Property / Law Test Guide

Question 1

What evaluation is defined as the cost to replace damaged property with less expensive and more modern construction or equipment?

Answer 1

Functional replacement Cost

Question 2

True or False: An insured operates a home day care business out of his house, he can ensure the liability exposure coverage by attaching a home day care coverage endorsement to the HO policy.

Answer 2

True

Question 3

True or False: The insure agreement is a commonly found condition in an insurance policy.

Answer 3

No

Question 4

What do the declarations cover?

Answer 4

The who, what, when and where information of a contract.

Question 5

What is the insuring agreement?

Answer 5

It provides information on the policy coverage and the legal obligations of the parties.

Question 6

What is a type of agent authority, that is also called “Perceived Authority”?

Answer 6

Apparent

Question 7

True or False: Damage to the dwelling caused by ash or dust from a volcanic eruption losses will be paid under HO-3 in addition to HO-2.

Answer 7

True

Question 8

Assuming agreement for a covered loss how soon after received proof of loss, must the insurer make payment?

Answer 8

60 Days

Question 9

If the insured dies the policy what happens to the rights and duties?

Answer 9

Automatically transfer to a legal representative.

Question 10

What do the exclusions cover?

Answer 10

What perils are insured and not insured against.

Question 11

What do the policy conditions cover?

Answer 11

How parties to the contract must act following a loss.

Question 12

The livestock form covers what following a loss?

Answer 12

Named peril coverage for death of livestock?

Question 13

True or False: The declaration page of a Homeowners policy covers has a statement that earthquake damage is not covered.

Answer 13

False - This would be in exclusions

Question 14

True or False: For business income coverage the insured is reimbursed for the loss from the date of loss to the date of restoration or policy expiration.

Answer 14

False.

Question 15

True or False: The duties of the insurer found in policy conditions include that the insurer is to notify the insured in the event of financial difficulty.

Answer 15

False

Question 16

If an insurance company states their policies are guaranteed by the Insurance Guaranty Association, they would be guilty of what?

Answer 16

An unfair trade practice

Question 17

If there is a criminal prosecution taken against a producer, when must the producer report that the director?

Answer 17

Within 30 days of the initial pre-trial hearing date.

Question 18

How long does an agent have to notify the Commissioner if he or she has a change of address?

Answer 18

30-Days

Question 19

If an insured covered under a mobile homeowners policy moves the mobile home to protect it from a covered peril the policy will pay up to how much?

Answer 19

$500

Question 20

True or False: Medical Payments to Others is included in an unendorsed homeowners policy?

Answer 20

True

Question 21

What are the conditions?

Answer 21

Sets forth the obligations and duties of the insurer and the insured.

Question 22

True or False: Personal injury is an additional liability coverage provided in a homeowners policy.

Answer 22

False - May be added by endorsement.

Question 23

True or False: Homeowners policies provide coverage for business property while on the residence premises up to $2,500.

Answer 23

True

Question 24

What is not a consideration in a policy?

Answer 24

The applications given to a prospective insured.

Question 25

What homeowner form is designed to provided named peril coverage for personal property to renters?

Answer 25

HO-4

Question 26

If a court ordered payment for a loss that was not covered in the policy even if it was clearly worded would be an example of what?

Answer 26

Reasonable Expectations

Question 27

According to the loss payment condition in HO policies, losses must be paid within how many days?

Answer 27

60-Days

Question 28

How many units are allowed in a dwelling policy?

Answer 28

4

Question 29

True or False: Personal injury liability endorsement to an HO policy applies to a third party who breaks a leg when the insured knocks him/her down.

Answer 29

False

Question 30

How long does the director serve?

Answer 30

4-Years

Question 31

How much notice to the insured is required when non-renewing an auto policy?

Answer 31

30-Days

Question 32

How much is covered for debris removal under the HO property additional coverages?

Answer 32

All reasonable costs.

Question 33

True or False: Provisions are considered parts of the policy structure.

Answer 33

False

Question 34

True or False: Coverage must be written as part of farm coverage for mobile agricultural equipment.

Answer 34

False

Question 35

True or False: Bodily injury to a residence employee would be included in the farm liability coverage forms?

Answer 35

True

Question 36

The policy provision found in property insurance policies that prevents the insured from collecting twice is called what?

Answer 36

Subrogation

Question 37

Which dwelling policy forms primarily insures a structure on an ACV basis?

Answer 37

DP-1

Question 38

An insured condo unit owner wants to purchase fire and extended coverage for personal property and liability coverage. What should they get?

Answer 38

HO-6

Question 39

True or False: Accident and health insurance is considered a limited line of authority.

Answer 39

False

Question 40

What is the agreement called between an insurer and an insured where the insurer agrees to covered the insured for specific losses in exchange for a premium?

Answer 40

The insurance contract

Question 41

How are state Insurance Guaranty Associations funded?

Answer 41

By their members

Question 42

What effect does the the Terrorism Risk Insurance Act of 2002 have?

Answer 42

Nullifies exclusion of certified acts of terrorism as covered by the act.

Question 43

When the director requests a hearing, written notice must be submitted how many days in advance?

Answer 43

14-Days

Question 44

True or False: Special personal property limits includes $500 for business personal property on the insured premises.

Answer 44

False.

Question 45

In property insurance ACV is defined as what?

Answer 45

Replacement cost at the time of loss, less depreciation.

Question 46

What is the liberalization clause in a policy?

Answer 46

Changes adopted by the insurer that broadens coverage automatically.

Question 47

In dwelling policies, automatic increases in insurance is what?

Answer 47

Coverage by endorsements

Question 48

True or False: Common carrier cargo liability is a class of inland marine.

Answer 48

False

Question 49

What is not a consideration of the policy structure?

Answer 49

Provisions

Question 50

In a commercial package policy, who may cancel the policy in writing and make changes to the policy with the consent of the insurer?

Answer 50

First named insured.

Question 51

True or False: A coin collection valued at $500 lost in a fire is covered by a homeowners policy.

Answer 51

False - Coins are valued at $200

Question 52

True or False: Damage from rising flood waters would be covered by the basic causes of loss form under a Commercial Property Policy.

Answer 52

False

Question 53

A specific coverage on a policy declaration page that has no premium shown means what?

Answer 53

There is no coverage

Question 54

True or False: The dwelling must be owner-occupied is a characteristic of a dwelling policy.

Answer 54

False

Question 55

What is a risk that eligible for coverage under a BOP?

Answer 55

Condominiums

Question 56

A commercial property special form covers property in transit up to what amount?

Answer 56

$5,000

Question 57

True or False: Theft is a covered peril, covered under the broad form dwelling policy.

Answer 57

False

Question 58

True or False: Fire department service is an additional coverage service charge under the builders risk form.

Answer 58

True

Question 59

If there is a complaint regarding an insurer and the matter can be cleared by looking at a record, who would most likely conduct the investigation?

Answer 59

The Director

Question 60

In Idaho what kinds of insurance policies are the basis for all property insurance policy and is the only policy with its word standardized by state law?

Answer 60

Fire

Question 61

All insurance policies written in the state must be countersigned by licensed agents. In these instances, the agent may grant the power of attorney to individuals over the age of what?

Answer 61

21

Question 62

Two individuals in the same age and risk class are charged different rates for their insurance policies is caused what?

Answer 62

Discrimination

Question 63

A parking garage owner completed Manor major renovations to a parking garage prior to selling to another company. Three months later overhead concrete fell on the cars in the second-floor garage. Who is liable?

Answer 63

The damage occurred when the concrete fell.

Question 64

Cruise of ships are covered under what?

Answer 64

Jones Act

Question 65

An owner of a parking lot wants liability coverage for damage to vehicles in her custody what does she need?

Answer 65

Garage keepers coverage

Question 66

True or false, the individual named insured endorsement a used by individual business owners who use company vehicles for personal use rather than purchasing a personal vehicle?

Answer 66

True

Question 67

A store employee suspect someone of shoplifting and escorts them to the back office, but later determines they have not stolen anything. What are they guilty of?

Answer 67

False arrest

Question 68

Who is not considered an employee in a commercial general liability policy?

Answer 68

Temp employees

Question 69

True or false to minimize the insured‘s level of liability in the event of a loss is not a goal of risk retention?

Answer 69

True

Question 70

True or false, proof of carelessness is one of the four primary elements considered establishing negligence?

Answer 70

False / Legal Duty

Question 71

What is also called perceived authority?

Answer 71

Apparent

Question 72

When an umbrella policy is broader than underlying policy insurance it pays a loss that is not covered by the underlying policy, it usually only pays what?

Answer 72

The excess over the self insured retention

Question 73

SIR stands for what?

Answer 73

Self-insured retention

Question 74

What is the basic limit for costs incurred at the place a vehicle is disabled provided by the towing and labor cost endorsement?

Answer 74

$25

Question 75

What type of information would be found in a policies insuring agreement?

Answer 75

Renewal dates

Question 76

Imposter worker has finished a job work coverage would protect them if the plaster falls and hurts someone because he did not do the job correctly?

Answer 76

Completed operation

Question 77

Under the Worker’s Compensation system who is responsible for the expenses resulting from work related injuries in occupational diseases?

Answer 77

The employer regardless of whether it was at fault for the injury or disease.

Question 78

True or false, in the event of a claim under a commercial general liability policy the insured is responsible for submitting to a medical exam when requested.

Answer 78

False

Question 79

What type of compensation damages will pay for pain and suffering disfigurement?

Answer 79

General

Question 80

What fundamental principle and property insurance holds that when there is an unbroken connection between an occurrence and damage the grows out of occurrence than the resulting damage is all part of the occurrence?

Answer 80

Proximate cause

Question 81

On a personal auto policy that has $5000 of medical coverage what does that amount represent?

Answer 81

The limit is not more than $5000 per person per accident.

Question 82

True or false comparative negligence is a statutory Defense?

Answer 82

True

Question 83

Under the business auto coverage form mobile equipment is covered for liability insurance when what?

Answer 83

When it is being carried or towed by a covered auto.

Question 84

What is the legal defense they can be used in most states in which proportion it damages may be awarded on both the plaintiff and defendant were negligent?

Answer 84

Comparative negligence

Question 85

An employee drives a company auto but does not own a vehicle herself. What endorsement could be added to the insurance policy covering the company auto that would provide coverage the employee when she drives someone else’s car for her personal use?

Answer 85

Drive other car coverage

Question 86

A market was sued when an employee detained a person to believe to be a shopper but the person turned out to be the meter reader which coverage would apply to the suit?

Answer 86

Personal and advertising injury liability

Question 87

The insured must be given written notice 10 days in advance of the cancellation for nonpayment of premium or 20 days for what reason?

Answer 87

Any other reason for cancellation

Question 88

If an applicant for insurance producer licenses Is denied licensing, how long must they wait to reapply?

Answer 88

1 year

Question 89

A policy owner provides a check to the producer for her initial premium, how soon from receiving the check master producer remit the payment to the insurance company?

Answer 89

21 days

Question 90

True or false a certificate of insurance must include the policy and it’s endorsements?

Answer 90

False

Question 91

Who has to provide proof of financial responsibility in Idaho?

Answer 91

Only individuals who operate a motor vehicle

Question 92

What is the maximum penalty for habitual well for noncompliance with a fair credit reporting act?

Answer 92

$2,500

Question 93

To legally transact business insurance in the state the insurer must obtain what?

Answer 93

Certificate of authority

Question 94

Excluded classification of employees under a Worker’s Compensation policy are what?

Answer 94

Statutorily defined

Question 95

When the Director conduct an examination of alien insures what is the typical extent of the examination?

Answer 95

Transactions occurring in the United States only

Question 96

A driver is convicted of failing to maintain auto insurance. He must now provide proof of financial responsibility for at least what time period?

Answer 96

12 months