pg. 1 Commercial Casualty – CIC Exam/ Actual Exam Questions with Correct Detailed Answers (Verified Answers) Graded A+
What are the two promises the insurer makes? - Correct Answer - 1. Indemnity 2.Defense
What is an exception in any easement or license agreement? - Correct Answer - connection with construction or demolition operation on or within 50 feet of a railroad
Hold Harmless agreement or Indemnity agreement - Correct Answer - on party (the indemnitor) promises to reimburse, and in some cases defend the other party (the indemnitee) against claims or suits brought against the indemnitee by a third party
The purpose of a hold harmless agreement - Correct Answer - to transfer the risk of financial loss from one party (the indemnitee) to another party (the indemnitor)
Indemnitor - Correct Answer - the person or organization that holds another (the indemnitee) harmless in a contract ex. sub contractor - they would respond to the suit bc they held the general contractor harmless
Indemnitee - Correct Answer - The person or organization that is held harmless in a contract (the indemnitor) ex. the general contractor - they are not held harmless
Contingent Liability - Correct Answer - Arises out of work performed for the named insured by someone else ex. can protect a named insured from negligent acts of an independent contractor 1 / 4
pg. 2
Personal Injury Liability - Correct Answer - Liability arising from intentional torts, such as libel, slander, wrongful eviction -coverage applies to named offenses as defined in the policy
Advertising Liability - Correct Answer - Liability caused by harm from such things as misappropriation of advertising ideas, style of doing business or infringement of copyright -Coverage applies to named offenses committed in the course of advertising the named insured's goods, products, or services
A person or organization must qualify as an insured in order to be provided insurance
protection. They must be: - Correct Answer - 1. Named insureds (those listed on
Declarations or Schedule)
- Automatic Insureds
- Those who qualify as named insured
- Non-automatic insureds - those added by endorsement
What is included in an insured contract? - Correct Answer - L - Leases of premises E - Easement or license agreement A - An obligation to indemnify a municipality as required by ordinance S - Sidetrack agreement E - Elevator maintenance agreement P - Plus, any other contract in which the named insured assumes the tort liability of another party to pay for BI or PD to a third person
What is not included in an insured contract? - Correct Answer - 1. A railroad indemnity agreement
- Architect, engineer or surveyor indemnity agreement
- An agreement in which the insured, if an architect, engineer or surveyor assumes
liability for injury or damage arising out of the insured's rendering or failure to render professional services 2 / 4
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Liquor Liability Exclusion - Correct Answer - Only applies if you are in the business of manufacturing, distributing, selling, servicing or furnishing alcoholic beverages
Excluded losses under Liquor Liability - Correct Answer - 1. Causing or contributing to the intoxication of any person
- Furnishing to a person under the legal drinking age or under the influence of alcohol
- Any statute, ordinance or regulation
- Applies to supervision, hiring, employment training or monitoring others or providing
or failing to provide transportation to an intoxicated person
One exception to Liquor Liability - Correct Answer - "Host" liquor liability coverage if the named insured is not in the business of manufacturing, distributing, selling, servicing or furnishing alcoholic beverages
Endorsements that amend the liquor liability exclusion - Correct Answer - Liquor Liability
- removes the liquor liability exclusion
Amendment of liquor liability exclusion - exclusion applies when there is a charge whether or not a profit is derived, applies when it is a gift if a license or permit is required, also applies to BYO establishments
Amendment of Liquor Liability Exclusion - Exception for scheduled premises or activities
Fourth Paragraph on the insurance contract - Correct Answer - Indicates that certain words and phrases in quotations have a special meaning
If the named insured is an individual (sole proprietorship), - Correct Answer - Then the
following are insureds:
-Named Individual -Spouse
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pg. 4 If named insured is a partnership or joint venture, - Correct Answer - Then the following
are insureds:
-Named Partnership -Named Joint Venture -Partners -Members _Spouses
If the named insured is a limited liability company, - Correct Answer - Then the following
are insureds:
-Named LLC -Members -Managers
If the named insured is an other organization (corporation, municipality, etc.), - Correct
Answer - Then the following are insureds:
-Named Entity -Executive Officers -Directors -Stock Holders
Definition of Executive Officer - Correct Answer - means a person holding any of the officer positions created by your charter, constitution, by laws or any other similar governing document
If the named insured is a trust, - Correct Answer - Then the following are insureds: -Named Trust -Trustees First Paragraph on the insurance contract - Correct Answer - States that various provisions restrict coverage
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