a worn out piece of flooring, and sued the salon for $500,000. Tara had recently purchased an Excess Liability policy and she was hoping that she could cover the claim with the new "excess" policy, leaving her underlying CGL policy untouched. This is not possible because:
The coverage under an Excess Liability policy are only triggered when the underlying policy's limits have been exhausted
Supplementary payments under the liability section of a Commercial Auto policy include reasonable expenses incurred by the insured including loss of earnings up to _____ per day.
$250
The "Medical Payments" section of the standard Yacht policy will provide coverage for all of the following, EXCEPT:
A scuba diving accident when diving from the insured boat.
The Homeowners "additional coverages" includes coverage up to __________ for grave markers including mausoleums on or away from the residence premises by a peril insured against
$5,000.
Under the "additional coverages" contained in Section II of the Homeowners forms, damage to "property of others" will not be covered if that damage was caused intentionally by an insured who is at least:
13 years of age.
West Virginia statutes require that payment on an Homeowners claim must be made within _____________ of the insured and the insurer reaching an agreement as to the loss settlement.
15 Working Days
In West Virginia, a producing agent must report to the Insurance Commissioner any administrative action taken against the producer in another jurisdiction or by another governmental agency in this state within _____ of the final disposition of the matter.
30
A couple has volunteered to cook at special events for their church. The church is concerned that one of these volunteers might be injured in the kitchen and wants to protect them in case of an accident. The church maintains workers compensation coverage for its maintenance personnel. What should the church do to provide coverage?
Add the Voluntary Compensation Endorsement to the workers compensation policy.
A person who knowingly makes false and maliciously critical or derogatory statements about another person with the intent to cause injury is guilty of:
Defamation.
The Fair Credit Reporting Act provides a credit or insurance applicant with the right to:
Dispute the information contained in their credit report..
Calvin has a Business Automobile policy covering the automobiles he uses in his business. He acquires a new trailer with a load capacity of 1,000 pounds and he plans to attach it to a van he already owns. The van is scheduled on the policy with Symbol 7 listed beside it. Based on this information, how long does Calvin have to report his new trailer to the insurance company?
Calvin is required to report newly acquired vehicles to the insurance company within 30 days.
Any false or malicious communication, written or oral, that injures an insurance company's or insurance professional's reputation, fame, or character is known as:
Defamation.
All of the following statements are TRUE of a Farm Liability policy with a Limited Farm Pollution Extension endorsement attached, EXCEPT:
he endorsement covers pollution clean up costs required by a government authority
The Builders' Risk form provides an extension of coverage for building materials within 100 feet of the building being constructed and belonging to others, but under the care, custody, and control of the insured for up to:
$5,000.
All of the following are duties conducted by insurance professionals who must be licensed before "transacting insurance", EXCEPT:
An attorney who oversees the adjustment of claims..
