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Which of the following policies does NOT contain an automatic reinstatement provision? a) Business automobile liability b) Personal automobile liability with split limits c) Homeowners d) General liability written with an aggregate limit - ✔✔General Liability written with an aggregate limit The ABC Corporation has $100,000 of coverage on its building through insurance Company A, and $50,000 of identical coverage on the same building through insurance Company B. Assuming coinsurance is not an issue, when a $24,000 loss occurs and the pro rata method is used, how much will each insurer pay? a) Company A will pay $24,000; Company B will pay $0. b) Company A will pay $16,000; Company B will pay $8,000. c) Company A will pay $20,000; Company B will pay $4,000. d) Company A will pay $12,000; Company B will pay $12,000. - ✔✔Company A will pay $16,000; Company B will pay $8,000. Farm fences (except field and pasture fences) are covered by which farm coverage form? a) Coverage A b) Coverage B c) Coverage E d) Coverage G - ✔✔Coverage G What type of coverage does a homeowners policy include that a dwelling policy does not? a) Personal property b) Other structures c) Broad form
d) Liability - ✔✔Liability Which of the following is NOT one of the 3 requirements for property to be eligible for FAIR plan coverage? a) Coverage could not be purchased through the normal insurance market b) It must be valued at an amount under the maximum value amount set by the state c) It must be located in a specific area defined by the state d) It must be considered insurable based on reasonable underwriting standards - ✔✔It must be valued at an amount under the maximum value amount set by the state Which of the following liability exposures is most likely for a small specialty clothing retail boutique? a) Operations liability exposure b) Product liability exposure c) Completed operations liability exposure d) Premises liability exposure - ✔✔Premises Liability Exposure All of the following types of property are covered by a standard builders risk form EXCEPT a) Tools 50 feet away from the building. b) The building itself. c) Temporary structures. d) Machinery that will be permanently attached to the building. - ✔✔Tools 50 feet away from the building If a consumer requests additional information concerning an investigative consumer report, how long does the insurer or reporting agency have to comply? a) 10 days b) 3 days c) 5 days d) 7 days - ✔✔5 days
d) A sports car kept in an attached garage - ✔✔An oriental rug in an on-premises apartment The insured's home is covered by an HO-3. Two years ago, the insured bought the home for $58,000. Today, its replacement value is $60,000. How much Coverage A does the insured need to qualify for replacement cost coverage? a) $46, b) $48, c) $58, d) $60,000 - ✔✔48, Which of the following is NOT one of the available additional coverages in the builders risk form? a) Fire department service charge b) Pollutant cleanup c) Vandalism d) Debris removal - ✔✔Vandalism In addition to income benefits, how much will a dependent survivor receive as a funeral benefit for a deceased employee covered under Workers Compensation? a) Reasonable and necessary b) $1, c) $3, d) $5,000 - ✔✔ 3000 Under the Motor Vehicle Financial Responsibility Law, First Party Benefits would NOT be denied for which of the following injuries? a) Injury that was intentionally self-inflicted b) Injury incurred while the person was under the influence of drugs or alcohol c) Injury incurred while attempting to elude apprehension by a law enforcement official d) Injury incurred during the commission of a felony - ✔✔Injury incurred while the person was under the influence of drugs or alcohol
All of the following could be considered rebates if offered to an insured in the sale of insurance EXCEPT a) Stocks, securities, or bonds. b) An offer to share in commissions generated by the sale. c) Dividends from a mutual insurer. d) An offer of employment. - ✔✔Dividends from a mutual insurer Which of the following is a unit of measurement an underwriter uses when determining the premium rates for insurance? a) Exposure b) Loss c) Hazard d) Risk - ✔✔Exposure A liability policy that provides coverage for a claim for injury or damage if the claim is first reported or filed against the insured during the policy period is called a) Bodily injury/property damage form. b) Occurrence form. c) Premises coverage. d) Claims-made form. - ✔✔Claims-made form What is the civil penalty for violating a cease and desist order of the Commissioner? a) $1, b) $5, c) $10, d) $50,000 - ✔✔10, An insured is driving above the posted speed limit. As he rounds a curve, he crashes into an illegally parked car. This is an example of a) Comparative negligence.
c) A station wagon that is used personally d) A two-ton grain truck with a 6,500-pound capacity - ✔✔A two-ton grain truck with a 6,500-pound capacity The broad theft coverage endorsement on the dwelling form specifies all of the following limitations EXCEPT a) $1,000 on silverware. b) $200 on money. c) $1,500 on securities. d) $1,500 on jewelry. - ✔✔1,000 on silverware A producer has successfully completed 52 hours of CE. How many hours can the producer apply to her current reporting period, and how many hours can she carry forward to the next reporting period? a) 26 hours will be applied to the current reporting perio and the remaining 26 can be applied to the period immediately following. b) Only 24 hours of the 52 earned may applied to this reporting period. c) 24 hours will be applied to the current reporting period, and 24 can be applied to the period immediately following. The excess 4 hours may not be carried over. d) 28 hours will be applied to the current reporting period, and 24 can be applied to the period immediately following. - ✔✔24 hours will be applied to the current reporting period, and 24 can be applied to the period immediately following. The excess 4 hours may not be carried over. A common exclusion found under physical damage to your auto includes a) Riot or civil commotion. b) Towing and labor. c) Mechanical breakdown. d) Glass breakage. - ✔✔mechanical breakdown Limited fungi, wet or dry rot, or bacteria endorsement in HO policies applies to a) Specified losses b) Property losses only
c) Liability losses only d) Property and liability losses - ✔✔Property and liability losses The Pennsylvania Property and Casualty Insurance Guaranty Association provides protection to insureds in the event of a) Unfair claims methods or practices. b) Insurance producer's dishonesty. c) Insurance company insolvency. d) Unfair trade practices. - ✔✔Insurance company insolvency. Which of the following may NOT be included in an insurance company's advertisement? a) That its policies are covered by a state Guaranty Association b) The policies' limitations or exclusions c) The name of a specific agent d) An identification of a limited policy as a limited policy - ✔✔That its policies are covered by a state Guaranty Association Within how many days must a producer respond to an inquiry from the Commissioner? a) 3 days b) 10 days c) 15 days d) 30 days - ✔✔30 days Which of the following would the livestock coverage form NOT insure against? a) Death of livestock caused by accidental drowning b) Death of livestock caused by a tornado c) The euthanasia of livestock after being hit by a vehicle d) The euthanasia of livestock suspected of carrying mad cow disease - ✔✔The euthanasia of livestock after being hit by a vehicle
An insurance company assures its new policyholders that their premium costs will not increase for a period of at least five years. However, due to increasing financial strain, they plan to raise premium costs for all insureds by 10% over the next two years. What term best describes this act? a) Defamation b) Unfair discrimination c) Errors and omissions d) Fraud - ✔✔Fraud Which of the following would be considered an insured under a business auto coverage form? a) The owner or anyone else from whom the named insured hires or borrows a covered auto b) Anyone using a covered auto while working in a business of selling, servicing, repairing, or parking autos if it is not the named insured's business c) A partner of the named insured for any covered auto owned by that person or a member of his or her household d) Anyone while using, with permission, a covered auto owned by the named insured - ✔✔anyone while using, with permission, a covered auto owned by the named insured What are the two types of compensatory damages? a) Pure and speculative b) Tort and general c) Normal and punitive d) Special and general - ✔✔special and general A mortgage company is named as a loss payee on the insured's homeowners policy, under the standard mortgage clause. If the insured suffers a loss due to a fire, which of the following is true? a) The entire loss is payable to the insured. b) The loss is payable to the insured and the mortgagee. c) The mortgagee should submit a claim to its insurer, and the insured should submit a claim to the HO policy. d) The entire loss is payable to the mortgagee. - ✔✔The loss is payable to the insured and the mortagee
A businessowners policy is a) A monoline policy. b) A self-contained prepackaged policy. c) A special policy designed for large retail operations. d) Part of a commercial package policy. - ✔✔a self-contained prepackaged policy Which part of an insurance policy covers claims-related expenses, reasonable expenses incurred by an insured to protect damaged property from further loss, or defense expenses? a) Exclusions b) Declarations c) Insuring agreement d) Additional coverage - ✔✔additional coverage All of the following are conditions commonly found in the insurance policy EXCEPT a) Subrogation. b) Appraisal. c) Insuring agreement. d) Cancellation and nonrenewal. - ✔✔insuring agreement When an auto insurance policy is cancelled by the insurer for an allowable reason other than nonpayment of the premium, how much prior notice must be given to the named insured? a) 45 days b) 10 days c) 15 days d) 30 days - ✔✔30 days 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
a) Negligence coverage. b) Property coverage. c) Liability coverage. d) Immediate coverage. - ✔✔Property Coverage A plasterer has finished a job. What kind of liability coverage would protect him if the plaster falls and hurts someone because he did not do the job correctly? a) Products b) Professional errors & omissions (E&O) c) Completed operations d) Medical payments - ✔✔Completed operations In a personal umbrella policy, the amount paid by the insured for certain losses not covered under the primary coverage is called a) Participation requirement. b) Self-insured retention. c) Stop-loss. d) Coinsurance. - ✔✔Self-insured retention. Which of the following is true regarding Continuing Education required for those holding a Pennsylvania producer license? a) Varies from insurer to insurer b) 24 hours each licensing period c) 12 hours each annual period d) Continuing Education is optional - ✔✔24 hours each licensing period What is a unilateral contract? - ✔✔A unilateral contract is a one-sided contract. This means only one party makes an enforceable promise
What is consideration in an insurance contract? - ✔✔Consideration is something of value that each party gives to the other What are conditions that increase the chance of a loss are known as what? - ✔✔Hazards When would a misrepresentation on an insurance insurance application be considered fraud? - ✔✔When its intentional and material What law protects consumers from the circulation of inaccurate or obsolete information? - ✔✔The fair credit reporting act What are the three types of agent authority? - ✔✔express, implied, and apparent What is symbol 1? - ✔✔Any auto What is symbol 2,3,4? - ✔✔owned autos, owned private passenger autos, and owned other than private passenger What is symbol 5? - ✔✔owned autos subject to no-fault coverage What is symbol 6? - ✔✔owned autos subject to compulsory UM law What is symbol 7? - ✔✔Specifically described autos What is symbol 8? - ✔✔Hired autos What is symbol 9? - ✔✔Non-owned autos What is symbol 19? - ✔✔Mobile equipment subject to a motor vehicle insurance law
