Property and Casualty Tests Bundle Set|For Different States|

The process where by a mutul insurer becomes a stock company is called CORRECT ANSWER Demutalization The process where by a mutul insurer becomes a stock company is called CORRECT ANSWER Demutalization The process whereby a stock company a mutal insurer is called CORRECT ANSWER Mutalization ...

Which of the following is not a coverage extension under the Building and Personal Property Coverage Form? CORRECT ANSWER Inflation guard (this is an OPTIONAL COVERAGE) Which term describes the equal sharing of a loss by two or more insurers until the loss is paid, or until each insurer has exhau...

Property vs Casualty: What is considered property? CORRECT ANSWER Structure & Personal Property Property vs Casualty: What is considered casualty? CORRECT ANSWER Non-property losses. Legal liability to others. 3rd Party Risk CORRECT ANSWER uncertainty of financial loss Pure Risk CORRECT ANS...

____ is uncertainty of loss CORRECT ANSWER risk ____ is a transfer of risk from the insured to the insurer CORRECT ANSWER insurance ____ risk means there is no chance of gain. It is insurable. CORRECT ANSWER pure ____ risk means there is a chance of a loss or a gain. It is not insurable. CO...

Which of the following is TRUE regarding who qualifies for coverage under the California Fair Access to Insurance Requirements plan? 1. Any person who is unable to obtain basic property insurance through normal channels. 2. Any person who qualifies will receive superior coverage to other forms...

Faulty wiring in a home is an example of a: a) loss b) peril c) risk d) hazard CORRECT ANSWER Hazard When a person buys insurance what method of handling risk has been undertaken? a) transfer b) reduction c) avoidance d) retention CORRECT ANSWER Transfer In property and casualty insura...

BPP building coverage CORRECT ANSWER insures the building at the described location, outdoor, fixtures, furnitures, items used to service the property, permanently installed machinery and equipment, and additions under construction, including the materials, supplies, and equipment. HO limits of p...

What do individuals use to transfer their risk of loss to a larger group? CORRECT ANSWER Insurance What are the four elements of an insurance contract? CORRECT ANSWER Agreement (Offer and Acceptance), Consideration, Competent parties, and legal purpose. In the agent/insurer relationship, who i...

If a producer misrepresents a part of a policy, will the Insurer cover a claim made for the misrepresentation? CORRECT ANSWER Yes, if an agent mistakenly says something untrue about a policy, the company WILL cover the loss b/c the agent legally represents the insurer. The insurer may seek reimburse...

Pro Rata Liability Clause is included in an insurance policy to deal with the problem of CORRECT ANSWER Duplicate insurance policies The purpose of this clause is to illustrate the method to determine each insurer's liability in case of a loss. Each insurer pays its fair share determined by the pe...

Physical damage coverage under a garage policy is a blanket limit for covered auto, an accurate statement? CORRECT ANSWER Yes; The dealer's physical damage limit would be done on a blanket limit basis. This would apply to comprehensive and collision losses to the auto inventory of the dealer. This ...

Electronic Media and Records CORRECT ANSWER Special limitation applies to business income loss under BOP, for loss of damage to Stolen Car CORRECT ANSWER According to part E duties after an accident or loss in Auto Policy, police should be called if Is required to undergo investigation by the ...

Under the Workers' Compensation policy, the insurer may audit the insured's records for a period of how many years following policy termination? CORRECT ANSWER 3 Which of the following is true of supplementary payments under Part A of the Personal Auto Policy? CORRECT ANSWER They are paid in ad...

Does HO insurance automatically provide for a detached garage? If so, how much? CORRECT ANSWER Yes, 10% of the Coverage A limit. Which form includes coverage for Internal Explosion? CORRECT ANSWER This coverage is included on ALL forms. Subrogation rights do not apply to...? CORRECT ANSWER Phy...

The Superintendent is the head of the Department of Insurance in New York. The _______ appoints the Superintendent to a four-year term. CORRECT ANSWER governor If the Superintendent requests information during an examination or investigation and a person does not respond within ____ days, he or s...

Insurance commissioner has the authority to..? CORRECT ANSWER enforce state insurance laws Department of Insurance has the power to..? CORRECT ANSWER Supervise the organization, regulation, examination, rehabilitation, liquidation and conservation of all insurance companies doing business in the ...

Driver A has a personal auto policy with Part C: UM/UIM limits of 100/300. He is injured by Driver B who has Part A: Bodily Injury Liability limits of 50/100. It is determined that Driver B is at fault for the accident. Driver A has $125,000 in medical expenses. How much will his Part C: UM/UIM cove...

a company in chartered in Guam or Puerto Rico doing regular business in new York would be considered by new yorkers to be a 1. domestic company 2. foreign company 3. alien company 4. international company CORRECT ANSWER 2. foreign company If a company cancels an auto policy mid-term, th...

Pay the claims covered under the policy. CORRECT ANSWER A primary obligation of an insurance company is to: Accumulating Risk CORRECT ANSWER Which of the following is not a reaction to risk? An increase in the possibility that a loss may occur. CORRECT ANSWER Which of the following describes a...

An incorporated insurance company which is run by a board of directors is known as CORRECT ANSWER a capital-stock company Which of the following statements is true regarding a binder? a. a binder guarantees that a policy will be issued by the insurance company. b. a binder guarantees coverage a...

What is a hazard? CORRECT ANSWER an increase in the possibility that a loss might occur transfer risk from a person or business to an insurance company that agrees to to pay for losses in exchange for a premium. CORRECT ANSWER insurance The type of insurance company in which the policyholder i...

If a company cancels an auto policy mid-term, the refund will be made on a : A. pro rata basis B. short rate basis C. retroactive basis D. coinsurance basis CORRECT ANSWER A. Pro Rata Basis What is the term used to describe terminating the insurance relationship at the end of the policy per...

The FAJUA is composed of: CORRECT ANSWER All companies licensed to write auto insurance in Florida A coverage that is similar to premises and operations coverage in the Commercial General Liability Policy covering bodily injury and property damage liability for aviation risks is defined as: CORRE...

A. To Administer the Insurance Laws CORRECT ANSWER What is the primary Function of the CFO? A. To Administer the Insurance Laws B. To pas laws regarding the insurance industry C. To negotiate the ethical standards with the insurance industry. D. to become the advocate for the insurance agents ...

B. A general lines agent or a general lines insurance agency CORRECT ANSWER Who may appoint a Customer Representative? Select one: A. A surplus lines agent holding a general lines license and a surplus lines license B. A general lines agent or a general lines insurance agency C. An adjuster ...

The Florida Surplus Service Lines Office (FSLSO) was created to CORRECT ANSWER oversee the surplus lines industry in the state Which of the following is NOT a required qualification for a General Lines Agent: CORRECT ANSWER Seeking the license only to write controlled business The Department o...

S is purchasing a Commercial Property policy to cover a commercial building with a replacement cost of $100,000. The policy includes an 80 percent Coinsurance clause. To avoid a coinsurance penalty in the event of a partial loss, S should purchase a policy with minimum limits of AT LEAST which of th...

Types of Dwelling Properties CORRECT ANSWER 1. 1 to 4 family 2. Rented to Others 3. Owned by Corp. or Partnerships 4. Low Valued 5. Mobile Homes Standard Dwelling Property Deductible CORRECT ANSWER $500 Dwelling Property Coverage A CORRECT ANSWER Dwelling - Including permanently installed...

Law of Large Numbers CORRECT ANSWER The larger the number of people with a similar exposure to loss, the more predictable actual losses will be. Insurance CORRECT ANSWER Transfers the risk of loss from an individual or business entity to an insurance company The three elements of insurable ris...

What is the definition of a risk that is insurable? a.Risk is defined as a chance or the possibility of financial loss; only pure risks are insurable as there is no possibility of a gain b.A chance of a loss or gain c.A risk where there is a possibility of a gain d.A chance for insurance cover...

Types Of Property Policies - % Property Insurance Terms And Related Concepts - % Property Policy Provisions And Contract Law - % Types Of Casualty Policies, Bonds, And Related Terms - % Casualty Insurance Terms And Related Concepts - % Casualty Policy Provisions - % Florida Statutes,...

Under Part A of a Personal Auto Policy, which of the following losses would be covered? A.) Damage to property being transported by the insured B.) Damage to a neighbor's parked car C.) Damage to a neighbor's lawn mower in the care of the insured D.) Damage to the home the insured owns CORRE...

The continuing education requirement to maintain a 4-40 license in Florida is: CORRECT ANSWER ten hours every two years A Personal Auto Policy (PAP) covers the insured in all places except: CORRECT ANSWER Mexico Joe is injured when the jack slips as he is changing a tire in his driveway. The b...

1.4 Qualifications for General Lines License CORRECT ANSWER 1. 18 or older 2. resident of FL or place of business in FL 3. will be active in business, business is accessible and identifiable by public 4. not licensing for writing or handling controlled business 5. Qualified via: a) 200 hr cou...

Should 2 or more insurers issue a combined Standard Fire Policy insuring a single risk, in the event of a loss, the insured must notify CORRECT ANSWER Any of the insurers providing coverage. The policy conditions define CORRECT ANSWER How parties to the contract must act following a loss. Beca...

Which One Of The Following Is NOT A Possible Defense Against Negligence? A. Statue Of Limitations B. Doctrine Of Reasonable Expectation C. Intervening Cause D. Comparative Negligence CORRECT ANSWER Doctrine Of Reasonable Expectation What Is A Hazard? CORRECT ANSWER An Increase In The Poss...

180 days CORRECT ANSWER The maximum term a temporary license may be issued for is 32 CORRECT ANSWER Continuing Education hours for a producer holding both a L&H and a P&C is every odd numbered year CORRECT ANSWER Property & Casualty licenses must be renewed $25,000 CORRECT ANSWER What is th...

Objectives: ◦ List requirements of obtaining and maintaining a Louisiana Insurance License ◦ Recognize Louisiana laws governing the business of insurance ◦ Name important Federal laws that apply to insurance producers and insurers ◦ Recognize statutory time limits and dollar amounts fr...

Is insurance regulated by the state or federal government? CORRECT ANSWER state What branch of government is the Indiana Department of Insurance? CORRECT ANSWER executive branch (with quasi-legislative and quasi-judicial responsibilities) due process means CORRECT ANSWER notice and hearing ...

A - protect the lender's financial interest in the car in the event it is damaged or destroyed CORRECT ANSWER In order to get a loan to buy a car, John had to obtain insurance on the car. The purpose of the insurance requirement is to A - protect the lender's financial interest in the car in th...

Insurance policy covers what type of losses CORRECT ANSWER Direct and Indirect In order to have an indirect loss, you must have CORRECT ANSWER a direct loss What does property insurance cover? CORRECT ANSWER structures and contents Direct loss CORRECT ANSWER physical destruction of property...

The arbitration clause in a personal auto policy would be used in which of the following circumstances? A. The ins company and a pedestrian struck by the insured's auto cannot reach an agreement regarding the settlement of a claim. B. The insured and an injured 3rd party cannot reach an agree...

Personal Automobile Policy CORRECT ANSWER • Accounts for 40% of all premiums • Vehicles registered to individuals and operated primarily for personal activities o Driving to work is a personal activity o Policy allows use of vehicle for incidental business activities Financial Responsib...

Insurance Terms and Related Concepts. What is insurance? CORRECT ANSWER transfers the risk of loss from an individual or business entity to an insurance company, which in turn spreads the costs of unexpected losses to many individuals. Insurance Terms and Related Concepts. What is risk? CORRECT...

A client may pay a fee to an insurance agent in Georgia as long as the fee has a maximum de minimum value of CORRECT ANSWER 45$ An insurer doesn't need a reason to cancel for terminating a property or casualty policy that has been in effect less than CORRECT ANSWER 60 days The commissioner mu...

A chance or uncertainty of loss is called ___? CORRECT ANSWER Risk Gambling is an example of ____. CORRECT ANSWER Speculative risk Insurance will only cover ____ risks. CORRECT ANSWER Pure The transfer of risk from an individual or business to a professional risk taking company is called __...

Warranty CORRECT ANSWER An applicant makes a statement on the insurance application which becomes part of the contract that she has an alarm system which qualifies her for a premium discount. This statement is considered a ________. Consideration CORRECT ANSWER In an insurance contract, the value...

S is purchasing a Commercial Property policy to cover a commercial building with a replacement cost of $100,000. The policy includes an 80 percent Coinsurance clause. To avoid a coinsurance penalty in the event of a partial loss, S should purchase a policy with minimum limits of AT LEAST which of th...

What is the required rate discount under a Good Driver Discount policy? CORRECT ANSWER 20% below the rate the insured would have been otherwise charged for the same coverage All the following are authorized activities for the Limited Automobile Insurance Agent EXCEPT if the agent CORRECT ANSWER C...

Contributory Plan CORRECT ANSWER Used in a group Insurance. Employee and employers share in the paying of premiums DP-1,DP-2, DP-3 All 3 dwelling forms cover? CORRECT ANSWER Loss of rental income Comparative Negligence CORRECT ANSWER You can file a claim, but damages are reduced based on that ...

1 Can a lender, as a condition of making a loan, require that any insurance be placed through a particular insurance agent or broker? CORRECT ANSWER The loan recipient may always select a particular agent or broker of their choosing 2 A claimant can be any of the following EXCEPT CORRECT ANSWER E...

Most workers compensation policies are written for 1 year terms. CORRECT ANSWER true A person licensed as either a property and casualty agent/broker or as an accident and health agent may be authorized to transact disability insurance for an admitted insurer by filing a notice of appointment fro...

The Insurance Services Organization CORRECT ANSWER is a rating bureau that creates standardized policy forms. The Standard Fire policy only covers CORRECT ANSWER the perils of fire, lightning and removal. In California, the maximum coverage limit under Uninsured Motorists coverage for property...

When can a person who sells real property require the use of a specific insurance agent, broker or solicitor? 1. As a condition precent to the sale of such real property. 2. When a buyer's credit score is below the lender's threshold. 3. A buyer is always able to choose their own insura...

1. How does an "admitted" person differ from a "non-admitted" person, as it pertains to insurance? CORRECT ANSWER o An "admitted" person has the right to transact insurance business within the state, while a "non-admitted" person is not entitled to this action. 2. A claimant can be any of...

All of the following are requirements to be licensed in PA except: -Complete a four-week long pre-licensing course -Pass the appropriate exam -Apply for a license with the insurance department and pay the appropriate fee -Have your fingerprints taken and submitted CORRECT ANSWER Complete a four-...

In a commercial general liability policy medical payment pay for medical expenses CORRECT ANSWER Without regard to fault Which type of insurance protection guarantees protection against legal liability from any risk arising from the ownership, maintenance, or use CORRECT ANSWER Professional liabi...

All of the following are elements of an agreement EXCEPT? CORRECT ANSWER The definite terms When terminating a licensed producer's appointment an insured must CORRECT ANSWER Notify the commissioner within 30 days following the termination An individual purchased a vehicle and financed it thro...

Law of Large Numbers CORRECT ANSWER Recognizes that as the number of exposure units increases, the more likely it is to predict accurately the expected outcome. What must an insurance producer do to apply for a nonresident license in Pennsylvania? CORRECT ANSWER Prove that their license is in goo...

Agents and brokers must notify the Insurance Department of any change in their residence or business address within: CORRECT ANSWER 30 days Insurers issuing liability policies covering motor vehicles in Pennsylvania must offer all of the following coverages EXCEPT: A) injuries incurred on the ...

All of the following are authorized activities for the limited lines automobile insurance agents EXCEPT if the agent CORRECT ANSWER Charges and collects a brokers fee for service Which of the following descries a contract of reinsurance? CORRECT ANSWER A first insurer issues insurance to compensa...

What purpose does licensing agents serve? CORRECT ANSWER The state is protecting the public and help them get the most for their insurance expenditures. Applicant Qualifications (6) CORRECT ANSWER - 18 years of age - must read and write in English - must not have committed any acts prohibited b...

Temporary Total Disability may be described as: CORRECT ANSWER Inability to return to any employment while recovering Supplementary Payment under Part A of the Personal Auto Policy? CORRECT ANSWER A Up to $250 for the cost of bail bonds B Payment for lost earnings up to $200/day C Medical payme...

A condition or situation that presents a possibility of loss is a (an): CORRECT ANSWER exposure The purpose of insurance is to: CORRECT ANSWER transfer risk Which hazard can be described as a careless attitude or general indifference on the part of the insured toward the occurrence of loss? CO...

Coverage for water backup or sump pump overflow is excluded from the Dwelling Policy. However, with the purchase of the water backup and sump pump overflow endorsement, coverage for up to $5,000 in loss or damage can be provided for an additional premium. What is the deductible associated with this ...

Which part of an insurance policy describes the responsibilities and obligations of both the insurance company and the insured under the policy? CORRECT ANSWER Conditions The limits of liability are found in which of the following sections of a casualty policy? CORRECT ANSWER Declarations The ...

Licensing Purpose CORRECT ANSWER For the protection of the public of this state. Individuals must satisfy the following to be eligible to get a license: CORRECT ANSWER -18 years of age or older -Resident of state -Passed exam and pay fees -Filed application and submitted a fingerprint card -N...