Casualty Flashcards
The termination of an insurance contract with the premium charge being adjusted in proportion to the exact time the protection has been inforce is considered a:
A. Refund cancellation
B. Short-rate cancellation
C. Flat rate cancellation
D. Pro-rata cancellation
D. Pro-rata cancellation
When a parent is required to pay for damaged caused by his children, this is an example of:
A. Strict liability
B. Intervening cause
C. Assumption of risk
D. Vicarious liability
D. Vicarious liability
Imposed upon a person or company engaged in hazardous or potentially dangerous business who, by negligence or by an omission, causes harm or injury to another person or property.
Absolute liability
All of the following statements describe the concept of strict liability EXCEPT:
A. Claimants may need to provide proof that a product defect caused an injury
B. It is imposed regardless of fault
C. It is applied in product liability cases
D. It is imposed on defendants engaged in hazardous activities
D. It is imposed on defendants engaged in hazardous activities.
What is a material misrepresentation?
A. Any misstatement by the producer
B. concealment
C. A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company.
D. Any misstatement made by an applicant for insurance.
C. A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company.
An insured had a liability policy that sets the amount for all claims that arise from a single incident at $50,000. Which type of limit if liability does this insured’s policy have?
A. Split
B. Per occurrence
C. Per person
D. aggregate
B. Per occurrence
Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract?
A. Indemnity
B. Representation
C. Warranty
D. Concealment
C. Warranty
What is the basic limit for costs incurred at the place a vehicle is disabled provided by the towing and labor costs endorsement?
A. $25
B. $50
C. $75
D, $100
A. $25
What is the deductible of a personal liability umbrella policy called?
A. The CPP
B. The SIR
C. The PIL
D. The CGL
B. The SIR
Self-insured Retention
An insured is involved in an auto accident in another state. The state has a financial responsibility law that specifies limits of liability higher than the limits shown in the declarations, What amount will the insured’s policy pay?
A. Higher limits
B. Lower limits
C. The insurer will not pay for out-of-state accidents
D. Only the limits specified in the policy
A. Higher limits
If the ocean marine contract pays the ACV of the property just prior to the loss, it is:
A. A demurrage contract
B. A valued contract
C. An indemnity contract
D. A replacement cost contract
C. An indemnity contract
Because most hull policies are written on an agreed value basis, the insurer and insured agreed upon the value of the ship at the time the contract is made.
In a personal umbrella policy, the amount paid by the insured for certain losses not covered under the primary coverage is called:
A. Self-insured retention
B. Stop-loss
C. Coinsurance
D. Participation requirement
A. Self-insured retention
In a marine policy, which of the following is referred to as the “amount insured hereunder?”
A. The duration of risk
B. The limit of insurance
C. The deductible
D. The agreed value
B. The limit of insurance
Complications and confusion over contractual duties are reduced by making the insurer and the _____ the primary parties for carrying out responsibilities.
First named insured
The transfer of money from inside a banking premises to a person other than a messenger outside those premises or to a place outside those premises is covered under which commercial crime coverage?
A. Computer fraud
B. Money orders and counterfeit paper currency
C. Other crime overage
D. Outside premises
A. Computer fraud
Which of the following would be covered under the garage liability coverage form?
A. Loss of use
B. Insured business premises
C. Product recalls
D. Fellow employees
B. Insured business premises
Which of the following statements is true concerning Underinsured Motorists Coverage under a Personal Auto Policy?
A. Coverage applies only to the extent that the Underinsured Motorist limits exceed the bodily injury limits carried by the operator of the at-fault vehicle.
B. It will pay up to the limits of insurance for any loss which involves an underinsured driver.
C. Limits must equal the bodily injury limits of the policy.
D. Limits may differ from the limits for Underinsured Motorists Coverage.
A. Coverage applies only to the extent that the Underinsured Motorist limits exceed the bodily injury limits carried by the operator of the at-fault vehicle
What is the difference between a fidelity bond and a surety bond?
A surety bond guarantees something will happen; a fidelity bond guarantees something will not happen.
In addition to the common policy conditions, all of the following conditions apply to liability coverage EXCEPT:
A. Bankruptcy
B. Employers liability
C. Separation of insured
D. Legal action against insurer
B. Employers liability
The primary purpose of a surety bond is to:
A. Secure a line of credit of a contractor
B. Pay employer losses
C. Make sure obligations are fulfilled
D. Eliminate the possibility of loss
C. Make sure obligations are fulfilled.
A surety bond guarantees the performance of the principal
In the event of a claim under a commercial general liability policy, the insured has all of the following duties to the insurer EXCEPT:
A. Submitting to a medical exam when requested
B. Providing prompt written notice of any claim or suit actually filed against the insured.
C. Furnishing the insurer with copies if any demands, notices, or other legal papers received in connection with a claim or suit.
D. Assisting the insurer upon request in the enforcement of any right against any person or organization that may be liable to the insured
A. Submitting to a medical exam when requested.
Under medical payments coverage, the injured third party has to submit to an exam upon request, not the insured.
Coverage A - Bodily injury and Property Damage in the commercial general liability policy will cover:
A. Contractual Liability
B. Damage to the insured’s product
C. Losses due to the insured’s negligence.
D. Liquor liability
C. Losses due to the insured’s negligence
(Cov A provides protection for bodily injury and property damage suffered by third parties due to negligence of the insured.)
When is a producer allowed to charge a service fee in addition to the premium for the processing of an application for insurance?
A. At any time
B. When consented to in writing by the applicant
C. Only if the policy has a 60-day free look
D. Never
B. when consented to in writing by the applicant
A company may be exempt from coverage under the North Carolina Vehicle Reinsurance Facility by the direct authority of:
A. Board of Governors
B. NAIC
C. No exemptions allowed
D. Commissioner of the Department of Insurance
A. Board of Governors
The Post-Assessment Guaranty Association covers which type of direct insurance?
A. Life
B. Health or disability
C. Automobile
D. Credit
C. Automobile insurance
All of the following must be found on a premium payment receipt EXCEPT:
A. Date
B. Signature of the person making the payment
C. Printed name of the producer and the insurer
D. Signature of the person accepting the payment
B. Signature of the person making the payment
( All premium payments receipts and copies issued by a producer or limited representative must be dated and contain the printed or stamped name and address of the agency, producer, or limited representative and the name of the insurer. Receipts must be signed by the person accepting the payment.)
