P&C license NE TH
The transfer of a legal right or interest in an insurance policy is called
Assignment
A personal umbrella policy may act as excess or over any of the following insurance coverage polices EXCEPT
Auto collision coverage
In a DP-1, if the insured elects to apply Coverage B to a detached garage, Coverage A will
Be reduced by 10%
Insurers CANNOT transact insurance in this state without a
Certificate of Authority
Recovery by the plaintiff is lessened or increased depending upon the degree of each party's negligence
Comparative negligence
Under which legal defense is there an apportionment of damage based upon the degree of fault of each of the plaintiff's and the defendant?
Comparative negligence
An insured intentionally did not disclose a material fact on the application for insurance. This would be considered
Concealment
The binding force in any contract
Consideration, the insurer promises to pay in the event of a loss
supplementary payments section of the commercial general liability policy would cover
Court costs assessed against the insured in a suit
Other than perils, the difference in the three DP forms is in coverage provided. Which of the following coverage options is covered by the DP-2 and DP-3 but not DP-1?
Coverage E- Additional Living Expense
Under a fidelity bond, what happens when the employer discovers the employee has committed an dishonest act
Coverage terminates immediately
Section III of the businesses auto policy provides physical damage coverage, All of the following are physical damages that may be selected coverages EXCEPT
Limited peril coverage
A ____________ is a statement that, if discovered, would alter the underwriting decision of the insurance company.
Material misrepresentation
Untrue statements on the application unintentionally made by insureds that, if discovered, would alter the underwriting decision of the insurance company, are called
Material misrepresentations
In a business owners policy (BOP), which of the following would be covered?
Medical expenses
Which is NOT true of workers compensation coverage
Medical payment benefits are limited to
Which of the following is the other major coverage provided by businessowners liability coverage form?
Medical payments
Which endorsement, when added to the personal auto policy, alters the definition of covered auto to include motor homes, golf carts, or motorcycles?
Miscellaneous-type vehicle endorsement
An insurance agent visits a potential clients and explains various types of policies. The customer displays a lack of interest, so the agent guarantees higher dividends than he knows would be possible. Which term describes what the agent has done?
Misrepresentation
The owner and operator of a store discovers that a customer paid for a large order with forged paper money the day before during business hours. Which crime coverage form would provide coverage for this loss?
Money orders and counterfeit paper
Coverage may be provided in all states named in Part Three of the information page, expect those states that maintain a __________ fund.
Monopolistic
Personal property is property that is moveable, real property is not
Moveable
Which of the following clauses excludes assignment or granting of policy provisions to any person who repairs property for a fee?
No benefit to bailee clause
Miscellaneous-type vehicle endorsement modifies the definition of covered auto to include motor homes, golf carts, motorcycles, dune buggies, but restricts the coverage for which vehicles?
Nonowned
Auto collision is not a liability coverage, therefore, the personal umbrella will
Not act as excess
Which of the following best defines the unfair trade practice of rebating?
Offering an inducement of something of value not specified in the policy
In the last 72 hours there were 3 instances of volcanic eruptions that damaged a property covered by a dwelling policy. How many deductibles will the insured have to pay before the policy covers the damages caused by the eruption?
One
The other states insurance section of a workers compensation policy coverage
Only for those other states listed in the policy
The extended nonowned coverage provides protection for
Only the person(s) named on the policy
What is Coverage B in HO
Other Structures
A sublimit in a liability policy that puts a ceiling on the payment for all claims that arise from a single accident
Per occurrence
What sublimit in a liability policy sets the maximum amount that will be paid for all claims arising from a single accident?
Per occurrence
The owner if a rental dwelling, insured under a DP-2, turns off the heat in the insured dwelling dureing the winder months because the dwelling is not ocucpied. The building's water pipes freeze and break, causing damage. How will the policy react to this loss?
The loss is excluded from coverage
An automobile policy has limits of 30/50/25. The number 50 means
The maximum limit for bodily injury claims that can be paid for one accident
Each of the following may be insured under a HO-3 homeowners policy EXCEPT
The owner occupant of a condominium unit
Under the property and casualty conditions of a homeowners policy, what may happen is it is discovered that the policyowner committed concealment or fraud?
The policy may be voided
Under a workers compensation policy, premiums will be determined when
The policy period ends
The Insurance Services Office (ISO) creates forms for
The standard mark
Rates for earthquake coverage in property policies are generally determined by which of the following?
The type of construction
Which of the following will be covered under Coverage A- Bodily Injury and Property Damage in the commercial general liability policy?
Third-party bodily injury due to the insured negligence
What was the purpose of the Motor Carrier Act of 1980?
To establish financial responsibility requirements for interstate motors carriers
Which of the following is consideration on the part of an insurer?
Underwriting
What polices are used when it is difficult to establish the value of insured property after a loss occurs, or when it is desirable to agree in a specific value in advance.
Valued polices
Which of the following would be a proper choice of policy for a company that transports goods that are irreplaceable in nature?
Valued policy
In regards to earth movement (earthquake) coverage in property policies, rates are general determined by the type of construction. This determines the dwelling's ____________ to earthquake losses.
Vulnerability
Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract?
Warranty
When can insureds obtain insurance through a surplus lines insurer?
When they are unable to procure insurance through an authorized insurer
An insured has the scheduled personal property endorsement attached to his homeowners policy. If the insured acquires new works of art, when must the insurer be notified for the new works of art to be covered under the endorsement?
Within 90 days
While engaged in a pick-up soccer game in the neighborhood park, the insured collides with another player, breaking his nose. Would the insured's homeowners medical payments cover the injury?
Yes, medical payments coverage also applies off the insured premises.
the obligation to compensate injured workers without regards to fault or negligence is know as
Absolute liability
What is Coverage E in HO
Additional Living Expenses
All of the following quality as an "insured contract," as defined in commercial auto polices EXCEPT
Agreement for demolition near a railroad
A driver who has an auto policy with limits of liability lower than required by state law would be considered
An uninsured motorist
An insured was judged at fault in an automobile accident. He has a 100/300 bodily injury liability coverage. Three other individuals were injured in the vehicle hit by the insured. They were awarded damages of $150,000, $75,000 and $75,000. What amount if any, was not covered by his insurance policy?
$50,000
A business had a CGL policy with limits of $20,000 per person and $50,000 per occurrence. The business is found liable for the bodily injury to three customers, each accruing $25,00 in medical expenses, How much will the CGL policy pay?
$50,000 in total
Under Homeowners policy, watercraft liability coverage will apply to all of the following vessels EXCEPT
A watercraft rented to another person
The obligation to compensate injured workers without regarding to fault or negligence is known as
Absolute liability
If a producer allows their license to lapse, within what maximum time period may the license be reinstated?
1 year
As specified in the protective safeguard endorsement added to business owners policy, if the automatic sprinkler system is shut down due to freezing conditions, the uninsured does not need to notify the insurance company as long as the system is restored within
48 hours
According to the business property coverage form vacancy condition, if a policy is issued to the owner of a building, the building will be considered vacant if what portion of the square footage is unused and not rented?
69%
All volcanic eruptions occurring within a _____ hour period of time will be considered one occurrence.
72
In business owners policies, how soon does the period of restoration for business income coverage begin after the direct loss?
72 hours
For coverage to apply to fine arts, the report of acquisition must be provided within how many days?
90
When insurance is written on a dwelling form, which of the following types of property would be insured under Coverage B (other Structures)?
A garage separated from the dwelling
During policy solicitation, an insurer exaggerates the financial condition of one of its competitors, and makes it sounds worse than it is. This is an example of an unfair trade practice of
Defamation
Under a workers compensation policy, premiums are based on payroll, because the final payroll will not be known before the policy is issued, the initial premium is considered a ______ and is subject to an adjustment at the end of the policy period
Deposit
If a fire erupts in the kitchen and spreads to the upstairs bedroom, resulting in the destruction of furniture, what type of loss has occurred?
Direct
What refers to any direct physical damage to buildings and personal property?
Direct
What is Coverage A in HO
Dwelling
Sarah owns a local toy shop. One day she notices a child taking a toy and trying to leave without paying. Sarah runs out after the child, pushes him down and sits down on him until the police arrive. The child suffers multiple fractures on the ribs, as well as psychological trauma. Which of the following exclusions in the commercial general liability policy applies?
Expected or intentional injury exclusion
Which of the following statements is true concerning a workers compensation and employers liability policy?
Exposures in states listed on the information page are covered
An employee cannot contract for workers compensation coverage for an employer without the _________________ of that employer.
Express Authority
The authority granted to an agent through the agent's contract is referred to as
Express authority
What is Coverage D in HO
Fair Rental Value
Which of the following would be considered a peril?
Fire
Which of the following is covered under a dwelling policy?
Fire caused by an earthquake
Space Age Rockets makes model rocket supplies and has 12 employees. The company is located in Atlanta, GA. Georgia has compulsory workers compensation laws. Space Age's owner thinks that his company is too small and unprofitable to carry the workers comp plan mandated by the state. Possible consequences of noncompliance include all of the following EXCEPT: a. payment of fines and penalties as dictated by state compliance authorities b. forced payment of billing for services rendered by any private insurer that "binds" coverage based on an employee's request for coverage c. closure of the business as a public nuisance by state officials d. payment for injuries in monetary amounts stipulated by the state with respect to workers compensation plans
Forced payment of billing for services rendered by any private insurer that "binds" coverage based on an employees request for coverage.
A warranty in insurance is a statement
Guaranteed to be true
Slippery floors, reckless driving, or providing false information are examples of..
Hazards
According to the Fair Credit Reporting Act, all of the following statements are true EXCEPT
If declined for an insurance policy, an applicant has not right to the information in the report
Restoring an insured financially after a claim is known as
Indemnity
Which of the following is NOT true regarding the automatic increase in insurance endorsements in dwelling policies?
It does not require an additional premium
All of the following are true regarding a producers fiduciary responsibilities EXCEPT
Producers may commingle personal funds with company funds
Which of the following is NOT available in a package policy?
Professional liability
Which of the following types of property is NOT moveable?
Real property
Which of the following insurance options would be considered a risk-sharing arrangement?
Reciprocal
One insurance company indemnifies another insurance company for part or all of its liabilities to protect the insured company against catastrophic losses.
Reinsurance
When one insurer buys insurance from another company to minimize the effects of catastrophic losses, they are
Reinsuring
Statements that are true to the best of the applicant's knowledge
Representations
When an applicant is applying for an insurance contract, the statements on the application are generally not warranties but
Representations
If an insured purchases an insurance policy with a large deductible, what risk management technique is the insured exercising?
Retention
For an additional premium, the extended coverages written on the basic form dwelling policy would cover which of the following?
Riot
The seven perils included in the extended coverage included coverage for damage by
Riots
Which of the following perils will be EXCLUDED from coverage under HO-4 Tenant Broad Form of a homeowners policy?
Sewer water backup
When insurance is obtained through a reciprocal insurer, the insureds are
Sharing the risk of loss with other subscribers of that reciprocal
Time parameters set by statute law that limit the amount of time in which a claimant cab bring an action for recovery for a certain types of losses is called
Statue of limitations
Coverage B- Personal and Advertising Injury Liability responds to claims arising from
Suits alleging infringement of a copyright
Which of the following has the primary responsibility to write forms for the standard market?
The Insurance Services Office (ISO)
A golfer slices a tee shot and the ball goes through the window of a house beside the fairway. The broken glass is paid for by
The golfer's homeowners liability coverage
Express powers are written into the contract between
The insurer and the agent
