1)
Adequate coverage for large, powerful boats is provided by which of the following?<\/p>\n\n\n\n
A homeowners policy\n A homeowners policy with the Watercraft endorsement attached\n Specialized personal watercraft policies, such as Outboard Motor and Boat, Boatowners, or Personal Yacht policies\n The reinsurance component of FAIR Plans\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. A homeowners policy provides only limited coverage for watercraft. Property coverage is subject to a special limit of $1,500, and coverage can be totally excluded for certain perils. Liability coverage is excluded for boats with motors of more than specified horsepower or boats of more than a specified length. Insureds typically need more coverage for this exposure than that provided by a homeowners policy, particularly those who own larger or more powerful boats. This coverage can be provided through Inland Marine forms, Ocean Marine policies, or specialized policies.
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2) A typical Outboard Motor and Boat policy provides which of the following coverages?<\/p>\n\n\n\n
Liability\n Medical Payments\n Physical Damage\n All of the above\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. This insurance is written to cover the physical damage exposure of boats. It is commonly provided under open peril Inland Marine floaters.
Unanswered
47% got this correct
3)
Under a National Flood Insurance policy, losses to which of the following could be paid on a replacement cost basis?<\/p>\n\n\n\n
Personal property\n Single family homes\n Mobile homes\n Both A and B\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. Single-family dwellings (other than mobile homes) are the only buildings that can be insured on a replacement cost basis under a flood policy. All other losses are paid on an actual cash value basis.
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65% got this correct
4)
Unless an exception applies, when does coverage under an NFIP policy begin?<\/p>\n\n\n\n
As soon as the gross policy premium is received\n Five days after the application and premium payment are mailed\n Thirty days after the date of application\n On the date the flood insurance application is mailed\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. Unless an exception applies, coverage does not take effect until after a waiting period of 30 days following the date of application. Binders may not be issued during the waiting period to provide Flood coverage.
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59% got this correct
5)
Which of the following losses are excluded under most Yacht policies?<\/p>\n\n\n\n
Injury suffered by a passenger in a waterskiing accident\n Collision damage to another boat for which the insured is liable\n Both A and B\n Neither A nor B\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. The collision clause on a Yacht policy covers the insured’s liability for collision damage to other vehicles. The waterskiing clause commonly excludes coverage for any person skiing or otherwise being towed by the vessel until they are back on board or have landed safely somewhere.
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6)
Which of these statements concerning the CPP are correct?<\/p>\n\n\n\n
Almost all commercial risks are eligible for coverage under the CPP. (Missed)\n The insured can choose a variety of eligible commercial coverages to tailor the package to fit his or her specific business insurance needs. (Missed)\n A complete CPP includes Common Policy Declarations, Common Policy Conditions, and two or more coverage parts. (Missed)\n A CPP can include Ocean Marine and Aviation insurance.\n\n Feedback<\/code><\/pre>\n\n\n\nA, B, and C are correct. Ocean Marine and Aviation insurance are not eligible for the CPP.
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7)
Which of the following are contained in the Common Policy Declarations?<\/p>\n\n\n\n
The policy period (Missed)\n The name and mailing address of the insured (Missed)\n Conditions specifying the insured's duties following a loss\n The insured's premium for each coverage part purchased (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nA, B, and D are correct. The Common Policy Declarations contains information about who is insured, when he or she is insured, and for what lines he or she is insured. It includes the name and mailing address of the named insured, the policy period, and a summary of the premiums charged. Loss conditions are described in the policy form, not the declarations.
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66% got this correct
8)
Who may cancel a CPP?<\/p>\n\n\n\n
Any named insured.\n The insurance company. (Missed)\n The first named insured. (Missed)\n None of the above; once a policy is issued, it can never be cancelled.\n\n Feedback<\/code><\/pre>\n\n\n\nB and C are correct. Under the Common Policy Conditions, certain responsibilities and obligations are assigned to the first named insured. One of these is cancellation of the policy. The insurance company may also cancel the policy under certain circumstances.
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70% got this correct
9)
Under a CPP, how many days advance notice is required if the insurance company is cancelling the contract for nonpayment of premium?<\/p>\n\n\n\n
10 days\n 21 days\n 30 days\n 60 days\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. When a CPP is cancelled by the insurer for nonpayment of premium, it is required to give notice at least 10 days in advance. In all other cases of permitted cancellation by the insurer, it must give notice at least 30 days in advance.
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77% got this correct
10)
Under a CPP, how long after the end of the policy period can the insurance company examine the insured’s books and records?<\/p>\n\n\n\n
10 days\n 3 months\n 1 year\n 3 years\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. The insurance company can examine an insured’s books and records up to three years after the end of the policy period.
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82% got this correct
11)
Under a CPP, when does the Inspections and Surveys condition give the insurance company the right to inspect the insured’s premises?<\/p>\n\n\n\n
At any time\n Quarterly\n Every six months\n Once a year\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. The insurance company has the right to inspect the insured’s premises at any time.
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56% got this correct
12)
What is required for an insured’s rights and duties under a CPP to be transferred while the insured is alive?<\/p>\n\n\n\n
The written consent of the insured\n The written consent of the insurance company\n The verbal consent of the insured\n The written consent of the insured's legal representative\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. The insured’s rights and duties under a CPP cannot be transferred without the written consent of the insurance company.
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13) What is the largest office building risk that might be eligible for a BOP?<\/p>\n\n\n\n
Three stories and 50,000 square feet\n Three stories and 75,000 square feet\n Six stories and 75,000 square feet\n Six stories and 100,000 square feet\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. Office buildings that are no more than six stories high and contain no more than 100,000 square feet are eligible for the BOP.
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14) In addition to maximum floor space, the BOP eligibility rules limit eligible risks to what maximum?<\/p>\n\n\n\n
$5 million in annual sales\n $3 million in annual sales\n $1.5 million in annual sales\n $750,000 in annual sales\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. Certain types of wholesale, processing, and service businesses are eligible for the BOP as long as gross annual sales do not exceed $3 million.
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15) Under the additional coverages of the Businessowners property coverage, property removed to protect it from loss will be covered at another location for up to how many days?<\/p>\n\n\n\n
5 days\n 10 days\n 20 days\n 30 days\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. The preservation of property additional coverage covers loss from any cause of loss to property that was removed from the insured location to protect it from damage by a covered peril. Coverage applies for up to 30 days after the property is first moved.
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69% got this correct
16) What is the standard deductible for the BOP property coverage?<\/p>\n\n\n\n
A. $500<\/p>\n\n\n\n
B. $1,000<\/p>\n\n\n\n
C. $750<\/p>\n\n\n\n
D. $250<\/p>\n\n\n\n
$500\n $1,000\n $750\n $250\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. The standard deductible is $500.
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17) Which of the following statements applies to Mechanical Breakdown coverage?<\/p>\n\n\n\n
It is not available in a BOP.\n It is automatically provided in a BOP.\n It is an optional BOP coverage that is activated by an entry in the declarations.\n It is specifically designed to cover insured objects while they are being tested.\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. Optional coverages are usually preprinted in the policy, but apply only if they are designated in the declarations. Losses involving an object during testing are specifically excluded.
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18) Which one of the following coverages is not included in the BOP?<\/p>\n\n\n\n
Bodily injury and property damage liability\n Personal and advertising injury liability\n Medical expense\n Professional liability\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. The Businessowners Liability coverage includes the following coverages: BI liability, PD liability, personal and advertising injury liability, and medical expense.
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19) Which of the following would be covered under the building coverage of a BOP?<\/p>\n\n\n\n
A. Restroom fixtures<\/p>\n\n\n\n
B. Photocopy machines<\/p>\n\n\n\n
C. Furnishings in the insured’s private office<\/p>\n\n\n\n
D. Carpets and floor tiles<\/p>\n\n\n\n
Restroom fixtures (Missed)\n Photocopy machines\n Furnishings in the insured's private office\n Carpets and floor tiles (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nA and D are correct. Property owned and used by the insured in the business, such as photocopy machines and furnishings in the insured’s private office, would be covered under Business Personal Property coverage.
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20) Which of the following would be covered under the business personal property coverage of a BOP?<\/p>\n\n\n\n
Desks, filing cabinets, and other office equipment the insured uses in her business (Missed)\n An enclosure around the front entry to a store that the insured tenant had built when he began leasing the building (Missed)\n Cans of paint that are stacked near a newly constructed outer wall prior to painting the wall\n Fire extinguishers located at various places on the inside walls of the building\n\n Feedback<\/code><\/pre>\n\n\n\nA and B are correct. Property owned and used by the insured in the business and tenants’ improvements and betterments made at the tenant’s expense that cannot be legally removed are covered under Business Personal Property coverage. Materials that are on or within 100 feet of the premises being used for alterations, such as the cans of paint in Choice C, are covered under Building coverage. Personal property used to maintain or service the building, such as the fire extinguishers in Choice D, are also covered under Building coverage.
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35% got this correct
21) Which of the following losses would be covered under the property coverage of a BOP?<\/p>\n\n\n\n
An insured moved inventory to another location to protect it from a tornado. Two days later, a sewer backup in the new location damaged that property. (Missed)\n An explosion at the insured's business spewed toxic chemicals onto property belonging to another company. That company's owner sues the insured for the costs to clean up the chemicals.\n When a tornado damaged a nearby business, authorities closed off the area for one week to clean up the damage. The insured lost business income during that period. (Missed)\n Because of negligence of an employee, an explosion on the insured's premises damages a nearby building.\n\n Feedback<\/code><\/pre>\n\n\n\nA and C are correct. The Pollutant Cleanup and Removal additional coverage pays the costs to extract pollutants from the insured’s premises, not property belonging to others. Damage to a nearby building might be the basis for a liability claim against the insured, but is not insured by the BOP property coverage.
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52% got this correct
22) Which of the following is not excluded under Businessowners Liability coverage?<\/p>\n\n\n\n
Damages the insured causes intentionally\n Liquor liability for those in the business of serving liquor\n Liability assumed under an insured contract\n Damage to the insured's own work\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. The exclusion for liability assumed under contract has some exceptions. One is liability assumed under an insured contract. All the other choices are specifically excluded.
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42% got this correct
23) What is the time limit for Extended Business Income coverage under the BOP?<\/p>\n\n\n\n
A. 30 days<\/p>\n\n\n\n
B. 45 days<\/p>\n\n\n\n
C. 60 days<\/p>\n\n\n\n
D. 90 days<\/p>\n\n\n\n
30 days\n 45 days\n 60 days\n 90 days\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. Extended Business Income coverage begins after the insured’s operations are resumed and continues until the insured is restored to the previous earning condition or for 30 consecutive days (unless a different length of time is specified in the declarations).
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48% got this correct
24) For how long after the date of a direct physical loss will the insurance company pay for extra expenses under the extra expense additional coverage?<\/p>\n\n\n\n
30 days\n 90 days\n 180 days\n 12 months\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. The insurance company will pay for extra expenses that occur within 12 consecutive months after the date of the direct physical loss.
Unanswered
40% got this correct
25) Unless a higher limit is shown in the declarations, what is the limit on coverage for business income from dependent properties?<\/p>\n\n\n\n
$5,000\n $10,000\n $50,000\n $100,000\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. The default limit for coverage of business income from dependent properties is $5,000.
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48% got this correct
26) What is the discovery period for coverage of losses under the employee dishonesty optional coverage?<\/p>\n\n\n\n
One year from the date of the dishonest act\n One year from the end of the policy period\n Three years from the date of the dishonest act\n Three years from the end of the policy period\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. The discovery period during which a claim for this coverage can be filed ends one year from the end of the policy period.
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78% got this correct
27) Which of the following is covered under personal and advertising injury liability coverage in the BOP?<\/p>\n\n\n\n
Slander and libel\n Malicious prosecution\n Copyright infringement\n All of the above\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. Personal and advertising injury covers all of the items listed plus false arrest, wrongful eviction, wrongful entry, invasion of the right of private occupancy, and use of another’s advertising idea in an advertisement.
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57% got this correct
28) Under the Earthquake and Volcanic Eruption endorsement, all earthquake shocks or volcanic eruptions that occur within a certain number of hours constitute a single earthquake or volcanic eruption. What is that time period?<\/p>\n\n\n\n
40 hours\n 72 hours\n 168 hours\n 24 hours\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. Under this endorsement, all earthquake shocks or volcanic eruptions that occur within any 168-hour period constitute a single earthquake or volcanic eruption.
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70% got this correct
29) Which Causes of Loss form provides open peril coverage?<\/p>\n\n\n\n
Basic\n Broad\n Special\n Both Basic and Broad\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. The Basic and Broad Causes of Loss forms are named peril forms.
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56% got this correct
30) Loss caused by sprinkler leakage is covered under which Commercial Property Causes of Loss forms?<\/p>\n\n\n\n
Basic\n Broad\n Special\n All of the above\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. All of the Causes of Loss forms cover sprinkler leakage.
Unanswered
49% got this correct
31) Which Commercial Property Causes of Loss forms cover collapse?<\/p>\n\n\n\n
Basic\n Broad (Missed)\n Special (Missed)\n All of the above\n\n Feedback<\/code><\/pre>\n\n\n\nB and C are correct. Collapse is not covered under the Basic Causes of Loss form.
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23% got this correct
32) Which of the following would be covered under the building coverage of the Building and Personal Property coverage form?<\/p>\n\n\n\n
Inventory stored at the insured's warehouse\n An addition to the insured's store on which construction has just begun (Missed)\n Fire extinguishers located in the insured's factory (Missed)\n Office furniture and supplies kept in the insured's building.\n\n Feedback<\/code><\/pre>\n\n\n\nB and C are correct. Inventory, furniture, and supplies would be covered under business personal property coverage.
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72% got this correct
33) The insured’s business sustains $25,000 damage in a fire. The fire department that was called to the scene billed the insured $1,000. The business is insured under the Building and Personal Property coverage form for $500,000 with a $5,000 deductible. How much will the insurance company pay for this loss?<\/p>\n\n\n\n
$21,000\n $20,000\n $24,000\n $26,000\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. Fire department service charges are paid in addition to the limit of insurance, with no deductible.
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57% got this correct
34) Which of the following properties would not be excluded under the Building and Personal Property coverage form?<\/p>\n\n\n\n
Lawn\n Driveway\n Private company jet\n Animals held for sale\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. The first three choices are excluded, but animals are not excluded if they are boarded or held for sale.
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35) When are losses under the Building and Personal Property coverage form paid at replacement or repair cost?<\/p>\n\n\n\n
Always\n Never\n If the insured meets the coinsurance requirements and costs are $2,500 or less\n Whenever the total amount of loss does not exceed 25% of the policy limit\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. Most losses are paid at actual cash value. However, if the Coinsurance conditions are met and costs are $2,500 or less, the policy will pay the cost of building repair or replacement without taking depreciation into account.
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36) Which of the following have special loss valuation requirements under the Building and Personal Property coverage form?<\/p>\n\n\n\n
Buildings\n Furniture and fixtures\n Glass (Missed)\n Valuable papers and records (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nC and D are correct. Stock, glass, valuable papers and records, and tenants improvements and betterments all have special valuation requirements.
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49% got this correct
37) Which of the following losses would be excluded under the Building and Personal Property coverage form if the insured building had been vacant for more than 60 days before the loss occurred?<\/p>\n\n\n\n
Attempted theft (Missed)\n Prinkler leakage when the insured had protected the system against freezing\n Vandalism (Missed)\n Glass breakage (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nA, C, and D are correct. Damage because of attempted theft, vandalism, or glass breakage is excluded after 60 days of vacancy. Damage in a vacant building because of sprinkler leakage is covered if the system was protected against freezing.
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77% got this correct
38) Which of the following is covered under the Builders Risk coverage form?<\/p>\n\n\n\n
Building under construction\n Foundation of the building under construction\n Fixtures, machinery, and equipment used to service the building if they will become a permanent part of the building and are located within 100 feet of the building\n All of the above\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. The Builders Risk coverage form covers the building under construction and its foundation. Fixtures, machinery, equipment used to service the building, and the insured’s building materials and supplies can be covered if they will become a permanent part of the building and are located within 100 feet of the building.
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49% got this correct
39) Up to what percent of the amount paid for direct loss will the insurance company pay for debris removal expense under the Business and Personal Property coverage form?<\/p>\n\n\n\n
5\n 10\n 20\n 25\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. Under the Business and Personal Property coverage form, the insurance company will pay up to 25% of the amount paid for a direct loss for debris removal expense. An additional $10,000 of coverage is available if the debris removal expense exceeds the 25% limit or the total loss exceeds the policy limits.
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40) What is the limit on Pollutant Cleanup and Removal coverage under the Business and Personal Property coverage form?<\/p>\n\n\n\n
$10,000\n $20,000\n $25,000\n $50,000\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. The policy will pay up to $10,000 for pollutant cleanup and removal if the pollution was caused by a covered peril.
Unanswered
63% got this correct
41) What is the per-year policy limit for coverage of electronic data under the Business and Personal Property coverage form?<\/p>\n\n\n\n
$1,000\n $2,500\n $5,000\n $7,500\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. The Business and Personal Property coverage form will only pay up to $2,500 in any one policy year for losses to electronic data.
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42) A voluntary action to rid the ship of cargo to prevent further damage is called what?<\/p>\n\n\n\n
Jettison\n Particular average\n Barratry\n General average\n\n Feedback<\/code><\/pre>\n\n\n\nJettison is permitted if the action is taken to save the remaining property. The loss incurred by sacrificing a portion of the cargo will be reimbursed.
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43) The Motor Truck Cargo policy does which of the following?<\/p>\n\n\n\n
Insures a truck carrier for liability arising out of the transportation of cargo\n Covers any loss to cargo in transit, regardless of whether the carrier is liable for damage\n Insures the shipper for all incoming or outgoing shipments during the policy term\n Provides coverage for a shipper on a single shipment of goods\n\n Feedback<\/code><\/pre>\n\n\n\nThis form protects the carrier, instead of the shipper, for liability for loss to domestic shipments in transit.
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35% got this correct
44) If the insurance company requests a proof of loss on a Commercial Inland Marine claim, the insured must submit it within how many days?<\/p>\n\n\n\n
10 days\n 30 days\n 60 days\n 90 days\n\n Feedback<\/code><\/pre>\n\n\n\nThe Commercial Inland Marine Conditions form states that the insured must send a signed, sworn statement of loss within 60 days after the insurer requests it.
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35% got this correct
45) Which of these statements about the Mail coverage form are correct? Select all that apply.<\/p>\n\n\n\n
It covers bonds, securities, and checks when they are sent by first class or certified mail. (Missed)\n Food stamps and money are always excluded under the policy.\n Property is covered on a named peril basis.\n Losses are valued on the basis of the property's actual value, but not less than its market value, on the date of mailing. (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nThe Mail coverage form provides open peril coverage against loss to property in transit by registered, first class, certified, or express mail. Food stamps and money can be covered when sent by registered mail.
Unanswered
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46) Which of the following can be covered under the Physicians and Surgeons Equipment coverage form? Select all that apply.<\/p>\n\n\n\n
Medical instruments that are on the premises (Missed)\n Dental instruments that are off the premises (Missed)\n Radium\n All of the above\n\n Feedback<\/code><\/pre>\n\n\n\nThis form covers medical and dental instruments on and off the premises, furniture and fixtures at the office, and the insured’s interest in improvements and betterments. Radium is not covered.
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52% got this correct
47) Which of the following losses could be covered under the Theatrical Property coverage form?<\/p>\n\n\n\n
Theft of costumes from an unlocked vehicle\n Damage to a vehicle used as a prop in the production\n Destruction of admission tickets for the production in a fire\n All of the above\n\n Feedback<\/code><\/pre>\n\n\n\nVehicles are covered if they are actually used on the stage in the covered production. Admission tickets are not covered property. Loss by theft from an unlocked, unattended vehicle is excluded.
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41% got this correct
48) Which of the following properties can be covered under the Film coverage form? Select all that apply.<\/p>\n\n\n\n
Positive prints\n Motion picture film (Missed)\n Soundtrack (Missed)\n Unused footage\n\n Feedback<\/code><\/pre>\n\n\n\nThe Film coverage form covers exposed motion picture film, soundtracks, videotapes, and magnetic tapes used in the production scheduled in the declarations and that the insured owns or has in his or her custody or control. It does not cover cutouts, unused footage, positive prints or films, or library stock.
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49% got this correct
49) Which of these losses is covered under the Signs coverage form? Select all that apply.<\/p>\n\n\n\n
The electric sign above the insured's business is destroyed when it is blown down in a thunderstorm. (Missed)\n The insured's neon sign is damaged when vandals throw rocks at it. (Missed)\n A power surge blows out several tubes in the insured's fluorescent sign.\n All of the above.\n\n Feedback<\/code><\/pre>\n\n\n\nLoss caused by artificially generated current that creates a short circuit or other electrical disturbance within a covered item is not covered.
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57% got this correct
50) Which of these losses is covered under the Jewelers Block coverage form, assuming that the insured has purchased all available optional coverages? Select all that apply.<\/p>\n\n\n\n
Theft of money from a locked vault on the insured's premises (Missed)\n Theft of money from an unlocked vault on the insured's premises\n Theft of covered property from an unattended auto\n Theft of items on display in a show window when the window is smashed (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nThe Show Windows optional coverage covers theft of stock from a show window when the window is cut or smashed. Money coverage covers theft of money from locked safes or vaults on the insured’s premises. Theft from any vehicle is excluded unless the insured, an employee, or other person whose only duty is to attend the vehicle is actually in or on the vehicle when the theft occurs.
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54% got this correct
51) How often is the insured required to submit reports of values under the Floor Plan coverage form?<\/p>\n\n\n\n
Quarterly\n Monthly\n Annually\n Weekly\n\n Feedback<\/code><\/pre>\n\n\n\nCoverage under the Floor Plan form is written on a reporting basis. The insured must file reports of values within 30 days after the end of each month.
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52) Which of these losses would be covered under the Camera and Musical Instrument Dealers coverage form?<\/p>\n\n\n\n
When the insured plugs in an electric guitar to demonstrate it for a customer, there is a short circuit that damages the guitar's wiring.\n A clerk drops a camera when arranging digital cameras in a show window. The lens shatters.\n Both A and B.\n Neither A nor B.\n\n Feedback<\/code><\/pre>\n\n\n\nThis form excludes loss arising out of artificially generated current that creates a short circuit or other electrical disturbance within an item covered under the policy.
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23% got this correct
53) The Electronic Data Processing Equipment floater covers what? Select all that apply.<\/p>\n\n\n\n
Computer hardware, but not software or data.\n Property in transit. (Missed)\n It does not cover computer equipment that is in the insured's care, custody, or control.\n It can contain breakdown coverage. (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nThe Electronic Data Processing Equipment floater provides open peril coverage for computer hardware, software, and data that is owned by the insured or in the insured’s care, custody, or control. Property in transit is covered. Optional breakdown coverage insures against damage to the equipment caused by mechanical breakdown, electrical disturbances, and temperature changes.
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32% got this correct
54) Which of the following are true about the 60-day basic extended reporting period? Select all that apply.<\/p>\n\n\n\n
It becomes effective automatically if needed when a claims-made policy expires. (Missed)\n The insured must request it in writing within 60 days after the policy expires.\n It does not require an additional premium. (Missed)\n No separate endorsement is required to provide this extended reporting period. (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nWhen a claims-made policy is terminated, a 60-day basic ERP automatically becomes available. The insured does not have to apply for it, and no premium is charged. It provides automatic coverage for any valid claim made during the 60 days after the policy expires, as long as the incident occurred between the expiring policy’s retroactive date and its expiration date.
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75% got this correct
55) What is the purpose of a retroactive date in the claims-made form?<\/p>\n\n\n\n
Extends the period of time in which a claim can be covered under the policy\n Stipulates a date as the first date on which an event can occur and be covered by the policy if a claim is filed\n Extends the policy period\n Stipulates a date after which any loss that occurs will not be covered\n\n Feedback<\/code><\/pre>\n\n\n\nThe retroactive date provides some protection against losses that occurred before the claims-made form was written.
Unanswered
90% got this correct
56) Which of the following is a personal and advertising injury?<\/p>\n\n\n\n
Broken leg\n Death\n Calling a client a cheat and a fraud\n Dog bite\n\n Feedback<\/code><\/pre>\n\n\n\nThe other answer choices are examples of bodily injury.
Unanswered
31% got this correct
57) Which of the following are usually excluded under Coverage A of the Commercial General Liability policy? Select all that apply.<\/p>\n\n\n\n
Property damage to property owned by the insured (Missed)\n Property damage to property in the care, custody, or control of the insured (Missed)\n Bodily injury sustained by an insured while using the insured's product\n Bodily injury to a customer who is injured in an accident on the insured's premises\n\n Feedback<\/code><\/pre>\n\n\n\nCoverage A excludes property damage to property owned by the insured and property damage to property in the care, custody, or control of the insured. Because Coverage A provides third-party liability coverage, injury to an insured is not covered.
Unanswered
44% got this correct
58) All of the following reduce the CGL’s General Aggregate Limit except which of the following?<\/p>\n\n\n\n
Medical Payments sublimit\n Personal and Advertising Injury limit\n Fire Damage limit\n Products-Completed Operations limit\n\n Feedback<\/code><\/pre>\n\n\n\nThere is a separate Products-Completed Operations Aggregate limit that is not subject to the General Aggregate limit.
Unanswered
85% got this correct
59) A woman is injured when she breaks a tooth on a rock that mysteriously found its way into a box of cereal. This is an example of which of the following?<\/p>\n\n\n\n
Premises and operations exposure\n Products-completed operations exposure\n Contingent liability exposure\n Contractual liability exposure\n\n Feedback<\/code><\/pre>\n\n\n\nThe products-completed operations hazard includes all BI and PD occurring away from the premises owned or rented by the insured, and arising out of the insured’s product or work, other than products that are still in the insured’s physical possession and work that has not yet been completed or abandoned.
Unanswered
37% got this correct
60) Which of the following business liability exposures are either excluded altogether from the CGL or covered only in certain circumstances? Select all that apply.<\/p>\n\n\n\n
Premises and operations\n Indirect\/contingent liability\n Pollution (Missed)\n Work-related injuries to employees (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nBusinesses face a number of liability exposures, including work-related injuries to employees; pollution; contractual agreements in which the insured assumes liability; and ownership, maintenance, or use of autos, watercraft, and aircraft. However, because of the unique nature of these liability exposures, they are either excluded outright from the CGL policy or may be covered only in certain circumstances or for limited amounts. More complete protection for these liability exposures is available under contracts specifically designed to cover them.
Unanswered
63% got this correct
61) Which one of the following is not required in a CGL coverage part?<\/p>\n\n\n\n
CGL declarations\n One or more CGL coverage forms\n Causes of Loss form\n Common Policy Conditions\n\n Feedback<\/code><\/pre>\n\n\n\nCauses of Loss forms are not used with the CGL coverage part.
Unanswered
46% got this correct
62) Which of the following would be considered mobile equipment under the Commercial General Liability coverage form? Select all that apply.<\/p>\n\n\n\n
Truck used to transport personnel to construction sites\n Road construction grader (Missed)\n Bulldozer (Missed)\n Self-propelled vehicles designed for snow removal\n\n Feedback<\/code><\/pre>\n\n\n\nBoth of these items are specifically listed in the policy’s definition of mobile equipment. An auto is a land motor vehicle, trailer, or semitrailer designed for travel on public roads, including any attached machinery or equipment.
Unanswered
68% got this correct<\/p>\n\n\n\n
63) Which of the following are excluded under Coverage A of the CGL?<\/p>\n\n\n\n
Damage the insured causes intentionally\n Pollution losses caused by the insured\n Liquor liability for those in the business of serving liquor\n All of the above<\/code><\/pre>\n\n\n\nUnanswered
20% got this correct
64) Which of the following would be excluded under Coverage C of the CGL? Select all that apply.<\/p>\n\n\n\n
A shopper is injured in the insured's retail store when a box falls on him from an overhead shelf. (Missed)\n The insured sponsors a foot race on the land surrounding his retail store. A participant is injured during the race.\n An individual hired by the insured to paint her business office falls off a ladder and is injured. (Missed)\n One of the insured's employees is injured while on the job. (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nCoverage C excludes injuries to the insured’s employees and injuries that occur while participating in athletics.
Unanswered
64% got this correct
65) If an insurer decides to not renew the CGL policy, how many days notice of nonrenewal must be provided to the first named insured?<\/p>\n\n\n\n
10 days\n 7 days\n 20 days\n 30 days\n\n Feedback<\/code><\/pre>\n\n\n\nThe nonrenewal condition states that if the insurer decides to not renew the CGL policy, it must mail or deliver written notice of nonrenewal to the first named insured at least 30 days before the expiration date of the policy.
Unanswered
16% got this correct<\/p>\n\n\n\n
66)
Which of the following coverages are provided by Business Auto Physical Damage coverage?<\/p>\n\n\n\n
Collision (Missed)\n Transportation Expenses (Missed)\n Comprehensive\n Garagekeepers Insurance (Missed)<\/code><\/pre>\n\n\n\nUnanswered
62% got this correct
67)
Which portion of the Garage coverage form covers liability for damage to property of others in the insured’s care, custody, or control?<\/p>\n\n\n\n
Liability\n Garagekeepers\n Physical Damage\n Both A and B\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. The Liability section of the Garage coverage form excludes liability for damage to customers’ autos in the insured’s custody. Coverage for this exposure is provided under the Garagekeepers section of the Garage form.
Unanswered
50% got this correct
68) Trailer Interchange coverage is included in which of the following forms?<\/p>\n\n\n\n
All Commercial Auto coverage forms\n The Truckers coverage form (Missed)\n The Motor Carrier coverage form (Missed)\n The Garage coverage form\n\n Feedback<\/code><\/pre>\n\n\n\nB and C are correct. Trailer Interchange coverage covers damage to a specific trailer under the policy of the trucker who has possession of the trailer at the time of loss, as long as certain conditions are met. It is included in the Truckers and Motor Carrier coverage forms.
Unanswered
54% got this correct
69)
The Garage coverage form covers liability arising out of which of the following?<\/p>\n\n\n\n
Ownership, maintenance, or use of covered autos (Missed)\n Garage operations (Missed)\n A trailer interchange agreement\n Advertising injury\n\n Feedback<\/code><\/pre>\n\n\n\nA and B are correct. Trailer Interchange coverage and advertising injury are not included in the Garage coverage form.
Unanswered
28% got this correct
70)
Which of the following perils are included in the Business Auto coverage form’s Specified Causes of Loss coverage?<\/p>\n\n\n\n
Collision\n Earthquake (Missed)\n Flood (Missed)\n Theft (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nB, C, and D are correct. Specified Causes of Loss coverage is a limited type of Comprehensive coverage. It covers fire, lightning, explosion, theft, windstorm, hail, earthquake, flood, vandalism, or mischief, as well as sinking, burning, collision, or derailment of a conveyance transporting the covered auto.
Unanswered
14% got this correct<\/p>\n\n\n\n
71)
Which of the following statements concerning Business Auto Liability coverage are correct?<\/p>\n\n\n\n
It covers BI or PD caused by an accident.\n It does not cover pollution losses.\n It only covers sums for which the insured is legally liable. (Missed)\n The BI or PD must result from the ownership, maintenance, or use of a covered auto. (Missed)<\/code><\/pre>\n\n\n\nUnanswered
31% got this correct
72)
Who of the following would be considered an insured under Business Auto Liability coverage?<\/p>\n\n\n\n
The named insured (Missed)\n Others while using a covered auto with permission (Missed)\n The owner of a borrowed auto\n Others who become liable for the conduct of an insured (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nA, B, and D are correct. The owner of a hired or borrowed auto is not an insured for Liability coverage while using the covered auto.
Unanswered
14% got this correct
73)
Which of the following are excluded under Business Auto Liability coverage?<\/p>\n\n\n\n
Liability assumed under a contract that is considered an insured contract\n Damage to the insured's own auto (Missed)\n Injury to employees covered by workers compensation laws (Missed)\n Liability for property in the insured's custody (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nB, C, and D are correct. The exclusion for liability assumed under contract or agreement does not apply to contracts that meet the policy’s definition of an insured contract.
Unanswered
62% got this correct
74)
Which of the following losses would be paid under the Business Auto coverage form’s Comprehensive coverage?<\/p>\n\n\n\n
Gradual corrosion of the grillwork on a covered auto because of continuous exposure to salt air\n Overturn of a covered auto\n Collision damage to a covered auto\n Theft of a covered auto\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. Losses from wear and tear are excluded. The other two losses are considered collision losses.
Unanswered
64% got this correct
75)
Which of the following businesses might be covered under a Garage coverage form?<\/p>\n\n\n\n
Used car dealer (Missed)\n Catering company\n Auto body shop (Missed)\n Service station (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nA, C, and D are correct. The Garage coverage form is designed to cover automobile-type businesses, such as car dealerships, gas stations, and parking garages. These types of businesses cannot be covered under the Business Auto coverage form.
Unanswered
33% got this correct
76)
Which of the following coverages are included in an unendorsed Garage coverage form?<\/p>\n\n\n\n
Garagekeepers (Missed)\n Uninsured Motorists\n Liability (Missed)\n Physical Damage (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nA, C, and D are correct. The Garage coverage form includes Liability, Garagekeepers, and Physical Damage coverage. Medical Payments, Uninsured Motorist, and Underinsured Motorists coverage may be added by endorsement.
Unanswered
46% got this correct
77)
Which of the following can be considered covered autos only under the Garage coverage form?<\/p>\n\n\n\n
Customers' autos left with the insured for service (Missed)\n Autos the insured has leased to use in the business\n Autos held for sale by a dealer (Missed)\n Autos owned by the insured and used in the insured's business\n\n Feedback<\/code><\/pre>\n\n\n\nA and C are correct. There are two covered auto symbols that are unique to the Garage coverage form. Symbol 30 is used for customers’ autos left with the insured for service, repair, storage, or safekeeping. Symbol 31 is used for Physical Damage coverage only for the dealers’ autos and autos held for sale by dealers, nondealers, or trailer dealers.
Unanswered
65% got this correct
78)
Which of the following Commercial Auto coverage forms does not offer liability coverage?<\/p>\n\n\n\n
Business Auto\n Business Auto Physical Damage\n Garage\n Trucker's\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. Business Auto Physical Damage covers losses to the insured’s own vehicles, not losses to other’s vehicles the insured might become liable for.
Unanswered
26% got this correct
79)
Which of the following would be included in an unendorsed Business Auto coverage policy? Select all that apply.<\/p>\n\n\n\n
Liability coverage (Missed)\n Physical Damage coverage (Missed)\n Uninsured Motorists coverage\n Medical Payments coverage\n\n Feedback<\/code><\/pre>\n\n\n\nA and B are correct. Uninsured Motorists and Medical Payments coverage are available only by endorsement.
Unanswered
88% got this correct
80)
George Hawthorn is employed by Moison Appliances as a shipping clerk. As he is stacking TVs in the storage room, he is surprised by two men, both carrying guns. They proceed to empty the warehouse of TVs. This is an example of what?<\/p>\n\n\n\n
Burglary\n Robbery\n Mysterious disappearance\n A fidelity loss\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. In Crime forms, robbery is defined as the unlawful taking of property from the care and custody of another person. The robber must have caused or threatened to cause bodily harm to the person being robbed or must have committed an obviously unlawful act that is witnessed by the person being robbed. Burglary is the taking of property by stealth rather than by force or threat.
Unanswered
62% got this correct
81)
Which of the following must be true in a burglary?<\/p>\n\n\n\n
Property must be taken from a custodian or watchperson.\n There must be no evidence of force or violence.\n The burglary must involve unlawful entry or exit from the premises. (Missed)\n There must be visible evidence of forcible entry or exit. (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nC and D are correct. Although burglary is not specifically defined in the Crime forms, it still has a specific meaning in the insurance industry. Burglary is the taking of property from inside the premises by a person unlawfully entering or leaving the premises. There must be evidence of forcible entry or exit, such as marks made by tools, explosives, chemicals, or electricity. There is no requirement that the property be taken from a custodian or watchperson.
Unanswered
79% got this correct
82)
Theft generally means which of the following?<\/p>\n\n\n\n
Any act of stealing\n Any act of stealing other than burglary or robbery\n Burglary and robbery only\n Employee dishonesty only\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. Theft means the unlawful taking of money, securities, or other property. This broad term includes burglary, safe burglary, and robbery.
Unanswered
42% got this correct
83)
Coverage for defense costs is included in which of the following?<\/p>\n\n\n\n
Computer Fraud coverage\n Forgery or Alteration coverage\n All of the Crime coverages\n None of the Crime coverages\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. Under Forgery or Alteration coverage, if the insured is sued for refusing to pay a forged or altered instrument and obtains the insurer’s written permission to defend the suit, the insurer will pay reasonable defense costs incurred by the insured.
Unanswered
47% got this correct
84)
Who of the following would be considered custodians while having care and custody of company property inside the premises?<\/p>\n\n\n\n
A store clerk (Missed)\n A company vice president (Missed)\n A janitor\n A night watchperson\n\n Feedback<\/code><\/pre>\n\n\n\nA and B are correct. A custodian is someone who has care or custody of property inside the premises. It includes the insured, the insured’s partners or members, or any employee. It does not include a watchperson or janitor.
Unanswered
59% got this correct
85)
In a Crime insurance policy, certificates of deposit are considered which of the following?<\/p>\n\n\n\n
Other property\n Money\n Securities\n Either money or securities\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. Securities are instruments or contracts that represent money or property. Checks, drafts, bonds, certificates of deposit, stock certificates, stamps, and credit card receipts are all considered securities.
Unanswered
58% got this correct
86)
What type of property is protected under Computer Fraud coverage?<\/p>\n\n\n\n
Money\n Securities\n Other property\n All of the above\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. Computer Fraud coverage covers loss of or damage to money, securities, and other property because of the use of a computer to fraudulently transfer that property from inside the premises or banking premises to a place or person (other than a messenger) outside the premises.
Unanswered
33% got this correct
87)
An insured must file a proof of loss within how many days after a loss?<\/p>\n\n\n\n
90 days\n 30 days\n 120 days\n 60 days\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. If a loss occurs, the insured must provide a sworn proof of loss within 120 days.
Unanswered
93% got this correct
88)
Which one of the following injuries qualifies as a compensable injury under workers compensation laws?<\/p>\n\n\n\n
A factory worker fractures her arm while working overtime on the assembly line.\n A hotel maid falls down the stairs while cleaning her own home.\n A secretary accidentally swallows his gum while in the company lunchroom and chokes when it gets lodged in his windpipe.\n An office manager is injured in a traffic accident on his way to work.\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. Work-related injuries must arise out of employment and arise in the course of employment to be compensable. Time, place, and circumstances are all considered in making this determination.
Unanswered
68% got this correct
89)
Which of the following benefits are paid under workers compensation laws?<\/p>\n\n\n\n
Medical (Missed)\n Rehabilitation (Missed)\n Disability income (Missed)\n Pain and suffering\n\n Feedback<\/code><\/pre>\n\n\n\nA, B, and C are correct. Workers compensation laws pay benefits in four categories: disability\/loss of income benefits, medical benefits, survivor\/death benefits, and rehabilitation benefits. They do not pay benefits for pain and suffering.
Unanswered
76% got this correct
90)
In a competitive state, an employer can obtain workers compensation insurance from which of the following?<\/p>\n\n\n\n
A private insurance company\n The state fund\n Either A or B\n Neither A nor B\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. Competitive states give employers a choice between purchasing workers compensation insurance from a state fund or a private insurance company. The state fund competes with private insurance.
Unanswered
60% got this correct
91)
In most states, workers compensation laws apply to which of the following?<\/p>\n\n\n\n
Only to workers in occupations that are considered extremely hazardous\n To most workers except those specifically excluded by law\n To full-time workers only\n To all workers\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. Every state has some exempt classifications, but the majority of the nation’s employees are covered under workers compensation laws.
Unanswered
35% got this correct
92)
Under which part of a Workers Compensation and Employers Liability policy would you find a description of the insured’s obligations when an injury occurs?<\/p>\n\n\n\n
Part One\n Part Two\n Part Three\n Part Four\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. Part Four describes the insured’s duties when a worker is injured. Part One describes the general terms of the workers compensation policy. Part Two is Employers Liability Insurance. Part Three is Other States Insurance.
Unanswered
55% got this correct
93)
Under which part of a Workers Compensation and Employers Liability policy would you find a description of employers liability coverage provided?<\/p>\n\n\n\n
Part One\n Part Two\n Part Three\n Part Four\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. Part One describes the Workers Compensation coverage, and Part Two describes the Employers Liability coverage. Part Three is Other States Insurance, and Part Four describes the insured’s duties upon a loss.
Unanswered
87% got this correct
94)
George is a trash collector earning $35,000 a year who hurts his back on the job, so he can no longer go out with the collection trucks. However, he can still be a route coordinator in the office at a salary of $25,000 per year. To what extent is George industrially disabled?<\/p>\n\n\n\n
$35,000 per year\n $25,000 per year\n $10,000 per year\n $0 per year\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. Industrially disability measures the earnings an injured worker had before and after the injury. George’s industrial disability is found by subtracting his route coordinator earnings of $25,000 from his trash collector earnings of $35,000.
Unanswered
53% got this correct
95) Which of the following may be covered under a Farm coverage part?<\/p>\n\n\n\n
Farm buildings, equipment, and livestock (Missed)\n Liability arising out of farm operations (Missed)\n Growing crops\n Farm dwelling and its personal property (Missed)\n\n Feedback<\/code><\/pre>\n\n\n\nA, B, and D are correct. Growing crops are not covered under a Farm coverage part.
Unanswered
70% got this correct
96)
A breakdown of equipment covered under the Equipment Breakdown Protection coverage form results in the simultaneous breakdown of three other pieces of covered equipment. According to the form, how many “breakdowns” occurred in this loss?<\/p>\n\n\n\n
One\n Two\n Three\n Four\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. One breakdown means that if an initial breakdown causes other breakdowns, all are considered a single breakdown. All breakdowns at any one premises that manifest themselves at the same time and are the direct result of the same cause are considered “one breakdown.”
Unanswered
81% got this correct
97)
The insured knows that it might take several months for his damaged turbine to be fully repaired, so he authorizes $500 for temporary repairs so that production can resume. This expenditure would be covered under which coverage in the Equipment Breakdown Protection coverage form?<\/p>\n\n\n\n
Spoilage\n Errors or omissions\n Expediting expense\n Contingent business income\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. This coverage extension covers the reasonable cost of temporary repairs and expedition (speeding up) of permanent repairs.
Unanswered
56% got this correct
98) Under the Equipment Breakdown Protection coverage form, which of the following causes of damage to covered equipment would not be a covered “breakdown”?<\/p>\n\n\n\n
Electrical failure, including arcing\n Leakage at any valve, fitting, shaft seal, gland packing, joint, or connection\n Failure of pressure or vacuum equipment\n Mechanical failure, including rupture or bursting caused by centrifugal force\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. Under the Equipment Breakdown Protection coverage form, breakdown means the following types of direct physical loss that cause damage to covered equipment and necessitates its repair or replacement: failure of pressure or vacuum equipment, mechanical failure, including rupture or bursting caused by centrifugal force, and electrical failure, including arcing. Choice B is specifically excluded under this definition.
Unanswered
52% got this correct
99)
Which of the following statements apply to Professional Liability policies?<\/p>\n\n\n\n
They cover the insured's liability arising out of rendering or failing to render services of a professional nature. (Missed)\n They duplicate the coverage provided by the CGL policy.\n They are tailored to fit specific occupational needs. (Missed)\n They cover most general liability and automobile liability losses.\n\n Feedback<\/code><\/pre>\n\n\n\nA and C are correct. Liability arising out of rendering or failing to render services of a professional nature is excluded under CGL policies. Special Professional Liability policies have been developed for many professionals, such as physicians, lawyers, and insurance agents. Each policy is tailored to fit a specific occupational need.
Unanswered
43% got this correct
100)
A business that wants coverage for its liability for employment-related acts can obtain it by purchasing which of the following?<\/p>\n\n\n\n
CGL insurance\n Workers Compensation and Employers Liability insurance\n Employment Practices Liability insurance\n Any of the above\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. This coverage is provided by Employment Practices Liability insurance. The other policies listed specifically exclude losses arising out of employment-related practices.
Unanswered
85% got this correct
101)
Commercial insureds who need more Liability coverage than provided by a certain policy or want coverage for losses excluded by a certain policy should purchase which of the following?<\/p>\n\n\n\n
Difference in Conditions policy\n Commercial Umbrella policy\n Surety bond\n Fidelity bond\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. Commercial Umbrella policies provide catastrophic Liability coverage for business risks. Because the Umbrella is not designed to handle usual or everyday exposures, the insured must have underlying Liability coverage before an Umbrella will be issued. The Umbrella can cover certain losses that are excluded by the underlying insurance.
Unanswered
25% got this correct
102) Which of these statements regarding Difference in Conditions insurance are correct?<\/p>\n\n\n\n
It excludes coverage for basic perils such as fire, lightning, and windstorm. (Missed)\n It is written in conjunction with policies that cover basic perils. (Missed)\n It does not have a deductible requirement.\n It covers property and liability exposures.\n\n Feedback<\/code><\/pre>\n\n\n\nA and B are correct. Difference in Conditions insurance is written to exclude the basic fire and extended coverage perils, but to include most other insurable perils that are not covered under Commercial Property coverage. Consequently, it is written in conjunction with policies providing the basic coverage excluded by the DIC policy. DIC policies are usually written on large risks with a high deductible.
Unanswered
82% got this correct
103)
Which one of the following answer choices lists all of the parties to a Surety bond?<\/p>\n\n\n\n
Principal and obligee\n Principal, obligee, surety\n Surety and obligee\n Principal and surety\n\n Feedback<\/code><\/pre>\n\n\n\nB is correct. There are three parties to a Surety bond: the principal, the obligee, and the surety.
Unanswered
43% got this correct
104)
All of the following types of losses may be covered by the Equipment Breakdown Protection coverage form except which of the following?<\/p>\n\n\n\n
Business income losses and\/or extra expenses\n Expediting expenses\n Losses because of spoilage damage\n Damage caused by fire or combustion explosion\n\n Feedback<\/code><\/pre>\n\n\n\nD is correct. Business income and\/or extra expense losses, expediting expenses, and spoilage damage are all coverage options in the Equipment Breakdown Protection coverage form. Damage caused by fire or combustion explosion is excluded because it is covered under Commercial Property insurance.
Unanswered
61% got this correct
105) How do deductibles apply in the Equipment Breakdown Protection coverage form?<\/p>\n\n\n\n
Deductibles apply separately for each applicable coverage unless the deductibles are shown as \"combined\" for any two or more coverages.\n A single deductible applies to all applicable coverages.\n Deductibles are always stated as a specific dollar amount.\n There are no deductibles under this coverage.\n\n Feedback<\/code><\/pre>\n\n\n\nA is correct. Deductibles apply separately for each applicable coverage unless the deductibles are shown as “combined” for any two or more coverages. Depending on the coverage, the deductible might be expressed as a dollar amount, a time limit, a percentage of loss, or a multiple of daily value.
Unanswered
63% got this correct
106)
Under the terms of the Suspension provision in the Equipment Breakdown Protection coverage form, coverage on dangerous equipment can be suspended when?<\/p>\n\n\n\n
On 30 days' advance notice to the insured\n At the end of the policy period\n Immediately on delivery of written notice to the insured\n On 15 days' advance notice when sent by certified mail\n\n Feedback<\/code><\/pre>\n\n\n\nC is correct. The insurer can immediately suspend coverage whenever covered equipment is found to be in or exposed to a dangerous condition. Suspension applies only to that particular object and takes effect as soon as written notice is delivered to the insured.
Unanswered
54% got this correct
107) Which type of insurer consists of an unincorporated group of members who share losses and provide insurance to each other?<\/p>\n\n\n\n
Lloyd's Association\n Reciprocal exchange\n Mutual company\n Multi-line insurer\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. Reciprocal insurers consist of members who are unincorporated and collectively share losses and provide insurance to themselves. Lloyd’s Associations are syndicates of insurance underwriters, and mutual and multi-line insurers are examples of traditional insurance companies.
Unanswered
61% got this correct
108) Medical payments under a homeowners policy are available for expenses resulting from an injury to which of the following?<\/p>\n\n\n\n
The named insured\n A residence employee\n A person who is on the insured location without permission\n Any regular resident of the insured's household who pays rent\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. Under homeowners coverage for medical payments to others, injuries to the named insured, family members, and any other regular residents are specifically excluded. However, although residents are not usually covered, an exception is made for “resident employees” and they are covered.
Unanswered
67% got this correct
109)
Some property insurance policies provide for payment of the full policy limit in the event of a total loss by a covered peril, regardless of the actual value of the property. These policies are known as which of the following?<\/p>\n\n\n\n
Indemnity policies\n ACV policies\n Valued or agreed amount policies\n Market value policies\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer C is correct. For certain hard-to-value items, the insurance company may issue a valued or agreed amount contract for a specified amount agreed to by both parties. If the item is lost or completely destroyed, the insurer will pay this amount as settlement.
Unanswered
69% got this correct
110) Which part of an insurance policy sets the rules of conduct, duties, and obligations of the insured and insurer under the terms of the contract?<\/p>\n\n\n\n
Declarations\n Insuring agreement\n Conditions\n Exclusions\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer C is correct. The conditions state the ground rules for the contract and spell out the responsibilities and obligations of both the insurance company and insured.
Unanswered
80% got this correct
111)
When an uninterrupted chain of events resulting from a negligent act causes a loss, that act is considered to be which of the following?<\/p>\n\n\n\n
An assumption of risk\n An intervening cause\n The proximate cause of loss\n A matter of strict liability\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer C is correct. To establish that one person’s actions toward another were negligent and caused injury or damage, the negligent act and the damage must be tied together. If there was no intervening cause and the negligent act led directly to the loss in an unbroken sequence of events, the negligent act was the proximate cause of loss.
Unanswered
36% got this correct
112) Policies issued under the National Flood Insurance Program provide removal coverage for property removed to protect it from flood. This coverage applies at another location for up to how many days?<\/p>\n\n\n\n
60 days\n 45 days\n 30 days\n 15 days\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. Under flood policies, property is also covered at another place, either above ground or outside of the special flood hazard area, for 45 days when removed by the insured to protect it from flood.
Unanswered
77% got this correct
113) In legal terms, the actions by one party might have the effect of giving up a known right. When this occurs, the party has created which of the following?<\/p>\n\n\n\n
Unilateral contract\n Representation\n Warranty\n Waiver\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer D is correct. The legal definition of “waiver” is the intentional relinquishment of a known right. Sometimes an insurer or its agent might overlook a provision that might have been grounds for denying coverage or increasing the premium. By doing so, the insurer might have relinquished its right to deny coverage or exercise options at a later date by creating a waiver. A representation is a statement believed, but not guaranteed, to be true, whereas a warranty is a statement guaranteed to be true. A unilateral contract is one in which only one party is obligated to perform its part of the agreementfor example, an insurance contract is unilateral because an insured might choose not to enter the agreement by paying the premium, but if the insured pays the premium, the insurance company is obligated to pay for covered losses.
Unanswered
73% got this correct
114)
When the special causes of loss form is attached to a commercial property coverage part, coverage for theft of furs and fur garments is limited to how much?<\/p>\n\n\n\n
$2,500\n $2,000\n $1,500\n $1,000\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer A is correct. The special form is the only causes of loss form for commercial property coverage that provides theft coverage. However, for certain classes of property, various limitations apply, and coverage for theft of furs and fur garments is limited to $2,500.
Unanswered
55% got this correct
115)
Claims-made general liability coverage does not apply to bodily injury or property damage that occurs when?<\/p>\n\n\n\n
On the policy's retroactive date\n Before the policy's retroactive date\n After the policy's retroactive date\n Before the effective date, if there is no retroactive date\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. A retroactive date on a claims-made liability policy marks the date on which coverage for reported claims begins. An occurrence on the retroactive date would be covered, but there would be no coverage for bodily injury or property damage that occurred prior to the retroactive date.
Unanswered
69% got this correct
116) Under liability insurance policies, what does an “aggregate limit” mean?<\/p>\n\n\n\n
It is the most the insurer will pay for any one accident.\n It is the most the insurer will pay for all losses during any one policy period.\n It is the maximum limit for each claim when multiple claimants are arising out of the same occurrence.\n It is the single largest limit that applies when a loss is covered by two or more policies issued by the same insurer.\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. An aggregate limit is a maximum limit that applies to all losses during a policy period. Each individual loss is subtracted from the aggregate limit and reduces the remaining coverage. At each policy anniversary or renewal, the aggregate limit is reinstated in full.
Unanswered
79% got this correct
117) Something that might increase the likelihood that a loss will occur, is called what?<\/p>\n\n\n\n
Peril\n Hazard\n Risk\n Catastrophe\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. A hazard is something that increases the chance of loss, such as a loose step or flammable materials. A peril is the cause of loss, such as a fire. Risk is any outcome that involves uncertainty. A catastrophe is an unexpected event, such as an earthquake or flood, which is not considered a hazard.
Unanswered
55% got this correct
118)
Tom Baxter has an automobile insured by a personal auto policy. He trades in his car and purchases a new private passenger auto as a replacement vehicle. If he does not notify the insurance company, the liability coverage for his replacement vehicle will apply automatically for how long?<\/p>\n\n\n\n
10 days\n 30 days\n 60 days\n Until the end of the policy period\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer D is correct. Under a personal auto policy, if a newly acquired auto replaces another auto, the new vehicle automatically has the broadest coverage for liability, medical payments, and uninsured motorists coverage for any auto shown in the declarations until the end of the policy period.
Unanswered
86% got this correct
119) A device that is used to minimize small nuisance claims and that helps to keep insurance premiums down is called what?<\/p>\n\n\n\n
Arbitration\n Deductible\n Valued policy\n Coinsurance\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. Many property insurance policies have a deductible, which is the amount of a claim the insured has to absorb before the insurance applies. Deductibles reduce the cost of insurance by eliminating small claims. The amount of the deductible is stated in the declarations. Arbitration is a means of settling claims disputes when the insured and the company disagree on the value of property. A valued policy is one under which a certain value for property is stated in the policy, regardless of its value at the time of any loss. Coinsurance is a means by which insureds share in partial losses if they have not insured their property for full value.
Unanswered
56% got this correct
120) Homeowners coverage for loss of personal property because of “mysterious disappearance” is provided by what?<\/p>\n\n\n\n
The special form (HO-3) only\n The broad and special forms (HO-2 and HO-3) only\n The comprehensive form (HO-5) only\n All homeowners forms\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer C is correct. The comprehensive form (HO-5) is the only homeowners policy that insures loss of personal property items by what is known as “mysterious disappearance” because it covers loss by “theft, misplacing, or losing.” The other policy forms only cover loss because of damage, destruction, or theft of property. The broad form (HO-2) covers only named perils, and mysterious disappearance is not one of them. The special form (H0-3) offers only broad form coverage for personal property.
Unanswered
44% got this correct
121)
Which of the following is not excluded under commercial general liability coverage for bodily injury and property damage liability?<\/p>\n\n\n\n
Injury or damage caused by the operation of mobile equipment\n Damage to property rented to the named insured\n An injury that is also covered by a workers compensation law\n Liability resulting from the accidental escape of pollutants\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer A is correct. BI and PD coverage for the ownership, operation, or use of mobile equipment is covered by CGL policies. All of the other answer choices are specifically excluded.
Unanswered
65% got this correct
122)
Most liability claims are based on negligence that results in injury or damage. An act of negligence is considered to be a tort. What does the term “tort” mean?<\/p>\n\n\n\n
A tort is a criminal act committed with the intent to cause injury.\n A tort is a civil wrong that violates the rights of another.\n A tort is any act that has the potential to cause financial loss to another person.\n A tort is an act that can be prosecuted by the state or federal government even if no injury or damage occurred.\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. A tort is a civil wrong that violates the rights of another. Unlike the commission of a crime, in which the government may prosecute the wrongdoer, torts are a part of civil law that is concerned with private relationships between people.
Unanswered
77% got this correct
123)
Claims that are paid by general liability coverage are charged against the aggregate policy limits and reduce the amount of insurance remaining to pay future claims. However, CGL aggregate limits will be reinstated in full<\/p>\n\n\n\n
If there are more than five claims during a policy period.\n On the next policy anniversary date.\n If the insured pays an extra premium for reinstatement.\n As soon as the aggregate is actually exhausted.\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. Claims paid under general liability coverage are charged against the applicable aggregate policy limits and reduce the amount of insurance remaining to pay future claims during the policy period, but they apply separately to each consecutive policy period and are reinstated on each policy anniversary date.
Unanswered
79% got this correct
124) Under the dwelling property forms, personal property moved to a new principal residence will be automatically covered at the new location (subject to policy expiration) for a period of how long?<\/p>\n\n\n\n
60 days\n 30 days\n 20 days\n 10 days\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. Coverage is provided for personal property moved from the described location to a new principal residence. This coverage applies only for 30 days and not beyond the policy expiration date.
Unanswered
60% got this correct
125)
Under the NCCI workers compensation and employers liability policy form, the basic, or minimum, limit for employers liability coverage is how much per accident?<\/p>\n\n\n\n
$50,000 per accident\n $100,000 per accident\n $250,000 per accident\n $500,000 per accident\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer B is correct. Employers liability insurance provides coverage for sums the insured becomes legally obligated to pay under common law because of work-related injuries or occupational diseases. A minimum limit of $100,000 per accident applies.
Unanswered
64% got this correct
126)
Which dwelling policy forms are named peril forms?<\/p>\n\n\n\n
All dwelling forms\n The basic form only\n The basic and broad forms\n The special form only\n\n Feedback<\/code><\/pre>\n\n\n\nAnswer C is correct. The basic and broad dwelling forms provide coverage on a named peril basis. The special form provides open peril coverage.
Unanswered
74% got this correct
127)
The only significant difference between the occurrence and claims-made forms of general liability insurance is found in which of the following?<\/p>\n\n\n\n
The coverages provided by the policy\n The policy's exclusions\n The \"trigger,\" or the way in which coverage is activated under the policy\n The policy's conditions\n\n Feedback<\/code><\/pre>\n\n\n\n