Property and casualty insurance Exam Questions and Answers Part one with Complete Solutions Which of the following are the authorities that an agent can hold? - Correct Answer Express and implied Which of the following terms refers to such disabilities the loss of a limb, hearing , or eye sight? - Correct Answer Permanent partial disability Who is NOT considered an employee in an commercial general liability (CGL) policy? - Correct Answer Temporary worker The major portion of the premium of an equipment breakdown policy pays? - Correct Answer For inspections and examinations An insured owns a building valued at $400,000. To comply with the 80% coinsurance provision of his insurance policy, how , much should he insure the property for? - Correct Answer 80% of the property's replacement cost or more Under the Fair Credit Reporting Act, if the consumer challenges the accuracy of the information contained in his or her report, the reporting agency must - Correct Answer Respond to the consumer's complaint.All of the following are found in the declarations section of a policy EXCEPT the - Correct Answer Exclusions.The cost of restoring farm records is an additional coverage offered under a farm policy. How much will the policy pay to restore the records? - Correct Answer Up to $2,000 All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT - Correct Answer Dividends from a mutual insurer.Which of the following may be covered by electronic data processing coverage form under an inland marine policy? - Correct Answer a) Computer hardware that is specifically scheduled. 1 / 3
b) Extra expense the insured incurs to continue the business following a loss.
c) Data processing media, including magnetic tapes or paper tapes, punch cards and discs
The party to a surety or fidelity bond who promises to fulfill the obligation is the - Correct Answer Principal The transfer of money from inside a banking premises to a person other than a messenger outside those premises or to a place outside those premises is covered under which commercial crime coverage? - Correct Answer Computer fraud Which of the following would NOT be covered under the liability section of a personal auto policy? - Correct Answer Bodily injury is caused by the insured's negligence while driving a three-wheel all-terrain vehicle.When a producer holding a certificate or a broker's license has a change in his/her residence or business address, he/she must notify the Department of Insurance and any company for which the producer holds an appointment within - Correct Answer 30 days.What will happen if a house covered by a standard mortgage clause is a total loss? - Correct Answer The insurer pays the mortgagee according to the mortgagee's interest in the property.What is the civil penalty for violating a cease and desist order of the Commissioner? - Correct Answer
$10,000
The Business Pursuits endorsement under Section II of a homeowners policy will cover all of the following EXCEPT - Correct Answer Business liability.If a property is covered by Company A for $20,000 and Company B covers the same property for $40,000, how much will Company A pay on a $24,000 loss? - Correct Answer $8,000 The risk management technique that is used to prevent a specific loss by not exposing oneself to that activity is called - Correct Answer Avoidance. 2 / 3
In a farm policy, any cost incurred by the insurer for the investigation or defense of a claim will be paid by - Correct Answer The insurer.Which of the following entities must approve all continuing education courses in this state? - Correct Answer The Commissioner An applicant knowingly fails to communicate information that would help an underwriter make a sound decision regarding coverage. This is an example of - Correct Answer Concealment A common exclusion found under physical damage to your auto includes - Correct Answer Mechanical breakdown.Which of the following is true regarding a risk retention group? - Correct Answer It is a liability insurance company owned by its members.Which of the following best describes a misrepresentation? - Correct Answer Issuing sales material with exaggerated statements about policy benefits A builder's risk form is most often written as which of the following? - Correct Answer Completed value form An insured has a liability policy that sets the amount for all claims that arise from a single incident at $50,000. Which type of limit of liability does this insured's policy have? - Correct Answer Per occurrence Which of the following is an example of a protective safeguard in a businessowners policy? - Correct Answer Automatic sprinkler system If a licensee wants to transact insurance under a different name than that listed on his or her producer's license, which of the following must occur? - Correct Answer The change must be reported to the Commissioner.
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