Property and Casualty Insurance
Which of the following statements about a property policy is false?
The purpose of coinsurance is to have the insure retain part of the risk
The insured is part of a homeowners association. After a property loss to the common area owned by all of the association's members, the insured is assessed $1,500 for the damages. The insured's Homeowners policy will provide:
$1,000 of coverage
Insurers in this state must provide ________ notice before cancelling an auto policy. A 30 days' B 60 days' C 20 days' D 45 days'
A
All of the following are false concerning the National Flood Insurance Program, except: A Payment for losses are made by the federal government B Agents may bind flood insurance for up to 15 days prior to submitting the final application C Flood policies are available only from the National Flood Insurance Program D Dwelling coverage includes trees, shrubs, and plants
A
It is prohibited for an agent to include in the sum charged for a policy any fee, compensation, or charge that is not specified in the policy. This is an unfair trade practice referred to as: A Nondisclosure of fees B Coercion C Unfair discrimination D Rebating
A
Liability insurance is a two-party contract with payments made to which of the following? A A third party B The insured C The party of the first part D The party of the second part
A
Specified Causes of Loss under Physical Damage Coverage of the Business Auto Coverage Form includes all of the following, except: A Glass breakage B Windstorm, hail or earthquake C Theft D Flood
A
Uninsured Motorist Coverage under a Personal Auto Policy covers which of the following vehicles? A A vehicle owned by the named insured B A vehicle used primarily for use off public roads C Any vehicle being used to carry property or persons for a fee D A vehicle being driven without permission
A
Which of the following is true regarding the HO-3 (Special Form)? A The dwelling and other structures (Coverages A and B) are written on an open perils basis B Coverages A, B, and C are all written on a replacement cost basis C The dwelling and other structures (Coverages A and B) are written on a named perils basis D The contents (Coverage C) are written on an open perils basis
A
An organization that writes liability insurance to cover the liability exposure for the mining engineers that belong to its associations is:
A Risk Retention Group
Under the HO-8 policy, the dwelling is valued on which basis? A Market value B Actual cash value C Replacement cost D Agreed value
B
Under the Nebraska's Workers' Compensation Plan, assignments may not exceed: A 4 years B 5 years C 2 years D 3 years
B
Which coverage is not an Additional Coverage under the Businessowners Coverage Form? A Pollutant clean up and removal B Equipment breakdown C Business income and extra expense D Increased cost of construction
B
Which is a true statement about the Boatowners Policy? A Losses are always settled on a ACV basis B It provides both property and liability coverage, similar to a PAP C It can be used to insure any owned marine vessel D It provides named perils coverage for the hull and motor only
B
Which of the following is not an exclusion under Section II of the Businessowners Coverage Form? A Watercraft Liability B Medical payments to volunteer workers C Professional Liability D Employers Liability
B
A producer licensed in Nebraska received 15% of their total commissions in one year from writing controlled business. What will happen in response? A Nothing; this is within accepted limits B The producer will be presumed to have obtained their license primarily to write controlled business and circumvent laws regarding rebates C Nothing; this state does not regulate controlled business D The producer will be conclusively presumed to have obtained their license primarily to write controlled business and circumvent laws regarding rebates
B
Choose the correct answer regarding Coverage F of the Farm Property Coverage Form. A It covers farm buildings, including silos and fences, as well as home furnishings and office furniture in a home office B It will cover farm machinery both on and away from described premises C It does not cover unscheduled livestock, but does cover show horses and ponies, if scheduled D Each item of farm machinery to be covered must be scheduled
B
Choose the false statement about the coverage under the Businessowners Policy. A Premises and operation exposures pertain to a building owner or tenant who may be held legally liable in the event of bodily injury or property damage arising out of conditions on or away from premises B Products and completed operations coverage under the Commercial General Liability Coverage Forms will cover damage to the insured's products C Product liability may be based either on negligence or on a warranty D Contractual liability policies cover liability assumed under designated contracts
B
L owns a dwelling, and rents the detached garage to tenants. The premises are insured under a Special Form Dwelling policy with a Coverage A limit of $100,000. How much is the detached garage insured for if damaged by a covered claim? A Nothing B $10,000 C $20,000 D $50,000
B
Mobile Home Insurance includes all of the following, except: A Coverage B with a limit of 10% of Coverage A B Coverage C with a limit of 50% of Coverage A C Property Removal up to $500 D Coverage A Dwelling coverage
B
T's office condominium is covered under a Condominium Commercial Unit-Owners Coverage Form. Which of the following is not covered on a primary basis? A Furniture B Fixtures owned by the Association C Business personal property D Improvements
B
The Garage Liability section of the Garage Coverage Form covers which of the following? A Property in the care and custody of the insured B Property damage for which the insured is legally responsible C Product recall D Injuries covered by Workers' Compensation
B
Which statement is false regarding the Farm Property Coverage Form? A Coverage F includes unscheduled farm personal property B Losses from nuclear damage are covered C Exclusions include earth movement and intentional loss D Coverage D provides coverage for loss of use
B
A Broad Form Homeowners policy would cover all of the following personal property losses, except: A Theft of a residence employee's watch from the residence premises B Damage to a guest's passport after an appliance accidentally overflows C Furniture lost due to a mudslide D Fire loss to the dwelling's contents after a flood started an electrical fire
C
A manufacturer is held liable if a product caused an injury whether the product was or was not defective. This describes what type of liability? A Operations liablity B Vicarious liability C Strict liability D Contingent liability
C
The Businessowners Liability Coverage Form includes coverage for bodily injury, property damage, personal injury and advertising injury to which coverage applies, plus: A Employers liability B Liquor liability C Liability assumed under an insured contract D Mobile equipment being transported on an auto owned or operated by an insured
C
The purpose of the Insurance Fraud Act is to do all of the following, except: A Reduce the amount of premium dollars used to pay fraudulent claims B Detect and eliminate the occurrence of fraud through the development of fraud prevention programs C Appoint the National Association of Insurance Commissioners to investigate activities involving insurance fraud in this state D Authorize the imposition of civil penalties and restitution of fraudulently obtained benefits
C
Under a Commercial Crime policy, the definition of securities includes all of the following, except: A Tokens B Revenue stamps C Bank notes D Evidences of debt
C
Which insurance company department determines the probability of loss and determines premium rates? A Underwriting department B Claims department C Actuarial department D Sales department
C
Which of the following statements about Fire Department Service Charge coverage is not correct? A Fire Department Service Charge coverage is included under all Dwelling policy forms B Coverage does not apply if the property is located within the limits of the jurisdiction furnishing the fire department response C The policy will pay up to $1,000 for Fire Department Service Charge coverage D The policy deductible does not apply to this coverage
C
Which statement is false regarding the Farm Liability Coverage Form? A Personal injury includes damages arising out of false arrest, malicious prosecution, libel and slander B Medical payments would provide coverage for a neighbor who is injured while working the insured's livestock on a volunteer basis C Medical payments provide coverage only when the insured is legally liable D Medical payments do not provide coverage for anyone eligible for Workers' Compensation
C
The Additional Coverages part of a property insurance policy provides:
Coverage automatically included in the policy to supplement the basic coverages in the Insuring Agreement without an additional premium
Which of the following is true about Builders Risk Floater?
Coverage can be provided for farms
Part D of the Personal Auto Policy provides which of the following coverages?
Coverage for Damage to Your Auto
The purpose of the Insurance Fraud Act is to do all of the following, except: A Authorize the imposition of civil penalties and restitution of fraudulently obtained benefits B Detect and eliminate the occurrence of fraud through the development of fraud prevention programs C Reduce the amount of premium dollars used to pay fraudulent claims D Appoint the National Association of Insurance Commissioners to investigate activities involving insurance fraud in this state
D
Truckers Coverage Form
Covers business exposures of motor carriers for hire who transport the goods of others, rather than its own goods.
Choose the false statement regarding commercial auto coverage. A Section IV of the Garage Coverage Form provides coverage for the insured's owned autos B Section II of the Garage Coverage Form does not provide physical damage coverage to a customer's car C The Business Auto Coverage Form will cover liability arising from mobile equipment being carried or towed D Section II of the Garage Coverage Form - does not provide completed operations coverage
D
Employers Liability Insurance is designed to do all of the following, except: A Fill in gaps of compensation coverage B Cover claims that are not subject to compensation laws C Protect the employer against common law claims D Extend policy benefits to states not listed on the Declarations page
D
No motor vehicle liability policy may be issued in this state unless _______________ is provided. A Coverage for tractors B Coverage for commercial-use vehicles C Stacked coverage D Uninsured/underinsured motorist coverage
D
Under the Nebraska Workers' Compensation Act, total disability compensation will be ______% of the wages received at the time of injury. A 75 B 50 C 80 D 66 2/3
D
Which of the following is not a condition found in an insurance policy? A Assignment B Subrogation C Liberalization D Insuring Agreement
D
Which of the following is not true of the HO-2? A The HO-2 covers owner-occupied dwellings B The HO-2 pays for losses to the dwelling on a Replacement Cost basis C The HO-2 insures against the broad form perils D The HO-2 pays for losses on an open perils basis
D
Which property would be settled for its actual cash value even if the Personal Property Replacement Cost Loss Settlement Endorsement is attached to an HO-3 policy? A Outdoor equipment B Carpeting C Appliances D Antiques
D
Under Part A of a Personal Auto policy, which of the following losses would be covered?
Damage to a neighbor's parked car
False Advertising
It is an unfair trade practice to present any information that is misleading about any insurer in the conduct of their insurance business.
The Difference in Conditions Policy is a special form used to fill in gaps of a property policy. Which of the following is true regarding this policy?
It is generally written on an open perils basis, excluding losses by perils that are covered under standard property forms
Which of the following coverages is not provided by the Personal Liability Supplement?
Medical payments to a regular resident of the dwelling who sustains an injury
It is prohibited for an agent to include in the sum charged for a policy any fee, compensation, or charge that is not specified in the policy. This is an unfair trade practice referred to as:
Nondisclosure of fees
Premises liability exposure
Not a contingent liability exposure
All of the following are additional coverages under the Building and Personal Property Coverage Form, except:
Peak season
Which of the following is not an additonal coverage under the BOP?
Personal effects
Which of the following is NOT an Optional Coverage under the Businessowners Policy?
Personal property of others that is in the insured's care, custody and control
Choose the false statement about the coverage under the Businessowners Policy.
Products and completed operations coverage under the Commercial General Liability Coverage Forms will cover damage to the insured's products
Which of the following would not be covered under a Valuable Papers and Records Floater?
Securities
Which of the following is true regarding Personal Inland Marine Insurance?
Since moveable property is also known as floating property, the policies are sometimes known as floater policies
Which statement about property coverages provided by Homeowners policies is incorrect?
The HO-4 covers the dwelling against the Broad Form named perils
Which of the following parties may assign a standard property policy?
The insurer with prior written permission of the insurer
A Broad Form Homeowners policy would NOT cover which of the following losses?
Water damage to personal property stored in the basement after a sump pump overflows
Under the Commercial Property policy, debris removal and fire department service charge coverage are examples of: A Additional Coverages B Optional coverages C Endorsements D Exclusions
A
Which of the following is true regarding Dwelling policy coverages? A Coverage C applies while insured property is located at the described location B Coverage D is considered a direct loss coverage C Coverage B would cover an attached garage D Coverage C includes coverage for personal property of tenants and boarders
A
Which of the following regarding the value reporting form is true? A Late reporting or under-reporting will result in a penalty in the event of a loss B The Value Reporting Form contains an 80% coinsurance clause C The form may be attached to any Commercial Property Part coverage forms D The final premium is based on the values reported in the last report of the policy term
A
Which of the following statements is incorrect about Supplementary Payments under the CGL? A Supplementary payments apply to losses under all Section I coverages B Payments do not reduce the Limit of Liability C The insurer's claim-related expenses are included D The cost of bail bonds is included up to $250
A
Insureds under Part C - Uninsured Motorists Coverage of a Personal Auto policy include:
A family member, occupying an insured auto struck by an uninsured vehicle
The Farm Liability Policy WOULD NOT cover?
A neighbor who is accidentally hurt on the insured's farm makes a claim for medical payments 4 years after suffering injury
P is an agent for ABC Insurer, which has just issued an insurance policy to M. In this transaction, who is known as the principal?
ABC Insurer
A Broad Form Dwelling policy would cover all of the following losses, except: A Building damage caused by burglars B Fence that is damaged by a fallen tree branch C Glass on a storm door that is broken during a riot D Floor damage caused by accidental discharge of water from a household appliance
B
A Broad Form Homeowners policy would cover all of the following personal property losses, except: A Theft of a residence employee's watch from the residence premises B Furniture lost due to a mudslide C Fire loss to the dwelling's contents after a flood started an electrical fire D Damage to a guest's passport after an appliance accidentally overflows
B
All of the following are true, except: A Coverage D of a Homeowners Policy covers additional living expenses B Coverage D of a Homeowners Policy includes loss of income from an incidental business C Home schooling is permitted under a Homeowners Policy D A Homeowners Policy will not cover theft of a boat away from premises
B
Under a Commercial Crime Policy written on a Loss Sustained Form, what is the latest date that a covered loss can be discovered? A 2 years following policy expiration B 1 year following policy expiration C The policy expiration date D 5 years following policy expiration
B
Which property would be settled for its actual cash value even if the Personal Property Replacement Cost Loss Settlement Endorsement is attached to an HO-3 policy? A Carpeting B Antiques C Appliances D Outdoor equipment
B
Which statement is false regarding the Building and Personal Property Coverage Form? A If either the insurer or the insured submits a written demand for appraisal, each will choose and pay for his or her own appraiser B The standard deductible is $100 C The Peak Season Endorsement can be provided for a specified increase for a certain period D Coverage does not apply to money or securities
B
All of the following statements about liability are true, except: A Breach of contract is not considered an act of negligence B An insured may be liable for damages to an injured party, even if they are not deemed negligent C The burden of proof is on the injured party to prove that the other party was negligent D Liability policies pay costs incurred by an insured to sue negligent third parties
D
Which of the following is true concerning monopolistic states regarding Workers' Compensation insurance?
In Monopolistic states, Workers' Compensation is only available through a state fund
The Personal Liability endorsement DOES NOT provide coverage for which of the following?
Injury caused to a regular resident of the dwelling.
Which of the following is not a condition found in an insurance policy?
Insurance Agreement
Assumption of Risk
Not an element of negligence
Section II (Liability) of the Garage Coverage Form covers which of the following?
Property damage for which the insured is legally responsible
A Special Form Homeowners policy will provide all of the following, except: A Coverage for the dwelling on a named perils basis B Coverage for personal property on a named perils basis C Settlement for losses to personal property on an actual cash value basis D Coverage for other structures on an open perils basis
A
To appoint a producer as its agent, an insurer must file a notice of appointment within _________ from the date the agency contract is executed. A 15 days B 30 days C 10 days D 5 days
A
Valuation Clause
A condition under a Building and Personal Property Coverage Form that determines how losses will be paid?
Discovery Form
A crime for that requires the use of a Retroactive Date
Which of the following is NOT one of the limits of liability provided by the CGL?
Bodily injury limit
Section II of a Homeowners policy may cover which of the following incidents?
Bodily injury to a stranger, caused by an insured's activities while picnicking at a city park
Which of the following is not an exclusion under the Umbrella policy? A Professional services B Product Recall C Personal injury D Contractual liability
C
Which of the following is true about the Dwelling Program? A The Special Form covers contents on an open perils basis B The Broad Form automatically covers contents against theft C The Basic Form covers the perils of fire, lightning, and internal explosion D The Basic Form covers loss to trees, shrubs, and plants
C
Which statement about the Builders Risk form is NOT correct?
Coverage is always written on an open peril basis
All of the following are general conditions of the BAP, except: A No benefit to bailee for physical damage B Concealment, misrepresentation, or fraud C Premium audit D Duties in the event of an accident
D
In bonding, the surety is also known as the: A Principal B Obligor C Obligee D Guarantor
D
Combined single limits
The policy liability limits that may be applied to either bodily injury or property damage, in any combination
All of the following must be listed on Form MCS-90, except:
The policy premium amount
A person operating a motor vehicle who is not able to provide current proof of financial responsibility in the vehicle when requested by a Nebraska law enforcement officer is allowed _____ days to prove that financial responsibility was in effect at the time of the request.
10
The Nebraska Property and Liability Insurance Guaranty Association will cover claims existing prior to the determination of insolvency and arising within _____ days after the determination of insolvency.
30
Under the Nebraska's Workers' Compensation Plan, assignments may not exceed:
5 years
Under a Homeowners policy, how much coverage is provided for theft or unauthorized use of a credit or debit card?
500
A Broad Form Dwelling policy would cover all of the following losses, except: A Fence that is damaged by a fallen tree branch B Floor damage caused by accidental discharge of water from a household appliance C Building damage caused by burglars D Glass on a storm door that is broken during a riot
A
All of the following are true of liability policies, except: A They will cover damage to the insured's own property B They do not cover medical expenses incurred by the insured C They will pay sums that the insured becomes legally liable to pay D They are designed to cover third party injuries or damages
A
All of the following are true of the Commercial Builders Risk Coverage Form, except: A Liability coverage is included in the form B Coverage is excluded for lawns, trees and plants C Coinsurance applies to Builders Risk at the percentage listed on the declarations D Covered perils are specified by attaching a separate causes of loss form
A
All of the following must be listed on Form MCS-90, except: A The policy premium amount B The names of the motor carrier and the insurance company C The limits of liability provided by the policy D The policy number and policy dates
A
In respect to Section II of a Homeowners Policy, all of the following are true, except: A Section II losses are subject to a standard $250 deductible B Individual and family cemetery plots qualify as an insured location C Bodily injury or property damage arising from a vehicle used to assist the handicapped, such as a wheelchair, is covered D Damage to Property of Others pays up to $1,000 per occurrence
A
Medical payments under Coverage F of a Homeowners policy may be provided to all of the following people, without needing to establish negligence, except: A A boarder B A family friend C A guest D A residence employee
A
The Additional Coverages part of a property insurance policy provides: A Coverage automatically included in the policy to supplement the basic coverages in the Insuring Agreement without an additional premium B The insured the right to request that extra coverage be provided by endorsement C The insured the right to request additional coverage to supplement the policy after paying an additional premium D The company the right to voluntarily waive the deductible
A
The Special Provisions Endorsement for Dwelling policies in Nebraska states that actual cash value is adjusted for all of the following factors, except: A Marketability B Deterioration C Depreciation D Obsolescence
A
The purpose of the Insurance Fraud Act is to do all of the following, except: A Appoint the National Association of Insurance Commissioners to investigate activities involving insurance fraud in this state B Reduce the amount of premium dollars used to pay fraudulent claims C Detect and eliminate the occurrence of fraud through the development of fraud prevention programs D Authorize the imposition of civil penalties and restitution of fraudulently obtained benefits
A
Which insurance company department determines the probability of loss and determines premium rates? A Actuarial department B Sales department C Claims department D Underwriting department
A
Which of the following Part D claims would be denied under the Personal Auto Policy? A Loss to the covered auto caused by road damage to tires B Loss to electronic ignition equipment of the covered auto C Earthquake damage to the covered auto D Loss to permanently installed sound reproduction equipment of the covered auto
A
Which of the following is not one of the limits of liability provided by the CGL? A Bodily injury limit B General aggregate limit C Medical expense limit D Personal and advertising injury limit
A
Which of the following vehicles IS covered under Part B - Medical Payments of the PAP?
A car used to carpool with colleagues
Which of the following is false under the Personal Auto Policy? A Coverage for damage to an insured vehicle is provided without regard to liability B Coverage is provided for theft under property damage liability C No-fault coverage is provided in states that require it D Medical payments may be provided for up to 3 years following an accident
B
Which statement is false regarding the Building Personal Property Coverage Form? A The optional agreed value coverage negates the coinsurance clause B Preservation of Property Coverage provides named-perils coverage for 10 days C The optional inflation guard coverage automatically increases the face amount of the policy D There is no coverage for automobiles that are held for sale
B
Which statement about the BOP's Hired Auto and Non-owned Auto endorsement is correct?
Business auto coverage for a vehicle the insured rents is added to the coverage
All of the following statements regarding coinsurance are true, except: A The higher the coinsurance percentage, the lower the premium B Coinsurance applies only in the event of a partial loss C The coinsurance clause increases the policy's deductible amount D The purpose of coinsurance is to encourage one to carry insurance to value
C
In bonding, the surety is also known as the: A Obligee B Principal C Guarantor D Obligor
C
Q runs a stop sign, causing an oncoming vehicle to swerve and hit a tree. Q is guilty of: A Gross negligence B Strict liability C Negligence D A criminal violation
C
Which of the following describes the policy liability limits that may be applied to either bodily injury or property damage, in any combination? A Split limits B Subrogation limits C Combined single limits D Per occurrence limits
C
Which of the following statements regarding flood insurance is not true? A The Federal government is the reinsurer B Under a Flood Policy, protection is provided to property that normally is on dry land C No deductible applies to loss of contents D In order to qualify for a federal loan, a property owner located in a recognized flood area must purchase flood Insurance
C
Which of the following types of liability limits represents the maximum amount payable for a single occurrence, without regard for the number of claimants? A Per person limit B Split limits C Combined single limit D Comprehensive limits
C
Which of the following would not be covered by the Ordinance or Law endorsement. A Clearance B Increased cost of repair C Building code fines D Demolition
C
All of the following are true of the supplemental extended reporting period, except: A It must be purchased within 60 days after the end of the policy B It is an optional extended reporting period of unlimited duration C The one time premium may not exceed 200% of the annual premium for the coverage part D The insurer may cancel it after the premium has been paid by the insured
D
Coverage C on the HO-3 would cover which of the following losses? A Lightning damage to a structure held for rental to tenants as a private garage B Damage to furniture caused by wild animals C Fire loss to the personal property of a boarder who is not related to the insured D Vandalism loss to property the insured borrows from a neighbor
D
Livestock is not eligible for coverage on which Farm policy? A Broad Cause of Loss Form B Basic Cause of Loss Form C Livestock Coverage Form D Special Cause of Loss Form
D
Q runs a stop sign, causing an oncoming vehicle to swerve and hit a tree. Q is guilty of: A Gross negligence B A criminal violation C Strict liability D Negligence
D
Which is a true statement about the Boatowners Policy? A It can be used to insure any owned marine vessel B It provides named perils coverage for the hull and motor only C Losses are always settled on a ACV basis D It provides both property and liability coverage, similar to a PAP
D
Which of the following coverages is not provided by the Personal Liability Supplement? A Defense costs B Medical payments to an injured residence employee C First aid expenses D Medical payments to a regular resident of the dwelling who sustains an injury
D
Which of the following describes the term General Average under Ocean Marine Insurance? A The average value per item of all the cargo on the ship B The average freight charges on the entire cargo of the ship C A partial loss where the loss is not shared D A partial loss where the loss is shared
D
Which of the following is not a contingent liability exposure? A Owners and Contractors Protective liability exposure B Contractual liability exposure C Liability exposure of insured's sub-contractors D Premises liability exposure
D
Which of the following is not covered under the Installation Floater? A Carpeting B Electrical equipment C Elevators D Construction equipment
D
Which of the following is not required by the Workers' Compensation policy's guidelines for providing "Other State" coverage? A The insurer must reimburse the insured for any payments the insurer is not allowed to pay directly B If the insured begins work in a covered state after the effective date of the policy, the insurance, will apply if no other coverage exists C The insured must notify the insurer within 30 days when an employee begins work in a state not listed on the policy D The state work is performed in may not be a compulsory state
D
Which of the following statements best describes the Other Insurance condition on a standard property insurance policy, when two separate property policies provide coverage for the same loss? A One policy pays up to its limits and the other policy pays the balance B Neither policy will make payment for the loss C Each policy pays an equal share D Each policy pays its pro rata share of the loss
D
The Commercial basic Cause of Loss Form DOES NOT cover which of the following perils?
Earth Movement
Which coverage is NOT an Additional Coverage under the Businessowners Coverage Form?
Equipment breakdown
Which of the following is NOT a type of coverage provided under a farm liability policy?
Professional Liability
Which statement regarding liability insurance coverage is incorrect?
The per occurrence limit is the maximum amount recoverable during the policy period
On the Personal Auto Policy, the Collision coverage provides payment for losses:
To your car, and regardless of liability
