AD Banker Property and Casualty Comprehensive Exam
preservation of property under the Building and Personal Property Coverage Form? - CORRECT ANSWER -The policy provides open perils coverage for 30 days on insured property that is being moved or temporarily stored at another location because of the endangerment of a covered peril
Employee theft or dishonesty a commercial crime policy - CORRECT ANSWER -covers loss of, or damage to, money, securities, and other property committed by an employee, whether acting alone or in collusion with others, that results directly from theft.After noticing the disappearance of office supplies from within a private office facility is an example.
In which section of the Workers' Compensation and Employer Liability policy would the policy conditions be found? - CORRECT ANSWER -The policy Workers' Compensation
contains the following parts: General Section, Part One - Workers' Compensation
Insurance, Part Two - Employers Liability Insurance, Part Three - Other States Insurance, Part Four - Your Duties if Injury Occurs, Part Five - Premium, Part Six - (Conditions).
Which of the following powers describes the authority stated in an agent's agency contract? - CORRECT ANSWER -Express The agency contract, which exists between an insurer and a producer, sets forth the powers that are granted to the producer. These powers are referred to as express because they are directly stated in the contract.
Pure Risk Insurance is designed to provide protection against which of the following? - CORRECT ANSWER-With pure risk, the only consideration is the possibility of loss or no loss. By contrast, speculative entails a chance of gain as well as a chance of loss.
Contribution by equal shares - CORRECT ANSWER -Under a contribution by equal shares provision, each insurer pays an equal amount to the loss settlement until the loss is paid, or until each insurer has exhausted its limits of insurance, whichever comes first.
The policy limit - CORRECT ANSWER -A total loss under a valued policy is payable based on the policy limit listed on the declarations page.An insured owns a home with a replacement cost of $300,000 and a market value of $250,000. What is the most a valued policy will pay in the event of a total loss without a deductible( is an example ) 1 / 4
Occurrence - CORRECT ANSWER -An event that happens An occurrence form provides coverage for losses that take place during the policy period.It doesn't matter when the loss is reported; what matters is when the loss occurred.The key in this form is the date the loss actually happened and if it happened when the policy was in effect.
Supplementary payments under Part A of the Personal Auto Policy - CORRECT ANSWER-Only bail bonds is a supplementary payment. The policy limit is $250.$100 for bail bonds
Choose the statement that is false about the FAIR plan. - CORRECT ANSWER -A FAIR means Fair Access to Insurance Requirements B It provides basic property coverage to those who have been rejected in the standard market C It provides property coverage to both residential and farm dwellings (Farm property is not eligible)(*) D Agents cannot bind FAIR plan coverage
Which of the following workers would be eligible for Workers' Compensation? - CORRECT ANSWER -A Domestic employees B Part-time worker (*) C Casual laborer D Farm laborer
Which of the following is true regarding the Self-Insured Workers' Compensation Program? - CORRECT ANSWER -A Sometimes large employers are attracted to self-insurance plans because losses can be predictable and benefits are capped by statute (*) B Self-insurance for Workers' Compensation is most generally used by smaller employers, who cannot afford to purchase Workers' Compensation insurance C Benefits under self-insurance differ from those provided by Workers' Compensation insurers D Self-insurance is allowed in all states
Choose the false statement regarding the application of coverage under the Products Exposure Liability Coverage. - CORRECT ANSWER -A Coverage applies to damage to the product itself (*) B Coverage applies to property damage the product causes C Coverage applies to bodily injury the product causes 2 / 4
D Coverage applies to bodily injury occurring away from premises the insured owns or rents
When his client's homeowners policy application is rejected by an insurance company due to underwriting rules, an insurance agent may request coverage under which of the following? - CORRECT ANSWER -A Write Your Own Homeowners Program B FAIR Plan (*) C Assigned Risk Plan D Joint Underwriting Association
Custodian - CORRECT ANSWER -keeper, guardian, conservator The custodian is the insured or any of the insured's partners or employees, while having care and custody of covered property inside the premises, excluding any person acting as a watchperson or janitor.
Temporary Total Disability may be described as: - CORRECT ANSWER -Inability to
return to any employment while recovering
Supplementary Payment under Part A of the Personal Auto Policy? - CORRECT ANSWER-A Up to $250 for the cost of bail bonds B Payment for lost earnings up to $200/day C Medical payments for an occupant of an insured vehicle (Not included)(*) D Reasonable expenses incurred at the insurer's request
The Commercial basic Cause of Loss Form does not cover which of the following perils? - CORRECT ANSWER -A Sinkhole collapse B Sprinkler leakage C Smoke D Earth Movement ( Not Covered )(*)
Which of the following would not be covered under an Installation Floater? - CORRECT ANSWER-A Electrical equipment B Carpeting C Construction equipment ( Not Covered )(*) D Elevators
Under the PAP, a temporary substitute would be covered if used: - CORRECT
ANSWER-A temporary substitute is a covered auto as long as an owned car is out of normal use due to breakdown, repair, servicing, loss, or destruction.
The Other Insurance condition - CORRECT ANSWER -specifies the process to be followed when more than one policy covers the same loss. For property insurance, 3 / 4
losses are settled on a pro rata basis, where each policy pays no more than its pro rata share of the loss.
Section III of the Businessowners Coverage Form includes: - CORRECT ANSWER -
Common Policy Conditions
Non-admitted - CORRECT ANSWER -An insurer that is not approved by the state Department of Insurance to transact insurance is called
An admitted - CORRECT ANSWER -Insurer has a Certificate of Authority issued by the Department or Division of Insurance to transact insurance.
An insured under the CGL policy - CORRECT ANSWER -The spouse of any individual or partner designated on the Declarations is also an insured.
Valuable Papers and Records Floater - CORRECT ANSWER -A Maps B Blueprints C Securities (Money and securities are not covered under the Valuable Papers and Records Floater.)(*) D Mortgages
A physical hazard - CORRECT ANSWER -A physical condition that increases the chance of loss.Wet leaves on a sidewalk are considered a Physical Hazard.
A commercial crime policy form written with the Robbery or Safe Burglary of Other Property insuring agreement would cover which of the following? - CORRECT ANSWER-The Robbery or Safe Burglary of Other Property insuring agreement does not cover cash, or losses outside the insured premises. Employee theft of any kind would be covered under the Employee Theft and Dishonesty insuring agreement.Jewelry store windows and glass display cases are destroyed during a burglary is an example.
The first named insured - CORRECT ANSWER -The individual whose name appears first on the policy's declaration.In the newer forms, the insurer may satisfy contractual duties by notice to the first named insured, rather than requiring notice to all named insureds.
The Residence Premises Under Section II of the Homeowners Policy - CORRECT ANSWER -The Residence Premises is either a 1, 2, 3, or 4 family dwelling in which the named insured resides.The residence premises also includes other structures and the grounds at that location, such as the 5 acres upon which the insured sits, including the barn, detached garage, and swimming pool.
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