Cert Exam Flashcards
With regard to binders, which of the following statements is correct?
A binder may be canceled by the insured with 2 days’ notice
The attempt to restore an insured to their pre-loss condition is known as:
Indemnification
A hurricane occurrence:
Begins when a hurricane watch or warning is issued for any part of Florida by the National Hurricane Center of the National Weather Service
Answers to specific questions on an insurance application that are guaranteed to be true best defines:
Warranties
Which homeowner policy form is for dwelling owners who do not wish to insure their older homes for replacement cost?
HO-8
All of the following are minimum financial responsibility limits of liability for automobile insurance in Florida for the owner of a motor vehicle, except:
$20,000 property damage
Which action would not constitute an unfair claim settlement practice on the part of an insurance company in its claim handling or processing?
Offering an insured a prompt explanation in denial of a claim or offer of compromise
All of the following are correct regarding the Florida Insurance Guaranty Association, except:
The association is responsible for penalties and interest
An agreement between 2 parties enforceable by law describes:
An insurance contract
An insurance agent is in the habit of offering potential clients a 10% premium discount on the first year’s premium if they will buy their insurance from him instead of one of his competitors. The agent is guilty of:
Rebating
Liability coverage is excluded under a personal auto policy for ownership, maintenance, or use of all of the following, except:
Off-road vehicle used by insured in an emergency
The federal act that protects consumer privacy by ensuring that data collected is confidential, accurate and used for a proper and specific purpose is the:
Fair Credit Reporting Act
After the first 24 hours, the Earthquake Endorsement covers damage for how many additional hours?
48
All of the following are examples of sliding, except:
Charging an applicant for an additional product when in fact, the applicant is aware of and agrees to the additional product
By what other name is the Dwelling Form DP-2 known?
Broad Form
When must an insurable interest exist in a property policy?
At the time of application
How many credit hours of continuing education must a new agent complete every 2 years?
24 (19 elective with 5 hours of law and ethics)
Which of the following is an example of a peril?
Gasoline stored on the premises
A reinsurance agreement that allows ceding and reinsurance companies the opportunity to negotiate coverage for individual risks is a:
Facultative Agreement
For insurance purposes, an unfurnished beach house is considered ____________ because no one is living there.
Vacant
A continuous or repeated exposure is a condition describing which of the following?
Occurrence
A continuous or repeated exposure is a condition describing which of the following?
Occurrence
Under the Personal Auto Policy, the definition of bodily injury includes all of the following, EXCEPT:
Loss of property use
Which of the following Forms provides open perils coverage for Coverages A and B?
HO-3
The price a willing buyer will pay for a property from a willing seller is:
Market value
If an insured’s claim was denied, the mortgagee can collect under the policy as long as the mortgagee meets all of the following requirements, except:
Hire a private investigator to follow the insured
Which condition provides the insurer the right to collect against a responsible third party?
Subrogation
Which vehicle would NOT be a covered auto under the Personal Auto Policy?
A new vehicle acquired during the policy period as long as coverage is requested within 45 days of taking ownership
All of the following perils are automatically covered under the DP-3 policy, except:
Theft of contents
Which peril is covered under the Dwelling Form DP-1?
Lightning
Whose consent is required to transfer or assign interest in an insurance contract to another?
The mortgagee
Evidence that specific types of insurance were purchased by the insured at certain limits on a specific date is called a:
Certificate of Insurance
Which of the following forms is known as the Unit-Owners Form?
HO-6
The “broad form” is also known as the:
DP-2
Which provision requires the insured to maintain a certain limit of insurance?
Coinsurance
What is an inherent vice?
A quality within property that causes it to damage or destroy itself
Which vehicle is considered a temporary substitute auto?
A dealer’s loaner car used while the insured’s auto is being repaired
Which part of an insurance policy describes the rules that the insured and insurer have agreed to follow?
Conditions
When is insurable interest required to exist on a property policy?
At the time of loss
Which provision encourages the insured to maintain a certain limit of insurance?
Coinsurance
Which loss would NOT be covered by the National Flood Insurance Program?
Water main break
Which term describes the cost to replace property minus the deduction for depreciation?
Actual cash value
An award to an injured party for compensatory damages of losses that cannot be assigned a specific dollar value are known as
General damages
Attachments that broaden or amend coverage in a property or casualty policy are known as:
Endorsements
All of the following are duties of the insured following a loss, except:
Separate damaged from undamaged property
A Florida insurer must give the named insured at least ______ days’ advance written notice of nonrenewal:
20
What Specifies that the insured may not transfer rights of ownership without the insurer’s prior written consent?
Assignment
ABC Insurer sends Marie a letter advising her that her policy will expire at the end of the policy term. This describes which of the following:
Termination
Which of the following types of risk are insurable?
Pure
How is the limit of liability applied under Coverage E of the Homeowners Policy?
Per occurrence
Which tort is unintentional?
Negligence
Which of the following is not an element of a legally enforceable contract?
Negotiation
The insured has an auto policy with liability limits of $30,000/$60,000/$10,000. He negligently runs off the road and causes $70,000 damage to an apartment building. How much will the policy pay?
10,000
Which type of coverage will replace damaged or destroyed property with the equivalent at current cost?
Replacement cost
Who are the owners of a mutual insurance company?
Policyholders
Which term refers to the termination of a policy before its expiration date?
Cancellation
The Personal Articles Floater provides for all of the following, except:
Insures commercial property
All of the following are correct regarding hurricane deductibles in Florida, except:
Changes to the percentage of deductible may be implemented at any time during the calendar year
Which of the following Forms provides open perils coverage for Coverages A, B, and C?
HO-5
A written notification provided by the insured to an insurer that specifies the details about the time, place and circumstances surrounding a loss is a:
Notice of Loss
Which of the following is NOT a purpose of licensing?
To facilitate the public supervision of such activities in the public interest
Market conduct examinations are:
Conducted to ensure compliance with statutes and rules
An agent must communicate with the Department regarding any change in address within ___ days.
30 days
Which coverage is provided under Part B of the Personal Auto Policy?
Medical payments
A policy that insures one dwelling for a single limit of $150,000 is an example of which property insurance limit?
Specific
The right of the insurer to take possession of damaged property after paying for its loss is called:
Right of salvage
Which of the following forms provides named perils coverage to the owner of a condominium or cooperative unit?
HO-6
Perils that are not covered by the policy are listed in the which section?
Exclusions
Gambling is an example of which type of risk?
Speculative
A nonadmitted insurer is a company:
Organized in another state in which its home office is located
An insured and insurer will utilize which of the following when they are unable to agree on the amount of a claim to be paid?
Appraisal
An insured has an automobile policy with bodily injury limits of $100,000/$300,000. Two persons are struck by the insured’s auto and are awarded $15,000 and $90,000 respectively. How much will the insured’s automobile policy pay?
$105,000, plus defense costs
All of the following may be considered to be an uninsured motorist, except:
A person borrowing the auto with permission
An insurance company is considered a domestic insurer in Florida if it is:
Organized and admitted in Florida
Under Section II of the Homeowners Policy, who is NOT an insured?
A friend residing in your home
Which concept is designed to eliminate small claims and help in reducing the cost of insurance?
Deductibles
Which part of the insurance contract specifies the risks the policy will not cover?
Exclusions
A policy form that alters or adds to the provisions of a property and casualty insurance contract is a(n):
Endorsement
An auto insurance policy must provide personal injury protection to all of the following, except:
The thief of a stolen vehicle
A formal statement made by the insured that provides necessary details for the insurer to determine liability under a policy is a:
Proof of loss
The Department of Financial Services has the power to do all of the following, except:
Regulate the state Medicaid program
All of the following are a regulatory concern with unlicensed entities transacting insurance business in Florida, except:
State or federal guaranty funds will cover unpaid claims of unlicensed entities as a priority
Which peril is NOT covered under Part D of the Personal Auto Policy?
Road damage to tires
The scrap value of damaged property is the:
Salvage value
Marie was mugged on the street when a stranger grabbed her purse and threatened to knock her down. This act describes which of the following?
Robbery
An applicant for general and personal lines licensing must qualify by all of the following, except:
Be at least age 21
Under Homeowners Section II, Damage of Property to Others pays up to:
$1,000
What is another name for the Homeowners Form HO-5?
Comprehensive form
What is another name for the Homeowners Form HO-5?
Comprehensive form
What is NOT a supplementary payment under Section II of the Homeowners Policy?
Expenses incurred by the insured at the insurer’s request
Lightning strikes a home and starts a fire that destroys the structure and its contents. The lightning is the:
Pure Risk
Which of the following terms describes an insurance company that has been organized outside the United States or its possessions?
Alien
Liability involving a degree of negligence that is established by a court of law, best describes:
Contributory negligence
The liability assigned to one party for the conduct of another, based solely on a relationship between the two is:
Vicarious liability
A licensed individual who is limited to transacting business related to property and casualty insurance sold to individuals and families for noncommercial purposes is a:
Customer Service Representative
What is the definition of risk?
The chance of a loss
An award to an injured party for compensatory damages of actual known expenses such as loss of earnings is known as:
Special damages
Choose the FALSE statement about mobile home insurance:
The mobile home and contents may be written only on a named peril basis
What is another name for the Homeowners Form HO-4?
Tenants Form
Catastrophic Ground Cover Collapse is geological activity that results in all of the following, except:
Structural damage to the covered building
All of the following statements are correct regarding the treatment of motorcycles, except:
A helmet is required for all riders in Florida
