GPCU 530 EXAM AND PRACTICE EXAM NEWEST

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GPCU 530 EXAM AND PRACTICE EXAM NEWEST

ACTUAL EXAM 450 QUESTIONS AND CORREC

DETAILED ANSWERS (VERIFIED ANSWERS

|ALREADY GRADED A+

Insurance agent Benjamin has previously placed business with Etchley Insurance Company for Magnus. Benjamin has also issued oral agreements for coverage for Etchley's Insurance Company on auto policies for Magnus. Benjamin has recently issued an oral binder for Magnus and has made a note on his calendar to place business with Etchley Insurance Company for Magnus. If a loss occurred for Magnus before Benjamin contacted Etchley, what would be the outcome for Benjamin's coverage with Etchley? - ANSWER- Etchley Insurance Company would provide coverage since Benjamin had placed previous business with Etchley for Magnus.

Juanita paid in advance for her six-month automobile policy but sold her vehicle to Peter after three months. As a part of the sale agreement, Juanita gave Peter the remaining three months of the insurance policy on the vehicle. Which one of the following statements is true regarding the validity of the insurance policy transfer? - ANSWER- It is invalid because insurance policies generally cannot be transferred.

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Which one of the following is an element that must be present for a reservation of rights notice to be effective? - ANSWER- The notice must inform the insured fairly of the insurer's position.

Sue has submitted a claim to her insurer for fire damage to a building insured under a property policy. Which one of the following questions must be answered in the affirmative to determine whether any coverage applies? - ANSWER- Was the loss caused by a covered peril?

Logan has a fully paid insurance policy that covers liability and physical damage for his vehicle. Logan lends this vehicle to a neighbor who has an accident and is found legally liable. There were injuries to the not-at-fault driver and damage to that vehicle as well. In this case, which one of the following is considered to be third-party to the automobile insurance policy?

• ANSWER- Only the accident victim

Which one of the following special characteristics of insurance contracts may result in a court interpreting ambiguous insurance contract provisions in favor of the insured? - ANSWER- Contract of adhesion

Certain elements must be present for a reservation of rights notice or nonwaiver agreement to be effective. Which one of the 2 / 4

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following is one of these elements? - ANSWER- Must communicate the notice by letter to the insured in a timely manner

Sho submitted a business insurance application to Blithe Insurance. Sho answered all application questions correctly.Blithe issued the policy. After Sho sustained a covered loss, Blithe realized that there were a number of things about Sho's business that would have caused it not to issue the policy. Based on this, Blithe - ANSWER- . Cannot deny coverage because Sho's answers were correct and he made no misrepresentation.

Oliver contacted his insurance agent Maria about homeowners

insurance. Oliver said: "I want homeowners insurance." Maria

responded: "You got it." Which one of the following is the best

statement of why no agreement to provide insurance was likely reached by the parties? - ANSWER- The agreement was not sufficiently specific on key terms.

Mitsuki applied for property insurance with Cintriell Insurance.Cintriell's application asked about the type of roof on Mitsuki's building. Mitsuki answered that her building had a tile roof. In fact, the building had a wood shingle roof. Cintriell issued the policy. Two months later, Mitsuki's building was destroyed by fire. Cintriell can deny coverage if Mitsuki's statement about the roof - ANSWER- Involved a material fact. 3 / 4

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Rin applied for auto insurance with Jancy Insurance. Jancy's application asked about any youthful drivers in Rin's household.Rin said there was one youthful driver living with her but in fact there were two, each with excellent driving records. Jancy issued the insurance policy and it would also have issued the policy had it known about both youthful drivers. If Jancy ultimately learns about Rin's incorrect application statement, it should - ANSWER- Do nothing because Rin's misrepresentation was not material.

Kenta is insured under a property insurance policy. He sustained a loss covered by the policy, but did not notify his insurance company until over a year later. The insurance company denied coverage because of Kenta's failure to promptly report the loss.Which one of the following special characteristics of insurance contracts is the basis of the insurance company's denial? - ANSWER- Conditional contract

The premium for any particular insurance policy should reflect - ANSWER- The insured's share of estimated losses that the insurer must pay.

Mikael, a new insurance agent, sent a letter to all residents of his apartment complex that set out the basic terms of a renter's policy and stated: "I will issue this policy to you and expect your

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