Category 1
Which commercial crime would provide coverage for a loss that did not necessarily happen during the policy but was revealed during the policy period?
A. Retro Form
B. Reporting form
C. Loss sustained form
D. Discovery form
B&B Market was sued when an employee detained a person he believed to be a shoplifter, but the person turned out to be the meter reader. Which coverage would apply to this suit?
A. Property damage liability
B. Crime coverage part
C. Personal and advertising injury liability
D. Bodily injury liability
The business income coverage form covers consequential loss of business income that occurs when a business must suspend operations because of a direct loss. Which of the following terms best describes the nature of this type of coverage?
A. Time element
B. Claims made
C. Occurrence
D. Direct damage
The other insurance provision that limits the liability of the insurer to a portion of the loss no greater than the amount the insurer bears to all the insurance covering the property is called?
A. Excess
B. Pro rata liability
C. Contributing
D. Proportionate
Which of the following coverages is included in an unendorsed homeowners policy?
A. Medical payment to others
B. Personal property replacement coverage
C. Fungi, wet or dry rot, or bacteria
D. Earthquake
An insured's 9-year-old son threw a ball, accidentally breaking a neighbor's plate glass window. The insured was found legally liable for the cost of replacing the window. This is a example of?
A. Vicarious liability
B. Intervening cause
C. Juvenile delinquency
D. Absolute liability
The business owners policy liability coverage will pay for necessary medical expenses of others within what maximum time period?
A. 90 days
B. 120 days
C. 1 year
D. 3 Years
If an insured bakery is sued because its marketing states that the product of another bakery may not be safe, which coverage of a commercial general liability policy will defend the suit?
A. Product liability
B. Completed operations
C. Personal and advertising injury liability
D. Premises and operations
When an insurance policy does not offer a continuation at its expiration date, it is considered a?
A. Nonrenewal
B. Suspension
C. Cessation
D. Cancellation
The insured's car was hit and damaged by a deer. Under which of the following coverages in a personal auto policy would this loss be paid?
A. Liability
B. Uninsured motorist
C. Collision
D. Other-than-collision
Events or conditions that increase the chances of an insured loss occurring are referred to as
A. Risks
B. Perils
C. Hazards
D. Exposures
All of the following are conditions commonly found in the insurance policy EXCEPT
A. Insuring agreement
B. Cancellation and nonrenewal
C. Subrogation
D. Appraisal
For insurance purposes, when an insured loses property to another because the person used violence or threat of violence to gain the property, this is defined as?
A. Robbery
B. A theft
C. A burglary
D. False pretense
A property insurance policy that is not subject to any coinsurance requirements but has a set amount of insurance scheduled for the property would use what loss valuation method?
A. Reproduction cost
B. Stated amount
C. Actual cash value
D. Replacement cost
Which of the following is a method of claim settlement used in casualty insurance when the insured and insurer cannot agree on how to settle a claim?
A. Proof of Loss
B. Restoration
C. Appraisal
D. Arbitration
The members of a limited liability company (LLC) are insureds under a BOP if
A. Each individual is listed as a named insured on the policy.
BA single individual member of the LLC is listed as the named insured.
C. Members of a LLC cannot be insured under BOP.
D. The LLC is designated as the named insured.
How much coverage is provided under a HOP for the theft or unauthorized use of credit card?
A. $100
B. $500
C. $1,000
D. $5,000
Which of the following special liability coverages provide protection to managers of a corporation for claims arising from a wrongful act committed by the manager while in an official capacity?
A. Malpractice insurance
B. Directors and officers liability
C. Employment practices liability
D. Errors and omissions insurance
Which of the following is used in the formula for calculating the actual cash value of a property?
A. Fair Market Value
B. Agreed value
C. Replacement Cost
D. Stated value
If more that one person has an insurable interest in the property covered under a dwelling policy,
A. All insureds must decide which one will be liable for the loss. B. The insurer will be liable for only the insured's interest in the damaged property.
C. Liability will be split evenly among all people ho have insurable interest.
D. All involved insurers must decide which one will be liable for the loss.
Which of the following acts created a federal program that would share the risk of loss from potential terrorist attacks with the insurance industry?
A. Gramm-Leach Bliley Act
B. TRIA
C. Fair credit reporting ACT
D. USA PATRIOT Act
What is the minimum amount of coverage that should be carried on a HO-2 on a home that was purchased four years ago for $75,000, which today has a replacement value of $100,000?
A. $80,000
B. $100,000
C. $60,000
D. $75,000
Which of the following types of valuation works best for property whose value does not fluctuate much?
A. Stated Amount
B. Inflation guard
C. Agreed Value
D. Market value
Which of the following is a mandatory part of an insurance policy that varies with each individual policy?
A. Declarations
B. Conditions
C. Exclusions
D. Insuring Agreement
A $100,000 house insured on a policy with an 80% coinsurance requirement has a fire that caused $40,000 of damage; the owner has a policy with $60,000 coverage. How much can the owner collect for his loss?
A. $20,000
B. $30,000
C. $40,000
D. $60,000