Chapter 1
WOTF is NOT the consideration in a policy?
a) The application given to a prospective insured
b) The promise to pay covered losses
c) Something of value exchanged between parties
d) The premium amount paid at the time of application
a) The application given to a prospective insured
WOTF would NOT be classified as personal property for insurance purposes?
a) Equipment
b) A vehicle
c) Furniture
d) A house
d) A house
WOTF claims would be included under the dwelling policy?
a) Death to the insured’s pet caused by smoke inhalation
b) Theft of the insured’s auto from the detached garage
c) Fire damage to a garage located on the insured premises used as an auto repair shop
d) Fire damage to the insured’s rowboat stored in the attached garage
d) Fire damage to the insured’s rowboat stored in the attached garage
WOTF homeowners forms is designed to provide named peril coverage for personal property to individuals who rent an apartment?
a) HO-2
b) HO-3
c) HO-4
d) HO-6
c) HO-4
A common exclusion found under physical damage to your auto includes
a) Riot or civil commotion
b) Glass breakage
c) Mechanical breakdown
d) Towing and labor
c) Mechanical breakdown
A tornado that destroys property would be an example of WOTF?
a) A pure risk
b) A loss
c) A physical hazard
d) A peril
d) A peril
WOTF is NOT one of the four primary elements considered in establishing negligence?
a) Standard of care
b) Legal duty
c) Proof of carelessness
d) Proximate cause
c) Proof of carelessness
WOTF would be covered under the Broad Form (DP-2) policy’s falling object peril?
a) Damage to the building’s awnings
b) Interior building damage if the exterior was damaged first
c) Exterior pavement and patio damage
d) Damage to outdoor television antennas if there is no interior damage
b) Interior building damage if the exterior was damaged first
The personal injury liability endorsement to an HO policy applies to AOTF EXCEPT
a) A third party breaks a leg when the insured knocks him down
b) False arrest
c) Invasion of privacy
d) Slander
a) A third party breaks a leg when the insured knocks him down
WOTF symbols used in business auto coverage is correctly described?
a) Symbol 1 – owned auto only
b) Symbol 7 – hired autos only
c) Symbol 2 – owned autos subject to no-fault
d) Symbol 9 – nonowned autos only
d) Symbol 9 – nonowned autos only
WOTF are the authorities that an agent can hold?
a) Primary and secondary
b) Express and implied
c) Authorized and admitted
d) Apparent and allowed
b) Express and implied
AOTF are considered parts of the policy structure EXCEPT
a) Exclusions
b) Insuring clause
c) Provisions
d) Conditions
c) Provisions
In dwelling policies, automatic increase in insurance is
a) Coverage by endorsement
b) Automatic coverage
c) Coverage for newly acquired property
d) Coverage without additional premium
a) Coverage by endorsement
The limited fungi, wet or dry rot, or bacteria coverage endorsement applies to which type of losses?
a) Property and personal injury
b) Liability and personal articles
c) Personal effects and liability
d) Property and liability
d) Property and liability
WOTF statements is true regarding a mobile equipment endorsement in commercial auto policies?
a) The endorsement is available for additional premium
b) The endorsement is automatic
c) Mobile equipment is covered for property insurance
d) Liability coverage is not provided on equipment that is being towed
a) The endorsement is available for additional premium
When someone purchases insurance, what risk management technique are they exercising?
a) Avoidance
b) Retention
c) Sharing
d) Transfer
d) Transfer
The part of the policy that clarifies the terms in the policy is the
a) Insuring agreement
b) Conditions
c) Definitions
d) Exclusions
c) Definitions
AOTF are other coverages included in both the broad and special form dwelling policy EXCEPT
a) Breakage of glass
b) Lawns, trees, shrubs, and plants
c) Collapse
d) Theft of personal property
d) Theft of personal property
WOTF liability coverages must be added by endorsement to a homeowners policy in order to apply?
a) Property damage liability
b) Personal Injury
c) Medical payments to others
d) Bodily injury
b) Personal Injury
What is business auto coverage territory for?
a) United States only
b) United States and Mexico
c) Only for specific location of the business
d) United States & its territories, Canada, or worldwide for private passenger hired autos
d) United States & its territories, Canada, or worldwide for private passenger hired autos
What is a foreign insurer?
a) An insurer with a home in a home office in another state
b) An insurer with licensed agents who are citizens in more than one country
c) An insurer with a home office in another country
d) An insurer with licensed agents doing business in other countries
a) An insurer with a home in a home office in another state
An insured’s business is damaged by fire, and he is forced to close temporarily for repair. As a result, he lost income. What type of loss is this?
a) Consequential
b) Additional
c) Special
d) Direct
a) Consequential
WOTF perils is covered under both the basic form and broad form dwelling policies?
a) Falling objects
b) Internal explosion
c) Freezing of plumbing or AC systems
d) Weight of ice, snow or sleet
b) Internal explosion
AOTF are optional coverages that may be attached to an HO-3 policy EXCEPT
a) Earthquake coverage
b) Home day care coverage
c) Personal property replacement cost
d) Dwelling replacement cost
d) Dwelling replacement cost
When would UM coverage apply?
a) Only when the insured is legally liable
b) Only when the insured drives an uninsured car
c) Any time the insured is involved in an accident with an uninsured driver
d) Only when the other party is legally liable but has no insurance
d) Only when the other party is legally liable but has no insurance