TEXAS PROPERTY AND CASUALTY

TEXAS PROPERTY AND CASUALTY

EXAM 250

QUESTIONS AND CORRECT DETAILED

ANSWERS |ALREADY GRADED A +

N own three homes in two different states. If N wanted to have

one policy that covers all of the properties, N should buy: Correct

Answer Blanket Coverage

B has a company that produces garden tools. One day, one of B's employees accidently ran over a visiting customer's foot with a forklift. Which of the following would define B's liability for the forklift incident? Correct Answer Vicarious Liability

Actual Cash Value (ACV) takes usage of property into consideration when an insurer pays a claim so that the insured becomes whole again after a loss. To restore an insured in this

manner is known as: Correct Answer Principle of indemnity

What is the minimum number of underwriters required to form a Texas a Lloyds? Correct Answer 10

An insured lets his van be used by the coach of a local baseball league to take the players out for hotdogs after the game. If the coach is responsible for an accident while driving the van where is the primary coverage placed? Correct Answer The insurance on the van is the primary coverage.

If a loss occurs, the first step an insured must take to file a successful claim is Correct Answer Notice of Claim

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How much of a producer's book of business must be written on something other than what he controls or has an interest in?Correct Answer 25%

In order to be an eligible surplus lines insurer in texas, an insurance company must Correct Answer Have at least $15 million dollars in capital and surplus

J claims that last night over $1,000,000 of cash was stolen from his desk drawer but when the policy investigate, there is no evidence of any signs of forced entry and J cannot explain that how this loss occurred. This loss would be a Correct Answer Mysterious Disappearance

B has a policy with a per person limit of $10,000. B causes in accident in which three other insureds are hurt. One person suffers, $10,000, another suffers $7,000 and the last injured party suffered $12,000 in injuries. How much will B's policy pay total to all three injured parties? Correct Answer $27,000

what is not a reason an insured may cancel a policy during the policy period? Correct Answer Insured bricked their house

All of the following statements are CORRECT regarding Insurable

Interest EXCEPT: Correct Answer The insured must have a

speculative risk in the property

A contractual term for a person who is responsible for unintentional acts that may cause death or harm to a person or property is known as Correct Answer Liability

Which of the following physical damage to a car is considered a collision? Correct Answer A driver is distracted by a billboard warning against texting while driving and runs his car into a traffic signal post. 2 / 4

According to TRIPRA, annual liability losses for the insured are

capped at: Correct Answer $100 billion

An insured purchases an apartment for $250,000, its replacement cost. He insures it for $150,000 under a Building and Property Coverage Form with an 80 percent Coinsurance clause. In the event of a total loss how much will the insurer pay on the claim?Correct Answer $150,000

In a Personal Auto Policy, the general provision which gives the right to the insurer to recover any payments made to an insured from a third party who caused the loss is called Correct Answer Subrogation

An example of rebating would be Correct Answer returning a portion of a premium as inducement to purchase insurance

Which of the following are types of Surety Bonds? Correct Answer All of the answers listed (Federal, Contracts, and Court)

If an insured hides information and fails to disclose a known material fact to the insurer is known as Correct Answer concealment

A lightning storm that completely destroys an insured's roof is an example of a Correct Answer Direct Loss (when property is damaged or destroyed by a peril that is covered under the policy.)

Under a CGL policy Coverage B, if the insured advertises services and the ad does harm to another, which of the following actions would not be covered? Correct Answer The insured has intentionally written several untrue and damaging facts about a local business competitor

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N has a policy that states if his property were to be damaged in the event of loss, that this insurer will provide benefits to buy brand new items at the time of loss. Which of the following policy loss valuations does N have? Correct Answer Replacement Cost

What is the name of the law that requires insurers to disclose information gathering practices and where the information was obtained? Correct Answer Fair Credit Reporting Act

A certificate of_____ permits an insurance company to transact business in Texas. Correct Answer Authority

H has a commercial policy covering his warehouse. During the application, H told the insurer that he guaranteed that smoke detectors were installed and functional in the building even though the warehouse does not have smoke detectors. If a fire were to occur and the insurer proves that there were no functional smoke detectors, they do not have to pay the claim. H's untrue statement

of the functional smoke alarms would be considered to be:

Correct Answer Warranty

If an insured hides information and fails to disclose a known

material fact to the insurer is known as: Correct Answer

concealment

To terminate an agent's appointment, an insurance company must Correct Answer send termination notice to the Texas Department of Insurance

Y has a policy of split limits of 50/100/50. If Y causes loss, what is the maximum amount that each person would receive? Correct Answer $50,000

The phrase "transacting business" includes Correct Answer collecting premiums

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