Practice Test

Which of the following represents the maximum amount reimbursable for tree debris removal for one occurrence under all Homeowners forms?

$1,000

Which of the following is the special limit of coverage on the homeowners policy form for property damage to personal watercraft?

$1,500

An insured with split liability limits of 100/300/100 is at fault in an automobile accident and the other vehicle sustains $6,500 in property damages as well as two occupants have bodily injury and are claiming $150,000 each. What is the most insurance will pay to each occupant?

$100,000

A single earthquake constitutes all shocks that occur within which time period?

72 hours

Which coverage forms are used when the insured sustains loss of revenue due to direct physical loss from a peril insured against that forces the insured to suspend operations during the period of restoration?

Business Income Coverage forms

Which of the following is TRUE when the insured?s limits of insurance apply per occurrence?

Coverage is triggered for smoke damage to siding caused by repeated acts by insured's neighbor.

Which of the following is EXCLUDED as a covered loss under the DP-3 coverage?

Damage by ice to outdoor radio and television antennas and aerials

Which applies when an insured is found legally liable for the loss of another and is ordered to pay general damages?

Damages compensate for pain and suffering.

Which of the following homeowners forms covers tenants?

HO-4

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.

When does the coverage begin for a builders risk form?

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

How does the BOP differ from the CPP?

The BOP prepackages a group of coverages desirable to small businesses.

If the insured has a loss with a private passenger nonowned temporary substitute vehicle how will the loss be treated by the insured?s own policy for physical damage?

The broadest coverage available extends from the insured?s policy.

An insured operates a 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 the custody of the insured.

Which of the following is correct for amounts paid as supplementary payments covered in the personal auto policy Part A liability?

They do not reduce the policy limit.

In which of the following situations would workers? compensation benefits be covered for an injured employee?

a slip and fall while on the job at work

All of the following are considered an insured under the liability part of a personal auto insurance policy EXCEPT

a stranger who takes the car without permission.

Underwriters are permitted to use all of the following when underwriting an application for insurance EXCEPT

age, race, and religion.

Under the insured?s personal auto policy, which of the following is CORRECT for a newly acquired car to be covered prior to reporting it to the insurance company?

all coverage extends if the insured reports the car within fourteen days.

What does an application for insurance contractually represent for the insured?

an offer

Which of the following is covered by the Homeowners Broad form (HO-2) insurance?

breakage of glass

All of the following are the most commonly used personal inland marine forms EXCEPT

builder's floater form.

An insureds place of business is broken in to and merchandise unlawfully taken during the night, the insured is the victim of which type of crime?

burglary

The property coverage of a BOP includes which of the following?

carpeting that is permanently installed inside the building

When the insured?s child spills red juice on the carpet of insured?s covered automobile, which of the following coverages will apply?

comprehensive

Which characteristic of an insurance contract states that when a loss occurs the insured should be restored to the financial condition he was in before the loss?

contract of indemnity

Which of the following is an example of replacement cost valuation?

cost new without depreciation at the time of loss

Which of the following does HO-6 provide?

coverage for personal property of a condominium owner

A DP-2 policy covers all of the following EXCEPT

damage to awnings from weight of snow.

Which part of the CGL designates who is an insured?

declarations

Which of the following is an example of a financial loss caused by a home being damaged in a windstorm?

direct loss

The insured has a commercial auto policy with a drive other car broadened coverage liability for named individuals (DOC) endorsement. In which of the following would the named individual be covered?

driving neighbor's auto

Workers? compensation coverage is rated on the basis of which of the following?

employer?s payroll

Employees are barred from suing employers in court to obtain compensation for injuries covered by workers? compensation because of which of the following doctrines?

exclusive remedy

All of the following are Unfair Claims Settlement Practices EXCEPT

failure to respond to a first notice of loss within 24 hours.

The Gramm Leach Bliley Act was enacted to protect consumer?s right to privacy and made mandatory which of the following?

financial institutions must have a privacy policy in place

Exclusions common to liability coverage for both the personal auto policy and the business auto policy include all of the following EXCEPT

for liability arising while the insured auto is being used in an auto business.

What is it called if someone plugs too many electrical cords into a single outlet?

hazard

According to the Nationwide Definition of marine insurance, which category is an eligible marine risk?

imported goods

Which of the following defines a loss which is consequential and comes as a result of an original loss?

indirect loss

After a loss occurs whose duty is it to complete a proof of loss?

insured

All of the following demonstrate insurable interest EXCEPT

insuring an engagement ring given to fiancée.

All of the following specify limits of insurance for the CGL EXCEPT

legal defense.

A contract that is against public policy is not enforceable according to which contract characteristic?

legal purpose

With which of the following methods are losses settled on an actual cash value (ACV) basis?

less depreciation

All of the following losses are excluded from the DP-1 basic policy form EXCEPT

lightning strike.

All of the following represent the maximum amount the insurance company will pay for a loss EXCEPT

limit of reimbursement.

Which of the following would be covered by a commercial package policy?

loss due to crime

Which exposure is unique to mobile homes?

loss from collision damage

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

All of the following professionals would purchase Medical Malpractice insurance to manage the liability risk associated with their practices EXCEPT

mortician

When the policy term ends and either the insured or the insurance company wants to discontinue coverage which provision is applied?

nonrenewal

Which of the following forms trigger coverage for a loss under the commercial general liability policy if a loss happens during the policy period?

occurrence form

For the CGL coverages of bodily injury, property damage and medical payments, which of the following limits of insurance apply if the aggregate limit is NOT met?

per occurrence

The Causes of Loss form for farm property lists which of the following?

perils property is insured against

All of the following would be found on a declarations page EXCEPT

policy exclusions.

Which of the following business liability exposures does a slip and fall loss fall under?

premises and operations

Which of the following terms applies to a policy that pays first when two policies cover the same property?

primary

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

Workers? compensation benefits for loss of wages include which of the following?

replacement of a portion of lost wages

The policy conditions as well as state laws permit the insurance company to cancel or rescind a policy when any of the following exist EXCEPT

representations.

The claims-made liability form provides coverage from a date that precedes the policy effective date. Which of the following defines that date?

retroactive date

Which of the following types of crime best describe the unlawful act of taking property from the care and custody of another person while threatening to cause bodily harm?

robbery

Bodily injury means injury arising out of all the following EXCEPT

slander.

Which of the following would be eligible to collect survivor and death benefits from workers? compensation in the event of the covered injury resulting in the death of an employee?

spouse of employee

Which one of the following is an example of pure risk

storing your new motorcycle outside

Which of the following terms refers to the transfer of the insured?s right of recovery against others to his insurance company?

subrogation

The State highway department is rebuilding a roadway and the general contractor winning the bid will be required to purchase a bond guaranteeing the work will be completed according to specifications and on time. Which of the following types of bonds will the general contractor need to purchase?

surety bond

The following are all types of disability categories under workers? compensation insurance EXCEPT

temporary permanent.

Which of the following created The National Flood Insurance Program?

the United States Congress

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

the fall

The insured carries uninsured motorist coverage limits of 100/300/100 and is struck by an uninsured motorist, who will pay insured?s bodily injury damages claimed for $100,000?

the insured?s insurance company

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

to state which perils are insured against

Liability arising out of any of the following is excluded from the personal and advertising injury liability coverage EXCEPT

unknowingly inflicting injury that violates the rights of another.

Mobile homes can be insured in all of the following ways EXCEPT

with a HO-8 Modified Coverage form.