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South Dakota Property and Casualty 202 5
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Which of the following is not a coverage extension under the Building and Personal Property Coverage Form? - ✔✔Inflation guard (this is an OPTIONAL COVERAGE) Which term describes the equal sharing of a loss by two or more insurers until the loss is paid, or until each insurer has exhausted its limits of insurance, whichever comes first? - ✔✔Contribution by equal shares Choose the physical damage claim that would be covered under the Personal Auto Policy. - ✔✔Malicious mischief to the tires When firefighters extinguish a house fire with water, the water damage is considered a(n): - ✔✔DIRECT loss In Surety bonding, the party to whom the surety is answerable is the: - ✔✔Obligee (whose party the benefit the bond is written) Which of the following would not be covered under Section II of the Homeowners Policy? - ✔✔Property damage to property owned by an insured (section II is about insurance for loss of third party) Livestock does not include which of the following animals? - ✔✔Poultry Damaged household and personal property in transit between the insured's old and new residences is covered by the Dwelling Policy under: - ✔✔Coverage C. 10% of this coverage applies to the insureds property away from the premises anywhere in the world
Which of the following is a false statement about the National Flood Insurance Program? - ✔✔There is no deductible. (The policy applies separate deductibles to losses to the building and to the contents.) When a claimant can prove that a product caused an injury, the fact that the manufacturer will be held liable regardless of whether the product was defective or not, is considered which of the following? - ✔✔Strict liability The taking of property from inside the premises by a person unlawfully entering or leaving the premises as evidenced by visible signs of forcible entry or exit is known as: - ✔✔Burglary Which of the following is not included in the definition of mobile equipment? - ✔✔3/4 ton pick up truck Which statement about the Umbrella Liability Policy is FALSE?? - ✔✔The standard deductible on an umbrella policy is $100,000 (THERE IS NO DEDUCTIBLE!!!!!!!) A sandwich shop discovers that someone has vandalized their customer bathrooms, causing $2,500 in damage. Under the shop's commercial crime policy, which insuring agreement or endorsement would pay for this loss? - ✔✔The insured would need to file a claim for this loss under their commercial property or businessowners policy If the amount of liability insurance coverage is divided between bodily injury and property damage claims, the policy limits are which of the following? - ✔✔Split limits
Because the insurance company must pay claims and the insured must comply with the policy terms, the insurance contract is considered which of the following types of contracts? - ✔✔conditional contract Under a Dwelling Policy, an insured tenant may use up to what percentage of the Coverage C limit of insurance for a covered loss to improvements, alterations, and additions made at the insured's expense to that part of the described location occupied by the named insured? - ✔✔10% A Builder's Risk policy automatically ends within how many days after construction is complete?
- ✔✔ 90 Which of the following statements about liability insurance is false? - ✔✔Bodily injury includes personal injury, sickness, and disease Which of the following is true about an aggregate limit? - ✔✔It applies to losses from all occurrences within a specified policy period Dwelling Coverage D covers which of the following losses? - ✔✔Access prevented by a civil authority because of a neighboring location's direct loss by a peril covered under the insured's policy (Coverage D - Fair Rental Value includes coverage for the indirect loss of access prevented by a civil authority due to the direct loss of a neighboring property by a covered peril. Coverage D will not provide coverage for lease cancellation. Additional living expenses are provided by Coverage E.) Part E of the Personal Auto Policy states that after a loss the insured must: - ✔✔Protect the auto from further damage
An insured looking to cover the dwelling against damage from hail would need to purchase which Dwelling form? - ✔✔Any form except for the unendorsed DP- 1 Which vehicle is covered under Part B - Medical Payments of the Personal Auto Policy? - ✔✔A vehicle used for car pools Which statement is false about Commercial Property insurance? - ✔✔Time element losses and direct losses are the same (the truth is these are indirect losses, not direct) Which of the following reduces an award in proportion to the amount of negligence? - ✔✔Comparative negligence Replacement for any of the nonmechanical sheet metal or plastic parts which generally constitute the exterior of a motor vehicle, including inner and outer panels is referred to as parts. - ✔✔Aftermarket crash Which of the following would not be eligible to purchase a Homeowners Policy? - ✔✔A person who owns and lives on a farm An insured contract includes all of the following, except: - ✔✔Pollution liability Fraud is an intentional act of any of the following, except: - ✔✔Warrenty Motels may not be written insured by a Businessowners Policy if they exceed: - ✔✔ 3 stories
Which statement regarding the purpose of Employers Liability Insurance is false? - ✔✔It extends policy benefits to states not listed on the Declarations page The Businessowners Liability Coverage Form includes coverage for bodily injury, property damage, personal injury and advertising injury to which coverage applies, plus: - ✔✔Liability assumed under an insured contract Which of the following statements about claim payment regarding a stolen vehicle is FALSE? - ✔✔If the insurer returns a stolen vehicle, the insurer does not have to pay claims for vehicle damage Which of the following is true regarding the BOP's Time Element Utilities Services Endorsement? - ✔✔It pays for loss of business income or extra expense at the described premises caused by the interruption of service at the described premises Which of the following would not be considered an insured under a CGL? - ✔✔An LLC employee's spouse assisting in cleaning the office so they can leave for vacation more quickly D does not agree with the insurance company's value of property damaged as a result of D's recent property loss. Which of the following establishes the procedure D and the insurance company must use to settle this issue? - ✔✔Appraisal Clause (basically a way to settle legal stuff without getting lawyers involved in official legal action) What is the correct term for a secondary loss that occurs as a result of a direct loss from a covered peril? - ✔✔Consequential Loss Which of the following is correct regarding preservation of property under the Building and Personal Property Coverage Form? - ✔✔The policy provides open perils coverage for 30 days on insured property that is being moved or temporarily stored at another location because of the endangerment of a covered peril
Which of the following is eligible to receive medical payments under Section II of a Homeowners Policy? - ✔✔A residence employee The concealment and fraud condition in a property insurance policy states: - ✔✔The policy will be voided if there is material concealment, misrepresentation, or fraud on the insured's part Under the Building and Personal Property Coverage Form, when is abandonment allowed? - ✔✔Abandonment is never allowed Employees exempted from Workers' Compensation laws include all of the following, except: - ✔✔part time employees The South Dakota Insurance Guaranty Association's obligation to claimants is limited to $ for covered claims other than for Workers' Compensation or return of unearned premium. - ✔✔300, All of the following are true regarding medical expenses coverage under the BOP, except: - ✔✔The policy excludes funeral expense All of the following are considered an insured under the Commercial General Liability Coverage Part to the Commercial Package Policy, except: - ✔✔Members of a past partnership not shown as a Named Insured in the Declarations
Which property condition requires the insurer broaden coverage during the policy period without an increase in premium? - ✔✔Liberalization All of the following are general conditions of the BAP, except: - ✔✔Duties in the event of an accident (this is a loss condition, not a general one) Which of the following is true concerning monopolistic states regarding Workers' Compensation insurance? - ✔✔In Monopolistic states, Workers' Compensation is only available through a state fund Which of the following statements is false regarding Workers' Compensation law? - ✔✔Employers are liable for injuries occurring outside the course of employment Under the Workers' Compensation policy, physical therapy benefits are a type of: - ✔✔Rehabilitation benefit Under the Garage Coverage Form, covered autos are usually written on which of the following basis? - ✔✔Blanket The Garagekeepers Coverage of the Garage Coverage Form covers the liability of: - ✔✔Physical damage to a customer's car that is in the care and custody of an insured Fair Access to Insurance Requirements (FAIR) Plans are designed to provide a means to purchase
property insurance on property located in urban areas when insurance cannot be obtained through standard markets (the property must meet underwriting standards). - ✔✔Basic In property insurance, which clause prevents the insured from relinquishing ownership and leaving damaged property to the insurer and claiming a total loss? - ✔✔Abandonment Which of the following is attached to a property and casualty insurance policy to amend policy provisions or conditions? - ✔✔Endorsements Property insurance policies that apply coverage only to perils that are stated in the policy, are considered to be written on: - ✔✔A named peril basis All of the following statements regarding property insurance are correct, except: - ✔✔The owner of clothing left in the care of a dry cleaner is called a bailee Which of the following relationships involves vicarious liability? - ✔✔Employer and employee Property damage covered by a liability policy includes which of the following? - ✔✔Damage to tangible property, including loss of use of that property caused by the insured's negligence D's neighbor H keeps a venomous snake as a pet. D's son is bitten after teasing the snake with a stick. After being sued by D's parents, H's insurance company claimed that the boy was acting negligently, and therefore, H was not liable. The boy's lawyer claimed that the pet was so dangerous that it did not relieve the owner of liability, an example of which principle? - ✔✔Absolute liability
The formal statement that verifies details so the insurer can determine liability is called: - ✔✔A proof of loss When a loss occurs as a result of two perils, one of which is excluded and the other of which is insured against, the situation is known as: - ✔✔Concurrent Causation Which one of the following is not a violation of the state's producer regulations? - ✔✔Obtaining a loan from an existing or former client where there is a written contract establishing the terms for repayment of the loan and the contract is filed with the Division of Insurance within 30 days of its effective date If the insured and insurer do not agree on the value of a property loss, what condition would apply? - ✔✔Appraisal Which of the following is not an element of negligence? - ✔✔Assumption of risk he elements of negligence are: - ✔✔Duty of care, violation of the duty of care, proximate cause, and damages that are foreseeable. When damages are reduced in proportion to the degree of negligence, this is an example of: - ✔✔Comparative negligence A primary liability policy is one that: - ✔✔Pays first with respect to other policies The termination of an insurance policy, by either the insured or the insurer before the expiration date, is known as: - ✔✔Cancellation
Making any false oral or written statement maliciously critical or derogatory of any insurer's financial condition that intends to injure someone in the insurance business is: - ✔✔Defamation of an insurer Actual Cash Value is best defined as which of the following? - ✔✔Today's current price, minus depreciation Which of the following operates the Insurance Fraud Division in South Dakota? - ✔✔The Attorney General Producers and business entities must be with the insurer prior to acting as an agent of that insurer. - ✔✔Appointed The Director can suspend any license for up to how many months? - ✔✔ 12 When cancelling a policy that has been in force for 60 or more days, a cancellation notice must be mailed or delivered to the named insured at least days before the effective cancellation date. - ✔✔ 20 If a violation is charged and such method of competition, act, or practice is not discontinued, the Director can at any time enjoin and restrain the person from engaging in the violation by issuing a: - ✔✔Cease and Desist Order A notice of nonrenewal of a commercial policy must be delivered at least days before the expiration of the policy. - ✔✔ 60
Making a written or oral statement that misrepresents or makes incomplete comparisons as to the terms, conditions, or benefits contained in any policy for the purpose of inducing a person to lapse, forfeit, borrow against, surrender, retain, exchange, or convert any insurance policy is called: - ✔✔Twisting Offering any return of premiums payable, any special favor, or any valuable consideration or inducement not specified in the policy is called: - ✔✔Rebating Under the South Dakota Automobile Insurance Regulations, if an insurer does not intend to renew a policy, a notice of at least days must be mailed or delivered to the named insured at the address shown in the policy. - ✔✔ 60 Why does the South Dakota Insurance Guaranty Association exist? - ✔✔To provide protection for insureds and claimants against financial losses when a property and casualty insurer becomes insolvent Which type of construction material has a fire-resistance rating between one and two hours for walls, floors and roofs? - ✔✔Modified Fire Restrictive Under the South Dakota Workers' Compensation Law no temporary disability benefits may be paid for an injury that does not incapacitate the employee for at least consecutive days. - ✔✔ 7
