PROPERTY CASUALTY PRACTICE EXAM: PERSONAL

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PROPERTY & CASUALTY PRACTICE EXAM: PERSONAL

LINES Actual Qs and Ans - Expert-Verified Explanation -Guaranteed passing score -83 Questions and Answers

-Format: Multiple-choice / Flashcard

Question 1: Which of the following collapse losses would be covered under an HO3?

• Defective workmanship completed 2 years ago
• Known insect damage
• Weight of contents
• Earth movement from a volcanic eruption

Answer:

C Question 2: What is one reason a person may purchase a Dwelling Policy instead of a Homeowners Policy?

• The owner does not reside in the dwelling
• Dwelling form provides broader coverages
• Dwelling is occupied by 2 families
• Dwelling form provides greater flexibility in selecting coverage

Answer:

A

Question 3: A standard "unendorsed" HO3 policy would cover which of the following types of losses?

• The insured's auto is stolen from the locked garage on the insured premises. A closed

investigation reveals evidence of visible forcible entry into the garage

• Damage to the insured's boat, when the trailer it is being towed on disconnects from the

insured's

• The insured's furniture is damaged when it is removed the insured's residence during a fire

at the residence

• None of these are covered

Answer:

C Question 4: What is one difference between a Homeowner's policy and a Dwelling policy for personal property coverage?

• Homeowners coverage is worldwide, while the dwelling policy limits coverage while on the

described premises

• There is no appreciable difference
• Homeowners coverage limit is higher than the Dwelling from for jewelry
• Homeowner's policies value property at replacement cost; the Dwelling values property at

actual cash value

Answer:

B Question 5: Which of the following perils is covered by a causes of loss-basic form?

• Riot or civil commotion
• War
• Ordinance or law
• Governmental action

Answer:

A

Question 6: All of the following loss exposures are covered under the Liability Section of a

Homeowner's Policy, EXCEPT:

• The insured is driving a motorized golf cart while playing golf at the local country club
• The insured is using his new personal auto, fully registered and licensed, on his premises,

which includes a large parcel of undeveloped land

• The insured is restoring an unregistered antique truck in his garage (the truck currently has

its engine removed)

• The insured is using a riding lawn mower to mow his own lawn

Answer:

B Question 7: Which of the following is covered under Section II of a Homeowner's policy?

• Defense costs stemming from a lawsuit that is false fraudulent
• The insured's 4 year old son intentionally strikes another youngster with a canoe paddle
• The insured damages a neighbor's camcorder after dropping it on a deck
• All of these are covered

Answer:

D Question 8: If the limits of liability on a structure are $75,000, and the structure is worth $125,000, how much would be owed on a fire loss of $50,000 if the policy has an 80% coinsurance requirement (disregard any ded)?

A) $32,000

B) $40,000

C) $37,500

D) $50,000

Answer:

C

Question 9: Why would an insured want to use an HO3 policy instead of a Dwelling policy?

• Lower premium is a concern of the insured
• Personal liability coverage is not needed by the insured
• The insured occupies one of the units in the dwelling, which is a six family dwelling
• Broader coverage is needed by the insured

Answer:

D Question 10: Jack, a condo owners, wants a fire and allied lines coverage for personal property, liability coverage for him and family members, and protection for assessments or damage for the building structure and other common areas. Which homeowners form would you recommend

A) HO2

B) HO4

C) HO3

D) HO6

Answer:

D Question 11: Mary has an HO3 policy with replacement cost coverage on the insured buildings.The cost of replacement on the dwelling is $100,000, and the other structure (a garage) is $20,000. To be certain of replacement cost coverage on a partial loss to either structure, she must carry a minimum of

• $100,000 on the dwelling; $10,000 on the garage
• $100,000 on the dwelling; $20,000 on the garage
• $80,000 on the dwelling; $8,000 on the garage
• $80,000 on the dwelling; $16,000 on the garage

Answer:

D