Test Questions Flashcards by newseamus moore

Which of the following Statements is true about reinsurance?
A. Rein is the process whereby the insurer transfers all or part of the risk to another company.
B. When an insurer obtains reinsurance, it has sold the contract to another insurer, and no longer has direct responsibility for the policy.
C. Property an casualty insurers use reinsurance, life insurers do not.
D. Rein is when the insured allows a policy to lapse for nonpayment. Later, if the insured makes the payment, the policy is reinsured.

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Which of the following is defined as `an agreement between two or more parties enforceable by law?`
A. Tort
B.  Agreement Clause
C.  Insurance Policy
D.  Contract

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Which of the following is NOT required for a risk to be ideally insurable?
A. The loss must be definite and measurable.
B. The loss must create economic hardship.
C: The loss must occur on the insured`s property.
D: The loss must be an accident.

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The law of large numbers is a principal that basically says:
A: the larger the possibility of a loss, the greater the exposure.
B: the larger the amount of information gathered, the more reliable that information will be.
C: the larger the number of people in an insurance company, the more stable it is.
D: the more insurance you have, the more protected you are.

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Type of loss exposure pertaining to land and structures attached to it is:
A:  property loss exposure
B:  liability loss exposure
C:  financial loss exposure
D:  personal loss exposure

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The degree of loss a person/organization faces from suits brought by a third party refers to:
A:  Liability Loss Exposure
B:  Loss Exposure
C:  Property Exposure
D:  Human Personnel Loss Exposure

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The uncertainty or chance of a loss occurring is known as:
A:  risk management.
B:  pure risk.
C:  risk.
D:  speculative risk.

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Restoring the insured back to the condition he or she was in before the loss occurred is known as:
A:  Restoration
B:  Insurable Interest
C:  Indemnification
D:  Loss Retention

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When a right or privilege has been given up, a party cannot reassert that right or privilege. The process of preventing the party from reasserting that right or privilege is known as:
A:  Pro-rata
B:  Waiver
C:  Estoppel
D:  Indemnity

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The term loss exposure refers to:
A:  the possibility of a loss.
B:  the actual cause of the loss.
C:  the uncertainty of a loss occurring.
D:  the increase in the possibility of a loss.

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Materiality is determined by the disadvantage placed on the other party and:
A:  not by the event
B:  neither are correct
C:  the influence of the facts
D:  both are correct

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A hazard is best defined as:
A: anything that increases the chance of loss or severity of loss due to a peril.
B: any action from a court that increases the likelihood or size of a loss.
C: a possibility of a loss.
D: risk shifted from one to another.

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Which of the following is the amount of money the insured pays before the insurer pays for the rest of the claim?
A:  Subrogation
B:  Deductible
C:  Coinsurance
D:  Premium

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Which of the following is an example of an adverse underwriting decision?
A: All of these are examples
B:  Rejecting the risk
C:  Issuing with limitations
D:  Charging a higher rate

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What are the two types of torts?
A:  Pure &amp; Speculative
B: Intentional &amp; Unintentional
C:  Broad &amp; Basic
D:  Legal &amp; Non-Legal

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Which of the following are the main types of risks?
A:  Avoidance and Retention
B:  Pure and Transfer
C:  Sharing and Transfer
D:  Speculative and pure

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Which of the following is not a class of insurance?
A:  Auto
B:  Casualty
C:  Marine
D:  Fire

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A hazard that deals with a persons mental attitude, behavior and habits is an example of: 
A:  Legal hazard
B:  Moral hazard
C:  Morale hazard
D:  Physical hazard

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Substitution of a small certain loss for a large uncertain loss is: 
A:  law of large numbers
B:  insurance
C:  a pure risk
D:  an insurable event

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Which of the following describes when one party intentionally gives the other party false information in order to benefit from the unlawful gain. 
A:  Misrepresentation
B:  Theft
C:  Fraud
D:  Concealment

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Which of the following is NOT a known private insurer? 
A:  Mutual Insurance Companies
B:  Stock Insurance Companies
C:  Bond Insurance Companies
D:  Reciprocal Insurance Exchanges

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When an insured rejects uninsured motorist in writing this is considered: 
A:  a waiver
B:  a modification
C:  an example of estoppel
D:  a rescission

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Insurance is a contract whereby one undertakes to indemnify another against: 
A:  Physical hazard
B:  Damage
C:  Exposure
D:  Uncertainty

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The state of being subject to a loss is considered: 
A:  exposure
B:  insurance
C:  risk
D:  hazard

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``` A peril is: A: pure and speculative. B: a possibility of a loss. C: the actual cause of the loss. D: anything that increases the chance of loss or severity of loss. ```

``` A beautician stating that this conditioner fixes badly damaged hair is a: A: stated fact B: representation C: expressed warranty D: implied warranty ```

The process of reviewing applications for insurance and the information on the application is: A: Underwriting B: Application Evaluation C: Field Underwriting D: the job of the agent before accepting or rejecting an application

``` Bob is thinking about obtaining insurance because he just found out he needs extensive surgery that will require several days in the hospital. This situation of waiting until the last minute to obtain insurance is known as: A: Ideally Insurable Risk B: Adverse Selection C: Spread of Risk D: Cost Effective Insurance ```

``` Which of the following elements of a contract is/are the binding force? A: Competent Parties B: Consideration C: Legal Purpose D: Offer & Acceptance ```

``` Performance depends upon an uncertain future event is the feature: A: adhesion B: unilateral C: conditional D: aleatory ```

``` Examples of tort law include all of the following EXCEPT: A: Breach of contract B: Bodily injury C: Libel and slander D: Personal injury ```

Loss control refers to: A: taking measures to prevent further damage during a loss. B: a combination of risk control techniques with risk financing techniques. C: preventing a loss from becoming catastrophic. D: taking the necessary precautions that will reduce the risk of a loss.

Any contingent or unknown event, whether past or future, which may damnify a person having an insurable interest or create a liability against him/her, may be insured against. The more unpredictable a loss becomes: A: the less insurable it becomes. B: the less it becomes insurable interest. C: the more it becomes insurable interest. D: the more insurable it becomes.

According to the California insurance law, either party may rescind a contract for any of the following reasons EXCEPT: A: Once a contract is signed, it can never be rescinded. B: One party intentionally or unintentionally hides material information. C: One party intentionally omits information from the other party. D: If a representation is false in a material point, whether affirmative or promissory, the injured party is entitled to rescind the contract.

``` Punishment for twisting or misrepresentation would be: A: up to 1 year in jail B: neither are correct C: both are correct D: up to $25,000 ```

Errors and omissions is a type of liability insurance: A: for protection against misrepresentation when filing a declaration page. B: that agents use to protect themselves if they give C: advice or information to a client. D: that indemnifies a client. E: for insured`s to use to protect themselves against a claim loss.

``` An insurer not authorized to conduct business in California would be: A: neither of these B: an unauthorized insurer C: a non-admitted insurer D: either of these ```

Which of the following actions would not be considered transacting insurance? A: Handing a prospect a business card and asking them for information. B: Giving a price quote over the phone. C: Emailing a prospect a auto quote. D: Collecting premium for a policy.

``` Binders can be extended how many additional days? A: 30 days B: 60 days C: 150 days D: 90 days ```

Which of the following is not true about the relationship between an agent and a solicitor? A: A solicitor may give premium quotes over the phone, just like an agent. B: A solicitor cannot be employed by more than one fire and casualty broker/agent at the same time. C: An agent represents the company, whereas the solicitor is an assistant to an agent and has no binding authority. D: An agent or broker cannot transact as a solicitor, but a solicitor can transact as a broker or agent

A broker can transact all of the following EXCEPT: A: Casualty insurance B: Life, health, and disability insurance C: Property insurance D: Personal Lines

``` If an agent gives Incorrect advice or unknowingly provides Incorrect information to the client, which of the following liability insurance policies for nonmedical professionals is available to pay for losses or defend lawsuits that might be filed against him? A: Errors and Omissions B: Medical Insurance C: Liability insurance D: Nonadmitted ```

``` Which marketing system does the insurer not own the expiration list? A: An independent agency B: A direct mail system C: Direct writing system D: A internet ```

``` Which of the following would not require a license? A: Public Adjuster B: All require a license C: Insurance Adjuster D: Independent Adjuster ```

``` The underwriting process consists of all of the following basic steps except: A: Issue the rate B: Gather necessary information C: Monitor the decision D: Implement the decision ```

Which of the following statements about insurance in connection with sales or loans is TRUE? A: No person involved in the business of financing the purchase of real estate may require the purchase of insurance through a specific agent as part of the requirements in the purchase except an agent licensed with the state of California. B: A person involved in the business of financing the purchase of real estate may require the purchase of insurance through a specific agent if the agent is employed by that company. C: A person approved by the Commissioner may be required to be involved in the business of financing the purchase of real estate. This person would act as the agent in purchasing insurance for the real estate. D: No person involved in the business of financing the purchase of real estate may require the purchase of insurance through a specific agent as part of the requirements in the purchase.

``` In which system is the agent considered an employee? A: A direct response system B: None of these C: Exclusive agency system D: Direct writing system ```

``` Which of the following is NOT a source of information an underwriter might use to investigate an application in order to approve or reject it? A: Medical Information Bureau B: Financial Reports C: Department of Industrial Relations D: Department of Motor Vehicles ```

``` When dealing with insurance in connection with sales or loans, violating the legal provisions specified by California law is considered a: A: misdemeanor B: felony C: penalty D: fine ```

Which of the following is NOT an action a person performs when transacting insurance? A: The actual execution of a contract B: Calling an insurer for a price quote C: Any transactions that later result from the operation of the contract D: Solicitation of insurance

``` An insurance agent is appointed to transact: A: all are InCorrect: B: all classes of insurance C: all lines of insurance D: all lines except 24hr care ```

``` In which of the following marketing distribution systems does the agent represent more than one insurer and more than one company? A: Independent agency B: Direct mailing system C: Direct writing system D: Exclusive agency ```

``` A lender does have the right to provide insurance or renew the insurance and charge a transaction fee if the borrower fails to deliver proof of insurance at least ____ days before the policy expires. A: 25 B: 10 C: 30 D: 15 ```

``` There are no binders issued in: A: life insurance B: Any of the above C: in health insurance D: excess of 1 million ```

The following acts are unlawful and are misdemeanors in California except when performed by a surplus lines broker EXCEPT: A: In any manner, advertising for a nonadmitted insurer in this state. B: In any manner, advertising for an admitted insurer in this state. C: In any other manner, aiding a nonadmitted insurer to transact insurance business in this state. D: Acting as agent for a nonadmitted insurer in the transaction of insurance business in this state.

Which of the following is a responsibility of the insured in an insurance contract? A: Send the application to the underwriting department. B: To complete the application. C: Give true statements and information on the application. D: Fully explain the policy to the client.

``` A _____________ licensee is authorized to transact ONLY the following lines of insurance: Automobile, recreational vehicles (noncommercial purposes), personal watercraft, residential property, earthquake, flood, inland marine, umbrella (excess liability). A: Fire and Casualty B: Limited Lines Automobile C: Life Only D: Personal Lines ```

``` Which of the following is NOT a type of authority given to agents? A: Express authority B: Apparent authority C: Customary authority D: Implied authority ```

``` Monitoring of existing risks is: A: post-selection B: a code requirement C: conditional underwriting D: pre-selection ```

``` Any person who transacts insurance without a valid license is guilty of a misdemeanor, punishable by a fine not exceeding ______. A: $25,000 B: $20,000 C: $50,000 D: $10,000 ```

A person licensed as a broker/agent shall be deemed to be: A: acting with the same authority granted a managing general agent B: involved in the business of financing the purchase of real estate C: responsible for deciding if an application should be approved or rejected D: acting as an insurance agent in the transaction of insurance placed with those for whom a notice of appointment has been filed with the Commissioner

The application is the document that: A: shows proof of insurance. B: shows the insured has coverage currently in force. C: states the name of the insured, the premium, and other facts that help the insurer decide whether to accept or reject it. D: serves as a temporary contract that usually lasts 30 days.

``` A solicitor holds which license? A: Personal lines broker-agent B: P&C broker-agent C: A solicitor's license D: Either P&C broker-agent or Personal lines broker-agent ```

``` Law of agency is the relationship between: A: agent and principal B: agent and client C: insurer and customer D: agency and agent ```

``` In a legal relationship, which authority does a principal (company) give the agent in writing? A: Apparent authority B: Customary authority C: Express authority D: Implied authority ```

The marketing/sales department is responsible for: A: using claims history, statistics, and computer data to predict losses. B: receiving claim requests, evaluating them, and paying those claims that are covered by the terms of the contract and rejecting those that are not. C: receiving applications for insurance and then deciding if the company should approve or reject the application. D: advertising, promoting and distributing an insurer`s products to the public.

``` Transacting via internet with a California resident would not require: A: license expiration B: license number C: name on license D: state licensee is domicile ```

``` Commissioner may give an order that records be brought current within: A: 15 days of the order B: 60 days of the order C: 90 days of the order D: 30 days of the order ```

________ refers to the inability of the insurer to meet its financial obligations when they are due. 1: Insolvency 2: Actuarial 3: Paid in capital 4: Non-Admitted

After providing an opportunity for a hearing, the Commissioner may deny an application for a license based on the following reasons EXCEPT: A: the applicant has acted as a licensed person before the license was issued B: the applicant lied on the application C: the applicant is disabled D: the applicant was convicted of a felony

``` Agents must keep good records and make them available to the DOI for a period of: A: 3 years B: 2 years C: 5 years D: 1 year ```

All Property and Casualty Broker/Agents are required by law to display to the public: A: The institution of education where they received their degree. B: The types of insurance they are licensed to sell displayed in their personal office. C: Their license to sell insurance displayed in their training room. D: Their license to sell insurance, displayed in a place where it can be easily seen

``` For an agent or solicitor to be valid to transact requires: A: both are required B: a proper license C: neither are required D: an appointment ```

When should a licensee notify the Commissioner of a change in address? A: within the 10 day grace period B: immediately C: within the 30 day grace period D: after notifying the company the licensee is employed with

``` Which of the following is not a person under the Code? A: An estate of a deceased B: An individual C: An entity D: A family ```

If a license is in the possession of the insurer or the licensee`s employer, the licensee may surrender his/her license: A: at any time. B: after the termination of employment with an insurer. C: after written notice is delivered to the Commissioner. D: after notifying the Commissioner and a mandatory 30 days waiting period.

A Property and Casualty Agent is required to continue their education by completing: A: a total of 100 hours during the first 4 years of licensing. B: a total of 24 hours per license term. C: a total of 25 hours during the first 2 years of licensing. D: a total of 55 hours during the first 2 years of licensing.

Every applicant for a license to act as an agent must have filed with the Commissioner: A: a notice of appointment to do business in the state. B: a request for application prior to being licensed in the state. C: a license number to be approved prior to receiving a license. D: an application for employment with the company employed with.

``` In lieu of denying an application for a license the Commissioner can: A: charge extra fees B: issue a restricted license C: neither of these D: either of these ```

Every licensee shall prominently put their license number on all of the following except: A: Phone book listing in the white pages B: Price quote C: Neighborhood advertising flyer D: Business cards

Insolvency means: A: a company has more claims than earned premium to pay for those claims B: a company has more earned premium than claims made C: an insurer`s inability to meet its financial obligations when they are due D: an insurer`s inability to meet the standards set by the DOI

``` Informational records must be kept a minimum of: A: 5 years B: indefinitely C: 18 months D: 12 months ```

``` In order to update, add or change a statute a bill must be passed by the legislature and then presented to the governor. If the statute is passed, it will go into effect: A: on the next January 1st B: immediately C: on the next August 1st D: on the next fiscal year ```

``` A subsidiary formed to insure the parent company is called a(n): A: Co-op insurer B: Inter-insurance exchange C: Captive insurer D: Fraternal ```

The actuarial department is responsible for: A: receiving claim requests, evaluating them and paying those claims that are covered by the terms of the contract and rejecting those that is not. B: receiving applications for insurance and then deciding if the company should approve or reject the application. C: using claims history, statistics and computer data to predict losses. D: advertising, promoting and distributing an insurer`s products to the public.

It is against the law for an insurance licensee to offer free insurance to: A: those who cannot afford it. B: anyone as an incentive to acquire some other type of business. C: anyone, regardless the reason. D: family and other relatives.

A licensee may surrender his/her license: Correct: upon written notice to the Department of Insurance at any time. A: after the termination of employment with an insurer. B: after notifying the Commissioner and a mandatory 30 day waiting period. C: after written notice to the Department and the Commissioner after the next January 1.

When can a partnership continue if a new partner joins? A: After the department is notified within 30 days and the changes are approved. B: After the Commissioner is notified and a new license is issued. C: After the new partner is issued a license by the department and the old license is terminated. D: After all the partners file a written notice with the Commissioner within 45 days.

``` All of the following are examples of fiduciaries EXCEPT: A: Vendor B: Corporate directors C: Administrators D: Executors ```

According to the qualifications of an insurer under the California Code a person can be any of the following EXCEPT: A: a trust B: a corporation C: a human being at least age 16 who is competent and not intoxicated D: an estate of a deceased person

``` Appointments are terminated: A: termination of license B: license fees paid late C: by either agent or insurer D: any of these ```

An organization ceases to exist as an entity eligible to hold a license upon all of the following EXCEPT: A: upon the termination of an association. B: upon dissolution of a co partnership or upon any change in membership of a co partnership. C: upon dissolution of a corporation. D: upon the termination of a key employee.

``` Commissioner can suspend a permanent license without a hearing, except: A: conviction of any felony B: license revoked last 5 yrs C: none are exceptions D: client co-signing a loan ```

To handle long term care insurance, an agent of more then four years must satisfy the continuing education requirement of: A: a 4 hour course in each of the first 2 years of licensing. B: a 4 hour course in each of the first 4 years of licensing. C: 8 hours of LTC training each license term. D: an 8 hour course in each of the first 4 years of licensing.

An agent or broker may charge an extra fee for services above and beyond what are considered normal duties. Which of the following is NOT considered an extra service? A: Application paperwork B: Additional activities C: Services performed as a convenience to the insured that result in extra expense to the broker or agent D: Additional research

What is the difference between an admitted and a non-admitted insurer? A: An admitted insurer has met all the qualifications designed by the DOI but hasn`t received a Certificate of Authority because they are not licensed in the state of California and a non-admitted insurer is licensed in the state of California. B: A non-admitted insurer is a company that has met all of the qualifications designed by the DOI and has received a Certificate of Authority from the DOI to transact insurance in California, whereas an admitted insurer has not complied or been denied. C: An admitted insurer is a company that has met most of the qualifications designed by the DOI and has received a Certificate of Authority from the DOI to transact insurance in California, whereas a non-admitted insurer has not applied or been denied. D: An admitted insurer is a company that has met all of the qualifications designed by the DOI and has received a Certificate of Authority from the DOI to transact insurance in California, whereas a non-admitted insurer has not complied or been denied.

``` If someone has a Life Agent Combo and a Property/Casualty license for 10 years, then how many CE hours would be required in the current license term? A: 50 hours B: 25 hours C: 30 hours D: 24 hours ```

Which of the following is NOT a valid reason for the Commissioner to deny the use of a name when filing with the Insurance Commissioner? A: The name gives the impression the licensee is authorized to conduct a type of business it cannot legally conduct. B: The name is politically connected to the government. C: The name would interfere or is too similar to the name of another agency already licensed by the Commission. D: The name would lead the public in the wrong direction.

Which of the following is NOT true about the California Insurance Code and the California Code of Regulations. A: The CIC is written, updated, and changed by the California State legislature. B: The Department of Insurance implements, enforces and monitors the CIC. C: The CIC and the CCR are a complete guide to ethical behavior. D: The CIC gives the Commissioner the power to institute rules and regulations which are called the CCR.

``` Records must be made available to the Commissioner: A: upon written request B: within 30 days C: within 5 days D: at all times ```

Which of the following is NOT a purpose of the Unfair Practices Article? A: To protect the public from agents who practice bad methods of selling insurance. B: To regulate trade practices in the insurance business. C: To keep agents honest when selling insurance. D: To determine the punishment for an agent found guilty of unfair practices in insurance.

The State of California requires that all admitted insurers be a member of the: A: Insurance Board Council B: Privacy Protection Committee C: California Code and Ethics Board D: California Insurance Guaranty Association

Which of the following is a responsibility of the Commissioner? A: To write the law of insurance. B: To enforce the law of insurance. C: To form and appoint a council that will regulate the code. D: To change the law of insurance.

``` Penalty for violation of a summary seizure would be: A: 1 yr imprisonment B: misdemeanor C: any and/or all of these D: $1,000 ```

``` Which court case reversed the Paul vs. Virginia case of 1868? A Houghton-Mifflin case of 1938 B McCarren-Ferguson Act of 1945 C SEUA case of 1944 D Public Law 15 ```

``` Solvency requires the insurer to have enough assets to cover: A paid-in-capital B reinsurance C liabilities D all of these ```

How is the Insurance Commissioner put into office? A Elected by the citizens B Elected by the council C Appointed by the previous commissioner D Appointed by the governor

Which of the following is NOT considered an unfair practice? A Filing false financial documents. B Unfairly discriminating against classes of insured`s. C Failing to display the license in a clearly visible place for the public to see. D Making false statements that mislead the public.

When the Commissioner takes over a company that is insolvent, his/her first responsibility is to: A liquidate the company and appoint new officers. B sell all the company assets and pay any open claims. C attempt to restore the company if possible. D shut down the company`s operations and start a full investigation.

``` Rates shall remain in effect if they are: A reasonable B adequate C not discriminatory D all of the following ```

``` Upon receiving any written or oral inquiry from the Department of Insurance concerning a claim, every licensee shall immediately, but in no event more than _______ calendar days of receipt of that inquiry, furnish the Department of Insurance with a complete written response based on the facts as then known by the licensee. A 30 B 14 C 7 D 21 ```

What is the role of the Commissioner and the Department of Insurance in relation to consumers? A The Commissioner and the DOI are responsible for regulating the conduct of agents and insurers. B The Commissioner and the DOI are responsible for making sure the public is given the opportunity to purchase insurance. C The Commissioner and the DOI are responsible for advertising to the public the roles and responsibilities of insurance. D The Commissioner and the DOI are responsible for making sure companies bring in more income than claims being paid out.

``` Which of the following is NOT a type of rating law? A Use and file B File and use C Prior approval D Legal Competition ```

``` Which one of the following is not one of the three principal parts to the privacy requirement of the Gramm-Leach-Bliley Act? A Credit Reporting B Pretext Provisions C Financial Privacy Rule D Safeguards Rule ```

All of the following are efforts the Department of Insurance takes to combat insurance fraud EXCEPT: A Each company is required to have a fraud detection unit. B Each company is required to submit a complete record of fraudulent claims made to the business each year. C Every insurer pays an annual fee to fund the fraud detection units D Every automobile insured is assessed about $1 per year to fund automobile insurance fraud task force activities.

Which of the following describes use and file as a type of rating law? A An insurance company must file rates with the commission, but can then use those rates until they hear back from the commission. B The insurer files policy rate information with the Department of Insurance. After filing, the insurer delivers evidence that the rates proposed are reasonable and fair. Then the insurer waits (30-60 days) for approval. C Insurers compete with one another by quickly changing rates without review by the state regulators. D An insurance company uses the rate they determine appropriate first and then file that rate with the commission.

All of the following are penalties for unfair discrimination EXCEPT: A prison B $15,000-$100,000 for frequent violations C $2,500 for first violation D $5,000 for subsequent violations

What is the significance of the SEUA case of 1944? A The court gave authority to the federal government to apply antitrust laws to the insurance business that was not being regulated by the state level. B The court established the right of the states, instead of the federal government, to regulate insurance. C The court exempted the insurance industry from the federal regulation required for most interstate commerce industries. D The court decided the federal government should regulate insurance.

``` CIGA pertains to: A insurer's insolvency B insurer's forms C insurer's rating D insurer's fraud unit ```

According to the Code, the word "person" means: A any person capable of binding an insurance contract. B the insurer in an insurance contract. C any person, association, organization, partnership, business trust, limited liability company, or corporation. D the client seeking insurance.

``` A subsequent violation of a cease and desist would result in: A a minimum fine of $5000 B license suspension C imprisonment up to 5 yrs D a fine up to $55,000 ```

``` An example of a self-regulatory authority of the insurance industry is: A the Commissioner B the ISO C the State legislature D the NAIC ```

``` Who administers the California Administrative Code of Regulations? A Commissioner B State Senate C Governor D Congress ```

``` To change the California Insurance Code a bill is brought before the Assembly and the Senate. After both parties vote on the bill and it is approved, it moves on to the: A Commissioner B Governor C Congress D State Senate ```

``` Insurer has up to how many days to accept or deny a claim? A 30 days B 40 days C 21 days D 15 days ```

All of the following are Incorrect penalties for violating the Unfair Practices article EXCEPT: A $15,000 fine for the first offense; Minimum of 3 years in prison B $10,000 fine for each act in violation; $15,000 fine for willful violation C $5,000 fine for each act in violation; $10,000 fine for willful violation D $5,000 fine for each act in violation; $15,000 fine for willful violation

``` Every company in California is required to report its financial condition to the Commissioner every year: A on or before March 1. B on or before December 31. C on or before January 1. D on or before April 15 ```

Which of the following is a penalty for violating the Insurance Information and Privacy Protection Act? A $5,000 fine for violations committed with regularity showing they are a general business practice B $50,000 fine for violations committed with regularity showing they are a general business practice C $100,000 fine for violations committed with regularity showing they are a general business practice D $20,000 fine for violations committed with regularity showing they are a general business practice

Unless expressly otherwise provided, any personal notice required by any provision of the insurance code may be given by any of the following EXCEPT: A postage prepaid B mailing notice C a third party D notification at his residence or principal place of business

``` According to the Code a "Notice of Claim" is a(n): A either qualify B written notification C oral notification D neither qualify ```

``` Which is not a violation of Unfair Practice? A Age discrimination B Misrepresentation C Delaying an investigation D Defamation of an insurer ```

``` Once insured an insurer are in agreement payment must be made within: A: 30 calendar days B: 15 calendar days C: 15 business days D: 30 business days ```

If convicted of insurance fraud: A: the fine can be up to $10,000 and up to 5 years in state prison. B: the fine can be up to $50,000. C: the fine can be up to $150,000 and up to 5 years in state prison. D: the fine can be up to $10,000.

Which of the following describes prior approval as a type of rating law? A: The insurer files policy rate information with the Department of Insurance. After filing, the insurer delivers evidence that the rates proposed are reasonable and fair. Then the insurer waits (30-60 days) for approval. B: Insurers compete with one another by quickly changing rates without review by the state regulators. C: An insurance company must file the rates with the commission, but can then use those rates until they hear back from the commission. D: An insurance company uses the rate they determine appropriate first and then file that rate with the commission.

Which of the following statements about insolvency is TRUE? A: An insurer cannot escape the condition of insolvency except by permission from the Commissioner. B: An insurer can escape the condition of insolvency by meeting its financial obligations when they are due. C: An insurer can escape the condition of insolvency by being able to provide for its liabilities and reinsurance of all outstanding risks. D: An insurer cannot escape the condition of insolvency by being able to provide for its liabilities and reinsurance of all outstanding risks.

All of the following are categorized torts EXCEPT: A: Adverse selection C; Absolute/Strict D: Negligence

Lapse refers to: A a policy is terminated because the premiums have not been paid. B terminating one`s insurance policy C continuance of an insurance policy beyond its original term D discontinuance of an insurance policy beyond its original term

Which of the following is NOT a description of what the California Worker`s Compensation Inspection Rating Bureau (WCIRB) does? A: Collects and tabulates information and statistics for the purpose of developing pure premium rates to be submitted to the commissioner for issuance or approval. B: Provides reliable statistics and rating information regarding worker`s compensation and employer`s liability insurance. C: Inspects risks for classification or rate purposes to furnish to the insurer and upon request of the employer. D: Develops information about property and liability risk and the property/casualty insurance industry`s leading supplier of statistical, actuarial, underwriting, and claims data.

Combined ratio is defined as: A: The company`s cost of operations, including overhead, marketing, and commissions. B: the amount of money an insurer pays for operation of the business. C: the reduction, decline, or disappearance of value of the person or property insured in a policy, by a peril insured against. D: the percentage of each premium dollar a company spends on claims and expenses.

Which of the following is NOT an example of assumption of risk? A: A spectator at a baseball game. B: The driver of a limousine service. C: A guest passenger in an automobile. D: A passenger on a helicopter tour of an exotic island.

A special surplus line broker may transact Special Surplus Lines. All of the following are special surplus lines EXCEPT: A: Farm or cattle ranch B: Reinsuring the liability of an admitted insurer C: Aircraft insurance D: Insurance on property or operations of railroads engaged in interstate commerce

``` Before determining liability based on negligence, the following requirements must be met EXCEPT: A: breach B: gross negligence C: duty D: unbroken chain ```

``` Payment for the loss of the ability to bear children or loss of limb would be: A: special damages B: punitive damages C: specific damages D: general damages ```

Which organization is the leading source of information about property and liability risk and is the property/casualty insurance industry`s leading supplier of statistical, actuarial, underwriting, and claims data? A: The Insurance Service Office (ISO) B: The California Worker`s Compensation Inspection Rating Bureau (WCIRB) C: Department of Insurance (DOI) D: Department of Data and Statistics (DDS)

Flat rate cancellation is described as: A: Termination of an insurance contract or bond with the premium charge adjusted in proportion to the exact time the protection has been in force. B: A type of cancellation whereby the insured can cancel without penalty. The insured receives a 100% refund of Premium. C: The method used when a policy is canceled by the insured before it reaches the expiration date. D: A policy is terminated because the premiums have not been paid.

``` A broken or interrupted chain of events is: A: intervening cause B: intentional tort C: breach of duty D: proximate cause ```

``` Which of the following is not a common law defense? A: Last clear chance B: Contributory negligence C: Comparative negligence D: Assumption of risk ```

``` Amounts paid for actual loss or injury are known as: A: Compensatory damages B: Specific damages C: General damages D: Punitive damages ```

``` When two or more perils happen at the same time, in sequence, and cause a loss, this is referred to as: A: Open peril B: Named peril C: All-risk D: Concurrent causation ```

Punitive damages are: A: losses of property or injuries resulting in medical bills. B: amounts paid for actual loss or injury sustained. C: losses that are not easily measured in dollar amounts. D: a form of punishment imposed by the court upon the individual responsible for a loss.

``` When someone willingly gives up the right to sue a person who was at fault, this is known as: A: Arbitration B: Mediation C: Subrogation D: Causation ```

``` When an employer is held responsible for actions of an employee this is: A: vicarious liability B: general liability C: contributory liability D: absolute liability ```

``` If an insured is 25% at fault and the insurer settles proportionally, this is: A: contributory negligence B: comparative negligence C: modified no fault D: common law negligence ```

Short rate cancellation is described as: A: A type of policy the insured can cancel without penalty. The insured receives a 100% refund of the premium. B: A policy is terminated because premiums have not been paid. C: Termination of an insurance contract or bond with the premium charge adjusted in proportion to the exact time the protection has been in force. D: The method used when a policy is canceled by the insured before it reaches the expiration date.

``` Which method of managing risk is described as not purchasing insurance at all, or paying part of a loss when it occurs? A: Avoidance B: Retention C: Transfer D: Reduction ```

``` A legal right of recovery can be based on which of the following? A: Torts B: Contracts C: Statutes D: Any one of these ```

``` All of the following are methods of managing risk EXCEPT: A: Transfer B: Rescission C: Retention D: Avoidance ```

Comparative negligence is best described as: A: the injured party must be completely free of fault in order to collect. B: people seeking insurance at the last minute when they need it. C: the injured party is fully responsible for the claim and the damages are not reduced accordingly D: part of the claim is paid for by the insured`s own insurance company; however, modification is made to the settlement amounts based on the idea of relative negligence, which assigns a percentage of carelessness to each party involved.

Proximate cause refers to: A: a person should have acted a certain way in that circumstance, but did not B: an uninterrupted chain of events resulting from negligence causes injury or damage C: a product causes bodily injury or property damage D: an individual`s negligent behavior does not mean he will be held legally liable

``` The Commissioner shall establish a list of all surplus line insurers who have met the recognized requirements for such title and shall issue a master list at least semiannually. This list is known as: A: LESLI B: OSHA C: the SEUA D: Commissioner`s list of surplus lines ```

Defamation is an intentional tort that damages one's reputation that is: A: either written or spoken B: false C: neither false or either written or spoken are correct D: both false and either written or spoken are correct

Loss is defined as: A: the reduction, decline, or disappearance of value of the person or property insured in a policy, by a peril insured against. B: the percentage of each premium dollar a company spends on claims and expenses. C: reduction of a company`s cost of operations, including overhead, marketing, and commissions. D: the amount of money an insurer pays for operation of the business.

In computing the loss payment for contributory negligence the claim would: A: be reduced by the percentage of fault for which the client is found responsible B: pay nothing if the injured party didn`t meet the standard of self-protection in any form. C: pay out the amount of the claim, minus the deductible. D: pay the full amount of the claim under all circumstances.

``` Which would not be a tort? A: Any legal wrong B: Keeping a pet rattle snake C: Negligence D: Strict liability ```

``` Loss of rent, profits, expenses necessary to keep a business running until the damage can be fixed are examples of: A: Indirect loss B: Loss exposure C: Direct loss D: Named perils ```

Insurance Services Office develops forms and lost cost rating for: A: surety ship and crops B: property and casualty C: workers' compensation D: Both property and casualty and surety ship and crops

``` Least professional method to identify loss exposure would be: A: copying previous apps. B: checklists and surveys C: financial statements D: contracts & agreements ```

``` The Tyler-Star Newspaper wrote an article about Jim`s Bakery that made Jim look like a racist. This type of injury to Jim`s character is known as: A: Absolute liability B: Libel C: Slander D: Misrepresentation ```

``` Which of the following terms describes an estimate of the amount an insurer will pay for a claim? A: Merit rate B: Manual rate C: Loss Reserve D: Rescission ```

``` Insurance that cannot be procured through admitted insurers may, under certain circumstances, be placed with nonadmitted insurers. This is known as: A: Surplus lines B: Special surplus lines C: Non-standard lines D: Tort lines ```

``` Mid-termination of a policy is known as: A: rescission B: policy termination C: cancellation D: none of these ```

``` Under personal lines insurance, dwelling insurance, which of the following perils is NOT covered on a standard fire policy? A Earthquake B Fire C Lightening D Removal ```

What is the difference between an HO 3 and an HO 3 with an HO 15 endorsement? A An HO 3 is a policy that covers all risks, except those excluded, on the dwelling, and personal property is covered with broad form perils, whereas an HO 3 with an HO 15 endorsement covers all perils with both dwelling and personal property. B An HO 3 covers the building under renter`s insurance, while an HO 3 with an HO 15 endorsement covers the building and all the property inside the building under renter`s insurance. C An HO 3 is a policy that covers all risks, except those excluded, on both dwelling and personal property, whereas an HO 3 with an HO 15 endorsement is a policy that covers all risks on the dwelling. D An HO 3 covers only broad form perils on a broad form, whereas the HO 3 with an HO 15 endorsement covers all perils.

``` Which HO form(s) provide open peril coverage for personal property? A HO-5 B Requires endorsement C Both HO-3 and HO-5 D HO-3 ```

What is the difference between an HO 2 and an HO 3? A An HO 2 has dwelling coverage on a special form and personal property on a broad form, while an HO 3 has coverage for both dwelling and personal property on a broad form. B An HO 2 has dwelling and personal property coverage on a broad peril form, while an HO 3 has dwelling coverage on a special form and personal property on a broad peril form. C Both an HO 2 and an HO 3 have dwelling and personal property on a broad peril form. D An HO 2 has both dwelling and personal property on a special peril form, while an HO 3 has dwelling and personal property on a broad form.

``` How are HO-8, HO-2, HO-3 and HO-5 different? A Perils insured against B All of these C Coverage A, B, and C D Liability coverages ```

``` Property insurance policies contain many items EXCEPT: A Perils insured against B The date the policy is effective C Insured`s gender D Name of the insurer ```

``` Which of the following homeowners policies covers condominium units? A HO 2 B HO 6 C O 8 D HO 4 ```

``` What method of valuation means the company will decide the replacement cost of a lost item, then subtract depreciation from it and pay the rest? A Market Value B Replacement Cost C Agreed Value D Actual Cash Value ```

Which of the following is NOT a difference between the Dwelling policy and Homeowners policy? A In Dwelling forms, the liability coverage is available only by endorsement, whereas in Homeowners it is always included. B In Dwelling forms, theft is a broad form peril, whereas in Homeowners it is not. C In Dwelling forms, personal property coverage is optional, whereas in Homeowners it is included. D In Dwelling forms, only 10% of the Coverage C limit is available for personal property away from the residence premises, whereas in Homeowners it is covered worldwide.

``` Policy provision that gives the insurer the right to repair or replace: A: loss payment B: our option C: loss settlement D: none of these ```

``` The part of the policy that contains the description of coverages provided is: A : insuring agreement B : additional coverages C : conditions D : declarations page ```

``` Which of the following homeowners policies covers renter`s insurance? A : HO 8 B : HO 4 C : HO 2 D : HO 1 ```

``` A fire that is intentionally set and remains within its intended limits is: A : covered by fire insurance B : not covered C : the definition of a fire D : a hostile fire ```

``` Homeowner form(s) that do not provide any dwelling coverage (Coverage A)? A : HO-4 only B : Both HO-4 and HO-6 C : HO-6 only D : HO-2 ```

``` In an insurance policy, which page contains information such as the insured`s name, information about risk, the date coverage begins, the premium, location of the property being insured, etc.? A : Insuring Agreement B : Exclusions C : Declarations D : Conditions ```

``` When an insurer pays the full amount of a claim, based on an appraisal made at the time of the contract and the value determined before the loss occurs, this is referred to as: A : Actual Cash Value B : Replacement Cost C : Stated Value D : Market Value ```

``` The stipulations for nonrenewing of a personal lines policy include a notice of cancellation of the policy in writing to the insured at least _________ before the effective date of cancellation. A : 45 days B: 10 days C: 60 days D : 20 days ```

``` Property and casualty policies are made up of the following parts except: A : Additional Claim Form B : Conditions C : Declarations D : Definitions ```

``` When an insured holds more than one identical policy for the same property, but the policies differ in coverage amount or length of coverage period, this is known as: A : Standard Mortgage Clause B : Concurrent Policy Coverage C : Special Lines Surplus Lines D : Standard Policy Coverage ```

``` Policy revision that provides broader coverage, no premium or endorsement: A : extension of coverage B : severability C : liberalization D : recovery ```

``` Two policies from different insurers otherwise identical are known as: A : nonconcurrent coverage B : fraud C : concurrent causation D : concurrent coverage ```

What is the main difference between the Standard Fire Policy (SFP) and the California Standard Form Fire Policy? A : The SFP is standard for all companies in the U.S. B : The SFP is under federal law, whereas the California Standard Form Fire Policy is under California state law. C : The SFP has 165 lines of text and the California Standard Form Fire Policy has 158 lines of text. D : The SFP is standard for all companies in the U.S. except California.

What is the difference between an HO 2 and an HO 4? A : An HO 2 is written on a Basic form, while an HO 4 is the Special or open peril form. B : An HO 2 is written on a broad form basis and covers the owner of a dwelling, whereas an HO 4 is a renter`s insurance policy. C : For an HO 2, the applicant must be the homeowner and all perils are covered unless they are excluded, whereas in an HO 4 the insured must be the owner of a dwelling, only Broad form perils are covered, and personal property may also be insured. D : An HO 4 is for condominium owners and an HO 2 is for tenants of the condominium.

``` This Standard Mortgage clause states that a __________ has the right to file a claim, make premium payments, and be notified of any cancellations or non-renewals. A : Insurance company B : Mortgage broker C : Policy Owner D: Lienholder ```

In a standard mortgage clause, what happens in the event of a total loss? A: The insurer pays the insured first and then the lien holder. B: The insurer pays the lienholder first and then the insured. C: The insurer pays the insured the full amount and the insured is expected to pay the lienholder. D: The insurer pays the lien holder the full amount and the lienholder pays the insured the remaining amount.

Cancellation for property and casualty policies for other than nonpayment is: A: Both 30 days except auto and 20 days for auto are correct. B: 30 days except auto C : 20 days for auto D : 50 days except auto

Which of the following is NOT a reason a home would be insured under a Dwelling policy rather than a Homeowners policy? A : The dwelling is a seasonal dwelling and not used all the time. B : The dwelling is a rental property. C : The insured doesn`t want theft or liability coverage. D : The dwelling has only one unit.

``` In an insurance policy, any modifications made to the regular contract are known as: A : Additional coverages B: Exclusions C : Conditions D : Endorsements ```

``` Which of the following homeowners policies have both dwelling and personal property on a broad peril form? A: HO 4, HO 5, HO 6 B : HO 2, HO 4, HO 5 C: HO 2 and HO 6 D : HO 2, HO 5, HO 8 ```

Under HO property additional coverages, what is covered for debris removal expense? A All costs, after the 10% share cost fee, to remove debris after a covered loss. B 80% cost to remove debris after a covered loss. C All cost to remove debris after a covered loss, unless excluded in the policy. D This Reasonable cost to remove debris after a covered loss.

The correct statement regarding landlord furnishings would be: A not covered in HO forms B excludes the peril of theft C This Both covered up to $2500 and excludes the peril of theft are correct D covered up to $2500

Which HO endorsement covers loss due to personal injury (false arrest, libel, slander, defamation of character, and invasion of privacy? A Personal Property - Replacement Cost endorsement B Scheduled Personal Property endorsement C This Personal Injury endorsement D Guaranteed and Extended Replacement Cost Options

Under Section 1 Condition - Loss Settlement on an HO3, which of the following situations shows the insured is covered adequately in the event of a loss? A The insured has $70,000 coverage on property worth $100,000. B The insured has $40,000 coverage on property worth $90,000. C This The insured has $80,000 coverage on property worth $100,000. D The insured has $170,000 coverage on property worth $300,000.

All of the following are major differences between the broad form and the special form EXCEPT: A This The broad form doesn`t require the 80% coinsurance and the special form does. B There is no exclusion for antennas, outdoor equipment, fences, or awnings from the peril of falling objects in the special form. C Coverage for accidental discharge or overflow of water or steam that occurs off the insured premises on the special form. D Theft of property that is a part of the dwelling or other structure is covered in the special form.

All of the following are true of a broad coverage form EXCEPT: A This No minimum amount of insurance is required for the basic form. B The broad coverage form covers more perils than a basic coverage form. C Seven extra perils are insured in a broad form. D Coverage must equal at least 80% of the dwelling replacement cost.

``` Jewelry valued at $30,000 is destroyed in a hotel fire in Paris, the HO would: A exclude the loss B all are incorrect C limit the loss to $1500 D This cover up to Coverage C limit ```

``` Volcanic eruption excludes: A airborne shockwaves B none are excluded C lava D dust and ash ```

Coverage D, loss of use, depends on which of the following for a limit of insurance to be applied? A Who is occupying the dwelling B This How much coverage is placed on the dwelling? C How long the dwelling has been occupied. D Where the dwelling is located.

``` Coverage not provided without endorsement on a DP-1/Basic is: A Coverage D B This Coverage E C Coverage C D Both Coverage D and E ```

All of the following are considered an "insured" under Section 1 of the HO 3 EXCEPT: A Named insured and his or her spouse. B This Relatives who share the same last name as the insured. C Family members who live with the insured. D Guests and employees of the house (optional upon request).

``` Which is not an "other coverage" in the dwelling forms? A This Volcanic eruption B Breakage of glass C Tenant improvements D Collapse ```

In property coverage, what is specifically covered under coverage B? A the dwelling unit and all personal property located inside the premises. B all attached structures and outdoor personal property or equipment used to maintain or service the premises. C This other structures/ separate structures at the same location, such as garages, sheds and birdhouses on the described location that are separated from the dwelling by a clear space or connected only by a fence or utility line. D personal property commonly found in homes owned by the insured or other family members living with the insured.

Under Section II of the Homeowners form, what does coverage E (personal liability) cover? A This This coverage will take affect if a claim is made against the insured for damages due to bodily injury or damage to the property caused by the insured`s negligent acts. B This coverage will take affect if the insured`s business is sued. C This coverage will take affect if the insured is hurt at work and needs medical attention. D This coverage will take affect if the insured is injured and needs medical attention.

According to the ordinance or law exclusion, which of the following does NOT apply? A The coverage applies to upgrades to a property due to building code changes by the city. B This This coverage is required by state law. C This exclusion also applies to the California requirement to provide restroom facilities compliant with the American Disability Act (ADA). D This coverage can be added by endorsement.

Liability and Medical Payments are the two major coverages provided in: A Section I of the Commercial form B Section I of the Homeowners form C Section II of the Commercial form D This Section II of the Homeowners form

Which of the following would NOT be covered under Section II of Medical Payment to Others? A This The insured`s pets that are injured on the insured`s property. B Someone who trips over a water hose on the insured`s property. C The insured`s family member not living on the property with the insured and not a named insured. D A person injured on the insured`s property who was granted permission to be there by the insured

``` Under HO property coverage earth movement is a general exclusion. Which homeowners policy has done away with the exclusion for concurrent causation regarding this peril? A HO 6 B HO 2 C HO 4 D HO 3 ```

Under HO property additional coverages, what is covered for removal? A This Property removed from the insured`s premises to protect it from damage due to a covered loss. B Debris removed after a covered loss to property. C Any and all removal from loss due to a covered peril. D Earth removal after total loss of a dwelling due to an earthquake or landslide.

``` Under Section II - Additional Coverages, which of the following is NOT included? A Damage to the Property of Others B First Aid to Others C Loss Assessment Coverage D This Medical Payments to Others ```

``` Which DP policies insure Coverage C for broad form perils? A DP-1, DP-2 and DP-3 B DP-3 C DP-2 D This Both DP-2 and DP-3 ```

``` Which is not a liability endorsement on the HO forms? A Watercraft B Business pursuits C Personal injury D This Mobilehome ```

``` Difference between DP-2 Broad form and the DP-3 Special form is: A Collapse B This plumbing water damage C friendly fire D windstorm ```

According to Section II of the Homeowners policy (selected homeowners endorsements), which of the following is true of the mobile home endorsement? A The mobile home is covered under the separate structure endorsement. B This The mobile home is considered the dwelling being insured when it is endorsed on the policy. C The mobile home is a moveable structure and is covered under the commercial policy. D The mobile home is a moveable structure and therefore cannot be covered as a dwelling.

Under Section 1 Condition - Loss Settlement, which of the following formulas is used to determine payment to an insured in the event of a loss? A This Insurance carried, divided by the insurance required, times the loss, minus the deductible, equals the loss payment. B Insurance required, divided by the insurance carried, times the loss, minus the deductible, equals the loss payment. C Insurance required, divided by the loss, times the insurance carried, minus the deductible, equals the loss payment. D Insurance carried, divided by the loss, times the insurance required, equals the loss payment.

``` Under property coverage, which of the following is covered under coverage A? A Garage B Personal property C Other structures D This Dwelling ```

``` Which is not an exclusion under Coverage A on an HO-3? A Damage by insured's dog B Damage by vermin C Damage by insects D Damage by a deer ```

``` All of the following are general exclusions to the HO 3 policy except: A Loss Assessment B Earth Movement C Flood D Building Ordinance ```

Which of the following is true regarding vehicles covered and not covered under Section II? A All the insured`s vehicles are covered. B All the insured`s vehicles are excluded, except the primary vehicles listed on the policy. C All the insured`s vehicles are excluded, except trailers being towed by the vehicles. D All the insured`s vehicles and trailers towed by the insured are excluded from coverage.

The Homeowners Watercraft Endorsement under Section II includes all the following EXCEPT: A Coverage for liability exposure on scheduled boats. B Coverage for medical payments exposure on scheduled boats. C Property damage for the boat itself is not covered. D Use of a boat in a racing competition.

Which of the following properties are NOT included in insured locations and residence premises under Section II of the Homeowner`s policy? A Insured`s cemetery plot B Insured`s work office space C Vacant land D Land on which a residence is being constructed

In the event of a loss, the insured has the responsibility to do all of the following EXCEPT: A Notify the police if the loss is the result of theft. B Report the loss as soon as possible. C Protect the property from further damage. D Provide a copy of the police report to the insurer.

``` Which is excluded under Section I and covered under Section II? A Ride on lawn mower B Firearms C Animals, birds, or fish D Hobby aircraft ```

``` Which of the following is NOT an option of the California Residential Property Insurance Disclosure Statement? A Fair Market Value Cost Coverage B Extended Replacement Cost Coverage C Guaranteed Replacement Coverage D Actual Cash Value ```

``` The following properties are included as an insured location and/or residence premises for Liability and Medical except: A Apartment B Insured's relative cemetery plot C Vacant Land D Borrowed beach home ```

Why is mobility a common characteristic of many types of property insured under Inland Marine contracts? A Mobility covers property while it is in transit from one location to another. B Mobility covers moveable property, whether or not it is actually moved. C Mobility covers the expense of transporting goods from one location to another. D Mobility covers the vehicles used to transport property from one location to another.

In an Inland Marine policy, what is the difference between the Personal Articles Floater (PAF) and the Homeowners Scheduled Personal Property Endorsement? A The PAF provides coverage for all perils and the Homeowners Scheduled Personal Property Endorsement provides coverage for perils included in the policy. B The PAF provides more coverage than the Homeowners Scheduled Personal Property Endorsement. C The PAF must have an appraisal and the Scheduled may not. D The Homeowners Scheduled Personal Property Endorsement provides more coverage than the PAF.

``` Which of the following provides coverage for injured crewmembers? This coverage is also known as Jones Act coverage. A Longshoreman and Harbor Workers B Personal Articles Floater C Workers Compensation D P & I (protection and indemnity) ```

Which of the following is NOT a provision provided by the California Earthquake Authority? A $5000 Personal Property coverage. B Dwelling coverage with a deductible equal to 15% of the dwelling limit. C Optional coverage: $10000 building code upgrades. D $2500 coverage on pools, fences, driveways, landscaping, and other structures.

``` Inland Marine policies are generally written on an open peril basis. All of the following are the most common exclusions EXCEPT: A government action B nuclear hazard C collision D indirect loss ```

What is the difference between the NFIP Emergency Program limits and the NFIP Regular Program limits? A The Emergency Program limits cover less for building and contents than the Regular Program limits. B The amount of coverage for contents is greater than coverage for the building in the Emergency Program limits. C The Emergency Program limits and the Regular Program limits cover the same amount for building and contents. D The Emergency Program limits cover more for building and contents than the Regular Program limits.

``` The Watercraft endorsement provides __________ coverage for Liability and Medical Payments to Others for scheduled boats. A extended B very limited C full D moderate limits of ```

``` Uninsured loss exposures on HO forms are due to: A uniqueness B items difficult to value C Any one of these D susceptibility to loss ```

``` In a boat owner`s policy, which of the following is NOT considered typical coverage? A Medical Payments B Physical damage coverage C Hull D Liability ```

``` The Earthquake stand alone policy typically has a deductible of ______. A 15% B 5% C $10,000 D $15,000 ```

Which of the following statements with regards to the NFIP is incorrect? A Flood Insurance is available on residential and commercial properties. B Standard Homeowners policies cover losses as a result of flooding. C Flood Insurance provides coverage to buildings and an insureds contents when damage. D The NFIP makes flood available for both commercial and personal property risks.

In an Inland Marine policy, which of the following is NOT an advantage to filed lines? A There have standardized forms. B The simplified rating (discounts). C They include Electronic Data Processing and Contractors Equipment floaters. D The ability to be included in a Commercial Package policy.

All of the following are disadvantages of using the earthquake endorsement, EXCEPT: A The deductible, typically 15% of the dwelling limit, applies to each coverage separately. B The deductible may be lower C The coverage usually costs more than a separate policy. D The deductible applies only once on a separate policy.

``` Broker fees can be charged for which type of policy or policies? A Flood insurance B None of these C Earthquake insurance D HO's or DP's ```

``` Which organization was created to help create earthquake coverage? A ISO B This CEA C NFIP D FEMA ```

Agents may bind flood insurance coverage after receiving what? A The application and payment B The application, payment and NFIP acceptance of the policy C 30 days after the signature date of the application D This Agents do NOT have binding authority

``` Must be offered with every residential property policy in California: A neither B both C This earthquake insurance D flood insurance ```

``` In regard to personal watercraft, to receive coverage for physical damage payments the insured would need which of the following policies? A Hull B Ocean Marine C This Boat owners D Yacht ```

``` With regard to the Unscheduled Personal Property endorsement, each of the following items has only a limited amount of coverage and requires an endorsement to have full coverage EXCEPT: A This DVD collection B Golf equipment C Coins D Cameras ```

``` The inland marine form known as Personal Articles is similar to: A Ocean marine policy B HO-15 endorsement C This SPP endorsement in HO's D Personal Effects Floater ```

"Mobile in nature" or "goods in transit" refer to which type of policies? A This Both Ocean Marine and Inland Marine B Inland Marine C Ocean Marine D Transportation

``` The following coverages are provide under the Yacht policy except: A P & I B Hull C Medical Payment D This E & O ```

``` Insures watercraft over 50 horsepower that can be towed behind a car: A any watercraft policy B This boatowner policy C endorsed HO policy D yacht policy ```

``` A yacht policy provides this protection but the boatowner policy does not: A hull coverage B medical payments C This workers' compensation D none of these ```

In an Inland Marine policy, an annual transit policy is usually provided: A on an open peril basis with a few exceptions. B on a special form. C This on a named peril basis. D on an open peril basis.

``` Which of the following is not covered under a yacht policy? A P and I (protection and indemnity) B Trailer C This Liability D Hull ```

Which one of the following is not true with regards to the CEA policy provisions: A $0 in coverage for fences B This $10,000 in additional living expense C $5,000 in personal property coverage D $10,000 in building code upgrade

``` Which licensee can sell flood and earthquake coverage? A Certified broker-agents B None of these C Any Agent D This Any broker-agent ```

``` Marine policies that are not regulated are known as: A Both filed form and controlled B filed forms C This non-filed forms D controlled ```

Type of policy or policies that do not normally exclude catastrophic losses: A marine policies B This both personal auto and marine policies C neither personal auto or marine policies D personal auto policy

The incorrect statement concerning qualification for the low cost program is: A must be at least 19 B can have one point C none are incorrect D licensed 2 years

Which of the following coverages would be useful if you bought a new car, and a month later you lose control of the car and total it? A P & I (protection and indemnity) B New Auto Coverage C GAP Coverage D Liability Coverage

Insured has an accident in a modified no-fault state the policy responds by: A both adding PIP at no charge and requiring an endorsement are correct B adding PIP at no charge C neither adding PIP no charge or requiring an endorsement are correct D requiring an endorsement

Which would not qualify as a covered trailer when being towed by an auto? A Farm wagon or implement B U-Haul trailer C All are covered trailers D Sailboat

Under a Personal Auto policy, if the deductible for collision is $500 and $250 for Other Than Collision, what would the insurer pay if he had a covered collision totaling $3,000 in which glass was also broken? A $2,500 B $3,500 C $500 D $3,000

What is the purpose of Named Non-owner Coverage? A This endorsement covers expenses incurred in the event of a total theft. B This endorsement is for people who don`t own a vehicle but still drive (rented, public transportation, company vehicle, etc.) C This endorsement allows the PAP to cover vehicles such as motorcycles, ATVs, dune buggies, and motor homes. D This endorsement allows nonowned vehicles furnished for the insured`s regular use (company car).

Which of the following is NOT covered under collision coverage? A Impact with an animal. B Upset (flipping the vehicle over). C Impact with another flying object (wall, tree, pole, etc.). D Impact with another vehicle.

Which of the following is NOT an ISO eligibility requirement for a Personal Auto Policy (PAP)? A Any commercial vehicle used during business hours. B Any private passenger auto. C Any pickup or van with a gross weight less than 10,000 pounds that is NOT used in any business other than farming. D Vehicles owned by a person or married couple.

Which of the following is NOT a determining factor for eligibility for the Good Driver Discount? A At least 30 years of age. B Good driving record. C No DUI in 7 years. D At least 3 years of driving experience.

Which of the following is NOT a difference between a Personal Auto Policy and a Motorcycle endorsement? A Driving experience B Liability coverage C Extra Payments coverage D Medical coverage

Under Coverage B - Medical Payments in a Personal Auto Policy, if the Medical Payments coverage limit is $8,000 and 4 people are injured, what is the maximum that may be paid to each person? A $8,000 to each person. B $2,000 to each person for a total $8000 paid out. C $2,000 to each person, if his name is on the policy. D $8,000 to each person, if his name is on the policy.

``` How many days does an insured have to request collision coverage when a newly acquired auto replaces a covered auto that has liability coverage only? A 6 days B 3 days C 5 days D 4 days ```

All are true, except which of the following concerning Part B of a PAP? A Has a 3 year limitation B Applies to pedestrians C The insured is covered D Pays regardless of fault

What is the difference between "share-the-expense car pools" and "for-hire" situations? A There is no difference between the two because both carry the same coverage. B ''Share-the-expense car pools are not covered in a personal auto policy and ''for-hire'' are. C ''Share-the-expense car pools'' are covered in a personal auto policy and ''for-hire'' are not. D Each person is covered in a "for-hire" situation, whereas each person in a "share-the-expense car pools"

``` Which of the following would be considered a named insured? A Any resident relative B Person away at school C Only those named D Resident spouse ```

All of the following are exclusions that apply to liability coverage under a personal auto policy EXCEPT: A Damage to property being transported by an insured. B Bodily injury or property damage caused accidentally by the insured. C Bodily injury to a company employee if Workers Compensation benefits are available. D Damage to property owned by the insured.

In an auto policy, coverage A, B, and C respectively represent: A Medical, Liability, and Uninsured Motorist B Liability, Medical, and Uninsured Motorist C Uninsured Motorist, Liability, and Medical D Liability, Uninsured Motorist, and Medical

All of the following are ways to show financial responsibility according to the Financial Responsibility Law EXCEPT: A Deposit $35,000 in cash per vehicle with the DMV. B Obtain a DMV issued self-insurance certificate. C Purchase auto liability insurance with a minimum of 15/30/5 coverage. D Purchase a surety bond for $89,000 from a California licensed insurer.

The split limit of 15/30/5, the 5 refers to which of the following? A Medical payments B Per person limit C Property damage D None of these

When are personal effects that are transported in the vehicle covered? A When the personal effects are listed in the policy. B They are not covered unless listed on an endorsement. C They are not covered. D When the loss was caused by another driver.

Coverage that could apply to a hit and run accident? A Waiver of deductible B All could apply C UMPD D UMBI

Which of the following organizations provides auto insurance for motorists who are unable to obtain coverage in the conventional market due to their driving records or extraordinary circumstances? A CEA B CAARP C FEMA D NFIP

Which of the following is NOT a supplementary payment under coverage A of a Personal Auto Policy? A $250 maximum for bail bonds B $200 a day loss of earnings C $500 a month loss of income D Postjudgement interest

The incorrect statement concerning transportation expense is: A must be endorsed B applies to Part D claims C available for bus fare D no deductible applies

Which of the following is NOT true of the Market Conduct Bureau? A The Bureau protects the public when they purchase insurance, make claims, etc. from insurance companies. B The Bureau provides individuals and companies assistance in buying automobile liability insurance in the state. C The Bureau consists of the Field Claims Bureau and Field Rating and Underwriting Bureau. D The Bureau conducts examinations licensed insurer`s claims-handling practices in the state.

Coverage(s) that follow the insured and family members into any auto: A would be Part A, B, and C B would be Part A, B, C, & D C would be Part B or Part C D would be Part A

Which of the following is NOT a benefit of having an Umbrella or Excess policy? A Umbrella coverage policies can provide excess protection over Personal Liability coverage, as well as other types of liability programs. B The Umbrella coverage provides a minimum of $1,000,000 in additional coverage. C An Umbrella policy will cover all perils and medical payments in an auto accident. D The extra coverage provided adds protection for a higher amount of coverage at an inexpensive rate.

Which of the following is NOT a requirement for CAARP? A Certified Producer in any state in the U.S. B California residents. C Members of the military stationed in California. D Nonresidents who own a vehicle registered in California.

How many days advance notice must be given to an insured for mid term-cancellation due to any reason other than nonpayment or non-renewal? A 15 days B 20 days C 30 days D 10 days

What is California`s minimum requirement for coverages A, B, C (Liability, Medical, Uninsured Motorist) in an auto policy? A 100/300/500 B 15/30/5 C 15/30/10 D 100/150/100

How many days advance notice of cancellation due to non-renewal does an insurer need to give an insured? A 30 days B 20 days C 10 days D 15 days

Collision would pay for damages to the insured vehicle in which situation? A Vehicle upset during riot B Hitting a deer C Running over branches D Avalanche of rocks

Which of the following is NOT true of a policy with Non-standard Physical Damage coverage? A This coverage is often purchased when an insured needs a physical damage policy but only qualifies for the CAARP plan. B This coverage is for people who have a less than favorable driving record. C This coverage is for people who have an excellent driving record. D This coverage typically covers only the driver on the policy.

All of the following are true about Uninsured Motorists coverage, EXCEPT: A The limit for property damage when an insured has no collision coverage is $3,500. B The other driver does not have to be liable for the injuries or damage to property. C Uninsured Motorists coverage only applies to bodily injury. D The owner of the vehicle that is responsible for the loss has purchased Liability insurance, but the company is insolvent.

To be eligible to receive the Low Cost Auto Insurance Program, a driver must meet all of the following, EXCEPT: A The vehicles insured cannot be valued at more than $20,000 by the DMV. B Have no more than one property-damage-only accident in which he or she was at fault. C Have no more than one moving violation. D Be at least 16 years of age.

Any licensed agent or broker may submit risks to the FAIR plan: A: but there is no binding authority. B: with immediate authority in affect. C: and authority is granted upon submission. D: but authority is not in affect until after a 30-day grace period.

``` The Incorrect: statement concerning coinsurance is it: A: applies to partial losses B: 100% of loss paid if met C: results in better premium D: None of these false ```

When a covered loss occurs and two policies are in force for the same property, with the same terms and conditions, how will the loss be settled? A: The policy with the highest coverage will pay first. B: Neither policy will pay. C: One will be Primary and the other Excess. D: Each company will pay their share of the loss on a pro rata basis.

``` The loss condition states the insurer must pay the claim within: A: 30 days B: 30 - 60 days C: 60 days D: 45 days ```

``` Which of the residential policies are basic perils? A: DP-1 and HO-8 B: DP-1, HO-8 and HO-2 C: DP-2 and HO-2 D: All the DP policies ```

The insurer may examine books and records of an insured: A: At any time and for up to three years after the policy expires. B: Annually. C: Only with the consent of the insured. D: Only after a 30 day notification to the insured.

``` All of the following may be written on a monoline basis, EXCEPT: A: General Liability B: Boiler & Machinery C: Inland Marine D: Ocean Marine ```

Which of the following is NOT considered subrogation? A: An insured assists an insurer in seeking recovery for payments made. B: The insurer collects damages from the responsible party. C: The rights to sue a third party are transferred to the insurer. D: The insured collects damages from the responsible party.

``` An apartment building is insured for $300,000 with an 80% coinsurance clause. The property is valued at $500,000. A covered loss occurs in the amount of $200,000. How much will the insurance company pay? A: $120,000 B: $150,000 C: Nothing. D: $200,000 ```

All of the following are true about the cancellation of a commercial policy, EXCEPT: A: All refunds will be mailed to the first named insured on the policy. B: 10 days notice must be given for non-payment of premium and 30 days notice for all other reasons. C: The insurer must be able to prove the delivery of a notice of cancellation. D: The first named insured may cancel the policy at any time.

``` The modular concept refers to: A: The declarations and conditions sections of a package policy. B: Parts of a package policy. C: Endorsements within a package policy. D: A monoline policy. ```

If a building has been vacant for 90 consecutive days prior to a loss, which of the following is false? A: The loss will not be covered if due to theft or attempted theft. B: All of these are true. C: If the loss is due to a fire, it will be covered but payment is reduced by 15%. D: The loss will not be covered if due to vandalism

``` Two perils that can be excluded from the vacancy permit are: A: glass and water B: vandalism and sprinkler C: theft and attempted theft D: theft and water ```

``` Coverage C perils are broad form on all HO policies except: A: HO-3 & HO-5 B: HO-8 C: HO-8 & HO-5 D: HO-4 & HO-6 ```

On a commercial package policy, "You" and "Your" refers to: A: All of these. B: An individual, corporation, or other entity. C: Any person with financial interest in the property. D: The named insured and resident spouse.

Under the Building and Personal Property coverage form, vacancy means: A: To be completely void of property. B: 100% of the building is not rented or occupied. C: A property left unattended for more than 60 days. D: Insufficient business property present to conduct customary operations.

``` Coverage B of the Commercial Building and Personal Property coverage form covers all of the following EXCEPT: A: Copy Machines B: Postage Meters C: Property off the premises D: Furniture and office supplies ```

``` The CPP Common Condition that relates to establishing premium is: A: Inspections & Surveys B: Changes C: Premium D: Examinations of Books ```

``` Inventory more than 100 feet off premise is: A: Covered for $10,000 B: Excluded C: None of these are correct D: Covered in a vehicle ```

``` In a commercial property policy, concealment, misrepresentation or fraud could cause a policy to: A: Cancel, effective the next renewal. B: Pay only a portion of a covered loss. C: No changes would be made. D: Be voided, denied or cancelled. ```

``` The declarations page of a commercial policy will state which of the following: A: Covered property. B: Named insureds. C: All of these. D: Premium amount and coverage limits. ```

The FAIR plan does all of the following, EXCEPT: A: Encourages maximum use of the normal insurance market provided by admitted insurers and licensed surplus line brokers. B: Assures stability in the property insurance market for property located in California. C: Provides for equitable distribution among admitted insurers of the responsibility for insuring qualified property for which basic property insurance cannot be obtained through the normal insurance market by the establishment of a FAIR plan. D: Establish a list of all surplus line insurers that have met the recognized requirements for such title and shall issue a master list at least semiannually.

``` How much would you receive if you carried $40K, the requirement was $30K, the loss was $10K, and the deductible was $1K? A: $6,500 B: $10,000 C: $9,000 D: $12,333.33 ```

Coverage A of the Commercial Building and Personal Property coverage form covers which of the following: A: Buildings and sparate structures and a riding lawn mower are both correct s. B: Personal Property C: A riding lawn mower. D: Buildings and Separate Structures

Coverage C of the Commercial Building and Personal Property coverage form does NOT cover: A: Property being transported in a vehicle. B: Property at a dry cleaners C: Property at a repair shop D: Property on consignment

``` All of the following are major differences between DPs and HOs, except: A: occupancy requirements B: none are exceptions C: theft coverage D: worldwide coverage ```

The normal vacancy condition under a commercial lines policy can be waived by: A: Occupying at least 80% of the property being insured. B: Supplying written notice to the insurer at least 30 days prior to a loss. C: This condition cannot be waived. D: Adding a Vacancy Permit endorsement.

Tenant Improvements and Betterment Losses are valued at: A: Tenant Improvements and Betterments is not covered. B: Replacement Cost C: Actual Cash Value D: Replacement Cost minus Depreciation

Which of the following describes a person eligible for insurance through the FAIR plan? A: Any person who has insurable interest in personal property and currently has insurance that cannot afford extended coverage from insurers in the standard market. B: Any person who cannot afford insurance through the insurer of their choice. C: Any person who has insurable interest in real or tangible personal property who, after diligent effort, has been unable to obtain basic property insurance through normal channels from an admitted insurer or licensed surplus lines broker. D: Any person who has insurable interest in real or tangible personal property.

Which of the following is a disadvantage of having a coinsurance clause on a commercial policy? A: Premiums are generally higher. B: Keeping up with property replacement values. C: Small D: None of the above.

The HO form that does not provide coverage for real property is: A: HO-6 B: All HO cover real property C: HO-8 D: HO-4

Coverage A of a Building and Personal Property form would exclude all but: A: vacuum and floor waxer B: Piers, wharves, docks C: patios and driveways D: indoor furnishings

``` Which of the following is a coverage extension on the Commercial Building and Personal property coverage form? A: Improvements and Betterments B: Debris Removal C: Stock or Inventory D: Indoor and Outdoor fixtures ```

What is the formula for calculating the coinsurance penalty? A: Amount carried, divided by required amount, divided by loss, minus deductible B: Amount of the loss, divided by the actual amount carried, minus the deductible C: Amount carried, divided by required amount, multiplied by loss, minus deductible D: Amount required, divided by actual amount carried, multiplied by loss, minus deductible

``` Which of the following would be considered a "module"? A: Exclusions B: Declarations C: Business Auto D: Conditions ```

Coverage C of the CGL policy would cover all of the following EXCEPT: A: Bodily Injury to a customer due to employee negligence. B: Damage to a customer`s property while left in the care, custody and control of the insured. C: Emergency treatment for a customer who burns himself on a hot cup of coffee. D: A trip and fall on the insured property, but not the fault of the insured.

``` The Commercial Broad Form Causes of Loss include all of the following EXCEPT: A: Ordinance or Law B: Collapse C: All of these are included. D: Breakage of Glass ```

An unendorsed claims made CGL includes: A: Midi tail coverage only B: BERP C: Mini tail coverage only D: SERP

Glass Breakage under a Broad Form Causes of Loss is covered for up to: A: There is no coverage under the Broad form. B: $1,000 per occurrence C: $300 per plate or pane D: $500 per occurrence

``` A cause of loss form that doesn't list the covered losses is named all the following except: A: Open peril B: All Risk C: Broad Form D: Special ```

``` The perils that trigger coverage under the business income form are found: A: Insuring Agreement B: Form attached to the BPP C: On the Declaration page D: In the coverage form itself ```

``` Revenue minus expenses describes: A: Net loss B: Continuing expenses C: Net profit D: Net income ```

``` An exclusion section that limits the application of covered perils is found in: A: Basic form B: Special Form C: Broad form D: All cause of loss forms ```

``` Not subject to the per occurrence limit on a CGL would be: A: Personal & Advertising B: Employer Practices C: Medical Expense D: Premises rented to you ```

``` Supplementary payments apply to which of the following coverages? A: Coverage A only B: Coverage B only C: Coverage A and B only D: Coverages A, B, and C ```

All of the following are exclusions on the Commercial Causes of Loss Special form policy EXCEPT: A: Insects, Birds, Rodents and other animals B: Faulty workmanship C: Sinkhole collapse refill D: Wear & Tear

``` The product and completed operations hazard claims are subject to a: A: None of these B: Per person limit C: Per occurrence limit D: Per organization limit ```

``` Which of the following is NOT an excluded loss under the Commercial property forms? A: Earth Movement B: Contractual Liability C: Volcanic Action D: Mechanical breakdown ```

All of the following are exclusions under the CGL policy EXCEPT: A: Products and Completed Operations coverage. B: Professional liability coverage. C: Liquor Liability coverage. D: Auto Liability coverage.

``` Which of the following perils are NOT covered under the Glass Coverage form? A: Breakage B: Chemical Damage C: Fire Damage D: Ornamentation ```

Which form would you buy if you wanted to buy a Contingent Business Interruption form? A: Business Income from Dependent Properties Form B: Leasehold Property Damage Coverage Form C: Mortgage Holders Interest Coverage Form D: Business Income Coverage Form

In which of the following events would coverage be provided under the CGL? A: A grocery store sells liquor to a customer and the customer, driving while intoxicated, injures another party. B: An Insurance Agent neglects to advice and retain a waiver from an insured regarding Uninsured Motorist coverage. C: Mobile Equipment being transported to a job site falls off and hits a vehicle on the highway. D: An employer exposes an employee to hazardous chemicals, damaging his lungs.

Coverage A of the CGL policy covers: A: Damage to buildings and business personal property as indicated on the declarations page. B: Bodily injury, sickness, disease or death. C: Bodily Injury and Property Damage the insured is legally obligated to pay due to a covered loss. D: Injury to an employee.

Personal Injury means: A: Slander, libel, defamation of character. B: Bodily Injury while on the insured`s premises. C: Bodily Injury to a third party. D: Bodily Injury to an employee.

What is the limit for glass coverage under the Glass Coverage Form/endorsement? A: $500 per plate & $1,000 per occurrence. B: $100 per plate & $500 per occurrence. C: Coverage provided without limitation and settled on an ACV basis. D: Coverage provided without limitation and settled on a replacement cost basis.

Which Commercial Property Causes of Loss form has the broadest coverage? A: None of the above are Commercial Causes of Loss forms. B: Specified Causes of Loss C: Special Causes of Loss D: Basic Causes of Loss

Which of the following is NOT a covered peril under the Specified Causes of Loss form? A: Falling Objects B: Water damage from accidental discharge of water or steam C: Volcanic Action D: Leaking from fire extinguishers and equipment

The Ordinance or Law endorsement can be added to allow for: A: Coverage in the event of a penalty for faulty construction. B: Coverage in the event of loss due to an uncovered peril. C: Coverage in the event of a coinsurance penalty. D: Coverage in the event of a building ordinance upgrade requirement.

A Builders Risk policy: A: May be insured for any limit. B: Must reflect a Coverage A limit of 100% of the value of the property. C: None of the above. D: Must reflect a Coverage A limit of 80% of the value of the property.

The Commercial General Liability policy "territory" includes: A: The United States and its territories and possessions. B: The United States, its territories and possessions, Puerto Rico and Canada. C: The United States. D: Only the geographical area in which the policy is written.

Business Income and Extra Expense coverage would be necessary in which of the following cases? A: A restaurant owner forgets to order enough product and suffers a loss of business income. B: A contractor has his tools stolen from a job site. C: A grocery store suffers damage to stock when an earthquake collapses a shelf. D: A dry cleaners has a fire and must relocate temporarily to avoid losing customers.

``` This form covers risk of direct physical loss subject to exclusions pertains to: A: Earthquake form B: All cause of loss forms C: Broad form D: Special form ```

``` What must happen in order for coverage to be available is the purpose of: A: Coverage forms B: Mortgage holders clause C: The Cause of Loss Forms D: Insuring Agreement ```

Business Income from Dependent Properties covers: A: a loss that occurs at a property the insured does not own, but one in which they have a financial interest. B: a loss that occurs at a property the insured does not own, but depends upon to run their business. C: a loss that occurs to a property the insured owns, but rents to a business operation. D: All of these would need Business Income from Dependent Properties coverage.

Which one of the following is not a time limit for an insurer to notify a lender by written notice? A: 30 days before the effective date for any other reason other than non-payment or non-renewal B: 20 days before the effective date for any other reason other than non-payment or non-renewal C: 10 days before the expiration date of a non-renewal D: 10 days before the effective date on a non-payment of premium notice

Which of the following statements are true regarding Blanket Insurance? A: Coverage A & B are specific dollar amounts B: There is a single limit of insurance for property at various locations or several types of property at one location. C: There is no specific limit of insurance on any particular item or property. D: Coverage amount would apply to each location individually

``` Which of the following forms is NOT considered a Named Perils form? A: Broad form B: Special form C: Specified form D: Basic form ```

``` Willful and malicious damage to property, including burglars entering or exiting is called ___________. A: Theft B: Robbery C: Riot or Civil Commotion D: Vandalism ```

Coverage B of the CGL includes coverage for: A: Buildings and Business Property B: Personal Property of Others C: Personal and Advertising Injury D: Medical Payments

In a Commercial General Liability policy, Supplementary Payments covers which of the following? A: Copyright Infringement. B: Loss of earnings for up to $100 per day. C: Rental Car Expense. D: Damage to the property of others in the insured`s care.

In the Definitions Section of a Commercial General Liability policy, "occurrence" means: A: A one time event. B: All of these. C: An accident involving continuous or repeated exposure to the same general harmful conditions. D: An event that is not discovered until years later.

``` Aggregate limit refers to: A: The limit of insurance per loss. B: Agricultural loss limit. C: The most an insurer will pay in any one policy period. D: A per article limit. ```

The Glass Coverage form pays: A: Actual Cash Value without limitation per plate or pane, unless stated as replacement cost on the policy. B: Replacement cost up to the specified limit on the policy. C: Actual Cash Value without limitation per plate or pane. D: Actual Cash Value with a limit of $100 per plate or pane and $500 per occurrence.

What form would cover tenants for financial loss resulting from the cancellation of a lease due to property damage? A: Mortgage Holders Interest Coverage Form B: Business Income and Extra Expense Form C: Leasehold Interest Coverage Form D: Leasehold Property Damage Coverage Form

``` Medical expense coverage on a CGL is provided by which coverage? A: Coverage B only B: None of these are correct C: Coverage A only D: Coverage ```

``` Crime policy form that is similar to CGL claims made in activating coverage? A: Discovery form B: Loss sustained form C: Employee Dishonesty D: Discovery period ```

``` After the policy has expired, the one year to discover a loss is called the: A: coverage extension B: reporting period C: discovery period D: optional period ```

``` In crime coverages the discovery period applies to which policy form? A: Occurrence form B: Loss sustained form C: Discovery form D: Claims made form ```

``` Negotiable and non-negotiable instruments are known as: A: register checks B: none of these C: property other than D: securities ```

Which of the following is NOT a common advantage of the Claims Made form? A: Eliminates the possibility of a loss due to the insured`s negligence. B: Eliminates stacking of limits. C: Minimizes gaps in coverage. D: Minimizes inflation effects on policyholders.

A Claims Made reporting form states that: A: Any covered loss reported within the policy period is covered. B: Any claims that occur within the policy period are covered, regardless of when they are reported. C: Claims made within the policy period must be reported and occur within the policy period to be covered. D: Covered claims are those reported within the policy period and occur no earlier than the retroactive date

``` Theft on the Commercial Crime coverage form includes all of the following EXCEPT: A: Burglary B: Hold-up of an armored car C: Robbery D: Theft of stock or inventory ```

``` The Insured shall mean the following except: A: Partnership B: Leased employees C: Governmental agency employees D: Corporation ```

``` __________ insurance is a type of coverage that protects businesses from the financial consequences associated with a variety of employment-related lawsuits. A: Employment Practices Liability B: Commercial General Liability C: Fiduciary Liability D: Directors and Officers Liability ```

``` An employee adds an extra zero to their paycheck. This is covered under: A: employee dishonesty B: alteration C: fund transfer fraud D: forgery ```

``` _________is what the insured must pay before the Umbrella policy will respond if there is no coverage on the underlying policy or if the underlying insurance lapsed or was cancelled for some reason. A: Claims first payment B: Co-insurance C: Self-insured retention D: Co-pay ```

``` Who would be covered under a commercial crime policy? A: Employees B: Independent contractors C: Officers D: Insured ```

``` Management liability insurance would include which of the following? A: Director & Officers B: Employee benefits C: All are included D: Employment Practices ```

``` Inside premises is which frequently used crime form? A: Form B B: Form C C: Form D D: Form A ```

Under the Commercial Crime insurance policy, "occurrence" is defined as: A: An act or series of acts that may not involve people. B: An act that causes bodily injury or property damage to the insured. C: An incident in which a person other than the insured, commits a crime involving money. D: A confrontation in which robbery or burglary is involved.

``` The primary types of Professional Liability insurance are all the following except: A: Medical Malpractice B: D & O C: E & O D: P & I ```

Directors and Officers coverage does not protect directors and officers of a corporation for: A: Punitive damages, fines and penalties against a director or officer. B: All of these. C: Wrongful acts while acting in an official capacity for the corporation. D: Breach of Duty

Errors & Omissions insurance would be needed for which of the following: A: An attorney who provides legal advice online for a fee. B: A real estate agent who provides services free of charge. C: A volunteer at a church picnic who forgets to bring the pickles. D: An accountant`s assistant who makes an error

``` The CEO of ABC corporation might need what type of Professional Liability insurance? A: Directors and Officers B: Medical Malpractice C: Fiduciary Liability D: Errors and Omissions ```

Professional liability policies are normally written on which form(s): A: claims made form B: discovery form C: both claims made form and occurrence form D: occurrence form

Commercial Excess Liability policies are unlike Personal Umbrellas in that: A: All of these. B: There may not be an underlying policy that pays primary. C: Their deductibles are typically much higher. D: They cover commercial business risks

Professional Liability coverage is designed to cover: A: Errors on a contract drawn by of a real estate agent for a client. B: A general contractor installs faulty wiring in a home. C: Injuries from an auto accident when a doctor runs a red light. D: Criminal acts of a financial advisor.

``` Professional liability policies provide coverage for: A: neither defense or damages B: both defense and damages C: defense D: damages ```

``` Key difference(s) between CGL and professional liability is/are: A: consent to settle B: use of deductibles (SIR) C: reporting periods D: all of these are correct ```

``` The main function of what policy is to provide higher limits of liability insurance in excess amounts over the underlying policy? A: Commercial Crime B: Umbrella C: Professional Liability D: Directors and Officers ```

``` In crime coverages the phrase theft, destruction, disappearance applies to: A: money & securities B: business property C: tangible property D: all of these are correct ```

``` ________ requires a confrontation with another person. A: Burglary B: Hold up C: Theft D: Robbery ```

Claims-made and reported policies are unfavorable from the ________ standpoint. A: Insured's B: Claimant's C: Agent's D: Insurer's

A Rationale - Claims-made and reported policies are unfavorable from the insured's standpoint because it is sometimes difficult to report a claim to an insurer during a policy period if the claim is made late in that policy period.

Which of the following is false about the Supplemental Extended Reporting Period (SERP): A: There is no additional charge for this coverage. B: It may cost up to 200% of the annual premium for this tail coverage. C: This tail coverage must be requested in writing at least 60 days prior to the termination of a policy. D: It provides an unlimited time for reporting claims that occurred after policy expiration.

Which one of the following common insuring agreements would not be found within a Directors and Officers policy? A: A-Side Coverage B: Entity Securities Coverage C: Corporate Reimbursement Coverage D: Pending Litigation Coverage

D Rationale - Agreement 1 - Insuring Agreement A (D&O) Insuring Agreement A, often referred to as Side Coverage. Agreement 2 - Insuring Agreement B (Corporate Reimbursement)Insuring Agreement B, or side coverage. Agreement 3 - Insuring Agreement C (Entity Securities Coverage) Insuring Agreement C, or side coverage.

``` With Boiler and Machinery, insurance carriers place great emphasis on: A: This Loss control and inspections B: Inspections and reports C: Loss control and premium audits D: Inspections and premium audits ```

``` Medical books in a Doctors library at home would be best insured under: A: Endorsed homeowners B: This Physician & Surgeons C: Personal Articles Floater D: Valuable Papers ```

``` The Commercial Articles Coverage Form is provided on an: A: Broad basis B: ACV basis C: This All-risk basis D: Basic basis ```

All of the following are excluded on an equipment breakdown form, except: A: Foundation breakdown B: Functioning of any safety or protective device C: This Steam boilers D: Leakage of values

What form would be used to cover a business that owns several laptop computers used by employees off premises? A: Electronic Data Processing Equipment Coverage form B: Business Personal Property Coverage form C: Inland Marine Computers Coverage form D: Off Premises Inland Marine coverage form

Which of the following would purchase the Motor Truck Cargo form? A: A Taxi Company B: This A grocery store that owns trucks and ships its own goods to its various owned locations. C: A pizza delivery person. D: A business that owns its own trucks and delivers goods to customers on behalf of another company

``` The definition of _________ for the Boiler and Machinery form is sudden and accidental (not intentional) breakdown of an object. A: This accident B: machinery C: object D: damage ```

If a boiler in a church building were to blow up and cause property damage and injury, which coverage would be necessary to cover this loss? A: Non-Profit Extended Liability coverage B: This Equipment Breakdown (Boiler & Machinery) coverage C: Building and Personal Property coverage D: There would be no coverage under any of these form because it is a church.

Non-filed commercial inland marine forms are also known as: A: Uncontrolled B: This Both uncontrolled and unregulated C: Unregulated D: Neither uncontrolled or unregulated

What coverage form has the sole purpose of insuring most types of industrial risks for direct damage by an accident? A: Equipment Machinery Coverage Form B: Inland Marine Coverage Form C: This Boiler and Machinery Coverage Form D: Crime Insurance Coverage Form

``` Boiler and Machinery is now known as: A: Boiler Protection B: This Equipment Breakdown C: Explosion & Breakdown D: Breakdown Protection ```

Which of the following is NOT a common exclusion on the Boiler & Machinery policy? A: Leaking of valves, joints or fittings B: This Breakdown of refrigeration units C: Property of Others, not in the insured`s care D: Loss due to safety devices not functioning properly

The Signs Coverage form is necessary when: A: This An insured has more than a $1000 value in signs or has any detached signs. B: An insured has the business name painted or etched on a glass window. C: An insured has more than one sign on the premises. D: An insured with at least one business location worth $250,000 or more.

``` Which of the following applies to Commercial Inland Marine Coverage Part? A: Filed forms B: Class rated C: Open Perils D: All of these are true ```

``` Which are excluded under the BPP but covered under the EDP? A: Change in temperature B: Electrical surges C: Dropping the computer D: All of these ```

``` Which of the following is issued under the Motor Truck Cargo Form? A: Shipper's Form B: Trucker's form C: Owner's form D: All of these ```

A Released Bill of Lading assures: A: That a common carrier will transport only goods that are not considered contraband or illegal. B: That the shipper of the product is fully responsible for any damage to the shipped property, as long as it is shipped in the U.S. or its territories and possessions. C: That the carrier of goods will not be responsible for any more than the stated value on the contract. D: That the shipper is released of any responsibility for product damage and will be paid replacement value if a loss occurs.

The two types of transit coverage are: A: Annual and Goods in Transit coverage B: Annual and Trip Transit coverage C: Common Carrier Transit coverage and Trip Transit coverage D: Trip Transit and Specific Transit coverage

``` Which of the following is a filed commercial inland marine form? A: Annual transit B: EDP Floater C: Mail coverage form D: Contractor's Equipment ```

Mayberry Construction has a Business Auto policy covering a 1995 pickup truck for liability and physical damage coverage. At the time of an accident, the driver of the pickup truck was pulling a trailer carrying a bulldozer. If the bulldozer slips off and causes bodily injury to another party, there is coverage under which of the following policies? A: The Business Auto Policy B: A Mobile Equipment Floater C: The Commercial General Liability Policy D: There is no coverage for mobile equipment.

``` A policy designed to fill in the gaps of a property policy would be? A: Common Carrier B: Difference in Conditions C: ISO form D: Inland Marine Form ```

``` Coverage that can be provided for goods shipped by several different carriers during a transport until they reach their ultimate destination is called ___________. A: Trip Transit Coverage B: Transit Equipment Floater C: Common Carrier Cargo D: Motor Carrier Cargo ```

Which of the following would be used to cover property of others left in a camera shop for repair? A: A Commercial General Liability (CGL) form B: An Equipment Dealers form C: A Business Personal Property coverage form D: A Camera & Musical Instrument Dealers/Commercial Articles coverage form

The valuation clause on an Inland Marine forms states all of the following except: A: The cost of replacing the property with substantially identical property B: The values will be established base on the higher of the above C: The cost of restoring the property D: The actual cash value of the property

A carrier of cargo is NOT liable for damage in all of the following situations, EXCEPT: A: Inherent Vice B: Acts of God/Nature C: A collision due to a mechanical malfunction. D: Negligence of the shipper

A Bailee is defined in the insurance industry as: A: One who is entrusted with the property of others. B: None of the above. C: One who receives the funds of another for the purpose of posting bail. D: One who assists another in bailing water from a vessel to avoid sinking.

``` The courts do not recognize the carrier as liable for a loss to another`s property by any of the following acts except: A: Acts of Public Enemy B: Acts of God and Nature C: Acts of Public Authority D: Acts of faulty construction ```

``` The commercial inland marine "signs" form would not insure: Correct: This Billboards Incorrect: Mechanical signs Incorrect: None are excluded Incorrect: Neon signs ```

``` When a claim is settled on an ACV basis, B & M equipment must be repaired or replaced within how many months? A: 18 months B: 6 months C: 24 months D: 12 months ```

The 2 types of Inland Marine policy forms are Filed and Non-filed. All of the following are true about the advantages of a Filed form, EXCEPT: A: They can usually be added to a package policy. B: They are regulated by the Department of Insurance. C: The forms are more standardized. D: The rates are cheaper than non-filed forms.

Garage Operations refers to: A: The liability exposure of an insured who has customers entering and exiting the property at various times. B: The repairs completed on vehicles in the insured`s care, custody, or control. C: The sale of auto parts. D: Ownership, maintenance, or use of a garage premises and autos in the insured`s care.

``` The Truckers Coverage form is most similar to what other form of coverage? A: The Business Auto Policy B: The Motor Truck Cargo Coverage form C: The Non-Owner Personal Auto Policy D: The Garage Coverage form ```

``` Which of the following symbols used on a business auto policy offers the broadest coverage? A: Symbols 8 & 9 together B: Symbol 7 C: Symbol 2 D: Symbol 1 ```

What would be needed if a business owner had no personally owned vehicles, but wanted insurance on a rental car he personally rented on vacation? A: A Drive Other Car Endorsement B: A Rental Car Endorsement C: A Non-Owner policy D: A Business Auto Policy is all that is needed.

``` Which of the following is NOT a Specified Cause of Loss? A: Explosion B: Flood C: Fire D: Aircraft ```

The four major exposures to an auto-related business owner that are covered on a Garage plan are: A: Auto Liability, Products & Completed Operations, Liability, and Workers Compensation B: Premises Operations, Completed Operations, Product Liability, and Professional Liability C: Premises Operations, Completed Operations, Product, and Auto Liability D: Liability, Property, Auto, and Workers Compensation

``` Garage liability is broader than business auto liability because: A: Garage covers CGL only B: Business auto is broader C: It covers CGL and auto D: There is no difference ```

``` Within a BAP, which auto symbol applies to mobile equipment? A: 2 B: 19 C: 6 D: 4 ```

Which one of the following would be insured under a Business Auto Policy? A: Auto owned by a partner B: Hired owned auto C: Employee owned auto D: Customer who borrowed a company car with permission

Under Truckers Coverage the definition of a trucker is: A: None of these above B: someone in the business of transporting the property of others by vehicle (auto or truck) for no fee. C: someone who covers autos and trucks kept by the insured in their care, custody, or control. D: someone in the business of transporting the property of others by vehicle (auto or truck) for a fee.

Trailer interchange coverage applies to which commercial auto form(s)? A: Truckers form B: Motor Carrier form C: All of the forms D: Both truckers form and motor carrier form

Which is incorrect: concerning the truckers form? A: Covers big rigs B: Transporting the property of others by vehicle for free. C: Similar to the BAP D: Must haul for hire

``` Physical Damage cover applies to all the symbols, except: A: Symbol #9 B: Symbol #1 C: Neither Symbol #1 or #9 D: Both Symbol #1 and #9 ```

``` This coverage applies only when the insured is found legally liable for the damage to a customer's vehicle: A: Garagekeeper Direct Coverage Excess B: Garagekeeper Direct Coverage Primary C: Garagekeepers Causes of Loss D: Garagekeepers Legal Liability ```

A business auto is defined as all of the following except: A: Private passenger auto B: Truck C: Golf cart used for business owned by the named insured D: Trailer owned by the named insured

``` Which symbol(s) covers the exposure of employer's non-ownership liability? A: Symbol #8 B: Symbols #8 and #9 C: Symbol #4 D: Symbol #2 and #4 ```

The Motor Carrier Act of 1980 states that a trucker must file proof of financial responsibility in order to meet the bodily injury and property damage minimum requirements for third party claims. Which of the following requirement is false? A: $5 million for poisonous gasses B: $1 million for oil and other hazardous wastes C: $5 million for oil an other hazardous wastes D: $5 million for radioactive materials

``` Which is not included in a Business Auto physical damage coverage? A: Vandalism B: Property damage liability C: Specified causes D: Transportation expense ```

``` Mobile Equipment subject to financial responsibility would be symbol: A: Nineteen B: Nine C: Six D: Five ```

All of the following are common exclusions on the BAP, EXCEPT: A: Property of Others B: Premises and Completed Operations C: Trailers the insured leases for business use. D: Pollution Liability

``` Newly acquired vehicles are not automatically covered under which symbol? A: Seven B: None of these C: Three D: Five ```

Coverage not included in a business auto policy would be: A: BI and PD B: Physical damage C: UMBI D: Specified causes

C Rationale - Uninsured motorist and medical payments must be endorsed to the policy.

``` This coverage form that extends liability and physical damage to vehicles and trailers on a primary basis is named ___________. A: Truckers Coverage Form B: Trailer Interchange coverage C: Motor Carriers Act D: Business Auto Policy ```

Which of the following statements is FALSE about the Motor Carrier Act of 1980? A: All interstate common carriers must have a certificate of insurance filed with the Interstate Commerce Commission showing proof of insurance. B: This act states that the minimum financial responsibility for carriers of radioactive materials is $5 million. C: It states federal regulations regarding the minimum financial responsibility limits for carriers of hazardous and non-hazardous property. D: This act makes purchasing an insurance policy a requirement for anyone transporting hazardous materials.

``` Drive other car endorsement on a Business auto may be used to cover: A: employees cars B: non-business exposures C: vehicle use by spouse D: business trip rentals ```

``` All of the following are considered a Specified Cause of Loss under the Business Auto Policy EXCEPT: A: Derailment while being transported B: Mechanical Breakdown C: Earthquake D: Vandalism ```

A parking garage would be BEST insured under which form(s): A: Garagekeepers Direct Coverage (Excess) B: Garagekeepers Legal Liability C: Garagekeepers Direct Coverage (Primary) D: None of the above would adequately cover the exposures for this type of business.

C Rationale - Remember, the most Correct: is Garagekeepers Direct Coverage (Primary), because it provides coverage whether or not the insured is legally liable, and it will pay before the customer`s own policy pays.

``` Which one of the following is not a major exposure to a business owner of an auto related facility? A: Product Liability B: Professional liability C: Completed Operations D: Auto Liability ```

One of the major differences between a business auto policy and a personal auto policy are the endorsements. Which coverage listed below is considered an endorsement on the business auto policy? A: Cost of legal defense B: Comprehensive & Collision coverage C: Uninsured Motorist and Medical coverage D: Liability coverage

C Rationale - UM & Medical coverage are not automatic coverages on the BAP and are considered endorsements, not separate lines of insurance coverage.

An owner of an auto repair business would be best covered under which of the following? A: A Business Auto policy with Non-Owned Autos as a specified symbol. B: A Commercial General Liability form. C: A Commercial Property coverage form. D: A Garage Liability Coverage form.

D Rationale - The Garage Coverage form is specifically designed for a business with temporary care, custody, or control of customer vehicles.

Which of the following is NOT true regarding the National Flood Insurance Program? A: Any licensed agent or broker may place business with the NFIP. B: Anyone desiring flood insurance may purchase it through the NFIP directly. C: The NFIP does have an endorsement that can be purchased for Business Income coverage. D: The NFIP is administered by the federal government.

The four (4) components of the Section II, Business Liability coverage are: A: Bodily Injury, Property Damage, Personal and Advertising Injury B: Bodily Injury, Property Damage, Professional Liability and Medical C: Building, Personal Property, Liability and Medical D: Building, Separate Structures, Personal Property and Liability

``` All of the following are covered perils on a crop insurance policy, EXCEPT: A: Inherent Vice B: Drought C: Insect Infestation D: Tornado ```

Barratry is defined as: A: Any of the above could be true. B: Intentional wrongful acts of a shipowner. C: Intentional misconduct of a master or crew without the knowledge of the shipowner, resulting in damage or injury. D: Damage or injury to a third party caused by intoxication of the master or crew.

``` The purpose of the Businessowners Program is designed for the owner of _______________. A: fireworks stands. B: a home based small business. C: apartment buildings. D: mobile car wash units. ```

``` Which of the following coverage is added by endorsement to the BOP policy? A: Outdoor Signs B: Money & Securities C: Earthquake D: Boiler & Machinery ```

``` Under farm liability, which coverage is optional? A: All are mandatory B: Coverage I C: Coverage J D: Coverage H ```

In order to place flood insurance through the NFIP, licensed agents must also complete ______________. A: 3 hours of continuing education before submitting the application. B: 8 hours of continuing education with 24 hours of submitting the application. C: 4 hours of continuing education before submitting the application. D: 3 hour of continuing education at the same time as submitting the application.

The difference in perils covered on the Commercial Property policy and the Standard form Businessowners policy is: A: The peril of Robbery & Safe Burglary. B: The peril of Earthquake. C: The peril of Transportation. D: The peril of Theft.

``` All of the following major perils are commonly insured under a crop insurance policy except: A: Insect infestation B: Flood C: Chemical disease D: Fire ```

The three (3) parties to a Surety Bond contract are: A: Obligor, Obligee and Insurer B: The Principal, Surety and Obligee. C: Insured, Insurer and Principal D: None of the above, as there are only two (2) parties to a surety bond contract.

``` In order to sell Flood insurance the producer must be: A: Flood certified B: Nothing C: Complete 3 hour course D: Have NFIP membership ```

Transportation coverage on the BOP would apply to which of the following? A: A vessel is stranded while transporting property of others to the insured's business location. B: Property of a customer is damaged while being transported by vessel. C: Property of the insured, while being transported by vehicle to a business location, is involved in an accident damaging the insured's property. D: A vehicle owned by the insured is damaged when a bridge collapses.

``` The Broad form includes perils for livestock for a farm risk which include: A: All of these are included B: Drowning C: Electrocution D: Accidental shooting ```

Protection & Indemnity coverage includes all of the following claims EXCEPT: A: Job-related injuries to employees B: Shipping Costs that must be paid a second time. C: Ship Operator Negligence D: Comprehensive & Collision

The FCIC is an agency that sells flood insurance policies: A: As a representative of the U.S. Department of Safety. B: None of the above. C: On an All Risk basis. D: Through a select number of agents.

Jettison is defined as: A: Throwing cargo overboard to lighten a ship. B: Being thrown from a vehicle or vessel. C: None of the above. D: The act of flying threw the air.

All of the following are NOT eligible businesses under the BOP program, EXCEPT: A: A 4 story apartment building with 60 total units. B: A small liquor store. C: A small family-owned auto body shop D: An 8 story office building with less than 100,000 square feet.

``` BOP's benefit the insured by providing all of the following, except: A: Simplified rating B: Simplified reading C: Reduced premium D: Business income ```

Which of the following is FALSE about the characteristics of a BOP policy? A: It typically has no coinsurance clause. B: The standard deductible is $500. C: Losses are valued at replacement cost. D: Loss of income is coverage up to stated limit.

``` BOP liability must include which of the following: A: PI & AI B: Medical expense C: All must be included D: BI & PD ```

``` The bond is written for the benefit of the: A: Guarantor B: Obligee C: Principal/obligor D: Surety ```

``` BOP's provide coverage for property of others under: A: Personal property B: By endorsement only C: Building coverages D: Property of others ```

``` The oldest type of insurance in the world is: A: Shipowners Liability insurance B: Product Liability insurance C: Automobile Liability insurance D: Ocean Marine insurance ```

``` Ocean Marine liability is known as: A: CPL B: Section II C: P & I D: Jones Act Coverage ```

The implied warranties understood by the ocean marine contract include all of the following, EXCEPT? A: Properly packed cargo. B: An agreed upon route with no deviation. C: All crew members are experienced seamen. D: The seaworthiness of a vessel.

If a shipowner who purchases an Ocean Marine policy on an All Risk form runs into a dock while transporting cargo for a customer, the policy would pay for: A: Damages to the ship, dock, cargo and any resulting bodily injury. B: Damages to the ship, dock and cargo. C: There is no Collision coverage on an Ocean Marine policy. D: Damages to the ship, dock, cargo and any resulting bodily injury; including that of injured employees.

``` Which of the following is NOT a common exclusion in the Flood Insurance program? A: Contents B: Fences C: Money D: Business Income ```

What unique exposure is present in a farming business? A: Risks involving livestock. B: The need for coverage on agricultural equipment. C: The risk of injury to employees. D: The need for Commercial and Residential coverage on the same property.

``` BOP's property section cannot be written on which form? A: Broad form B: Standard form C: Special form D: All these are options ```

``` A Named Peril policy in Ocean Marine insurance refers to "perils on the sea" and "perils of the sea". These perils do NOT include: A: Explosion B: Barratry C: Jettison D: Sinking ```

Which of the following would be covered by a crop insurance policy? A: Loss to plants on which a crop would normally yield income to the farm owner. B: Loss of growing crops normally given to a homeless shelter in town. C: Loss of crops due to hail damage. D: None of the above.

``` The amount the bond is issued for is known as the: A: Promise B: Face C: Penalty D: Limit of liability ```

The Businessowners Policy (BOP) is a package policy combining what types of coverages? A: Liability , Property and Workers Compensation coverage B: Liability, Property and Professional Liability coverage C: Liability and Property coverage D: Liability, Property, Business Income & Extra Expense and Property of Others coverage

All of the following are differences between a Bond and Insurance EXCEPT: A: A Bond is identical in nature to an Insurance contract. B: A Bond is not insurance, only a financial guarantee. C: With a Bond, the company can seek recovery for claims payments from the Principal. D: There are only two (2) parties in an Insurance contract, but three (3) parties involved in a Bond.

Coinsurance Payout Formula?

Insurance Carried ÷ Insurance Required x Amount of loss - Deductible

What is DICE?

Declarations Insuring Agreement Conditions Exclusions

According to a new legal development, AB984 Chapter 439, if an automobile service contract is considered an insurance policy: A: None of the above, as there is no law regulating insurance sold through auto service contracts. B: It must be pre-approved by the Insurance Commissioner and the insurer providing coverage must be disclosed by a declarations entry. C: It must be pre-approved by the Insurance Commissioner and the seller must be licensed. D: It must have a standard deductible of $250 or less and be disclosed by a declarations entry.

According to a new development, AB 227 Chapter 635 regarding Workers Compensation and the California Insurance Guaranty Association, which of the following is NOT true? A: Fines for filing fraudulent Workers Compensation claims were increased to a minimum of $5,000.00 B: bill states that CIGA may be financed with a bond not to exceed $5 billion at any one time. C: The term insolvency was expanded to include the inability to meet a company`s financial obligations. D: bill also states that the Commissioner must publish the rates for the top 50 Workers Compensation carriers.

Which of the following is NOT an exempt category under Workers Compensation insurance? A: A small business with only one employee. B: A student who is a pitcher for the school baseball team. C: A domestic employee who has earned only $90 total. D: Volunteers for a non-profit organization.

The Second Injury Fund is: A: A fund regulated and supported by all Workers Compensation carriers in the state and payable only to employees who have lost a limb, sight or hearing due to a prior work-related injury. B: A Fund issued by the state, which assists in claims payments for totally disabled individuals who had a permanent pre-existing disability with their prior employment. C: A Fund issued by the federal government, which assists in claims payments for totally disabled individuals who had a permanent pre-existing disability with their prior employment. D: There is no such fund.

An insured who takes necessary precautions to reduce Workers Compensation claims or severity of losses, could receive a discount through: A: Experience Modification B: A Risk Manager C: Reporting Modification D: A ''No Losses'' modification

This defense states that the employee knew in advance the risks associated with the job and was paid a salary to assume those risks. A: Contributory Negligence B: Fellow Employee Rule C: Assumption of Negligence D: Assumption of Risk

Which of the following was NOT a responsibility of an employer under common law obligations for Workers Compensation in the early 1900s? A: Assuming risk B: Enforcing safety rules C: Providing a safe workplace D: Providing safe equipment

A workers compensation insurance policy provides: A: statutory benefits B: both statutory benefits and employer's liability are correct C: state common law benefit D: employer's liability

The establishment of Workers Compensation laws: A: Was foundational to building a relationship between the employer and employee B: Complicated the process of filing claims regarding work-related injuries. C: Is not based on the concept of absolute liability. D: Put the burden of proof of fault on the employer.

According to a new legal development, AB996 Chapter 647, regarding hate crimes against reproductive health facilities, all of the following are true, EXCEPT: A: An insurer may cancel or non-renew a policy due to excessive hate crime claims with written notice to the insured no less than 45 days prior to the cancellation or non-renewal. B: bill helps to guarantee the availability of insurance to these types of facilities. C: bill states that all hate crime claims must also be reported to the Commissioner. D: Insurers may not charge excessive or unfair premiums due to prior hate crime losses.

The California Insurance Code defines 24-Hour Coverage as jointly issuing a Workers Compensation policy with a ________. A: Life policy B: Health care policy C: Auto policy D: Annuity policy

24 Hour coverage is defined as: A: Providing around-the-clock coverage through a joint Workers Compensation and Life insurance policy. B: Providing around-the-clock coverage through a Workers Compensation, Medical, and Group Disability policy. C: Providing around-the-clock coverage through a Workers Compensation, Medical, and Life insurance policy. D: All of these are options under the Health and Disabilities Act

Which of the following is NOT true regarding the voluntary workers compensation endorsement? A: It protects a business owner from lawsuits that may arise, even from those who by law are exempt from coverage. B: It provides workers compensation coverage when a regular employee of a business ALSO volunteers to work at business-sponsored events. C: It can be added upon request by the insured at any time during the policy period. D: It applies only to volunteers who are working for the business named on the workers compensation policy.

Statutory benefits are covered under what part of the WC insurance policy? A: Part II B: Coverage A C: Part I D: Part III

In regards to workers compensation volunteer workers are considered to be: A: Both exempted workers and covered by endorsement are correct B: covered workers C: exempted workers D: covered by endorsement

The workers compensation policy was developed by: A: California's WCIRB B: ISO C: NCCI D: NAIC

Workers Compensation claims settle based on: A: statutory damages B: specific damages C: general damages D: statutory benefits

All of the following are true about the State Fund, EXCEPT: A: The State Fund may be used only as a last resort. B: The State Fund competes for Workers Compensation business with the private sector. C: State Fund is operated by the state of California. D: The State Fund sells its policies through brokers, as well as directly to the general public.

Other States Insurance is Part Three (3) of the Workers Compensation policy and covers: A: Employees who travel out of state on work assignments and provides the statutory limits of the state in which they are working. B: The employer who operates a business in multiple states. C: Employees who live in a state other than California, but are employed by a company organized in California. D: None of the above are true.

The California State Compensation Insurance fund is considered to be: A: a direct writer B: both competitive fund and direct writer are correct C: neither competitive fund or direct writer are correct D: a competitive fund

The percentage of a deceased worker`s weekly wages payable to the spouse and dependent children is: A: 66 2/3 percent B: 50 percent C: 100 percent D: 33 1/3 percent

Employer's liability coverage covers what type of claims? A: Part I claims B: Part III claims C: Common law claims D: statutory benefits

When an employer has the choice of purchasing Workers Compensation insurance from either the State Compensation Fund or from any authorized private insurer, the Workers Compensation system is considered to be: A: competitive. B: independent. C: a monopoly. D: a secondary market.

For an employee's illness or injury to be covered it must: A: be accidental B: the employers fault C: be work related D: happen on the job

OSHA was established to do all of the following, EXCEPT: A: Mandate that all employers who do not comply with health standards will be fined. B: Organize American employees in support of an Occupational Safety Union. C: Create education and training for employers. D: Promote and assure the safety and health standards for American workers.

Under the Workers Compensation policy, disability income benefits are payable to a partially disabled worker when: A: The injured worker cannot return to work. B: The injured worker has a loss of limb(s). C: The injured worker can return to work, but is unable to earn the income once received. D: The injured worker will have medical and surgical treatment needs on an ongoing basis.

A state that does not allow private insurers to offer workers compensation: A: is in violation of the law B: is a monopolistic state C: None of these D: is a noncompetitive state

In 1995, the "open rating system" gave companies a competitive edge in that: A: Workers Compensation insurance companies no longer had to file their rates and wait for approval from the Department of Insurance and no minimum rates were mandated. B: Workers Compensation minimum rates were mandated. C: Workers Compensation benefits were reevaluated and new rates were formed. D: Workers Compensation rates were increased to absorb the high cost of medical products and services.

WC now limits chiropractic and physical therapy to: A: unlimited visits B: 24 visits per injury C: 12 visits D: None of these

Workers Compensation statutory benefits means: A: Minimum and maximum benefits, waiting periods, etc. are established by state law and all Workers Compensation policies sold in this state must meet these requirements. B: Every employer must purchase Workers Compensation for its employees. C: An employer may stipulate the limit of insurance, and therefore control costs. D: The state of California offers benefits for work-related injuries to any employer who cannot afford or cannot procure a policy on their own.

Which licensee can transact all classes, except life and disability: A: P&C Insurance agent B: P&C Broker C: All of these D: P&C Solicitor

The following acts are unlawful and are misdemeanors in California except: A: Advertising for a nonadmitted insurer B: Acting as an agent for a nonadmitted insurer C: Transacting business thru a surplus lines broker who uses nothing but nonadmitted insurers D: Placing business with a nonadmitted insurer if no other insurer will take the business

What could a penalty be for a person who transacts insurance without a valid license? A: A misdemeanor punishable by $50,000 and 13 months in a county jail B: A misdemeanor punishable by $30,000 and 2 months in a county jail C: A misdemeanor punishable by $75,000 but no jail time D: A felony punishable by $50,000 and 6 months in a county jail

Aiding, assisting, or advertising for a nonadmitted is considered: A: never allowed B: a misdemeanor C: ok, with DOI permission D: ok, if you are a broker

An insurance solicitor may complete all the following transactions EXCEPT A: bind an insurer B: make prospecting calls C: set sales appointments D: offer a quote

Which of the following is an agreement between an insurer and the insured to transfer risk for payment. A: Solicitation B: Transaction C: Execution D: Negotiation

According to the California insurance law, all the following are reasons why either party may rescind a contract EXCEPT A: One party may rescind if the other party, intentionally or unintentionally, hides material information from them. B: If a representation is false in a material point, whether affirmative or promissory, the injured party is entitled to rescind the contract from the time the representation becomes false. C: Once a contract is signed, it can never be rescinded. D: The insurer can rescind the insurance of another party if that party intentionally omits information (concealment).

A representation can be altered or withdrawn: A: only after the insurance is issued B: at anytime the wrong representation has been discovered C: either before or after the insurance is issued D: only before the insurance is issued

All of the following are part of the six specs of a insurance policy except: A: A statement of the premium B: Duties of an insured after a claim C: The risks insured against. D: The parties between whom the contract is made

Terminating a contract from the very beginning as if it never existed is: A: rescission B: noncompliance C: termination D: cancellation

Johnny told the insurance agent that he thinks he drive about 10,000 miles a year, but in fact is more like 15,000. What term would best describe this situation? A: Misstated fact B: Concealment C: Misrepresentation D: Fraud

Neither party is required to communicate: A: an opinion B: relevant information C: all are required D: material facts

If your agent asks you if you use nicotine products and you say you live very healthy. What have you just done? A: Giving the agent an expressed warranty B: Stated a material warranty C: You breached a warranty D: Giving the agent an implied warranty

Which licensee is not appointed? A: Solicitor B: Broker C: All are appointed. D: Agent

This class of insurance protects against loss from damage done by lightning, windstorm, tornado, and earthquake. A: Homeowners B: Dwelling fire C: Liability D: Miscellaneous

___________ is the rule used to determine the importance of a misrepresentation. A: Warranty B: Implied warranty C: Materiality of concealment D: Material warranty

Which of the following are not reasons that either party may rescind a contract? A: One party hides material information from the other B: One party intentionally omits their son as a driver in the household C: An insured by accident tells the insurer that he is accident and ticket free when he really has 1 speeding ticket. D: An insured knowingly tells the insurer that he has a Nissan Altima SE when it really is a LE model

Which of the following are not actions of transacting insurance? A: Solicitation of insurance B: Negotiations preliminary to the execution of a contract C: The actual execution of a contract D: Remitting of premium payments to the insurer

All the following are true with regards to insurance agents except: A: Insurance agents are authorized by an insurer to transact all classes of insurance except life and disability B: Agents always receive commissions and renewals on sales they transact. C: Agents represent the insurance company to the public. D: A property and casualty agent may not sell health insurance.

Which of the following is not a class of insurance? A: Fire B: Marine C: Casualty D: Auto

Workers' Compensation insurance is insurance against loss from _______. A: liability for damages to property or property interest of others B: injury imposed by the company C: liability imposed by law D: disability imposed by the insurance company

All the following are true with regards to insurance brokers except: A: Brokers are authorized to transact all class of insurance except life and disability which includes health insurance. B: Brokers represent the public to the insurance companies. C: Brokers charge a fee for their services as well as receive commissions. D: Brokers may deal with a maximum of 10 insurance companies.

Which one of the following would not constitute transaction of insurance? A: Execution of the contract B: Negotiation C: Delivery of the policy D: Solicitation

Losses that can be insured are those that are considered: A: Predictable events B: Catastrophic events C: Contingent events D: Insurable events

Which of the following can bind insurance? A: Each can bind coverage B: Agent C: Solicitor D: Broker

Which of the following is not a party to a contract of reinsurance? A: All are parties B: Insured C: Insurer D: Reinsurer

In insurance contracts, neither party are required to communicate the following items except: A: Information that should be known B: Information that is material to the risk C: Known information D: Information which the other party waives

Which of the following is a Personal Lines Licensee not allowed to transact? A: Stand alone earthquake and flood insurance B: Personal watercraft insurance C: Inland marine insurance covering personal property D: Stand alone Umbrella or excess liability insurance

Which of the following would not be considered a binder? A: A temporary contract between the agent and the insured usually 30 days. B: A temporary contract giving an insured coverage for their additional truck they bought over the weekend. C: A verbal contract given to an insured that purchased a car in a different city. D: A verbal contract giving an insured automobile coverage for the weekend on their new car.

Binders cannot be issued for which of the following? A: None of these B: Disability Insurance C: In excess of one million D: Life insurance

Who has the ability to legally bind insurance for the insurer? A: Insurance Agent B: Insurance Solicitor C: Insurance Broker D: Insurance Administrator

Which is not a power of a Managing General Agent? A: Appoints local agents in that territory B: Underwrites gross direct written premium equal to or more than 10% of the policyholder surplus. C: Accept or decline risks D: Collect premium moneys for producing broker/agents

Which of the following is not associated with the word insurance? A: Known event B: Transferring risk C: Indemnify D: Written contract

Which is not a reason for a company to obtain reinsurance? A: Share in the loss ratio with another company B: Protect companies from major losses C: Protect companies from catastrophic losses D: Share the risk with another company

Transactions subsequent requires a license because it means you are: A: servicing a policy B: negotiating insurance C: quoting insurance D: selling

Licensees must renew their license: A: every 5 years B: annually C: every 2 years from issue D: every 2 calendar years

All of the following must be kept for at least 2 years from the application date except: A: Date insurance is effective and any date it ceases to be effective B: Proposals, including comparisons with existing coverage C: Copy of the clients declaration page from prior carrier D: Coverage changes

Notifying the DOI is required if there are stock ownership changes: A: of 50% or more B: of 10% or more C: of 25% or more D: Of any percentage

How many CE hours would someone need if they are licensed and maintain both Property and Casualty and Life Agent Combo licenses? A: 30 B: 24 C: 48 D: 54

What does the CIC and CCRs stand for? A: California Insurance Code / California Code of Rules B: California Insurance Code / California Code of Regulations C: California Insurance Code / California Conduct Resources D: California Insurance Code / California Conduct Regulations

An Alien insurer is an insurance company incorporated where? A: California B: In another State C: Outside the United States D: Outside the North America

Which of the following is/are fiduciary responsibilities of a licensee? A: Forwarding funds B: All of these C: Not diverting the funds D: Not co-mingling funds

The following require that CE be completed before first application, except: A: 3 hr FAIR Plan course B: 8 hr annuity course C: 3 hr flood course D: 8 hr LTC course

Which of the following acts are not prohibited? A: A lender may provide the insurance for the borrower if they don't deliver proof of insurance. B: A lender may require their borrower to purchase insurance from a certain insurance company but not a certain agent C: A lender may provide their own insurance to their borrower whether or not the borrower agrees D: A lender may require their borrower to purchase insurance from a certain agent

In California, a person may be all of the following except: A: A trust B: A deceased person C: 19 year old student D: A government

Required on all printed materials, and must be as large as phone number is: A: All of these B: the word "insurance" C: agency name D: licensee's name

When either fees are not paid current, or CE is incomplete, the license is: A: considered inactive B: considered expired C: considered revoked D: considered suspended

All of the following statements are true concerning continuing education except: A: A Property and Casualty agent must obtain 30 hours per year. B: A Personal lines agent needs 24 hours per license term. C: A Life agent combo must complete 24 hours per license term . D: A Property and Casualty agent must obtain 24 hours per license term.

Which of the following would not have to display your insurance license number? A: Business cards that you make yourself on your home printer B: Written price quotes that you show customers but they do not take the quote with them when they leave. C: Advertising page in your kid's school year book. D: Writing your name and phone number on a napkin at lunch and giving it to someone to call you for a quotation

One of the following does not need to be kept for at least five years? A: Amount of premium B: Policy number C: Name of insurer D: Date commissions was received by the agent

An Applicant may be denied a license without the right to a hearing if any of the following conditions apply except: A: Applicant was denied an insurance license last year B: Applicant's previous insurance license was revoked within the past 5 years C: Applicant was convicted of a felony D: Applicant was convicted of a DUI misdemeanor

Which of the following is not true with regards to nonadmitted insurers: A: Each surplus line broker shall file with the Commissioner a written report within 30 days of placing business with a nonadmitted insurer. B: Anyone may negotiate directly with a nonadmitted insurer to obtain insurance C: Surplus line brokers may issue evidence of insurance with an eligible nonadmitted insurer D: Surplus line brokers are responsible to ensure that a diligent search is made among insurers that are admitted

Which licensee must maintain a principal office in California? A: Resident broker-agent B: Solicitor C: Non-resident broker-agent D: All of these

Instead of suspension or denial of a license the commissioner may issue: A: certificate of convenience B: a restricted licensee C: certificate of licensee D: a temporary license

All of the following are acceptable DBAs except: A: Miller Insurance Group, Chartered Property and Casualty Underwriter B: Miller Insurance Group, Chartered Life Underwriter C: State Farmers D: The Jason Miller Insurance Agency

The only exceptions to the free insurance prohibition are as follows except: A: Services of a motor club B: Newspaper subscriptions C: Life insurance to pay off a mortgage loan D: Auto insurance included in a automobile sale

A hearing would be allowed to discuss a permanent license being revoked for which of the following: A: Applicant was denied an insurance license almost 5 years ago B: Applicant was convicted of a insurance related misdemeanor C: Applicant was convicted of a felony D: Submitted a fraudulent educational certificate

Successful renewal of the license requires: A: no criminal convictions B: All of these are required C: fees paid before last day D: proper CE credits

If you are acting in the best interest of the insured and handling their funds and affairs, then you are acting as a: A: Guarantee association B: Insolvency director C: Conservator D: Fiduciary

Which of the following is not a penalty for unlawfully acting as an insurer without a certificate of authority? A: Fined $50,000 B: Fined $100,000 C: Imprisonment in the county jail for 13 months D: Imprisonment in the state prison for 11 months

The commissioner may disapprove the use of any true or fictitious name on any of the following grounds except: A: a name that way misleads the public. B: a name that is too similar to a name already filed and in use. C: a name that contains the word Motor Club D: a name that contains the word Chartered Life Underwriter

An agent's license may be renewed or reactivated at any time prior to its expiration by the filing the following except: A: A new bond B: A new appointment C: A new action notice D: A new company contract

Subsequent violation of a cease and desist order would result in: A: mandatory revocation B: suspension up to 3 years C: suspension up to 1 year D: mandatory ethics course

You must notify the Commissioner immediately if the following occur except: A: Mailing or email address change B: Residence address change C: Drivers license change D: Principal business address change

All of the following are expectations in dealing with clients except: A: Stay up to date with all insurance laws and regulations B: Be accurate and truthful C: Try to find ways to save your client money D: Avoid making bad or negative comments about the competition except when you know they are truthful.

A pretext interview is conducted when any person does one or more of any of the following except: A: Pretends to represent someone he is not actually representing B: Refuses to identify himself upon the initial interview C: Pretends to be someone he is not D: Misrepresents the purpose of the interview

If you have a web page for your insurance business you must identify all the following on the site except for: A: Your fictitious name approved by the commissioner B: Your insurance license number C: Your phone number and email address D: Your main office address and the state of your domicile

Who writes standard coverages in California but the insurer is unlicensed? A: Admitted Insurer B: Surplus lines insurer C: Nonadmitted insurer D: Standard Market Insurer

There are strict regulations governing truth in insurance advertising. If a premium amount is stated in an ad, it must be: Correct: For the exact coverage described in the ad. Incorrect: More than $100 Incorrect: Explained with a footnote in the ad. Incorrect: Less that $100

Insurers are required to keep _______ to be used to pay future claims. Incorrect: Interest bearing accounts Incorrect: Re-insurance Incorrect: A profitable environment Correct: Reserves of funds

Insurance ads cannot not imply that claim settlements will be: Correct: All of these are true Incorrect: generous Incorrect: include special treatment Incorrect: unusually high

All admitted insurers must submit to the DOI a detailed financial statement: Incorrect: Semi-annually Incorrect: Quarterly Correct: Annually Incorrect: Only upon request

A source of guidance for proper behavior as a producer can be found in: Incorrect: can you sleep at night Incorrect: church Incorrect: parents Correct: industry's code of ethics

A principal compensates an agent based on the terms of the employment agreement, but the most common breakdown includes which of the following: Incorrect: Different rates for different lines of insurance. Incorrect: Higher rate of commission on new business. Incorrect: Lower rate of commission on renewal business. Correct: All of the above/below.

In most states, insurance is regulated on the ________ level. Incorrect: Company Correct: State Incorrect: Federal Incorrect: Tax basis

A/an _________ agent is an agent who has signed an exclusive contract with one or more companies. Incorrect: Independent Incorrect: Unethical Correct: Captive Incorrect: Endorsed

Discussing the benefits of one product but selling another in it place is: A: called bait and switch B: ok, if the premium is less C: common practice D: not illegal

Regulations governing the insurance industry are designed primarily to ______ and to promote fair competition among insurers. A: Increase producer commissions B: Reduce the number of policies sold. C: Protect the consumer from abuses. D: Impose taxes on policies

There are three preferred methods that can be used to address ethical dilemmas. Which one of the following is NOT one of the preferred methods. A: A list of key questions. B: An ethical checklist. C: The ten-step method D: A lawsuit.

Producers should provide for the clients: A: Neither proper legal advice or drafted legal documents. B: drafted legal documents C: Both proper legal advice and drafted legal documents. D: proper legal advice

``` Untruthful policy replacements, where an agent advises a policyholder to let his policy lapse so it can be replaced with a new policy, is known as: A: Hopping. B: Twisting. C: Sleeping D: Looping. ```

Licensing relates to all of the following except: A: Renew licenses B: Suspend and revoke licenses. C: Protect insurers from the insured D: Issue licenses

People like to do business with __________ . A: relatives B: their friends C: people they trust D: strangers

The state stipulates that in order for a rate to remain in effect it must be: A: adequate B: reasonable C: not discriminatory D: All of the above/below

Ethics requires that when talking about a competitor an agent: A: not present an image harmful to the industry B: find fault with the competitors product. C: should always be critical. D: point out all the negative product elements.

Ethics in the business environment is about prioritizing _______ and ensuring behaviors are consistent with those values. A: Personal values B: Legal values C: Moral values D: Religious values

_________ consent is granted as a result of those actions which must be taken to carry out the authority granted to an agent in expressed consent. A: Residual B: Apparent C: Implied D: Full

Handling an insured's assets is regulated by most states who require A: Professional financial counseling. B: High return investments. C: Conservative investments. D: Savings accounts.

There are three basic methods of crediting a return on an insurance policy: portfolio method, new money method and combination method. In the portfolio method, ________ are emphasized A: Short term investments B: Long term investments C: Treasury bonds D: Pro rata or block investments

In a policy illustration, premiums that come due but which are paid by dividends and other cash values of the policy are called A: Paid up premiums. B: Vanishing premiums C: Additional premiums. D: Escrow premiums.

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