AD Banker - Comprehensive Exam Flashcards
All of the following are false concerning the National Flood Insurance Program, except:
Flood policies are available only from the National Flood Insurance Program
A. Flood policies are available only from the National Flood Insurance Program
B. Dwelling coverage includes trees, shrubs, and plants
C. Agents may bind flood insurance for up to 15 days prior to submitting the final application
D. Flood policies are available only from the National Flood Insurance Program
D. Flood policies are available only from the National Flood Insurance Program
How many credit hours of continuing education must a producer with a life and health or property and casualty license complete every renewal period?
A. 18 hours, with at least 3 hours in ethics
B. 30 hours, with at least 3 hours in ethics and no more than 3 hours in agency management
C. 24 hours, with at least 1 hour in ethics
D. 12 hours, with at least 3 hours in ethics
A. 18 hours, with at least 3 hours in ethics
Under the HO-8 policy, the dwelling is valued on which basis?
A. Replacement Cost
B. Agreed Value
C. Market Value
D. Actual Cash Value
D.Actual Cash Value
Transportation Expenses coverage under the Personal Auto Policy begins how long after a covered auto has been stolen?
A
Immediately
B
48 hours
C
24 hours
D
72 hours
B. 48HOURS
**Transportation Expenses Coverage pays $20 per day, up to $600, for transportation expenses incurred due to total theft of the covered auto. Coverage begins 48 hours after a theft.
An automobile policy issued in Kansas may be cancelled after it has been in force for 60 days if the insured was guilty of which of the following in the past 3 years?
A. Leaving the scene of an accident without stopping to report
B. 2 moving violations in the past 3 years
C. Being a passenger in a car while intoxicated
D. Making false statements on the vehicle registration
A. Leaving the scene of an accident without stopping to report
**The policy may also be cancelled if the insured had a 3rd violation within a period of 18 months, made false statements in the application for a driver’s license, or operated a motor vehicle in an intoxicated condition or under the influence of drugs.
Including debris removal, what is the maximum an HO-3 policy with a Coverage A amount of $250,000 will pay if a detached garage burns down?
A. $26,250
B. $250,000
C. $1,250
D. $25,000
A. $26,250
**Coverage B, which covers structures that are not attached, is automatically issued for 10% of Coverage A. This means the Coverage B total is $25,000, and the policy allows for an additional 5% for debris removal: $25,000 + 5% or $1,250 = $26,250.
Which of the following clauses protects the interests of the loss payee?
A. Abandonment clause
B. Mortgagee clause
C. Loss settlement clause
D. Loss payable clause
D.Loss payable clause
**The loss payable clause protects the interests of a person or business with insurable interest in the insured’s property (known as a loss payee), such as a financial institution who finances an auto loan.
A flood damages a single-family dwelling that is in a community in the early stages of participation in the NFIP, but they are not yet considered participating. What is the maximum a resident may receive for damages to their personal property?
A. $35,000
B. $100,000
C. There is no coverage
D. $10,000
D. $10,000
***The dwelling is covered under the Emergency program. The maximum amount of coverage for contents in a single-family dwelling is $10,000.
The formal statement an insured provides to an insurer, including all the details an insurer needs to assess its liability following a loss, is known as a:
A. Proof of loss
B. Notice of loss
C. Binder
D. Certificate of insurance
A. Proof of loss
***A proof of loss is a formal statement made by the insured and provided to the insurer that provides necessary details for the insurer to determine its liability under a policy.
What is the name for an insurer organized in the same state in which it is authorized to do business?
A. Domestic
B. Admitted
C. Alien
D. Foreign
A. Domestic
***A domestic insurer is organized under the laws of the state it does business in.
Which statement is true concerning Dwelling policies?
A. The Special Form automatically covers the contents against the peril of theft
B. 100% of Coverage C applies to worldwide coverage
C. The Basic Form pays for losses to the dwelling on a replacement cost basis
D. The Special Form insures the dwelling on an open perils basis, and insures the contents against the broad form perils
D. The Special Form insures the dwelling on an open perils basis, and insures the contents against the broad form perils
***The Special Form insures the dwelling on an open perils basis, and insures the contents against the broad form perils. Theft is excluded. The Basic Form settles losses to the dwelling on an ACV basis. Up to 10% of the Coverage C limit may be applied to covered property anywhere in the world.
Under the PAP, after a collision the insured is entitled to Transportation expenses up to:
A. $500
B. $600
C. $1,000
D. $200
B. $600
***The policy will pay a maximum of $20 per day, up to $600, for transportation expenses.
The most a policy will pay for a loss arising out of any one accident regardless of overall policy limits, is known as the:
A. Per occurrence limit
B. Aggregate limit
C. Per person limit
D. Split limit
A. Per occurrence limit
***The per occurrence limit represents the most the policy will pay for all losses arising out of any one occurrence, regardless of other policy limits.
The Kansas Automobile Assigned Risk Plan is designed for which of the following persons?
A. A person who uses the automobile for deliveries
B. A person who needs only basic liability insurance
C. A person who has a high-value automobile
D. A person who no longer can get normal coverage due to claims history
D. A person who no longer can get normal coverage due to claims history
***The Automobile Assigned Risk Plan is for individuals who have been unable to obtain auto insurance through normal markets.
Property damage covered by a liability policy includes which of the following?
A. Damage to the insured’s products arising out of the products
B. Damage to property of others in the insured’s care, custody, or control
C. Damage to tangible property, including loss of use of that property caused by the insured’s negligence
D. Damage to property owned by, or leased to, the insured
C. Damage to tangible property, including loss of use of that property caused by the insured’s negligence
Liability policies cover legal liability arising from physical damage to tangible property of others, including loss of use of that property, caused by the acts of an insured.
