The process where by a mutul insurer becomes a stock company is called
Demutalization
The process whereby a stock company a mutal insurer is called
Mutalization
The provision in a property policy which states that the insured has been paid up to their insurable interest is
Valuation clause
The part of the policy that states the amout of coverage the insured property policy period is
Declaration
Part of the policy that establishes limits upon the insurer and the insured with the insuance policy
Conditions
Which are the characterics of negligence
Duty,breach,proximate cause, damages
Which of the following is not a federal program
Worker' compensation
Absolute risk(liability) is imposed
When there is negligence whether proven or not
X is in an accident with Y. X suffers $5000 of damage but it is determined that X is 60% responsible for the accident. How much would X receive under CONTRIBUTORY negligence rules?
$0
what is the main purpose of tort law
to determine financial responsibillty for damage
what of the following is not considered an intentional tort?
Auto accident
Which of the following statements is true regarding compensatory damages?
There is usually no direct correlation between the amount of general and special damages awarded to the victim
The insurer decides not to renewan insured's personal auto policy. How much notice must the insurer provide to the insured
30 days
an insured's loss reserve for a claim isan estimate of the amount insurer will pay for present and future loss, which of the following is an example of loss prevention
a homeowner decides not to install a pool in the backyard
which of the following describes the act of making a false entry in any book statement of report of any insurer with the intent to device any examiner lawfully appointed to examine the insured's
an unfair practice
a person can base his/her claim for liability on the basis of all of the following EXCEPT
breach of liability
the term "assignment"refers to
the transfer of the insured's interest in a policy to another party
the term "subrogation" refers to
the insured's right to recover payment from a responsible 3rd party
insur's right to recover the payment of the claim after they paid the insured for their property losses a negligent 3rd party is know as,
subrogation
an insurance deductible is
the amount of covered expense that the insured pays before the insurer pays,
all of the following are requirements for a notice by mail to an insured by insurer except
notice must be sent with return receipt required
which of the following is considered special damages
Compensation for time away from work
Which advisory organization(s) develop forms for the standard market?
Insurane service office and American association of insurances
Which of the following would be considered special dmamges?
Lost wages
What do the initials S.tA.R.R reperesent?
Methods of risk mamagement
All of the following would be considered benfits of insurance except
Retention of loss by the insured
What gives an insured party the right to seek compensation if it is proven that another person with negligence contributed to the injury
Tort law
What of the following is NOT one the three main types of insurance losses
Financial loss
Under a special cause of loss form if a landslide is caused by an unnatural flow of water due to improper grading, the loss is,
Excluded under the concurrent causation
An open peril policy protects agaginst the loss from
Any peril, other than those specifically excluded
What factor supportd the principle of indemnity?
Insurable interest
All of the following are characteristics of an ideally insurable loss exposure"except
Losses that are catastrophic
The amount to replace property with " like property of the same quality and construction" is the properties
Replacement value
All of the following are considered intentional torts
except, Assult
What is the difference between per accident limit in a split limit policy and single limits
There is no difference
The intentional relinquishment of known right is
Waivier
Which type of loss is a business retirement or disability of key employee, exposed to death retirement or disability of key employee,
Personnel loss exposure
The amount to replace an insured's damaged property
less depreciation, is know as the, Actual cash value
The commercial property conditions included a condition called " liberalization". The effect of this condition is
To automatically apply broader coverage to the commercial property coverage part if a policy form revision would broaden coverage without an addition premium
In a commercial lines program policycommon policy condition do not include which of the following as a condition?,
Perils insured
A possibility of financially loss resulting from the ownership of property is know as
insurable interest
laura is driving her own car on behalf of her employer laura's negligent operation of her car injures a member of public. The employer may be held liable because of what is called.,
Vicarious liability
Type of exposure can be best defined as a condition or situation where the exposure to financial loss is presented to a business owner by the injury
disability, death, sickness, of valuable employee, Personnel loss exposure
Which of the following is also know as a human loss exposure
Personal loss exposure
Which of the following best characterize a speculative risk?
A situation that offers the possibility for a loss or gain
In the state of CA no rate will remain in effect if it is considered to be any of the following, EXCEPT,
Impartial
What course of action does a party to a contract have if the other party is found to be breach of that contract
Damage for breach, reasonable attorney fee and cost
Which part of the insurance contract summarize the major promises of the insurer
Insuring agreement
Under tort law a corporation can be subject to a claim for legal liability on the basis,
Absolute liability
Risk management technique that eliminates a loss exposure and reduces the chance of loss to zero is
Avoidance
A situation is which there only the possibility of loss or no loss is considered a
Pure risk
A reduction in value of property that results immediately from damage to the property is know as
Direct loss
Items that are paid on replacement cost is defined as the
Amount to replace the damage property without a deduction for depreciation
A wrongful act other than a crime or breach of contrat is law
Tort law
The amount to replace property with like property of the same quality and construction is the
Replacement cost
Whatis the process whereby insurers decides which customers to insure and what coverage to offer
Underwriting
The amount paid for damaged propertywhich is equal to the price for which it could have been sold is called
Market value
A policy may not be transferred to another without
Written consent of the insured
An insured's loss reserve for a claim is
An estimate or the amount that the insurer will pay
What is the type of loss exposre that would include land and property attached to it
Liability loss exposure
What type of policy protect against loss from any peril except those that are specifally excluded
All-risk or open peril
Who is considered the first party to an insurance contract
The insured
A written provision that modifies the provisions of the original contracts is know as
An endrorsment
In a commericial property the insurance claim is deniend because of the insured action's. the mortgage holder will in most cases.,
Still have right to receive the full amount of the loss a payment
Named insured on a commercial insurance policy is "sam stone and dan Sullivan DBA S&S bar and grill" if the insurer cancels the policy, they are required to mail or deliver written notice to
Only san stone
Which type of exposure can be best be defined as a condition or situation for any exposure or finanicial loss is presented to an individual or family by such cause as injurydisability, death or sickness
Personal loss exposure
What is the primary reason for co-insurance clauses in property polices
to encourage insurd's to purchase coverages near the value of the property
the state laws that regulate insurer practice regarding underwriting sales, rate-making, and claims handling are called,
market conduct regulation
a common fourmula that is used to establish cash value is
ACV=replacement cost minus depreciation
The possibility of financial loss resulting from the ownership of property is know as
Insurable interest
Which of the following types of loss would result in a claim for monertary damages due to injury to another or damage to another's property
Liability loss
Which of the following coverage's is a property insurance coverage.
Other collision
exclusive agents
generally represent only one insurer
in an unendorsed claims-made general liability policyhow long does an insured have to report a claim which occurred during the policy perio
60 days
To determine the fact actual cash value of commercial bulding for coinsurance purposes uses
Fair market value
What causes is commony used to require's purchase insurance close to the value of the property
Coinsurance clause
A distinct feature of the alternative funding method know as self-funding is
The benefits are tailored to the group
Actual cash value is defined as the
The amount to replace damage property minus depreciation
Which of the following would be know as the process whereby an insurer determine appropriate changes for its policies
Rate-making
All of the following would be considered benefits of insurance EXCEPT
Retention of the loss by the insured
What is the formula for actual cash value (ACV) in determinig loss values
Replacement cost less depreciation
Which of the followingwould be classified as a property insurance coverage
Other-than-collision coverage
Which of the following is the reason that an insured should not be making any kind of profit as the result of an insurance claim/loss being paidbut rather, the payment should restore the insured to the financial status that existed prior to the loss with
Basic principle of insurance
What is the effect of "concurrent causation" exclusion under the "cause of loss-broad form in a commercial property policy?
If there is a loss resulting from two or more perils that occur at the same time to cause a loss then is no coverage is any of the perils are excluded
What will the mortgage holder do in the event that an insurer does not pay claim as the result of the actions of the insured
Receive full payment for the loss, if the required premium has been paid
What exactly does a policy know as "open peril" protect against
Perils not specially named as exclusions in the policy
What does a "pure risk" consist of ?
The chance of loss only
The term "proximate clause " is best defined by which of the following?
A negligent act that causes bodily injury or property damge that follows a sequence of uninterrupted, but related chains of events
Why would an employer be held legally liab;e for the negligent operation by employee who is driving a vehicle on belhalf of the employer and cause an injury to a pedestrian
The principle of vicarious liability
How would a "peril" best be defined?
Reason for the loss event that leads up to loss
Which of the following combinations of characteristics should be considered when making a an insurance recommendation to a propective insured that has just purchased a new office building?
The structure that is exposed a loss, the perils that may occur, consequently causing a loss possible financial impact of loss
What type of insurance company is owned by individuals that are stockholder in the company; and share in the profits of the company?
Stock insurance companies
All of the following explain the characterics that are unique to insurance contracts EXCEPT
There is an equal exchange of amounts or values within the contract
With regards to insurance applicability the word "risk" can be best defined as which of the following?
The uncertainty associated with a loss occurring
All of the following insurance company are private insurers; EXCEPT
Fraternal insurance company
What would be the reason(s) for $100 deductible versus a $1000 deductible
Neither of these apply
An indivual who loves next to nuclear power plant is exposed to which of the following types of hazard
Physical
Which of these is defined as "exclusive agent'
Sells for one insurance company and only that company's products.
The concept of "pure risk" involves the possibitly of chance of which of the following?
A loss only
An employee is operating their own car for their employer. The individual injures a person in a area as result of negligent drivng. The reson why the employer would be held liable is because of which of the following?
Vicarious liability
Which of the following coverages' does an open peril policy provide?
Perils other than those specifically named as being excluded
risk" is one of the most important terms in the insurance industry. How is it defined
the uncertainty of a loss
what would be the result of a lower(250) deductible vs. the selection of a higher deductible ($1000)
greater number of smaller claims sent to the insurer
of the following which is true characteristic about insurance
it is considered a method of transferring risk
the amount paid for property damage which is equal to price for which it could have sold is
market value
which of the following is the best definition of an insurer's loss reserve
the approximate dollar amount of an insurer's liability of at least one (or more)open claims
for any type of risk exposure to be considered an ideally insurable riskwhich of the following characteristics does not have to exist , there is very little
if any chance a loss happening during the policy period
during the application process for a personal auto policy. the applicant says that he has not had any tickets or accidents. The insurance company accepts the risk and issues the policy. Shortyly after. the insured's vehicle is stolen resulting in the insu
the traffic tickets that were not disclosed were not material. This is why the policy was not recinded and the claim was paid
under California insurance code marketing department is responsible for all of the following; except
bulk mailing
A representation as to the past
present or future is an ,verified promise
When must insurance records for insurance agents and insurance broker be made available to the insurance commissioner?
all times
When may a representation be withdrawn?
only before the insurance is in effect
RW and associates is an agency which represents BLG insuaracne corporation. RW and associates may leave the name BLG insurance corporation in its advetertisments by clearly stating the relationship between the two business in any of the following ways ; E
RW And Associates underwriting for Blg insurance Corporation
Which of the following describes an insurer who has enough financial resources only to provide for all its liabilities and for all reinsurance of all outstanding risk?
insolvent
Represention as to the future is considered which of the following
promise
An insurer that has a certificate of authority in California is
amitted
The execution of a policy involes which of the following?
signing a covering note
The negotiation of a policy involes which of the following
sending the propect an email suggesting that they buy a certain type of policy
An applicant of insurance does not reveal information that the insurer would rely upon to issue the policy this is/an
consealment
The method that the California DOI uses to approve or disapprove rate filing for various types of insurance such as homeowners and automobile is know as?
prior approval method
An organization will cease too exsit as an entity eliglble to hold a liceense for all of the following reasons EXCEPT
termination of key employee
All of the following are areas that market regulation cover EXCEPT
Employee training
Which of the following statement is true regading insurer with admitted status in California?
they may not use race color, religion, or national origin as condition to use higher rate
All of the following are requirements for a notice by mail to an insured by an insurer EXCEPT
notice must be sent with return receipt reuired
What is one the main factors that the insuruce commissioner uses while detereming whether a rate excessive or unfairly discriminatory?
wheter the rate mathematically reflects the insurance company's investment income
An agent who divert/comingles premium dollars for the agents's own use is guilty of
theft
Every admitted insurer in the state of California is required to maintain a unit or division to investigate which of the following?
possible fraudulent claims made by insured's
What will happen when an agent's appointment to an insurance company is terminated and the agent has no other appointment with any other insurance company?
The agent's permanent license becomes inactive
The CA insurance code requires property insurance polices specify all of the following EXCEPT
the insured address
What steps need to taken to terminate a licensee's license that is in the possession of an employer?
the licensee needs to give written notice of intent to the insurance commissioner
Under California insurance code a surplus lines broker
transact business only with non admitted insurers
What would the commissioner likely do if an agent induces a client to co sign a loan
suspend the agent's license
Section 770 of the insurance code is true regardging unfair or trade practice?
an entity cannot demand the insurance be placed with a particurl agency
Which of the following describes an insurer who has enough financial resources only to provide for all of its liability and for all reinsurance of all outstanding risk?
insolvent
In California. Excess and surplus lines coverage needs to be placed through
a surplus lines broker
What must a life agent travel agent, or fire and casualty insurance agent do in order to act as an agent of a particular insurer?,
file a notice of appointment with the commissioner
In the business of insurance. The act of concealment is defined by all of the following statement EXCEPT
concealment does not occur if no inquiry is made
Which of the following statements is NOT true? A fire and casualty agent
does not have the authority to collect premiums from producing broker agents.
Where would an insured that is in the business of importing exotic animals from Africa most likey go to obtain
excess and surplus lines insurer
What else must an applicant for a fire and causualty license . life agent license. Or personal lines agent license complete in addition to pre- classroom study?
a 12 hour course on ethics and CA code
Which rate approval filling system is used in California for most lines of insurance
prior approval
When is property and causulty agent required to in form an isured of any conditions which may be precedent to coverage regarding a personal auto policy?
at time of application
The state law that regulates insurer practices regarding underwriting. Sales. rate-making and claims handling are called
market conduct regulation
The CA insurance code
requires agents to keep records of any compensation they may have received for ther services involved with premium financing
It is a violation of CA insurance code to act as a producer for a non- admitted carrier unless
the producer is a surplus lines broker
You meet with a small furniture manufactuer and make a property and liability insurance recommendation. You have insured many risk of this type in the past and have a good idea of what their needs may be. There are several popular ways of determining busi
get a copy of all current polices and determine what coverages they have been carrying and how much they have been paying
Where do most states require insurers to file policy forms?
the insurance department
What must an isurer do who accept from an agent who is not specifically appointed by the insurer and then issues a policy from that application
forward to the commissioner a notice of appointment with 14 days of receipt of application.
In the state of CA no rate will reamin in effect if it is considered to be any of the following except
impartial
What does it mean if an agent's license is inactive?
the agent cannot transact any insurance business for valid, active license is required
A representation in an insurance contract qualifies as which of the following?
an implied warranty
According to the CA insurance code a binder is deemed a valid insurance policy for the purpose of providing that the insurance coverage specified in the binder for each of the following types of insurance EXCEPT
life insurance
What is required of a broker- agent before appointing an insurance solicitior?
must hold a permanent license
Company that negotiates and binds ceding reinsurance on behalf of an insurer is considered
managing general agent
Insurers may purchase reinsurance for a variety of reason which of the following is not a good example of the use of reinsurance? Insurer purchases reinsurance
only on the below average business submitted to them keeping the good business for themselves
Any person who makes a loan of money using real property as security
Shall no make available the information contained in a borrower's fire or causulaty policy if the borrower has filed a statement with the lender that they do not want the lender to disclose this informqation.
What must a licensee do in order to surrender for cancellation a license in their posseion?
deliver the document itself to the commissioner
If an insurer pays an insured $25000 in lost wages,$45,00o for physically visits and hospital cost and $15,000 for physical therapy treatments and later finds out that the claim was faudlent the insured may be fined as much as 000 in lost wages,$45,00o fo
$170000
It is a violation of the CA insurance code to act as a producer for a non admitted carreier unless
the producer is a surplus lines broker
� Which of the following insurance professionals would be employed to aid an insurance broker
insurance solicitor
� All of the following are characteristic of ideally insurable loss exposure EXCEPT:
losses that are catastrophic
� The types of transactions and insurer that a surplus lines broker is involved with is/are
non-admitted insurer, property and casualty insurances
� How is an admitted insurer defined according to California DOI?
it transact insurance according to laws of the state of California
� All licensees must be appointed by the insurance companies they represent in order to sell the lines of insurance that a particular insurer may offer. Assuming that a licensed fire and casualty broker/agent has received the proper appointment
what type or types of insurance, from the following list, may this individual sell, auto, property insurance
� The insurance code definition of "insurance broker" is
someone paid to transact insurance on behalf of another person, but not on behalf of the insurer
� The continuing education requirements that a fire and casualty broker-agent must fulfill as required by the DOI are which of the following?
25 hour during each twelve month period for the first four years the licensee is licensed
� In the state of California how is a domestic insurer defined according to the California DOI code?
organized, chartered, or incorporated under the law of state of California
� Which of the following is the only reason that an insurer can cancel an automobile insurance policy?
the driver's license of the individual who usually operates the vehicle that is insured by the policy and who is insured by the policy has had license suspended temporarily
� Under which of the following circumstance can the insurance commissioner deny the application for an agents license without a hearing?
the applicant has previously has a licenses application denied for cause within the past five years
� It can be very tempting for commission based insurance salespeople to perform unethical activities in order to make a sale. of the following which would not be a reason why and agent might be tempted to act unethically?
maintaining the best interest of customers first and foremost
� It is vital that an insurance agent/broker fully assess analyze and review a particular risk in order to determine the proper insurance coverage needed. The least likely way to do this is to
review all coverage in their current insurance contracts as well as the premiums paid
� If an insured signs a claim form a claim which is fraudulent the insured may be guilty of
perjury
� Which of the following best defines a binder
a contract of insurance that is temporary, only in writing, between the insured and the insurer
� A fire and casualty managing general agent can do all of the following EXCEPT
none of these are excluded from the power and authority given to fire and casualty managing general agent
� An insurance company pays a loss and continues coverage under an auto policy under the following circumstances. An insured honestly thinking that he received his last traffic ticket more than 36 months ago. Applies for an auto policy stating that he has
the concealed facts were not material, they would paid the claims anyways
� The process of underwing a disability income insurance policy includes analyzing the risk associated with certain act ivies. Hobbies and hazardous sports. Therefore how does the California insurance code define and classify and act of an applicant who d
this is defined and classified as concealment
� With respect to premium finance compensation service which statement are /is true
the DOI require agents and brokers to maintain records of the compensation they receive for providing premium financing service for 3 years
� How is an "insurance broker" defined according to the California insurance code?
an individual who receives compensation for transacting insurance on behalf of another person, but not on behalf of an insurance company
� What type of insurance company has owners who are stockholder in company and who share in the profits of the company?
stock insurance companies
� Entitles or organizations that provide coverage for medical expenses in California are subject to the jurisdiction of the state department of insurance (with several exceptions) unless these entities or organizations can demonstrate that during the cour
they are subject to the, all of the above
� When does the authority to transact insurance that is granted to a licensee from an insurance company become effective
when the insurance company representative signs the notice of appointment
� What is the minimum number of required continuing education hours that a fire and casualty broker-agent must meet?
25 hours each 12 month period following the date of the original license if license after 1/1/92
� Which of the following statements is true regarding the material of representations and concealment?
it is determine by the affect of the facts on each party to the contract in determining his or her estimate of the disadvantages of the contract
� All fire and casualty broker-agents must not only be licensed with the DOI but they must also be appointed with the insurance companies they will be representing. When does this authority resulting from the insurer appointment to transact insurance busi
when the notice of appointment is signed by the insurer
� A licensed fire and casualty broker-agent when properly appointed may transact all of the following except
health insurance
� The California insurance code contains requirements concerning the requirements for name approval for all insurance licensees. These requirements included which of the following?
the professional designation "CPCU" is acceptable following the name of any fire and casualty underwriter
� The word"materiality" applies to the concept of concealment and representation. Which of these is true in this regard?
the materiality of any information in this regard is determined by the influence of the fact on each party in determining their estimates of the disadvantages of the proposed contract
� Insure' especially those with higher premiums very often have the immediate funds to pay required premiums such as automobile liability insurance. In many cases insurers will provide premium financing. Which of the following statements is correct regard
any agent that provides premium financing service is required to maintain all records regarding the financing if compensation is received for financing of the premium for three years after transaction.
� When does the license of a fire and casualty broker- agent become inactive?
when the broker/agent has no appointment with any insurance company, but licensing renewal fee have paid and CE requirement have been met
� How do insurance regulators view a statement made by an agent to a prospective insured that the dividends of an insurance contract are guaranteed each year?
this would be considered a misrepresentation
� For more serious offenses and conviction an application for a license can be denied without a hearing which of the following circumstances would allow for an application to be denied for an insurance license WITHOUT A HEARING
the applicant for the insurance has had no previous license denied for cause with previous 5 years
� All of the following factors can be used according to the insurance code in California to determine auto insurance policy rates in addition to any other factors the insurance commissioner is allowed to adopt; and include by regulation
1and 3 only
The collision coverage of the personal auto policy does not cover the following loss situations; EXCEPT
large limbs and branches of a tree that have fallen into the street as a result of a windstorm. The insured collides with them
To be covered for a hit and run accident under the uninsured motorist property damage coverage of a PAP, what is required to be provided to the insurer
license number of hit and run vehicle
Which of the following coverage's may you buy with a NAMED OPERATOR POLICY?(chose the most complete answer)
liability, uninsured motorist, medical payments, collision and other than collision
The PAP collision deductible is $1000 and other than collision deductible is $500. How much would the insurer pay for an accident involving the overturn of one vehicle resulting in $2000 of damage
$1000
A is an accident with B. A suffer$10000 of damage but it is determined that A is 25% responsible for accident. how much would a receive under COMPARATIVE negligence rules
$7500
Under California financial responsibility law the minimum financial responsibility for accidents that involve several people injured in one accident, is
$30,000
When does a personal auto policy require the insured to notify the police?
for hit and run and thefts
When an automobile insurance policy is canceled at the request of the insured , and the insurance company keeps all earned premiums, in addition to an amount to an pay for overhead expense incurred by the insurer, it is referred to as what type of cancell
the short rate type of cancellation
Which of the following coverage's may you buy with a named non-owner liability policy?(choose the most complete answer)
liability and medical
What coverage is available under the extended non-owned liability coverage?
liability and medical payments
What is the limit per day for a transportation expense in an unendorsed personal auto policy in the event of theft, after it is reported and automobile is not returned within 48 hours of theft
$20
After a collision loss, the personal auto policy requires the insured to
allow the company to inspect the damaged property before it is repaired
An insured has a personal auto policy and did not pay the initial insurance premium when it due. The insurer cancels the policy for non- payment. How much days' notice must the insure give?
10 days
If an individual does not own an auto, nor have regular use of an auto, what endorsement to a personal auto policy could be used to properly protect that individual
named non-owned liability coverage
What coverage is available under the miscellaneous type vehicle endorsement?
all coverage under the personal auto policy
If an insured purchased an all- terrain vehicle(ATV), what endorsement can be added to the personal auto policy to insure the vehicle?
miscellaneous type vehicle endorsement
Under an unendorsed personal auto policy, transportation expense coverage applies to
theft only losses
Under an unendorsed personal auto policy, what coverage is available for personal effects?
none
What is the minimum discount percentage for the "good driver" discount?
20%
What is one of the principle rating factor under proposition 103 allowed for personal auto polices?
safety driving record
Which of the following is an insurer's option when making a settlement with the insured under a personal auto policy?
return stolen property to the address shown in the policy
The personal auto policy towing and labor endorsement pays for
the cost of the labor only if the labor is performed at the place of disablement
Which of the following losses would be covered under Dick's personal auto policy other than collision coverage?
someone shoots Dick's car rear window while the car is parked on the street overnight
If a motor home is scheduled on a miscellaneous type of vehicle endorsement, all of the following property covered, EXCEPT
awnings
Max's personal auto policy (PAP) has liability and collision coverage. His neighbor's car has liability coverage only. Max borrows his neighbor's car to go the store and has an accident that is his fault. He damages his neighbor's car another car. Max PAP
liability coverage that is excess of his neighbor's liability coverage. His collision coverage also applies, but on primary basis
A personal auto policy (PAP) insured's car was a total loss when the car was stolen and wrecked. The insured has the following coverage': liability, medical payments, and "other than collision". Her PAP
other than collision" will pay for the loss
The personal auto policy territory limits include
Montreal, Canada
A personal auto policy is written for Lisa providing liability coverage. Which of the following auto liability situations would not be covered unless Lisa has an endorsement attached and paid an additional premium
Lisa destroys a mailbox while driving a (non-owned) company car furnished for Lisa's regular use
Kim's car is insured with a personal auto policy. The coverage includes medical payments with $2000 limits, which of the following is true statement about the medical payment coverage for necessary medical expenses?
Kim gives her neighbor ride to the store in the insured car. She has an auto accident in which they each incur over $2000 in medical expenses. The maximum that Kim's policy will pay is $2000 to her and $2000 to her neighbor
The collision coverage of a the personal auto policy covers?
damage caused by the insured, driving into a fallen tree, that fell during a storm
Which of the following losses is not covered by either the personal auto policy collision or other than collision coverage?
David leaves his personal (non-business) laptop computer in his car overnight. Car is parked in the driveway outside of his home. Computer is stolen from his
In reference to the coverage's provided in the basic form, the boat owners policy is similar to what other policy
the personal auto policy
If an insured rents an auto while on vacation, what coverage if any will be available for physical damage coverage under a personal auto policy
the broadest coverage on any auto shown in the declarations
What is the difference between per accident limit in a split limits policy and single limits
there is no difference
If an insured with a personal auto policy has an accident in a state with personal injury protection, how does the policy respond?
coverage automatically is broadened to provide PIP
Which of the following is a true statement about CAARP
the minimum liability for CAARP policies are 15000/30000/5000
Newly acquired motorcycle are not automatically covered under a personal auto policy (PAP) because:
the unendorsed policy does not cover two wheeled vehicles
Under the liability portion of an unendorsed personal auto policy, what coverage is available if the named insured is operating a company car on a regular basis
the policy exclude this usage
All of the following are principal rating factors under proposition 103 for personal auto policies, EXCEPT
number of listed drivers
Steven's(unendorsed) personal auto liability coverage would pay for
the cost of repairing the neighbor's fence that Steven damage due to the negligent operation of his car
All of the following expenses are covered in addition to the limits of a liability under coverage a of a personal auto policy except
pre judgment
Jim, your unmarried homeowner's insured does not own his car. He is planning a vacation trip to Florida and will be renting a car. He also drives cars belonging to friends occasionally. To protect Jim in theses situation, you would recommend a personal au
named non-owner coverage endorsement
The limited Mexico endorsement applies to trips to Mexico with duration of
10 days or less
If an insured borrows a neighbor's vehicles to run a personal errand, how do the policies respond in the event of an auto accident?
the neighbor's policy is primary and the driver's policy is excess
Under a personal auto policy. If a newly acquired auto is to replace the covered auto with liability coverage only, how long does the insured have to request collision coverage?
4 days
Livery conveyance is best described as a
vehicle for hire to transport people
Damage done by an earthquake to an insured auto covered by the auto policy
if the other than collision coverage is purchased
If an insured timely requests coverage for a newly acquired auto under an existing personal auto policy, what coverage is provided before the request is made?
broadest coverage for any vehicle shown on the declarations
If an insured rents vehicle while on vacation in the U.S, what coverage is provided under the personal auto policy?
all coverage is in force in the personal auto policy
A private passenger vehicle is added to an insurance policy. The CA insurance code
make no mention of vehicle inspection requirement
If an insured under a personal auto policy leaves a covered auto dealer for repairs, and the auto is involved in an accident while being test driven by employee of the dealer, how will the personal auto policy respond to liability claims
the personal auto policy is excess
A single person does not own or lease an automobile. She occasionally drives her housemate's vehicle on an emergency basis. She is going on vacation and will have to rent a car. To obtain full automobile insurance coverage when this occurs, what should sh
the named non-owned coverage endorsement
Under the liability portion of an unendorsed personal auto policy, what coverage is available if the named insured is operating a company car a regular basis?
the policy excludes this usage
Which of the following events within the last three years would disqualify an individual from receiving a good driver discount?
.An at fault accident involving minor bodily injury
What endorsement can be used to insure a motorcycle under a personal auto policy?
miscellaneous type vehicle endorsement
California has lower financial responsibility limits than most other states. If randy, a California personal auto policy insured, carrying minimum limits on coverage, has an accident in a state that quires higher limits then,
the policy will automatically provide the higher limits at no extra charge
Of the following loss scenarios, identify the one that is excluded from coverage under both the collision and other than collision coverage of an insured's PAP
a "palm pilot' computer (owned by the insured) is stolen from the vehicle while parked in the insured's driveway. There are forcible signs of the vehicle
Which of the following is not an uninsured motor vehicle as defined by personal auto polices uninsured motorist coverage?
a vehicle owned by state agency which self-insures its auto
Under a personal auto policy, who qualifies as an insured while using a covered auto
any person
Lee has a personal auto policy with $250 deductible collision coverage and $100 deductible other collision coverage. He runs a stop sign and hits another car. There is $1300 worth of damage to his(the insured's) car. How much would the insurer pay the dam
$1050
A car is insured using a personal auto policy. The car is damages by hail. The loss is:
covered as other collision loss
The limit of liability under a personal auto policy under the section "coverage for damage to your automobile is typically the lesser of the dollar amount needed to replace or repair the damage property or the _____of the damaged property. From the follow
actual cash value (ACV) or fair market value
All of the following vehicles are eligible for coverage under a personal auto policy, EXCEPT
a private passenger auto owned by a partnership
An insured living in California has the following coverage's under PAP: with liability, medical payments, and loss other than collision. The individual vehicle is stolen from her driveway and then totally wrecked. Which of the following cover this loss?
other than collision coverage
Under a personal auto policy(PAP), how would the damage sustained to an insured vehicle as the result of an earthquake be covered?
under the other- than-collision section of the policy
Very often the deductible amount under the collision and other than collision sections of a personal auto policy are different. With this in mind, what would be the amount that an insure would pay for a loss under the following circumstance:$500.00 dedecu
$1500.00
The territorial limits of a personal auto policy include which of the following
Toronto,Canada
What is the minimum number of days that an insurer must give an insured, prior to canceling a policy for non-payment?
10 days
other-than-collision" coverage of a personal auto policy includes which of the following types of losses
theft of any of these would be covered
Which of the following would be covered by the physical damage section of a personal auto policy?
none of these are covered
Under a personal auto policy(PAP),how would the damage sustained to an insured vehicle as the result the insured smashing into a large fallen tree that had fallen several hours earlier as the result of a lightening striking is it covered?
under the collision section of the policy
What kind of coverage would you recommend to one of your insured's who is single and does not own a car, but, she does , on occasion, drive cars that belong to her friends (both male and female). Additionally, she is planning a vacation to Florida and wil
named non-owner coverage endorsement
What would an insurer likey pay if the following were the details surrounding an accident for which the insured was at fault and had bodily injury policy limits of $25,000 per person and $50,000 per occurrence? Three people injured:#1-$11,00,#2-$26,000 an
$48,000
Which of the following cities would fall within the policy territory limits of PAP issued by an insurer in the state of california?
Vancouver,Canada
You are the agent for an insured that carries both a homeowners policy and a personal auto policy(PAP) with you through the same insurance carrier. The insured is driving home,(in the auto you have insured),after purchasing a brand new big- screen TV,VCR,
DVD player all in one unit. He collides with a parked car and destroys the new TV. How would this loss be covered?/ the homeowners policy-personal property coverage
What is the requirement and what is provided under the Mexico coverage endorsement to a PAP in California?
provide liability coverage (excess) for any accident in Mexico with 25 miles of the us border
Of the following choices, which is correct regarding why a motorcycle is not automatically covered under a personal auto policy?
an unendorsed personally auto policy does not automatically cover two wheeled vehicles
How would the damage resulting from hail be covered under a personal auto policy
covered as other than collision loss
An automobile insurance company is permitted to cancel a personal auto policy for which of the following reasons?
the insured's drive license is suspended. This is the person that normally drives the vehicle
Jackie's personal auto policy(which is unendorsed) would provide payment for which of the following?
expense of repairing a neighbor's wall, surrounding a garden, that Jackie accidentally backed through
All of the following are considered an uninsured motor vehicle according to policy definitions found in a personal auto policy, EXCEPT
A vehicle that is self-insured because it is owned by a state agency
Your insured has a personal auto policy that provides medical payment coverage $2000. Of the following statements, which is true regarding the amount payable under this section of the policy?
the insured is car- pooling to work with her neighbor when they are in an accident. Both are injured and incur almost $3000 each in medical expenses. The insured and her neighbor would each be paid $2000 from the policy
Your insured client has an auto policy with liability and collision coverage's. the insured experience an at fault accident the first time he uses the neighbor's truck which has liability coverage only. His PAP provides coverage and will pay for the entir
this is how the insurer would handle this claim.
other-than collision" coverage of personal auto policy covers which of the following types of losses?
the windshield of the vehicle is damaged while left overnight on a city street within 5 miles of the insured's residence
Which of the following is not only reason that an insurer can cancel an automobile insurance policy?
the driver's license of the individual who usually operated the vehicle that is insured by the policy and who is insured by the policy has had his licenses suspended
A personal auto policy will cover all the following types of losses, EXCEPT:
a "palm- top" computer, personally owned by the insured, is stolen from the insured's car while it is parked in her driveway at home
Calculate the amount the insurer would pay, under a PAP, for a loss in the following circumstances, with the following coverage limit: collision coverage--$500 deductible. Other- than collision-- $50 deductible; damage to the insured's vehicle-$1050 after
$550
State of California DOI minimums for liability coverage are $15,000 /$30,000/$5,000. An insured has an accident out of state that has higher financial responsibility limits than California. Which of these is true?/
the policy automatically provides the higher necessary limits without an extra premium
An individual is driving home from the store with a new 48- inch flat screen TV. An accident occurs and the TV is destroyed. The driver carries a homeowners policy (HO) as well as a personal auto policy (PAP). Will the damaged TV be covered? If yes, how?
yes, under the personal property part of his HO policy
Which of these is not included in definition of the "uninsured motor vehicle" in a personal auto policy?
vehicles that are owned by an agency of the state that self-insures the vehicle
Why is a newly acquired motorcycle not automatically covered under the tems and conditions of a persona auto policy?
these types of vehicles( motorcycles, and other types of non-automobiles) are not covered under a personal auto policy that is unendorsed
An insured's vehicle is stolen. Following this the insured rents a replacement vehicles for two months until her auto is repaired by the insurer. Will her personal auto policy pay for the cost of the rental, and if so how?
the policy will pay all needed expense the insured incurs for the rental car to the stated limits found in the policy
In addition to paying legal damages, but without deducting from the policy's limits, which of these would be covered in a personal auto policy?
these are all covered in addition to the limits stated in the policy contract
A personal auto policy contains the state required liability and medical payment coverage as well as "other-than- collision' coverage. How would a claim be paid if there were a loss after an insured is stolen and then wrecked
the claim would be paid under "other-than-collison" coverage
An unendorsed personal auto policy would cover which of the following under the liability coverage part?
the repair expenses that are needed to fix the damage to neighbor's fence that was the result the insured negligently driving through it while driving unsafely
The best definition of the term "collision" as found in a personal auto policy is which of the following?
hitting any other vehicle or object with the insured vehicle, or the upset of the insured vehicle
What is the limit for sound reproducing equipment under the coverage endorsement for excess sound reproducing equipment, audio, visual and data electronic, tapes , record, disks and other media
$200
A PAP contains the following limitations; $30,000person and $50,000/accident for bodily injury. An accident occurs that injures three people resulting in a number of lawsuits. The outcome of lawsuits found the insured to be liable and responsible for the
$50,000
Damage which is the result of a hailstorm, in which of the following ways under a personal auto policy?
covered as an other-than- collision loss
An endorsement and an extra premium would be required for which of the following liability losses under a personal auto policy?
the insured regulary uses, at the permission of his employer, a company owned car and has an accident with the vehicle
The limit of liability in a personal auto policy proving coverage for "damage to your automobile" is stated as " the lesser of the amount necessary to replace or repair the damaged property (vehicle) or the ________(fill in the blank from the choice below
actual cash value of the damaged or stolen property
There is exclusion in an automobile insurance issued by admitted insurer in California regarding coverage in Mexico, which can only be provided through an endorsement to PAP. Which is true regarding this endorsement?
it is liability coverage, on an excess basis , provided for losses that occur in Mexico, within 25 miles of the California/Mexico international border
Coverage under a comprehensive personal liability policy or a homeowners section 2 extends:
to the premises described and to the personal activities of the insured's on or off of the premises
Which property is excluded under an HO3 policy?
guard dog
Which is an additional coverage does a DP2 have compared to a DP1
additional living expense
Which of the following collapse losses would be covered under an HO3
Weight of contents
Which of the following loss exposures is not covered by section 2 of Ron's homeowners policy?
Ron's registered/ licensed personal auto while used on his own property which includes 10 acres of undeveloped land
The ordinance or law limitation in a homeowner's policy may cause a gap in coverage in which of the following situations?
The insured's home is damaged by fire and must be rebuilt to meet present building codes. The additional cost of complying with the codes is 50%
What is one way in which the HO2, HO4, and HO6 are similar?
perils insured against under coverage C
Which homeowners form is best for use on a brand- new single family dwelling?
HO5
Which coverage's are typically provided in a boat owners policy?
physical damage, liability and medical payments
The watercraft endorsement on a homeowners policy extends coverage for
liability coverage for watercraft listed on the schedule
Mary has an HO3 policy with replacement cost coverage on the insured buildings. The cost of replacement on the dwelling is $100,000, and the other structure (a garage) is $20,000. To be certain of replacement cost coverage on a partial loss to either stru
$80,000 on the dwelling; $16,000 garage
A home is damaged two hours after an earthquake, first by fire, then by fuel pipes bursting and causing an explosion. Under an HO3 form:
there is coverage, but only for the damage caused by the fire and explosion
Which of the following perils is covered by a "causes of loss-basic form"?
riot or civil commotion
How are the HO3 and HO5 Similar?
both provide open peril coverage for the dwelling
Which of the following would be used for a new single-family dwelling?
HO5
Which of items of real property under HO3 are valued on an actual cash value basis?
Built- in appliance
Which is a valid reason for an applicant to purchase a HO3 policy instead of dwelling policy?
the insured desires broader coverage
Grace has a homeowner's policy that includes section 1 coverage's A, B and C. A,B and C provide coverage for
dwelling, other structures, and personal property
What is the primary medical payment coverage difference between a boat owners policy and HO3 policy?
the boat owners policy covers injuries to the people on the boat, and the HO3 covers injuries to other outside the home
What is the primary difference between a HO2 and HO3 policy?
the perils insured against
Which of the following perils is insured against in the special form, but not in the basic form?
collapse
Which of the following persons is not an insured under section1 of a homeowners policy?
the named insured's( non-resident) spouse
The watercraft endorsement on homeowners policy extends coverage for
liability coverage for watercraft listed on schedule
What is the primary difference between an HO3 and an HO5?
coverage C broad named perils
Your HO3 insured wants to make sure he has liability protection against claims for false arrest, libel and slander. You should
tell him he should add the personal injury endorsement
If the limit of liability on a structure are $75,000 and the structure is worth$125,000, how much would be owed on fire loss of $50,000 if the policy has an 80% coinsurance requirement (disregard any deductibles?)
$37,500
The applicant wants a homeowner policy that has open peril coverage on his home(building structure) assuming he is eligible for the policy, which would you recommend?
HO3
What additional coverage is provided in DP3 that is not included in DP1?
collapse
What is one reason a person may purchase a dwelling policy instead of homeowners policy?
the owner does not reside in the dwelling
Which of the following perils is included in the broad form, but not in the basic form
falling objects
Which peril(s) is
are included in vacancy permit endorsement?/ all of the above
Which of the following is most likely to be eligible for CA FAIR plan?
a well- maintained dwelling located in a hazardous brush area
What is one difference between a homeowners policy and dwelling policy for personal property coverage?
there is no appreciable difference
What perils are insured against under the "additional coverage's property removed" of a homeowners policy?
all perils
What additional coverage's are available under the scheduled personal property endorsement that is not available under an unendorsed homeowners policy?
breakage of glassware by an earthquake
Which exclusion in the "causes of loss-special form" excludes coverage for mudflow
water(flood)
Under a building and personal property coverage form, if the insured has been vacant for more than 60 consecutive days. What effect will this have on vandalism loss
the loss is excluded
What is the primary difference between a HO2 and a HO4 policy?
property insured under coverage A
How much coverage, if any, is available under HO3 for landlord's furnishes?
$2,500
What additional coverage does a DP2 have compared to a DP1?
additional living expenses
Ordinance or law coverage provides protection which of the following losses
the increased expense incurred for the insurer to repair or rebuild property according to building code specification
Jack, condo owners, wants a fire and allied lines coverage for personal property, liability coverage for him and family members, and protection for assessments or damage for the building structure and other common areas. Which homeowners form would you re
HO6
If the named insured has been charged with arson in reference to a total loss to the insured's building, what effect will the insured's action have on the mortgage holder's claim for damages?
the mortgagee is entitled to receive 100% of their loss
What items of personal property are included in a coverage A under HO3 policy
paint on the premises to be applied to the interior
What is one peril included in DP2 that is not included in a DP1
falling objects
What is an additional coverage provided by HO3 policy
tree, shrubs, and other plants
The ordinance or law exclusionlimitation found in property policies such as the commercial property coverage, and in the homeowner policy have the following effect:/
it excludes that part of the loss resulting from the enforcement of a building ordinance or law
A hoe is damages two hours after an earthquake, first by fire and then by fuel pipes bursting and causing an explosion. Under a homeowner's HO3 form:
there is coverage, but only for the damage caused by the ensuing fire and explosion
The water damage exclusion in the cause of loss- special for applies to all the following, EXCEPT:
plumbing system leakage
An insured duties after a loss are described in the homeowner's section 1 conditions. Which of the following is NOT a correct statement about these duties? The insured must:
make all necessary repairs to protect the property from further damage. The excludes that part of the loss resulting from the enforcement of a building ordinance or law
A home is damage exclusion in the cause of loss- special form applies to all the following EXCEPT:
plumbing system leakage
An insured' duties after a loss are described in the homeowner's section 1 conditions. Which of the following is NOT correct statement about these duties? The insured must:
make sure all necessary repairs to protect the property from further damage. The expense is paid by the insured
Under section 2 of a homeowner's policy, comprehensive personal liability, coverage is extended to which of the following
premise described in the policy and all personal activities of the insured on or off the described premised
The limit of liability in a personal auto policy proving coverage for "damage to your automobile" is stated as " the lesser of the amount necessary to replace or repair the damaged property (vehicle) or the ________(fill in the blank from the choice below
actual cash value of the damaged or stolen property
There is exclusion in an automobile insurance issued by admitted insurer in California regarding coverage in Mexico, which can only be provided through an endorsement to PAP. Which is true regarding this endorsement?
it is liability coverage, on an excess basis , provided for losses that occur in Mexico, within 25 miles of the California/Mexico international border
Coverage under a comprehensive personal liabity policy or a homeowners section 2 extends:
to the premises described and to the personal activities of the insured's on or off of the premises
Which property is excluded under an HO3 policy?
guard dog
Which is an additional coverage does a DP2 have compared to a DP1
additional living expense
Which of the following collapse losses would be covered under an HO3
Weight of contents
Which of the following loss exposures is not covered by section 2 of Ron's homeowners policy?
Ron's registered/ licensed personal auto while used on his own property which includes 10 acres of undeveloped land
The ordinance or law limitation in a homeowners policy may cause a gap in coverage in which of the following situations?
the insured's home is damaged by fire and must be rebuilt to meet present building codes. The additional cost of complying with the codes is 50%
What is one way in which the HO2, HO4, and HO6 are similar?
perils insured against under coverage C
Which homeowners form is best for use on a brand- new single family dwelling?
HO5
Which coverage's are typically provided in a boat owners policy?
physical damage, liability and medical payments
The watercraft endorsement on a homeowners policy extends coverage for
liability coverage for watercraft listed on the schedule
Mary has an HO3 policy with replacement cost coverage on the insured buildings. The cost of replacement on the dwelling is $100,000, and the other structure( a garage) is $20,000. To be certain of replacement cost coverage on a partial loss to either stru
$80,000 on the dwelling; $16,000 garage
A home is damaged two hours after an earthquake, first by fire, then by fuel pipes bursting and causing an explosion. Under an HO3 form:
there is coverage, but only for the damage caused by the fire and explosion
Which of the following perils is covered by a "causes of loss-basic form"?
riot or civil commotion
How are the HO3 and HO5 Similar?
both provide open peril coverage for the dwelling
Which of the following would be used for a new single-family dwelling?
HO5
Which of items of real property under HO3 are valued on an actual cash value basis?
Built- in appliance
Which is a valid reason for an applicant to purchase a HO3 policy instead of dwelling policy?
the insured desires broader coverage
Grace has a homeowners policy that includes section 1 coverage's A,B and C. A,B and C provide coverage for
dwelling, other structures, and personal property
What is the primary medical payment coverage difference between a boat owners policy and HO3 policy?
the boat owners policy covers injuries to the people on the boat, and the HO3 covers injuries to other outside the home
What is the primary difference between a HO2 and HO3 policy?
the perils insured against
Which of the following perils is insured against in the special form, but not in the basic form?
collapse
Which of the following persons is not an insured under section1 of a homeowners policy?
the named insured's( non-resident) spouse
The watercraft endorsement on homeowners policy extends coverage for
liability coverage for watercraft listed on schedule
What is the primary difference between an HO3 and an HO5?
coverage C broad named perils
Your HO3 insured wants to make sure he has liability protection against claims for false arrest, libel and slander. You should
tell him he should add the personal injury endorsement
If the limit of liability on a structure are $75,000 and the structure is worth$125,000, how much would be owed on fire loss of $50,000 if the policy has an 80% coinsurance requirement(disregard any deductibles?)
$37,500
The applicant wants a homeowner policy that has open peril coverage on his home(building structure) assuming he is eligible for the policy, which would you recommend?
HO3
What additional coverage is provided in DP3 that is not included in DP1?
collapse
What is one reason a person may purchse a dwelling policy insyead of homeowners policy?
the owner does not reside in the dwelling
Which of the following perils is included in the broad form, but not in the basic form
falling objects
Which peril(s) is/are included in vacancy permit endorsement?
all of the above
Which of the following is most likely to be eligible for CA FAIR plan?
a well- maintained dwelling located in a hazardous brush area
What is one difference between a homeowners policy and dwelling policy for personal property coverage?
there is no appreciable difference
What perils are insured against under the "additional coverage's propery removed" of a homeowners policy?
all perils
What additional coverage's are available under the scheduled personal property endorsement that is not available under an unendorsed homeowners policy?
breakage of glassware by an earthquake
Which exclusion in the "causes of loss-special form" excludes coverage for mudflow
water(flood)
Under abuilding and personal property coverage form, if the insured has been vacant for more than 60 consecutive days. What effect will this have on vandalism loss
the loss is excluded
What is the primary difference between a HO2 and a HO4 policy?
property insured under coverage A
How much coverage, if any, is available under HO3 for landlord's furninshgs?
...$2,500
What additional coverage does a DP2 have compared to a DP1?
additional living expenses
Ordinance or law coverage provides protection which of the following losses
the increased expense incurred for the insurer to repair or rebuild property according to building code specification
Jack, a condo owners, wants a fire and allied lines coverage for personal property, liability coverage for him and family members, and protection for assessments or damage for the building structure and other common areas. Which homeowners form would you
HO6
If the named insured has been charged with arson in reference to a total loss to the insured's building, what effect will the insured's action have on the mortgage holder's claim for damages?
the mortgagee is entitled to receive 100% of their loss
What items of personal property are included in a coverage A under HO3 policy
paint on the premises to be applied to the interior
What is one peril included in DP2 that is not included in a DP1
falling objects
What is an additional coverage provided by HO3 policy
tree, shrubs, and other plants
The ordinance or law exclusion/limitation found in property policies such as the commercial property coverage, and in the homeowner policy have the following effect:
it excludes that part of the loss resulting from the enforcement of a building ordinance or law
A hoe is damags two hours after an earthquake, first by fire and then by fuel pipes burting and causing an explosion. Under a homeowner's HO3 form:
there is coverage, but only for the damge caused by the ensuing fire and explosion
The water damage exclusion in the cause of loss- special for applleies to all athe following, EXCEPT:
plubing system leakage
An insured duties after a loss are described in the homeowner's section 1 conditions. Which of the following is NOT a correct statement about these duties? The insured must:
make all necessary repairs to protect the property from further damage. The expenses is paid by the insured
Under section 2 of homeowner's policy, comprehensive personal liability,coverage is extended to which of the following
premsies described in the policy and all personal activities of the insure on or off the described premises
Which of the following suggest the need for an attachment of the additional residence rented to others endorsement to an insured's homeowners policy? The insured also owns a two family dwelling rents it our to two families. The insured
is concerned that she might be liable to the renter for liable to the renter for injuries that might occur in connection with the rental
Under a standard (ISO)HO3, real property and personal property are covered for the perils on
all risks", coverage applies to real property , broad form named perils coverage applies to personal property
Which of the following is covered under section 2 of a homeowner's policy
all of these are covered
All of the following loss exposures are covered under the liability section of a homeowner's policy, EXCEPT
the insured is using his new personal auto, fully registered and licensed, on his premises which includes a large parcel of undeveloped land
Damaged caused by burglary of personal property is not covered under which dwelling form(except by endorsement)
basic form
Which type of policy would provide both property and liability covergage for the owner of a condonminum as well as for assessments following damage to the building and other structures?
HO6
In an insured has n Ho3 policy, with replacement cost coverage on the building, what minimum amount must the insured carry to ensure that he has dwelling--$200,00 and other structure --$40,000 replacement cost coverage for a partial loss to ensure the dwe
$160,000 on the dwelling and $32,000 on the other structures.
Why would an insured want to use HO3 policy instead of dwelling policy?
broader coverage is needed by the insured
All homeowners polices specifically describe the duties of the insured following a loss. Identify which of the following is not a duty of the insured following a loss
prepare an inventory of the property that has been damaged which included a description of the property, the quantity, the amount of the loss, and the actual cash value
The dwelling policy form that offers the broadest type of coverage is which of the following
special
What type of homeowners's policy provides open peril coverage?
H03
Which of the following choices is NOT covered under section 2 of a homeowners policy?
the insured being liable for a bodily injury to someone in the insured's immediate resident family
How can as insured ensure that she has protection against possible claims for libel, slander,and false arrest under an HO3 policy?
by adding a personal injury endorsement
All of the following are true regarding the California standard form fire insurance policy, EXCEPT:
the content and wording of the policy is stated in the state insurance code
Section1 of a homeowners policy provides coverage for all of the following individuals EXCEPT
the spouse of the insured (not living in the same residence)
The coverage that is the broadest, is found in which of the following dwelling insurance contracts?
the special form
A standard "unendorsed" HO3 policy would cover which of the following types of losses/
the insured's furnitutre is damaged when it is removed from the insured's residence during the fire at the residence
An individual is driving home from the store with a new 48- inch flat screen TV. An accident occurs and TV is destroyed. The driver carries a homeowners policy (HO) as well as a personal auto policy (PAP). Will the damaged TV be covered ? if yes , how?
yes under the personal property party of his HO policy
Which of these Dwelling policy types do not include coverage for burglary of personal property
none of these covers theft of personal property, except by endorsement
The coverage found under both a homeowners section 2and a comprehensive personal liability policy extends to which of the following?
both personal activities and premises of the insured as well as any activates of the insured that occurs off the named premises
A homeowners policy contains liability insurance coverage under section 2. Which of these would be covered under this part of the policy/
these are all covered
Coverage for personal property under an HO4 with no deductible. Provide coverages for personal property for the insured while vacationing in Europe: the bed and breakfast inn. The hotel they are staying at burns down, the insured's chothing and suitcase a
$32,000
The type of homeowners contract that should be considered and then purchased by one of your propectives insured's, who is a tenant renting 2,500sq foot 2 story house is which of the following
HO4
What is the coverage under a homeowners policy that is personal property of the insured, when personal property is away from the premises, while the insured is traveling anywhere in the world/
the identical coverage limits to that of coverage personal property on the premises
All of the following meet the definaition of the insured under a HO3 policy, EXCEPT
a 70-year old grandparent residing in an adult care facility
Which of the following is reason why someone would purchase a Dwelling policy instead of an HO3?
broader coverage is desired
A homeowners, specifically coverage C, has certain limits on various classifications of property, the lower sub limits apply for THEFT to the following of personal property; EXCEPT
money
A homeowners policy that includes a "scheduled personal property endorsement " provides coverage which of the following?
jewelry, fur, musical instrumental, and camera for dollar value amounts decided by the insurer
The personal property coverage part of an unendorsed HO3 form covers which of the following/
damage to the insured's living room furniture that is result of the furniture being removed from the insured premise to prevent it from further damage after a covered fire at the same premises
Under a standard ISO homeowners HO3, real property and personal property are covered for the perils of:
all risk" coverage applies to real property. Broad form named perils coverage applies only to personal property an applicant would like to buy a personal umbrella policy:/ your insurer may requires that he maintain underlying liability coverage by carryi
Typically exclusions under any medical expense policy include all of the following EXCET
claims also covered by personal auto policy medical payment
Under a personal umbrella policy, what underlying coverage's must an insured typically maintain?
auto and personal liability only
Medical payment coverage in boat owners policy cover injuries to:
permissive occupants of the insured's boat
umbrella polices "provide coverage for and are best defined as which of the following?
excess liability coverage, on a broader basis, above an underlying primary policy
What is self- insured retention under an umbrella policy?
a deductible applicable to losses excluded by the underlying coverage and covered by the umbrella
Inland marine polices nearly always provide________coverage
open peril/All Risk /Special form
If an Inland marine policy provides coverage for any loss unless it is specifically excluded, it would be considered which of the following?
open perils
In reference to the coverage's provided in basic form, the boat ownners policy is similar to what other policy?
the personal auto policy
What is the primary difference between umbrella and excess liability policies/
the umbrella covers most liabity exposure; the excess liability will cover only one line
The personal auto policy" coverage for damage to your own automobile" states that the limit of liability is lesser of the amount necessary to repair or replace the property or the:
actual cash value of the stolen or damaged property
An umbrella policy:
provides broad excess liability coverage over one or more primary polcies
Under a scheduled personal property endorsement, loss to stamps is excluded when they are:
being shipped with freight company
Under a yacht policy, protection and indemnity provides coverage for
liabillty if the insured vessel strikes a marina and injures a dock worker
What are the licensing requirements for individuals that are permitted to sell the California FAIR plan?
individuals having a fire & causulty broker- agent license
Which inland marine floater is most similar to the scheduled personal property endorsement on a homeowners policy?
personal article floater
Which of the following does not have a standard coverage form in common use?
umbrella policy
The los under a watercraft endorsement is covered if it arises out of:
the use of the watercraft for business party
What exactly do umbrella polices provide coverage for?
broad excess liability coverage over two or more underlying polies
The theft of the insured would be covered under
physical damage coverage
All of the following would not be eligible for coverage under the California FAIR,EXCEPT
a home well taken care and is located in specially designated hazardous brush fire area
What does the California FAIR plan provide coverage for?
homes located in a hazardous brush or high risk urban areas
All of the following are incorrect regarding the CAARP,EXCEPT
$15,000/$30,000/$5,00 are the minimum liability limits required under this plan
Which of the following lines of in insurance would cover the loss of net income a business incurs due to a fire
business income insurance
Where would an insured find insurance coverage to protect against damage to a shipment of televisions shipped on a semi truck for the insured's business
inland marine
Diamonds Toy Company is being sued for a death caused by a child choking on a piece from one of its transformers. Where would diamond find coverage for the defense of this law suit
commercial general liability
All of the following are parties to surety bond, EXCEPT
bondsman
Your commercial auto policy insured needs coverage for his liability arising out of his employee using their o cars in his own cars in his business. The best way to be sure your insured is covered is to:
include employers non ownership liability coverage in employer's commercial auto policy
What is revenue minus expense?
net income
The broadest form of crime coverage is:
theft
All of the following causes of loss are covered by equipment breakdown insurance, EXCEPT:
inherent defect
One difference between a robbery peril and burglary peril is that he burglary peril:
requires physical signs of forcible entry or exit
Coverage's A and
or B of the commercial general liability (CGL) contract contains coverage for:/advertising injury
JAE Computer Company is being sued by Stack Company for an advertising campaign stack computer feels false and misleading. JAE company would find coverage for losses which could result from this lawsuit under which category of insurance:
commercial general liability
All of the following are listed on a commercial liability declarations page, EXCEPT
rented to you limit
Your insured has a ten year lease on his store. He has spent $50, 00 on shelving, wall-to-wall carpeting, partitions, and lighting, etc., all of which are part of the building and cannot be legally removed. He is concerned that a fire might damage these c
coverage B personal property
An insured purchased a commercial policy on an owned building. The policy contains a coinsurance provision. The coinsurance clause
makes carrying insurance of percentage of the building value advisable to avoid a possible
Which of the following is not a type property commonly insured by using a comical coverage
automobiles while kept for the owner in a commercial parking garage
Under the commercial property coverage program, which causes of loss form(s) include coverage for peril of windstorm?
basic, broad, and special
Which of the following losses would be excluded by the ordinance or law exclusion?
additional cost necessary to make a restroom ADA compliant
One of the major advantages to insured's of a commercial lines package program over purchasing coverage on a mono-line basis is:
the convenience of having all coverage in one policy
In a claims-made commercial general liability policy, which of the following begins when the policy period ends, and is activated when the policy is cancelled or not renewed?
basic extended reporting period
Which of the following is best defined as "the taking of property from a person by someone who has caused or who has threatened to cause that person bodily harm"?
robbery
What does a supplemental extended reporting period endorsement provide?
extends the filling reporting period indefinitely
A commercial property causes of loss forms do not cover any losses caused by
smoke damage from industrial operations
The medical expense coverage in workers' compensation policy
does not have a time nor a dollar limit
What is one of the main reasons the federal government insurance programs exist
the large amount of resources needed for some catastrophic losses
A business owners policy would be appropriate for which of the following types of business?
a three story office building
Which cause of loss, under commercial property coverage, includes coverage for the peril of windstorm?
basic, broad and special
An apartment house is worth $500,000. The owner insurers it for $300,000; the policy has an 80% coinsurance clause. There is a $200,000 loss. The insurer will pay
$150,000
The retroactive date of claims-made professional liability policy is always:
the earliest date an event/loss may occur and still be eligible for recovery
The business income coverage form covers the actual loss of business income sustained due to necessary suspension of operations. The loss of income must
be caused by an insured peril, otherwise there is no coverage
The commercial general liability (CGL) declaration pages display many different limits of insurance that apply to a policy. One limit shown is the insured's general aggregate limit. Which off the following is correct statement about the general aggregate
does not included the products- completed operation aggregate limit
If a named insured is not the owner of the building, improvements and betterments are covered under the
business personal property
Under a value reporting form, if the insured has made no reports as required, what is the most that will paid in the event of a loss?
75% of the limit
Fred is named insured on a commercial property policy insuring a commercial building. Fred burns the building down and is convicted of arson. Fred's commercial property policy conditions state that:
the mortgagee of the insured property can recover on this loss
Thomas fry has insured a building under his commercial policy. The building was vacant for 75 consecutive days before a loss. The policy will not pay for the loss if caused by the perils of
building glass breakage and vandalism
A pickup or van with a gross vehicle weight of 9,500lbs. may be eligible for personal policy if it was used in the
farming or ranching
If a building damaged during an attempted burglar where money was stolen from a vault, which of the following coverage's would cover the loss of the money as well as the damage to the building?
inside the premises-theft of money and securities
Which of the following polices would provide coverage for a builder under construction?
a builder risk policy
Which of the following is not listed on a commercial general liability declarations page as an aggregate limit?
products/completed limit
One example of a loss covered by business income insurance is a loss:
of profits due to suspension of business operations because of a premises fire
Are standardized umbrella polices available?
no because each company want the ability to establish their own pricing
Professionals are exposed to liability for failure to perform their profession duties. Which of the following would be least likely prospect for a professional liability policy?
pro basketball player
Under an unendorsed commercial property coverage form with no optimal coverage's, on what basis are buildings
actual cash value
The named for a commercial package policy is " Jill koslin and Edward koslin DBA coastline photo shop" under the terms of the common policy conditions of the commercial package policy, who is responsible for the premium payments?
Jill
The limits of medical expense coverage in a workers' compensation policy is:
not limited for either the time and/or the dollar amount
All of the following occupation are exposed to a chance of failing to properly fulfill professional duties and are therefore potential prospects for profession liability policies, except
professional sports player
Coverage part A of a commercial package policy, specifically inland
marine coverage, includes coverage for all of the following types of property EXCEPT/ vehicles that are stored for the owner in a commercial public parking lot
Plate glass coverage, which is found in a commercial property policy, (basic, broad and special cause of loss form), contains which of the following characteristics?
the broad and special forms have limited coverage for glass breakage
Employee dishonesty coverage forms would apply to which of the following?
company funds and securities that are stolen by an employee
Symbol 7 in a business auto policy indicates that there is liability coverage for:
auto specially described in the policy are covered
A claims-made professional liability policy contains a retroactive date. Which of these best describes this date?
the earliest date that a loss or event may occur and still be eligible for coverage under the policy
What would be the most optimal way to be sure your client, the owner of a commercial auto policy, would be able to obtain liability coverage exposures resulting from employee using their own vehicles in your client's business? To obtain liability coverage
purchase employer's non- ownership liability coverage in the commercial auto policy
What type of policy is comparable to commercial property policy coverage as a dwelling policy's coverage is
business owners policy
Coverage parts A,B & C of GCL is which of the following?
bodily injury and property damage liability, personal and advertising injury, and medical payments
There is a certain type of liability coverage referred to as P&I, which stands for protection & Indemnity. "what does this coverage offer protection for?
other vessels that receive collision damage from the insured vessel
When must an injury occur for the medical payment coverage of a commercial general liability policy to apply?
customers being on the insured's premises
What type of coverage is usually provided by an inland marine policy
open or all-risk coverage
Which of the following is true regarding the loss of income that is result of a suspension of business's operations under the business income coverage form?
it must be the result of a peril that is insured under the policy, otherwise there will be no coverage
The phase "80% coinsurance" in the commercial property field refers to:
the insured must maintain insurance coverage equal to 80% of the value of the property as well as receiving a lower premium; otherwise a coinsurance penalty will be imposed in the event of a loss
Which of the following bodily injury or property damage loss exposure is covered by an unendorsed commercial general liability policy?
an employee who causes an injury to a customer while working in home of that customer
What right does an insurer have as far as auditing the books and records of an insured according to the conditions of a commercial property policy?
perform an audit while policy is in force & up to three after expiration or termination of policy
Who has the right to request cancellation of a commercial lines policy
the first named insured and the insurer
The exclusion for liquor liability found in a commercial general liability policy excludes coverage for any liability claims that are the result of:
the insured being in the alcoholic beverage business
There is a "changes" condition found in a commercial lines policy that says that the policy has within it all the agreements between the insured and the insurer regarding the insurance that is being provided. Additionally, this condition further provides
only if an endorsement is attached to the policy and comes from the insurer
All of the following are common policy conditions under the commercial lines program, EXCPET
insured risk and peril
A dwelling fire policy's coverage is to a homeowners policy, as a commercial property policy's coverage is to a:
business owners policy
There is type of policy in the commercial insurance field know as a commercial lines package. Why would an insured purchase this structure of policy over a monoline policy
it provides the convenience of one policy for all exposures and risk
Define the term "we" as it is found in three types of property covered under a commercial building and personal property coverage form, specifically, business personal property
the insured as listed in the declaration page
The phase "aggregate limit" is found and defined in a commercial general liability policy. Which of the these is true about this limit?
this limit could reduce the products and completed operations
Your client owns a business that leases a warehouse and office space, in order to maximize the space and size of the building he has installed over $100, 00 of partitions, lighting, security equipment, carpeting, bookcases and storage cabinets. All of the
improvements and betterments coverage
The loss exposures in the following situations resulting in bodily injury or property damage claims are all excluded under a commercial general liability policy EXCEPT
A Patron of the insured business is injured by an employee of the insured, at the customer's residence. The employee was at the residence to perform the carpentry services that the business provides
What is it about a liability policy that causes there to be a need for inland marine coverage
the exclusion for care, custody and control
Business auto policies(BAP) Contain which of the following combinations of physical damage coverage's
collision coverage, comprehensive coverage, or specified peril coverage's
The definition of "mobile equipment" and "automobile" are defined in both a commercial general liability policy and business auto policy to specify the coverage on any vehicle or equipment. These two coverage's
differ and therefore avoids any over- laps between the two contracts
Professional liability insurance should be purchased by all of the following categories of professions, EXCEPT
professional athletes and coaches
This statement that is true regarding medical expense coverage in a worker's compensation policy is
it contains an unlimited amount of coverage for both time and dollar amount
Which of the following types of crime insurance is the broadest in terms of coverage?
theft
Where is ocean marine liability insurance found?
protection and indemnity coverage
A policy called "builder's risk" would be found in which of the following circumstances
building in the process of being constructed
A commercial lines policy contains a number of conditions. which of these is not one these conditions?
perils insured by the policy
The term "your was found in the definitions section of a commercial building and personal property coverage form referring to "your business personal property" is defined as which of the following?
the named insured from the declaration page, exclusive
Of the following, which are included under the coverage provide by a worker' compensation policy?
coverage for sickness or injuries illnesses that are job related without regard to who is at fault or negligent
What is the advantage to the insured of purchasing a commercial package policy instead of purchasing the coverage on a monoline basis
there is the convenience all coverage being contained in one policy, which typically contains package discounts
A commercial building which is a combination office, retail, and warehouse space, has been left vacant by its owners for more than 60 consecutive days. In what manner will an insurance company respond to loss that occurs, which is covered under the commer
any part of the loss which is caused by the perils of vandalism, theft or glass breakage, sprinkler leakage will not be covered
Business in come as, it is defined under a business in come coverage form provides coverage for actual losses of business income resulting from the suspension of the actual operation of the business. Which of the following is the formula to determine this
net income of the business plus normal operating expenses including payroll
A business owner, who is insured with a business auto policy, is interested in purchasing the necessary liability coverage for any losses and subsequent claims that result from an employee's use of their own vehicles. What would be the best way to do this
buy employer's non ownership liability in the business auto policy
Liability exposures that result from the location of a business in addition to the activities of that business, is known as which of the following?
the premises and operations exposure
The symbol "4" on a business auto policy indicates coverage for which of the following categories of vehicles?
owned autos other than private passenger auto
What des ocean marine hull insurance cover?
the vessel itself
In a commercial property policy, which causes of loss includes coverage for the peril of glass breakage?
the broad and special form
Which of the following types of businesses could utilize a business owners policy?
office building 2 stories high and containing about 5,000 square feet
Identify which of the following is always included in a commercial package policy?
common policy declaration and conditions
The medical payments coverage found in a commercial general liability applies to which of the following categories of individuals
the insured's customers who are in the process of transacting business on the insured's premises
Which of the following coverage parts is not found in standard commercial policy?
the dwelling property coverage part
Which of the following is covered under worker's compensation policy
an employee accidently getting injured, at a customer's home while working at the customer's home
A practicing physician would need the type of professional liability coverage that is contained in a medical malpractice policy because:
professional liability and malpractice losses are excluded in commercial general liability policies
If a property owner is insured under a building and personal property insurance form, when is the property considered vacant
when less than 31% of the building space is rented to other or in use by the insured
The products and completed operations hazard would apply to which of the following situations
bodily injury to a customer as the result of a defective manufactured by the insured
Which party is allowed to cancel a commercial policy (assuming all legal requirements are met?
insurance company and/ or the first named insured in the policy
Which of these covered by an employee dishonesty coverage form?
theft of stock from the business, owned by the policyholder, by an employee
Of the following choices, which one would define the " replacement date" which is contained in the structure of a claims-made professional liability policy contract?
a loss occurs or event can occur and still be eligible for recover of payment under the terms of the policy, if it occurs after this date
Under the terms and conditions of the commercial package policy, who is responsible to make all premium payments, if there are four individuals named as insured's, which are all operating a business under a DBA, and are unincorporated
the first named insured
Which of the following does not have a standard coverage form?
umbrella policy
Determine the actual cash valuing the following situation: original price of office when purchased(8 years ago-$9,000 depreciated amount at time of fire --$5,000; current replacement cost --$12,000
$7,000