Property and Casualty

How many days under the builder's risk form until policy ends if construction is completed?

90 days

Protective Safeguards Endorsement

Under BOP endorsement that requires insured to have fire or security service as a condition

Under the protective safeguards endorsement how long until you would have to notify the insurance company about an issue with a sprinkler system?

48 hours

BOP

Commercial package policy that provides property and liability insurance to certain types of small businesses

Who is the ideal BOP prospect?

The small, well managed, one location business with easily predicted coverage needs

Under the BOP what sq footage and gross sales can eligible risks not exceed?

25,000 ft in total floor area or $3 million in annual gross sales at each location

What's the building size limit to be eligible for a BOP?

Building cannot exceed 6 stories in height or contain more than 100,000 sq ft

What's coverage A and coverage B under a BOP?

Coverage A - Buildings
Coverage B - Business Personal Property

Liability policies usually pay damages for the insured liabilities for
Bodily injury
Property damage
Personal injury
Intentional torts

A B and C

An aggregate limit is the most a company will pay
For any one event
Over the policy year
For any one person or item of property

Over the policy year

What are the four components needed to have negligence?

Duty to others
Breach of this duty
Damages
Proximate cause

Compensatory damages

Damages that reimburse the injured party only for losses that were actually sustained

Name and define the two types of compensatory damages

Special and general
Special damages include all direct and specific expenses involved in a particular loss (medical expenses, lost wages)
General damages compensate other things like pain and suffering and disfigurement

What are the four coverages of a basic dp form?

Coverage A - Dwelling
Coverage B - other structures
Coverage C - personal property
Coverage D - fair rental value

What are the extended perils covered under a dwelling policy?

Wind
Hail
Aircraft
Riot / civil commotion
Volcanic eruption
Explosion
Smoke

What four Other Coverages are covered under the DP-2 and 3?

Plants
Collapse
Glass
Ordinance or law

What is the Ordinance Or Law?

Coverage that allows payment of up to 10% of coverage A limit of liability for the increased cost to repair or rebuild a dwelling or other structure to conform with applicable building and land use codes

Which dwelling form covers losses to the dwelling and other structures on a replacement cost basis?

DP-2 and DP-3

Under the dwelling policy, what coverage would reimburse a family for having to stay in a motel because they had a fire?

Coverage E - additional living expense

What's the percentages paid for losses under Coverage B, C, and D under the dwelling policy?

Coverage B other structures is 10% of coverage A limit
Coverage C personal property is 20%
Coverage D fair rental value is 20% divided by 12 months

What does the HO-5 policy provide and what's another name for its form?

Comprehensive form that provides open peril coverage for dwellings, other structures, and personal property

What for of homeowners insurance is good for tenants and what does it provide?

HO-4 and provides broad coverage for personal property and no coverage for the dwelling

Which homeowners form provides broad coverage for both the dwelling and its contents?

HO-3

An extension of coverage is good for what? How long is it good for?

Newly acquired property coverage
14 days before you need to contact your insurance company

What's the formula for a co-insurance penalty?

Insurance carried over insurance required times loss equals the amount paid

Liability losses are known as - first party, second party, or third party losses?

Third party - the insurance company is the second party and you're the first

Insurance is a contract by which one seeks to protect another from ______________.

Loss.

An insured carries a property policy on her home in the amount of $250,000. A bank is shown as the mortgagor in the policy. Last month the insured made her final mortgage payment but did not remove the bank from the policy. In
the event of a covered loss

Nothing

Aggregate Limit of Liability

the maximum limit of coverage available under a liability policy during a policy year regardless of the number of claims that may be made or the number of accidents that may occur

Speculative Risk

events in which the principal has both the chance of winning or losing

Direct Loss

includes damage where the insured peril was the proximate cause of loss

All of the following are factors in the determination of "Actual Cash Value" EXCEPT:
a)Replacement cost
b) Original cost, new
c) Kind and quality of property
d) Age of the property

b)Original cost, new

Loss of use

coverage that covers any additional living expenses

In a liability policy with split limits of 15/30/10, what is the maximum amount that would be payable in the event of injury to a single person?

$15,000

If an insured violates an insurance contract without the knowledge of the mortgage holder, after a loss what happens?

The insured cannot collect but the mortgage holder will still be paid

Consequential Loss

amount of loss incurred as a result of being unable to use business property or equipment

Theft

unlawful taking of property

Robbery

similar to theft, but with the added element of force or use of a weapon

Vicarious liability

situation where someone is held responsible for the actions or omissions of another person
In a workplace context, an employer can be liable for the acts or omissions of its employees, provided it can be shown that they took place in the course of their e

For a contract to be enforceable by law, the purpose of the contract must be:
a) For financial gain.
b) For the benefit of the general public.
c) Of pure intent.
d) Legal and not against public policy.

d) Legal and not against public policy.

In return for a premium, an insurance company must
a) Provide the insured with coverage adequate for all potential losses.
b) Use standardized tables of coverage for specific risks to be excluded from coverage.
c) Give the insurer valuable consideration
d

d) Be fair in underwriting and pay covered losses.

Consideration

premium payment, as well as, the insurance company's offer to make a loss good; submitting statement of good health

Appraisal Clause

establishes the procedure for determining the amount of a loss when the insurer and the insured cannot agree on the value of property or amount of loss

Other insurance

an insurance policy provision that defines how the policy will respond if there is more than one insurance policy written on the same risk

Misrepresentation

a false statement or lie that can render the contract void

Fraud

intentional misrepresentation or deceit with the intent to induce a person to part with something of value

Material Misrepresentation

a statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company

What is DICED?

Declarations
Insured Agreements
Conditions
Exclusions
Defintions

Declarations

the section of an insurance policy containing the basic underwriting information, such as the insured's
name, address, amount of coverage and premiums, and a description of insured locations, as well as any supplemental
representations by the insured

Gramm-Leach-Bliley Act

limits disclosure and use of customer information, and imposes a security rule for covered information by "financial institutions" and most insurance agents and brokers

Subrogation

legal process that gives the insurer, after payment of a loss, the right to seek recovery from a third party that was responsible for the loss

Exclusions

Causes of loss, exposures, conditions, etc. listed in the policy for which the benefits will not be paid

Assignment

The transfer of a legal right or interest in an insurance policy
In property and casualty insurance, assignments of policies are usually valid only with the prior written consent of the insurer

Concealment

The withholding of known facts which, if material, can void a contract

Conditions

The section of an insurance policy that indicates the general rules or procedures that the insurer and insured agree to follow under the terms of the policy

Insuring Agreement

The section of an insurance policy containing the insurer's promise to pay, the description of
coverage provided and perils insured against

Endorsement

A printed addendum to a contract that is used to change the policy's original terms, conditions, or
coverages

Abandonment

The abdication of insured property into the hands of another, or into the possession of no one in
particular

Coercion

An unfair trade practice in which an insurer uses physical or mental force to persuade an applicant to buy insurance

Avoidance

A method of dealing with risk by deliberately keeping away from it
(e.g. if a person wanted to avoid the risk of being killed in an airplane crash, he/she might choose never to fly in a plane)

Insured

The person or organization that is protected by insurance; the party to be indemnified

Insurer

Al entity that indemnifies against losses, provides benefits, or renders services (also known as the
"company" or "insurance company").

Fiduciary

An agent/broker who handles insurer's funds in a trust capacity

Beneficiary

The person who receives the proceeds from the insurance policy

Coverage under the Builders Risk form will end in all of the following situations EXCEPT
a) Construction has been abandoned.
b) 60 days after the building became occupied.
c) The insured has sold the property.
d) 60 days after the construction has ended.

d) 60 days after the construction has ended

Jean owns a craft store. The Protective Safeguards endorsement of her BOP requires Jean's store to have a functional automatic sprinkler system. One night, a storm with wind chills of 30 degrees below zero freezes the pipes to the sprinkler system, and th

a) 48 hours

How does the mobile home endorsement affect the other coverage of law or ordinance in a homeowners policy?

It removes the coverage

Who would participate in a WYO program?

Private insurers that wish to write and service National Flood Insurance policies on a no risk-bearing basis

Under a Business owners policy, the inspections and surveys condition specifies what three things?

1) The insurer does not make safety inspections for the insured.
2) The insurer does not guarantee that conditions are safe or healthful.
3) The insurer does not guarantee that the insured is meeting all required safety regulations.

Johanna purchased a National Flood Insurance policy 10 days after her communify entered an emergency program.
When would her coverage be effective?

12:01 am the day after the application and premium payment are mailed

What two things can be true about the NFIP emergency program?

it goes into effect after the community has received a Flood Hazard Boundary Map and ends when the normal program begins
and
it provides limited amounts of coverage at subsidized rates

An insured with a homeowners policy has removed property from the insured location to protect it from loss which could be caused by a covered peril. The removal coverage applies for how many days?

30 days

Which of the following is NOT covered under the Farm Coverage policy?
a) Raising livestock in a commercial feed lot
b) Growing of vegetables
c) Marketing of field crops
d) Raising fish at an agriculture operation

a) Raising livestock in a commercial feed lot

Which of the following is NOT true of National Flood Insurance?
a) Emergency program limits are available to communities immediately.
b) Participating communities must agree to implement certain land use
regulations.
c) National Flood Insurance provides c

d) Insurance provided by the flood program is also available in standard
properly policies.

The regular National Flood Insurance Program would insure an eligible single family dwelling for up to how much amount of money?

$250,000

The insured purchased a $200,000 Extra Expense Policy. If the percentages applying to the limit of insurance are 40%, 80%, and 100%, what would be the maximum payable for a 47-day loss?

$160,000

Which of the following is NOT an optional coverage available in a BOP?
a) Employee dishonesty
b) Workers Compensation
c) Outdoor signs and exterior grade floor glass
d) Mechanical breakdown

b) Workers Compensation

Producer

A person who acts on the behalf of the insurer to sell, negotiate, or effect insurance contracts; also known as an agent.

Which of the following is true regarding insurance company appointment for a broker?
a) Brokers act as agents.
b) Brokers represent insurers.
c) Brokers do not need to be appointed.
d) Brokers must be appointed by the insurer.

c) Brokers do not need to be appointed.

For purpose of determining its financial condition, fulfillment of its contractual obligations and compliance with Nevada law, the Commissioner will examine the affairs of each insurer as often as deemed necessary. Each
domestic insurer must be examined a

every 5 years

Which of the following individuals may act as a producer without a license?
a) A consultant who offers insurance advice to a prospective purchaser.
b) A producer's secretary who answers the phones and solicits insurance products to potential clients.
c) A

c) An insurance company president who is solely responsible for the administration of the company.

How many days does a nonresident producer have to file a change of address when the agent moves to Nevada from another state?

30 days

Twisting

A form of misrepresentation in which an agent persuades an insured/owner to cancel, lapse, or switch policies, even when it's to the insured's disadvantage.

Underwriting

The process of reviewing, accepting or rejecting applications for insurance.

Underwriter

A person who evaluates and classifies risks to accept or reject them on behalf of the insurer

Which of the following would be an example of an insurer participating in an unfair competition practice of discrimination?
a) Making malicious statements about the insured based on their race
b) Charging different premium rates to the insured in differen

d) Charging the insured higher premiums based on their race

Should any person willfully engage in an unauthorized insurance transaction, the Commissioner may impose an administrative fine or penalty of up _________.

$10,000 for each and every act

Certificate of Authority

A document that authorizes a company to start conducting business and specifies the kind(s)
of insurance a company can transact. It is illegal for an insurance company to transact insurance without this certificate.

Insurance

The transfer of the possibility of a loss (risk) to an insurance company, which in turn spreads the costs of unexpected losses to many individuals.

When an agent is handling premium funds while conducting business, the insurance agent acts in a(n) _____________.

Fiduciary capacity

Existing and replacing life insurers me required to keep copies of all summaries, notices, and statements used in sale transactions until the conclusion of their next examination by the Division of lnsurance, or for a period of at least ____________.

3 years

__________ is a criminal activity that would be a sufficient violation to warrant rejection, revocation, or suspension of an insurance producer's license?

Forgery

If the Commissioner fails to approve or disapprove a proposed rate within ______ days, the proposal can be considered approved.

60 days

Joe received a notice from his insurer that his policy would be cancelled in 30 days. The notice did not give any reason for the cancellation and did not tell Joe any way to obtain that information. When will this cancellation be effective?
a) Immediately

b) The cancellation is not effective

If the insurer offers to renew the policy on different terms, how long does the policyholder have to cancel the policy without being penalized?

30 days after receiving notice of the changes

A person who acts as a motor vehicle physical damage appraiser without a license is subject to an administrative fine of ______________.

Not more than $1,000 for each violation

If an insurer intends not to renew a commercial policy, how much notice must it give the policyholder?

60 days before the expiration of the policy

Each licensed motor vehicle physical damage appraiser must obtain a surety bond in favor of the people of the State of Nevada and conditioned for the faithful performance of required duties in the amount of ___________.

$2,500

Surety Bond

A guarantee that debts and obligations will be carried out, and the benefits will be paid for losses caused by nonperformance.

How soon after receiving a statement of charges for completed repairs must an insurer issue a check payable to the garage or jointly to the insured and the garage?

Within 30 days

Commercial policies issued for a term longer than one year may be cancelled by the insurer by giving notice of cancellation ___________________________.

60 days before any anniversary date of the policy

Reciprocal

Insurance resulting from an interchange of reciprocal agreements of indemnity among persons known as subscribers.

Surplus Lines

Insurance for which there is no readily available, admitted market

A non-admitted insurer who provides insurance coverages that are not available from an admitted insurer is called
a) Assessment mutual insurer.
b) Capitol stock insurer.
c) Reciprocal insurer.
d) Surplus lines insurer.

d) Surplus lines insurer

Joe is a resident agent who is countersigning a policy for Alex, a nonresident agent. Joe and Alex will split the commissions on this policy. ___________ of the premium is the minimum commission for Joe.

5%

Abandonment condition

Absolute liability

Accident

Accounts receivable insurance

Actual cash value (ACV)

Additional coverages

Additional insured

Additional insured - lessor endorsement

Adhesion contract

Adverse selection

Agency

Agent

Aggregate Limit

Agreed Value Condition

Aleatory Contract

Alien Company

A.M. Best Company

Annual Transit Policy

Apparent Authority

Application

Appraisal Condition

Appurtenant Structures

Arbitration Condition

Assessment Mutual Company

Assignment Condition

Assumption of Risk

Authorized Insurer

Automatic Increase in Insurance Endorsement

Automobile Insurance Plan

Aviation Hull Insurance

Aviation Liability Insurance

Bailee

Bailee's Customer Policy

Bailment

Barratry

Best's

Bid Bond

Bill of lading

Binder

Blanket Insurance

Blanket Position Bond

Bodily Injury (BI)

Boiler and Machinery Insurance

Broad Theft Coverage Endorsement

Broker

Builders Risk Coverage Form

Builders Risk Reporting Form

Building and Personal Property Coverage Form

Burglary

Business Auto Coverage Form

Business Auto Physical Damage Coverage Form

Business Income Coverage Forms

Business Income from Dependent Parties

Business Liability

Business Pursuits Endorsement

Businessowners Policy (BOP)

Camera and Musical Instruments Dealers Coverage Form

Cancellation

Capital

Cargo Insurance

Casualty Insurance

Causes of Loss Form

Certificate of Insurance

Claim Adjuster

Claims-made Form

Coinsurance

Coinsurance penalty

Collision Coverage

Combined Ratio

Commercial Articles Coverage Form

Commercial Auto Coverage Part

Commercial Blanket Bond

Commercial Crime Coverage Part

Commercial General Liability (CGL) Coverage Part

Commercial Lines

Commercial Package Policy (CPP)

Commercial Property Coverage Part

Commercial Property Floater Risks

Common Policy Conditions

Common Policy Declarations

Comparative Negligence

Compensatory Damages

Competent parties

Competitive state fund

Completion bond

Comprehensive coverage

Concealment

Concurrent causation

Conditional contract

Conditions

Condominium association coverage form

Condominium commercial unit-owners coverage form

Consideration

Consultant

Contract

Contract bonds

Contractors equipment floater

Contribution by equal shares

Coverage trigger

Contributory negligence

Countersignature

Court bond

Coverage form

Coverage part

Custodian

Damages

Defense costs

Degree of care

Declarations

Deductible

Definitions

Deposit premium

Diminution of value

Direct response system

Directors and officers liability insurance (D&O)

Difference in conditions insurance (DIC)

Direct loss

Direct writer

Disability insurance

Discovery form

Doctrine of reasonable expectations

Domestic company

Domestic shipments

Drive other car (DOC) - Broadened Coverage For Named Individuals Endorsement

Duties following loss

Dwelling policy

Dwelling under construction endorsement

Earned premium

Earthquake insurance

Electronic data processing equipment floater

Employees as additional insureds endorsement

Employers liability coverage

Employment practices liability insurance

Endorsement

Equipment breakdown protection coverage form

Equipment dealers coverage form

Errors and omissions insurance (E&O)

Estoppel

Excess electronic equipment endorsement

Excess insurance

Excess lines agent

Exclusions

Exclusive agent

Exclusive remedy doctrine

Expense ratio

Experience modification factor

Experience rating

Exports

Exposure

Express authority

Extended nonowned coverage - Vehicles furnished or available for regular use endorsement

Extended reporting period (ERP)

Extortion - Commercial entities endorsement

Extra expense coverage form

Fair Credit Reporting Act

Fair access to insurance requirements (FAIR) plan

Farm coverage

Federal Employers Liability Act (FELA)

Fellow servant rule

Fidelity bond

Fiduciary

Fiduciary bond

Fiduciary liability policy

Field underwriting

File and use

Filed form

Film coverage form

Financial responsibility laws

First-named insured

First party loss

Flat cancellation

Floater

Floor plan coverage form

Foreign company

Fraternal Benefit Society

Fraud

Freight insurance

Functional replacement cost

Garage coverage form

Garagekeepers insurance

General average loss

General conditions form

General damages

Hazard

Health insurance

Hired and nonowned auto liability endorsement

Hold harmless agreement

Home day care coverage endorsement

Homeowners policy

Hull insurance

Implied authority

Implied warranties

Imports

Incidental occupancy

Incurred losses

Indemnity

Independent adjuster

Independent agent

Indirect loss

Individual named insured endorsement

Inland marine insurance

Installation policy

Instrumentalities of transportation and communication

Insurable interest

Insurance

Insurance Commissioner

Insurance department

Insurance guaranty association

Insurance Services Office (ISO)

Insured contract

Insuring agreement

Interline endorsement

Intervening cause

Invitee

Jettison

Jewelers block coverage form

Joint ownership coverage endorsement

Jones Act

Judgement rating

Judicial bond

Law of large numbers

Legal liability coverage form

Legal purpose

Liability insurance

Liberalization condition

License and permit bond

Licensee

Life insurance

Limitations

Liquor liability coverage form

Livestock coverage form

Lloyd's Association

Longshore and Harbor Workers' Compensation Act coverage endorsement

Loss cost

Loss provisions

Loss ratio

Loss sustained during prior insurance condition

Loss sustained form

Mail coverage form

Malpractice insurance

Manual rating

Market value

Material fact

MCS-90 endorsement

Merit rating

Messenger

Miscellaneous type vehicle endorsement

Misrepresentation

Mobile agricultural machinery and equipment coverage form

Mobile equipment endorsement

Mobile home insurance

Monoline company

Monoline policy

Monopolistic state fund

Moral hazard

Morale hazard

Mortgage condition

Mortgagee rights

(DEFINITION FIRST)
Direct Writer - C

(DEFINITION)
issue or countersign policies - A

(DEFINITION)
collects and analyzes data to determine the rates to be charged for insurance - D

(DEFINITION)
2A ; 4B ; 5C ; 1D ; 3E

What is the primary reason the state or federal government becomes involved in providing insurance?

Give three reasons that state insurance departments regulate insurance companies' financial situations.

(DEFINITION)
an evaluation of the characteristics of the individual risk - A

(DEFINITION)
Merit - B

(DEFINITION)
concern material facts - A

(DEFINITION)
CANNOT - Most statements contained in the insured's application for insurance are representations - statements that applicant believes are true. Under the law, a representation is not considered a matter to which the parties contract, so a po

List four information sources besides the application that an underwriter might use to evaluate whether a risk is insurable

Retrospective rating bases premiums on the insured's loss experience (before/during) the current policy period.

(DEFINITION)
is estopped from denying coverage because the agent stated that the loss is covered - B

(DEFINITION)
A,B, D, & E

(DEFINITION)
both A & B - C

Why do property insurance policies limit or exclude coverage for losses when property is vacant or unoccupied?

These conditions increase the chance of loss.

(DEF)
Home under Construction - B
Townhouse - C
Home rented to another person - D
To be eligible, a mobile home must be permanently located. An apartment building may not contain more than four units.

(DEFINITION)
DP-1, 2, and 3

How many boarders can a dwelling have to be covered under a dwelling policy? Up to how many apartments?

Up to five boarders and up to four apartments

Mobile homes may only be covered under the dwelling basic form if it's _______________ among other qualifications.

permanently located

Certain incidental business and professional occupancies are allowed under the dwelling policy but must be conducted by the insured, provide service rather than sales, and involve ________________________________ working on the premises at any one time.

no more than two people

Coverage B - other structures insures buildings on the premises that are __________________________________ or ______________________________________.

separated from the dwelling by a clear space
connected only by a fence, utility line, or similar connection

___________________, including mausoleums, are not covered under coverage B- other structures.

Grave markers

Vandalism and malicious mischief (V&MM) must be purchased in conjunction with the ___________________.

extended coverage perils

What does V&MM not cover?

damage to glass parts of a building other than glass building blocks
losses by theft (does not apply to building damage caused by burglars)
vandalism to a building that has been vacant for more than 60 consecutive days

In addition to insuring against the listed perils, the dwelling basic form provides certain other coverages, such as;

Also rental value provides 20% of the coverage A limit for loss of fair rental value, payable at 1/12 of the 20% limit for each month the described location is unfit for its normal use.

Under the dwelling basic form other coverages property removed is covered for _______ days.

Five

Under the dwelling basic form other coverages improvements, alterations, and additions is available for up to _______ of the coverage C limit.

10%

What does fire department service charge under other coverages cover?

it pays up to $500 for fire department charges incurred when the fire department is called to save or protect covered property from a peril insured against.
No deductible applies to this coverage.

What's worldwide coverage under dwelling basic form other coverages?

provides 10% of Coverage C limit for personal property while it is located anywhere in the world

Are losses due to power interruption that occurs away from the insured location covered under the basic dwelling policy?

No

If the government or a public authority were to cause destruction at a premises is this covered under the DP basic form?

No

The loss payment condition states that the loss will be paid _______________ after reaching an agreement with the insured.

within 30 days

Falling objects is covered under which DP form?

Broad form

The burglars and accidental discharge perils are not covered if the building has been vacant for ________________.

more than 60 days

Among other exclusions in the DP-3 special form loss caused by _________, __________, _________, and ___________ animals are listed.

birds, vermin, insects, and domestic animals

If a civil authority prohibits use of the insured property because a covered peril damaged a neighboring location, payments are limited to _________________.

a maximum of two weeks

Trees, shrubs, and other plants pays __________ for damage to trees, scrubs, plants, or lawns caused by a specified list of perils. The policy will not pay more than ____________ for damage to any one tree, shrub, or plant.

5% , $500

In the DP-2 and DP-3, property removed is covered for _________. In the DP-1, it is covered for _________.

30 days
only 5 days

DEFINITION
Broad theft coverage endorsement

DEF
more than 60 consecutive days

DEF
$200
$1500
$2500
$1500
$1500
$2500
$1500

DEF
notify the police

DEF
$100,000

DEF
within three years
$1,000 per person

DEF
claim expenses, first aid to others, and damage to property of others
in addition to

DEF
-defense costs
-court costs
-premiums on bonds that do not exceed the Coverage L limit
-reasonable expenses
-up to $50 per day

DEF
- more than four families
- one additional family
- two roomers or boarders

DEF
HO-2, HO-3, HO-4, HO-5, HO-6, and HO-8
- identical liability coverage
- broad, broad
- special, open, other structures, broad
- contents broad, tenants
- comprehensive, open, personal property
- unit-owners, broad, personal property
- modified coverag

DEF
-renters and tenants can insure only their personal property
-$1,000

DEF
-10%
-$1,000
-30 days
- excluded
- Animals, birds, and fish

DEF
-$200
$1500
$1500
$1500
$2500
$500
$1500
$1500
- theft
1500
2500
2500

DEF
5%
$1000
one
$500
5%
$500
$500
$500
$1000

DEF
additonal
10%
C
$5000
C
10%
A

Basic named perils insured against under all homeowners forms includes:
Fire
Lightening
Windstorm or Hail
Explosion
Riot or civil commotion
Aircraft
Vehicles
Smoke
Volcanic Eruption
and what other two?

Vandalism & Malicious Mischief
Theft

DEF
60 or more consecutive days
the basic perils
falling objects

DEF
"mysterious disappearance

DEF
10%
50%
2,3, and 5 : 30%
$1,000, HO-6
50%
30%

DEF
$100,000
within three years

DEF
25 total horsepower or less
25 total horsepower
25 total horsepower
45 days of their acquisition
26 feet long
26 feet long

DEF
loss of earnings, $250 per day
First Aid Expenses
Damage to property of others, $1,000
$1,000

DEF
10 days
60 days
Material misrepresentation, 30
change in risk, 30
Nonpayment, 10
30

DEF
26
25
inboard or inboard-outdrive engines or motors
26
personal injuries

DEF
liability coverage
medical payments coverage
uninsured motorists coverage
coverage for damage to your auto (physical damage)

DEF
automatically
14 days
14 days
automatically
must be requested within 4 days

DEF
$250, bail bonds
$200, loss of earnings

DEF
regardless of who was at fault
within three years

DEF
$20, $600
48-hour waiting period

DEF
Physical damage, actual cash value
no benefit to bailee

DEF
10 days
60 days
20 days
20 days

DEF
D, $20, $600
automatically, 14 days

DEF
Assigned risk plans
poor

How many days under the builder's risk form until policy ends if construction is completed?

90 days

Protective Safeguards Endorsement

Under BOP endorsement that requires insured to have fire or security service as a condition

Under the protective safeguards endorsement how long until you would have to notify the insurance company about an issue with a sprinkler system?

48 hours

BOP

Commercial package policy that provides property and liability insurance to certain types of small businesses

Who is the ideal BOP prospect?

The small, well managed, one location business with easily predicted coverage needs

Under the BOP what sq footage and gross sales can eligible risks not exceed?

25,000 ft in total floor area or $3 million in annual gross sales at each location

What's the building size limit to be eligible for a BOP?

Building cannot exceed 6 stories in height or contain more than 100,000 sq ft

What's coverage A and coverage B under a BOP?

Coverage A - Buildings
Coverage B - Business Personal Property

Liability policies usually pay damages for the insured liabilities for
Bodily injury
Property damage
Personal injury
Intentional torts

A B and C

An aggregate limit is the most a company will pay
For any one event
Over the policy year
For any one person or item of property

Over the policy year

What are the four components needed to have negligence?

Duty to others
Breach of this duty
Damages
Proximate cause

Compensatory damages

Damages that reimburse the injured party only for losses that were actually sustained

Name and define the two types of compensatory damages

Special and general
Special damages include all direct and specific expenses involved in a particular loss (medical expenses, lost wages)
General damages compensate other things like pain and suffering and disfigurement

What are the four coverages of a basic dp form?

Coverage A - Dwelling
Coverage B - other structures
Coverage C - personal property
Coverage D - fair rental value

What are the extended perils covered under a dwelling policy?

Wind
Hail
Aircraft
Riot / civil commotion
Volcanic eruption
Explosion
Smoke

What four Other Coverages are covered under the DP-2 and 3?

Plants
Collapse
Glass
Ordinance or law

What is the Ordinance Or Law?

Coverage that allows payment of up to 10% of coverage A limit of liability for the increased cost to repair or rebuild a dwelling or other structure to conform with applicable building and land use codes

Which dwelling form covers losses to the dwelling and other structures on a replacement cost basis?

DP-2 and DP-3

Under the dwelling policy, what coverage would reimburse a family for having to stay in a motel because they had a fire?

Coverage E - additional living expense

What's the percentages paid for losses under Coverage B, C, and D under the dwelling policy?

Coverage B other structures is 10% of coverage A limit
Coverage C personal property is 20%
Coverage D fair rental value is 20% divided by 12 months

What does the HO-5 policy provide and what's another name for its form?

Comprehensive form that provides open peril coverage for dwellings, other structures, and personal property

What for of homeowners insurance is good for tenants and what does it provide?

HO-4 and provides broad coverage for personal property and no coverage for the dwelling

Which homeowners form provides broad coverage for both the dwelling and its contents?

HO-3

An extension of coverage is good for what? How long is it good for?

Newly acquired property coverage
14 days before you need to contact your insurance company

What's the formula for a co-insurance penalty?

Insurance carried over insurance required times loss equals the amount paid

Liability losses are known as - first party, second party, or third party losses?

Third party - the insurance company is the second party and you're the first

Insurance is a contract by which one seeks to protect another from ______________.

Loss.

An insured carries a property policy on her home in the amount of $250,000. A bank is shown as the mortgagor in the policy. Last month the insured made her final mortgage payment but did not remove the bank from the policy. In
the event of a covered loss

Nothing

Aggregate Limit of Liability

the maximum limit of coverage available under a liability policy during a policy year regardless of the number of claims that may be made or the number of accidents that may occur

Speculative Risk

events in which the principal has both the chance of winning or losing

Direct Loss

includes damage where the insured peril was the proximate cause of loss

All of the following are factors in the determination of "Actual Cash Value" EXCEPT:
a)Replacement cost
b) Original cost, new
c) Kind and quality of property
d) Age of the property

b)Original cost, new

Loss of use

coverage that covers any additional living expenses

In a liability policy with split limits of 15/30/10, what is the maximum amount that would be payable in the event of injury to a single person?

$15,000

If an insured violates an insurance contract without the knowledge of the mortgage holder, after a loss what happens?

The insured cannot collect but the mortgage holder will still be paid

Consequential Loss

amount of loss incurred as a result of being unable to use business property or equipment

Theft

unlawful taking of property

Robbery

similar to theft, but with the added element of force or use of a weapon

Vicarious liability

situation where someone is held responsible for the actions or omissions of another person
In a workplace context, an employer can be liable for the acts or omissions of its employees, provided it can be shown that they took place in the course of their e

For a contract to be enforceable by law, the purpose of the contract must be:
a) For financial gain.
b) For the benefit of the general public.
c) Of pure intent.
d) Legal and not against public policy.

d) Legal and not against public policy.

In return for a premium, an insurance company must
a) Provide the insured with coverage adequate for all potential losses.
b) Use standardized tables of coverage for specific risks to be excluded from coverage.
c) Give the insurer valuable consideration
d

d) Be fair in underwriting and pay covered losses.

Consideration

premium payment, as well as, the insurance company's offer to make a loss good; submitting statement of good health

Appraisal Clause

establishes the procedure for determining the amount of a loss when the insurer and the insured cannot agree on the value of property or amount of loss

Other insurance

an insurance policy provision that defines how the policy will respond if there is more than one insurance policy written on the same risk

Misrepresentation

a false statement or lie that can render the contract void

Fraud

intentional misrepresentation or deceit with the intent to induce a person to part with something of value

Material Misrepresentation

a statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company

What is DICED?

Declarations
Insured Agreements
Conditions
Exclusions
Defintions

Declarations

the section of an insurance policy containing the basic underwriting information, such as the insured's
name, address, amount of coverage and premiums, and a description of insured locations, as well as any supplemental
representations by the insured

Gramm-Leach-Bliley Act

limits disclosure and use of customer information, and imposes a security rule for covered information by "financial institutions" and most insurance agents and brokers

Subrogation

legal process that gives the insurer, after payment of a loss, the right to seek recovery from a third party that was responsible for the loss

Exclusions

Causes of loss, exposures, conditions, etc. listed in the policy for which the benefits will not be paid

Assignment

The transfer of a legal right or interest in an insurance policy
In property and casualty insurance, assignments of policies are usually valid only with the prior written consent of the insurer

Concealment

The withholding of known facts which, if material, can void a contract

Conditions

The section of an insurance policy that indicates the general rules or procedures that the insurer and insured agree to follow under the terms of the policy

Insuring Agreement

The section of an insurance policy containing the insurer's promise to pay, the description of
coverage provided and perils insured against

Endorsement

A printed addendum to a contract that is used to change the policy's original terms, conditions, or
coverages

Abandonment

The abdication of insured property into the hands of another, or into the possession of no one in
particular

Coercion

An unfair trade practice in which an insurer uses physical or mental force to persuade an applicant to buy insurance

Avoidance

A method of dealing with risk by deliberately keeping away from it
(e.g. if a person wanted to avoid the risk of being killed in an airplane crash, he/she might choose never to fly in a plane)

Insured

The person or organization that is protected by insurance; the party to be indemnified

Insurer

Al entity that indemnifies against losses, provides benefits, or renders services (also known as the
"company" or "insurance company").

Fiduciary

An agent/broker who handles insurer's funds in a trust capacity

Beneficiary

The person who receives the proceeds from the insurance policy

Coverage under the Builders Risk form will end in all of the following situations EXCEPT
a) Construction has been abandoned.
b) 60 days after the building became occupied.
c) The insured has sold the property.
d) 60 days after the construction has ended.

d) 60 days after the construction has ended

Jean owns a craft store. The Protective Safeguards endorsement of her BOP requires Jean's store to have a functional automatic sprinkler system. One night, a storm with wind chills of 30 degrees below zero freezes the pipes to the sprinkler system, and th

a) 48 hours

How does the mobile home endorsement affect the other coverage of law or ordinance in a homeowners policy?

It removes the coverage

Who would participate in a WYO program?

Private insurers that wish to write and service National Flood Insurance policies on a no risk-bearing basis

Under a Business owners policy, the inspections and surveys condition specifies what three things?

1) The insurer does not make safety inspections for the insured.
2) The insurer does not guarantee that conditions are safe or healthful.
3) The insurer does not guarantee that the insured is meeting all required safety regulations.

Johanna purchased a National Flood Insurance policy 10 days after her communify entered an emergency program.
When would her coverage be effective?

12:01 am the day after the application and premium payment are mailed

What two things can be true about the NFIP emergency program?

it goes into effect after the community has received a Flood Hazard Boundary Map and ends when the normal program begins
and
it provides limited amounts of coverage at subsidized rates

An insured with a homeowners policy has removed property from the insured location to protect it from loss which could be caused by a covered peril. The removal coverage applies for how many days?

30 days

Which of the following is NOT covered under the Farm Coverage policy?
a) Raising livestock in a commercial feed lot
b) Growing of vegetables
c) Marketing of field crops
d) Raising fish at an agriculture operation

a) Raising livestock in a commercial feed lot

Which of the following is NOT true of National Flood Insurance?
a) Emergency program limits are available to communities immediately.
b) Participating communities must agree to implement certain land use
regulations.
c) National Flood Insurance provides c

d) Insurance provided by the flood program is also available in standard
properly policies.

The regular National Flood Insurance Program would insure an eligible single family dwelling for up to how much amount of money?

$250,000

The insured purchased a $200,000 Extra Expense Policy. If the percentages applying to the limit of insurance are 40%, 80%, and 100%, what would be the maximum payable for a 47-day loss?

$160,000

Which of the following is NOT an optional coverage available in a BOP?
a) Employee dishonesty
b) Workers Compensation
c) Outdoor signs and exterior grade floor glass
d) Mechanical breakdown

b) Workers Compensation

Producer

A person who acts on the behalf of the insurer to sell, negotiate, or effect insurance contracts; also known as an agent.

Which of the following is true regarding insurance company appointment for a broker?
a) Brokers act as agents.
b) Brokers represent insurers.
c) Brokers do not need to be appointed.
d) Brokers must be appointed by the insurer.

c) Brokers do not need to be appointed.

For purpose of determining its financial condition, fulfillment of its contractual obligations and compliance with Nevada law, the Commissioner will examine the affairs of each insurer as often as deemed necessary. Each
domestic insurer must be examined a

every 5 years

Which of the following individuals may act as a producer without a license?
a) A consultant who offers insurance advice to a prospective purchaser.
b) A producer's secretary who answers the phones and solicits insurance products to potential clients.
c) A

c) An insurance company president who is solely responsible for the administration of the company.

How many days does a nonresident producer have to file a change of address when the agent moves to Nevada from another state?

30 days

Twisting

A form of misrepresentation in which an agent persuades an insured/owner to cancel, lapse, or switch policies, even when it's to the insured's disadvantage.

Underwriting

The process of reviewing, accepting or rejecting applications for insurance.

Underwriter

A person who evaluates and classifies risks to accept or reject them on behalf of the insurer

Which of the following would be an example of an insurer participating in an unfair competition practice of discrimination?
a) Making malicious statements about the insured based on their race
b) Charging different premium rates to the insured in differen

d) Charging the insured higher premiums based on their race

Should any person willfully engage in an unauthorized insurance transaction, the Commissioner may impose an administrative fine or penalty of up _________.

$10,000 for each and every act

Certificate of Authority

A document that authorizes a company to start conducting business and specifies the kind(s)
of insurance a company can transact. It is illegal for an insurance company to transact insurance without this certificate.

Insurance

The transfer of the possibility of a loss (risk) to an insurance company, which in turn spreads the costs of unexpected losses to many individuals.

When an agent is handling premium funds while conducting business, the insurance agent acts in a(n) _____________.

Fiduciary capacity

Existing and replacing life insurers me required to keep copies of all summaries, notices, and statements used in sale transactions until the conclusion of their next examination by the Division of lnsurance, or for a period of at least ____________.

3 years

__________ is a criminal activity that would be a sufficient violation to warrant rejection, revocation, or suspension of an insurance producer's license?

Forgery

If the Commissioner fails to approve or disapprove a proposed rate within ______ days, the proposal can be considered approved.

60 days

Joe received a notice from his insurer that his policy would be cancelled in 30 days. The notice did not give any reason for the cancellation and did not tell Joe any way to obtain that information. When will this cancellation be effective?
a) Immediately

b) The cancellation is not effective

If the insurer offers to renew the policy on different terms, how long does the policyholder have to cancel the policy without being penalized?

30 days after receiving notice of the changes

A person who acts as a motor vehicle physical damage appraiser without a license is subject to an administrative fine of ______________.

Not more than $1,000 for each violation

If an insurer intends not to renew a commercial policy, how much notice must it give the policyholder?

60 days before the expiration of the policy

Each licensed motor vehicle physical damage appraiser must obtain a surety bond in favor of the people of the State of Nevada and conditioned for the faithful performance of required duties in the amount of ___________.

$2,500

Surety Bond

A guarantee that debts and obligations will be carried out, and the benefits will be paid for losses caused by nonperformance.

How soon after receiving a statement of charges for completed repairs must an insurer issue a check payable to the garage or jointly to the insured and the garage?

Within 30 days

Commercial policies issued for a term longer than one year may be cancelled by the insurer by giving notice of cancellation ___________________________.

60 days before any anniversary date of the policy

Reciprocal

Insurance resulting from an interchange of reciprocal agreements of indemnity among persons known as subscribers.

Surplus Lines

Insurance for which there is no readily available, admitted market

A non-admitted insurer who provides insurance coverages that are not available from an admitted insurer is called
a) Assessment mutual insurer.
b) Capitol stock insurer.
c) Reciprocal insurer.
d) Surplus lines insurer.

d) Surplus lines insurer

Joe is a resident agent who is countersigning a policy for Alex, a nonresident agent. Joe and Alex will split the commissions on this policy. ___________ of the premium is the minimum commission for Joe.

5%

Abandonment condition

Absolute liability

Accident

Accounts receivable insurance

Actual cash value (ACV)

Additional coverages

Additional insured

Additional insured - lessor endorsement

Adhesion contract

Adverse selection

Agency

Agent

Aggregate Limit

Agreed Value Condition

Aleatory Contract

Alien Company

A.M. Best Company

Annual Transit Policy

Apparent Authority

Application

Appraisal Condition

Appurtenant Structures

Arbitration Condition

Assessment Mutual Company

Assignment Condition

Assumption of Risk

Authorized Insurer

Automatic Increase in Insurance Endorsement

Automobile Insurance Plan

Aviation Hull Insurance

Aviation Liability Insurance

Bailee

Bailee's Customer Policy

Bailment

Barratry

Best's

Bid Bond

Bill of lading

Binder

Blanket Insurance

Blanket Position Bond

Bodily Injury (BI)

Boiler and Machinery Insurance

Broad Theft Coverage Endorsement

Broker

Builders Risk Coverage Form

Builders Risk Reporting Form

Building and Personal Property Coverage Form

Burglary

Business Auto Coverage Form

Business Auto Physical Damage Coverage Form

Business Income Coverage Forms

Business Income from Dependent Parties

Business Liability

Business Pursuits Endorsement

Businessowners Policy (BOP)

Camera and Musical Instruments Dealers Coverage Form

Cancellation

Capital

Cargo Insurance

Casualty Insurance

Causes of Loss Form

Certificate of Insurance

Claim Adjuster

Claims-made Form

Coinsurance

Coinsurance penalty

Collision Coverage

Combined Ratio

Commercial Articles Coverage Form

Commercial Auto Coverage Part

Commercial Blanket Bond

Commercial Crime Coverage Part

Commercial General Liability (CGL) Coverage Part

Commercial Lines

Commercial Package Policy (CPP)

Commercial Property Coverage Part

Commercial Property Floater Risks

Common Policy Conditions

Common Policy Declarations

Comparative Negligence

Compensatory Damages

Competent parties

Competitive state fund

Completion bond

Comprehensive coverage

Concealment

Concurrent causation

Conditional contract

Conditions

Condominium association coverage form

Condominium commercial unit-owners coverage form

Consideration

Consultant

Contract

Contract bonds

Contractors equipment floater