P&C License Exam - Practice Test Questions

________ limits of insurance on the dwelling are available and apply to Coverage D-Fair Rental value

20%

For the purpose of worker's compensation insurance who would not be subject to worker's compensation laws, either as an employer or an employee?

A Crew member of an ocean going vessel

Part Four of the Worker's Compensation and Employer's liability policy describes what?

Insured's duties upon a loss

Which of the following coverage provisions would not be found in an unendorsed Dwelling policy form? - dwelling - other structures - liability - personal property

Liability

Which policy condition applies when an insurer covers property losses at cash value rather than an amount that exceeds the repair or replacement value?

Loss Settlement Condition

What exposure is unique to Mobile homes?

Loss from Collision Damage

The insured is moving his lawn when a stranger is noticed in the backyard. The stranger claims to be a substitute delivery person. Several days later, a gold watch can not be found. What describes the loss?

Mysterious disappearance

Under which part of a Worker's Compensation and Employers Liability policy would you find a description of employers liability coverage provided?

Part Two

Can Mobile Homes be insured with a mobile homeowners endorsements to a HO-3 form?

Yes

Does Worker's Compensation benefits for loss of wages include replacement of a portion of lost wages?

Yes

Does a DP-2 policy cover accidental discharge of steam from a plumbing system?

Yes

Does deciding to insure an inherited firearm collection demonstrate an insurable interest?

Yes

Is burning debris near the building on a calm sunny day considered a physical hazard?

Yes

Is carpeting that is permanently installed inside the building included in the property coverage of a BOP?

Yes

Is power interruption excluded from the DP-1 basic policy form?

Yes

The insured's employee causes an injury while on the job. Is this an example of vicarious liability?

Yes

Would carpet cleaning after a water main break trigger coverage under business income form with extra expense coverage?

Yes

Which of the following would be covered under the building coverage of the building and personal property coverage form? (2 answers) - Inventory stored at the insured's warehouse - An addition to the insured's store on which construction has just begun - Fire extinguishers located in the insured's factory - Office furniture and supplies kept in the insured's building

- An addition to the insured's store on which construction has just begun - Fire extinguishers located in the insured's factory

What is the correct timeframe for earthquake shocks to be considered as a single earthquake?

72 Hours

Under the dwelling policy conditions, how would the insurance company settle a loss?

Company has the option to repair to pre-loss condition

The "ground rules" are described in which part of an insurance policy?

Conditions

What best describes the CGL's general aggregate limit as it applies to the coverage parts of the CGL?

Coverage A, B, and C apply in sum and are the most that will be paid subject to the general aggregate limit

Which of the following coverages may be attached to a homeowners policy only by endorsement? - Coverage for a mobile home - Coverage damage to the property of others - Personal Property Coverage - Medical Payments

Coverage for a mobile home

The financial loss caused by a home being damaged in a windstorm is a(n) ___________ loss

Direct Loss

T/F - Caps, covers, or bedliners on pickup trucks are excluded losses under Part D - damage to an auto of the personal auto policy

False

T/F - Discharge or overflow of water from a sump is a covered cause of loss under the HO-2 Broad Form

False

T/F - Freezing of plumbing would be covered perils under the DP-1 Basic Policy Form

False

T/F - Freezing or road damage is specifically listed in the policy as being other than collision losses

False

T/F - Homeowner's Special Form (HO-3) covers Broken Glass, but Homeowner's Broad Form (HO-2) does not.

False

T/F - The employer while insured is driving a company car is considered an insured under Part A Liability Coverage of the personal auto policy

False

T/F - The policy conditions as well as state laws permit the insurance company to cancel or rescind a policy when representations exist.

False

T/F - Under CGL defense cost for the plantiff is covered under supplementary payments

False

T/F Mental Anguish is considered compensatory special damages when an insured is found legally liable for the loss of another

False

Which Homeowners form covers tenants?

HO-4

Which Homeowners form provides the most comprehensive coverage?

HO-5

What homeowners form is the most appropriate for older homes with replacement values hat may far exceed their market values?

HO-8

When an individual with a pre-existing condition is in an automobile accident and the insurance covers rehabilitation only to the level of the condition prior to the accident, this is because of which principle?

Indemnity

An extended reporting period attached to a general liability policy provides coverage in which of the following ways?

It provides coverage for claims made outside the policy term

Under the Equipment Breakdown coverage form, which of the following causes of damage to covered equipment would not be a covered "breakdown"? - Electrical Failure, including arcing - Leakage at any valve, fitting, shaft seal, gland packing, joint, or connection - Failure of pressure or vacuum equipment - Mechanical failure, including rupture or bursting caused by centrifugal force

Leakage at any valve, fitting, shaft seal, gland packaging, joint, or connection

Which of the following would be covered by a commercial package policy? - Small to Medium Size Businesses - Loss due to crime

Loss due to crime

Are outdoor signs that are not attached to the building included in the property coverage of a BOP?

No

Can Mobile Homes be insured with a HO-8 modified coverage form?

No

Does An auto not titled to an insured but available for regular use of named insured or family member describe a non owned auto under the commercial auto policy symbol 9?

No

Does a DP-2 policy cover damage to awnings from weight of snow?

No

Does insuring an engagement ring given to fiancee demonstrate an insurable interest?

No

Is bodily injury to an insured's nonresident family member or relative an exclusion found under the personal auto policy Part A liability coverage?

No

Is leaving the keys in the car and the doors unlocked considered a physical hazard?

No

Is lightning Strike excluded from the DP-1 basic policy form?

No

Is loss from collapse of awnings a unique exposure to mobile homes?

No

The insured loans a defective ladder to a neighbor that results in an injury. Is this an example of vicarious liability?

No

Would Employee Pay after a building structure is damaged trigger coverage under business income form with extra expense coverage?

No

When does Coverage begin on a Builder's Risk form?

On the date construction starts above the lowest basement floor, if there is a basement

Part three of the Worker's Compensation and Employer's liability policy describes what?

Other States Insurance

An insured has transportation expenses coverage under part D of the personal auto policy when involved in a collision. Coverage provides which of the following?

Rental Reimbursement until claim is settled by insurance

Which type of crime best describes someone who waits until store personnel are preoccupied and pockets merchandise while no one is looking and leaves without detection

Robbery

Who would be able to collect survivor and death benefits from WC in the event the covered injury resulting in the death of an employee?

Spouse of Employee

The Terrorism Risk Insurance Act and the National Flood Insurance Program are similar by providing what?

Subsidies, loss sharing or excess coverage

The party who agrees to be responsible for loss in the case of a fidelity bond?

The Surety

Part one of the Worker's Compensation and Employer's liability policy describes what?

The WC Coverage

An insured operates an auto repair shop and has a garage coverage form with garagekeepers insurance when an employee on a test drive with a customer's car is involved in a crash. How will the customer's car be covered by the insured's policy?

The customer's car is covered for any physical damage while in custody of the insured

What is the purpose of the causes of loss form that lists specific exclusions?

To state which perils are insured against

T/F - Homeowner's Special Form (HO-3) covers Structures other than the dwelling, but Homeowner's Broad Form (HO-2) does not.

True

T/F - Losses due to the destruction or confiscation by civil authorities are excluded losses under Part D - damage to an auto of the personal auto policy

True

T/F - Others to the extent that they share liability with the insured are considered an insured under Part A Liability Coverage of the personal auto policy

True

T/F - Riot or civil commotion would be covered perils under the DP-1 Basic Policy Form

True

T/F - The policy conditions as well as state laws permit the insurance company to cancel or rescind a policy when fraud exists.

True

T/F - Under CGL Cost of Bail Bonds is covered under supplementary payments

True

T/F - Weight of ice, snow, or sleet is a covered cause of loss under the HO-2 Broad Form

True

T/F - Windstorm is specifically listed in the policy as being other than collision losses

True

T/F Lost Wages are considered compensatory special damages when an insured is found legally liable for the loss of another

True

In legal terms, the actions by one party might have the effect of giving up a known right. When this occurs, the party has created which of the following? - Unilateral Contract - Representation - Warranty - Wavier

Waiver

Not a common exclusion in a liability policy

damage caused by acts of civil disobedience and riots

A woman slips on icy steps and breaks her leg. What is the peril in this situation?

the fall