P Review Flashcards
Inland Marine will NOT cover:
Select one:
a.
cattle shipped to market
b.
imports
c.
leased buildings
d.
exports
Leased buildings
A Business Income Coverage Form has a $100,000 limit of liability with a 25% monthly limit of indemnity. If the insured loses $47,000 in a particular month, the most the policy will pay for that month’s losses is:
Select one:
a.
$0
b.
$25,000
c.
$47,000
d.
$100,000
25,000
Under Section II of the HO policy, Med Pay will cover a claim:
Select one:
a.
for pain and suffering.
b.
only if the insured is negligent and liable.
c.
for medical expenses of the insured.
d.
regardless of liability.
Regardless of liability
Which would NOT purchase a bailee’s floater?
Select one:
a.
dry cleaner
b.
a credit union
c.
computer repair business
d.
a furrier
A credit union
If a business insured by a Building and Personal Property policy (BPP) acquires a new business, the new business is insured for a grace period of:
Select one:
a.
30 days
b.
60 days
c.
90 days
d.
120 days
30 days
Marine Transportation Insurance covers:
Select one:
a.
domestic shipments of goods
b.
commercial buildings
Domestic shipments of goods
A Mobile Home policy covers a detached garage:
Select one:
a.
to 10% of A (with at least $2,000 coverage)
b.
with no limit
c.
only by a rider, endorsement, separate policy
d.
to 20% of A
To 10% of A (with at least $2,000 coverage)
The HO’s Supplementary (Additional) Payments pays:
Select one:
a.
in addition to the limits of liability.
b.
after the deductible is satisfied.
c.
only after the limit of liability is reached.
d.
only up to the limit of liability.
In addition to the limits of liability
Joe has a building covered by a Building and Personal Property policy. What must he do to cover a new lawnmower used to service the premises?
Select one:
a.
list the items on an endorsement
b.
nothing
Nothing
A carpenter working on a house has a hammer slip from his hands, but no damage occurs. This is not an accident because:
Select one:
a.
it was unexpected.
b.
it was not intentional.
c.
no damage occurred.
d.
it happened very suddenly.
No damage occurred
The owner of a new office building is unable to move in for 80 days. Which provision will restrict coverage?
Select one:
a.
vacancy
b.
abandonment
c.
coinsurance
d.
indemnity
Vacancy
Which of the following is eligible for flood insurance?
Select one:
a.
a retail store only
b.
a retail store and its inventory
A retail store and it’s inventory
Ocean marine floaters cover each of these EXCEPT:
Select one:
a.
jettison
b.
insects and vermin
c.
theft
d.
barratry
Insects and vermin
The earthquake deductible is applied:
Select one:
a.
with each aftershock
b.
once each 7 days (168 hours)
Once each 7 days (168 hours)
Each of the following could be included in a CPP EXCEPT:
Select one:
a.
Commercial Auto
b.
Inland Marine
c.
Equipment Breakdown
d.
Ocean Marine
Ocean marine
The optional coverage under a BOP is:
Select one:
a.
Liability coverage
b.
Burglary and Robbery
c.
Building coverage
d.
Personal Property coverage
Burglary and robbery
The Business Income coinsurance requirement to maintain the Coverage Extensions is:
Select one:
a.
20%
b.
50%
c.
80%
d.
90%
50%
Under a Homeowner policy, abandonment is:
Select one:
a.
not permitted
b.
permitted
Not permitted
The HO-2 provides vandalism coverage for a maximum of how many days after the beginning of the vacancy?
Select one:
a.
30 days
b.
60 days
c.
90 days
d.
120 days
60 days
The Business Income form covers each of these EXCEPT:
Select one:
a.
payroll
b.
property replacement
c.
necessary continuing operating expenses
d.
lost profits
Property replacement
Inland Marine policy losses are usually calculated with which method of valuation:
Select one:
a.
replacement cost
b.
actual cash value
Actual cash value
Extra Expense covers:
Select one:
a.
all expenses necessary to continue the business after a loss.
b.
only the additional expenses necessary to continue the business after a loss.
Only the additional expenses necessary to continue the business after a loss
The deductible under an earthquake policy is:
Select one:
a.
$250.
b.
a percentage.
A percentage
The owner of a business carelessly left the rear door unlocked over the weekend, resulting in merchandise being stolen. Under a Building and Personal Property policy – Special, this loss:
Select one:
a.
will be covered as a theft loss
b.
will not be covered
Will be covered as a theft loss
If the insured’s dog bites a jogger, the HO’s Bodily Injury Liability will pay for:
Select one:
a.
a new kennel.
b.
fencing for the dog.
c.
retraining the dog.
d.
defense costs if the jogger sues.
Defense cost of the jogger sues
A building valued at $100,000 has a policy with an 80% coinsurance clause. The minimum coverage needed to fully cover a $15,000 fire loss is:
Select one:
a.
$15,000
b.
$50,000
c.
$80,000
d.
$100,000
$80,000
Under the pair or set rule:
Select one:
a.
Both items in the pair or set must be insured for full replacement or actual cash value.
b.
In no event will the loss of one item in the pair or set be considered to be the loss of all items in the pair or set.
In no event will the loss of one item in the pair or set be considered to be the loss of all items in the pair or set
The HO-5 policy provides:
Select one:
a.
Coverage F (Medical Payments) only
b.
neither Coverage E (Personal Liability) nor Coverage F (Medical Payments)
c.
Coverage E (Personal Liability) only
d.
both Coverage E (Personal Liability) and Coverage F (Medical Payments)
Both coverage E (personal liability) and coverage F (medical payments)
The Building and Personal Property policy may be used to cover each of the following EXCEPT?
Select one:
a.
tenant’s improvements and betterments
b.
property of others
c.
property damage liability
d.
building additions
Property damage liability
The HO’s Medical Payments pays:
Select one:
a.
only up to the limit of liability.
b.
after the deductible is satisfied.
c.
in addition to the limits of liability.
d.
only after the limit of liability is reached.
Only up to the limit of liability
Which can get a Businessowner policy?
Select one:
a.
a small restaurant
b.
a bungee jump at an amusement park
c.
theatre
d.
a factory
A small restaurant
Which form of Business Interruption coverage allows a business to continue partial or full operation after loss caused by a covered peril?
Select one:
a.
Extra Expense coverage.
b.
Direct loss coverage.
Extra expense coverage
The HO’s Personal Liability section covers:
Select one:
a.
Damage to the property of other persons.
b.
Medical expenses of the Insured’s children.
c.
Damage to the insured’s home.
d.
A tenant’s suit for wrongful eviction.
Damage to the property of other persons
A building with no occupants or contents is:
Select one:
a.
vacant
b.
unoccupied
Vacant
A mobile home policy:
Select one:
a.
Provides Replacement Cost coverage.
b.
May be used if the mobile home has at least 200 square feet.
c.
will pay $500 of the cost of transporting the mobile home to a new permanent location.
d.
May be used if the mobile home has at least 300 square feet.
Provides replacement cost coverage
A DP-1 (Dwelling Policy -1) covers each of the following EXCEPT:
Select one:
a.
hail
b.
earth movement
c.
fire and smoke
d.
explosion
Earth movement
Which is true regarding the HO-8?
Select one:
a.
It is only designed for multi-family dwellings.
b.
It was created because replacement cost is too costly for some homes.
c.
It allows the insured to operate a small business in the home and still have both liability and property coverage as well as work comp coverage for employees.
d.
There is no liability coverage.
It was created because replacement cost is too costly for some homes
If the insured is injured in her home, she will be compensated under:
Select one:
a.
Section I of the HO
b.
Section II of the HO
c.
Medical Payments under the HO
d.
Her health insurance policy, but not under the HO at all
Her health insurance policy, but not under the HO at all
The Extended Business Income is intended to provide 30 days coverage that begins:
Select one:
a.
on the date the loss occurs.
b.
after the reopening of the business following the loss restoration.
c.
on the date the policy is purchased.
d.
after the policy terminates.
After the reopening of the business following the loss restoration
The additional coverages under the Building and Personal Property policy include each of the following EXCEPT:
Select one:
a.
Fire Department Service Charges
b.
Removal/Preservation of Property
c.
Theft of Money
d.
Debris Removal
Theft of money
A car is destroyed by a hurricane. This is:
Select one:
a.
an accident
b.
an occurrence
An accident
The Building and Personal Property policy deductible does not apply to:
Select one:
a.
Newly Acquired or Constructed Property
b.
Trees
c.
Removal/Preservation of Property
d.
Fire Department Service Charge
Fire department service charge
The Building and Personal Property policy covers outdoor furniture located within a maximum of:
Select one:
a.
50 feet
b.
100 feet
c.
200 feet
d.
250 feet
100 feet
A mobile home policy:
Select one:
a.
may provide Replacement Cost coverage for the structure if it is insured to 80% of replacement cost.
b.
does not provide Section II liability coverage.
May provide Replacement Cost coverage for the structure if it is insured to 80% of replacement cost
Flood insurance covers:
Select one:
a.
leaky roofs
b.
broken water pipes
c.
mudslides
d.
foundation seepage
Mudslides
For a business, Extra Expense would cover:
Select one:
a.
rebuilding the structure
b.
lost business income
c.
payment of normal payroll
d.
rental of substitute space
Rental of substitute space
Most Personal Articles Floaters are written on:
Select one:
a.
an open perils (all-risk) basis.
b.
a stated value basis.
An open perils (all-risk) basis
A Personal Articles Floater:
Select one:
a.
is an unscheduled blanket policy.
b.
covers inherent vice.
c.
provides all-risk coverage.
d.
provides named peril coverage.
Provides all-risk coverage
Under a CPP, the duration of the policy’s coverage is found in the:
Select one:
a.
exclusions
b.
declarations
c.
conditions
d.
insuring agreements
Declarations
Extra Expense coverage may be provided with:
Select one:
a.
Business Income
b.
Liability insurance
Business income
A store’s business owner’s policy covers the store’s portable shelving. The shelving, which was destroyed by fire, had the following valuations: replacement cost - $7,000; actual cash value - $3,000; original purchase price - $5,000; fair market value - $280. The policy will pay how much on this claim?
Select one:
a.
$280
b.
$3,000
c.
$5,000
d.
$7,000
$7,000
Which federal agency runs the flood insurance program?
Select one:
a.
FEMA
b.
FTC
c.
EPA
d.
IRS
FEMA
While playing with fireworks, Smith’s 16-year-old child negligently destroyed the neighbor’s $250,000 home. Smith’s homeowner’s policy will cover the liability up to:
Select one:
a.
$0
b.
$1,000
c.
$100,000
d.
$250,000
$100,000
After a Building and Personal Property policy proof of loss is filed, the claim must be paid within:
Select one:
a.
10 days
b.
30 days
c.
60 days
d.
90 days
30 days
Which of the following will result in an “automatic” assignment of a CPP?
Select one:
a.
sale of the business
b.
bankruptcy of the Insurer
c.
bankruptcy of the business
d.
death of the Insured
Death of the insured
Loading docks and cattle shipped to market are insured by what area of insurance?
Select one:
a.
inland marine
b.
ocean marine
Inland marine
The National Flood Insurance Program is operated by the:
Select one:
a.
state government
b.
federal government
Federal government
The most a HO policy will pay for a liability slip and fall claim under Section II of the policy is:
Question 58 Select one:
a.
$15,000.
b.
$25,000.
c.
$40,000.
d.
the policy’s limit of liability.
The policy’s limit of liability
If a fire causes $100,000 damage and the debris removal expense is $14,000, a Building and Personal Property policy will pay how much (assuming it has adequate limits of coverage)?
Select one:
a.
$14,000
b.
$100,000
c.
$114,000
d.
$135,000
$114,000
Commercial floaters cover:
Select one:
a.
birthday gifts
b.
salespersons’ samples
Salespersons samples
Which is a coverage extension?
Select one:
a.
fire extinguishers
b.
vans
c.
lawns and crops
d.
newly acquired property
Newly acquired property
Building materials used for repairs are not covered for:
Select one:
a.
vandalism
b.
theft
c.
wind and hail damage
d.
fire damage
Theft
Which BOP is not available?
Select one:
a.
Basic (standard) coverage
b.
Broad form coverage
c.
Special (open perils) coverage
d.
Basic and Special coverages
Broad form coverage
An appliance repair business is robbed of $10,000 in equipment and $500 cash. The $75,000 Special Businessowner’s policy will cover the loss for:
Select one:
a.
$0
b.
$500
c.
$10,000
d.
$10,500
$10,000
A homeowner policy requires notice of a loss to be given to each of the following EXCEPT:
Select one:
a.
the police if a crime is involved.
b.
the insurer.
c.
other insureds.
d.
the credit card company if a credit card is stolen.
Other insureds
Under the Building and Personal Property policy, the mortgagee is entitled to:
Select one:
a.
Payment as per the mortgagee’s interest at the time of loss
b.
45 days notice of cancellation for nonpayment of premium
Payment as per the mortgagee’s interest at the time of loss
Which floater covers a heating/air conditioning dealer putting a new furnace system in an office building?
Select one:
a.
Installment Sales Floater
b.
Contractor’s Equipment Floater
c.
Physicians and Surgeons Floater
d.
Installation Floater
Installation floater
A refinery’s pipe suddenly bursts and pollutes the atmosphere. This is an:
Select one:
a.
occurrence
b.
accident
Accident
Which of the following is covered by a Commercial Package Policy (CPP)?
Select one:
a.
Ships
b.
Crime
c.
Partners’ Accounting
d.
Aircraft
Crime
The Building and Personal Property policy covers each of the following EXCEPT:
Select one:
a.
fire extinguishers
b.
building materials used to make repairs
c.
a tenant’s furnishings
d.
appliances furnished by the land lord in a tenant’s unit
A tenant’s furnishings
Pollution over a long period of time is:
Select one:
a.
an accident
b.
an occurrence
An occurrence
For the dwelling, Mobile Home policies cover loss settlement:
Select one:
a.
on an ACV basis.
b.
without a deductible.
c.
on a stated or agreed value basis.
d.
on a Replacement Cost basis.
On a replacement cost basis
If the insured’s dog bites a jogger, the HO will pay a maximum of defense costs plus:
Select one:
a.
$1,000
b.
$100,000
c.
$101,000
d.
$250,000
$100,000
If all of a business’s trees are destroyed in a fire, the maximum the BOP will pay is a total of:
Select one:
a.
$250
b.
$500
c.
$2,500
d.
$5,000
$2,500
Three trees valued at $1,900, $600, and $200 were destroyed by fire. The businessowner policy will cover this loss to a total of:
Select one:
a.
$0
b.
$1,500
c.
$1,800
d.
$2,500
$1,800
Each of these is true regarding flood insurance EXCEPT:
Select one:
a.
There are both regular and emergency programs.
b.
Flood policies contain a coinsurance requirement.
c.
Flood insurance is sponsored by the federal government because private insurance companies did not meet the need.
d.
One to four family dwellings are covered.
Flood policies contain a coinsurance requirement
An Earth Movement policy covering a shopping mall would most likely cover a claim involving:
Select one:
a.
flood
b.
war
c.
nuclear
d.
volcanic eruption
Volcanic eruption
A single unexpected event is:
Select one:
a.
an occurrence.
b.
an accident.
An accident
A business is insured by a $400,000 BOP. If three trees valued at $600, $700, and $400 are destroyed by fire, the policy will pay how much?
Select one:
a.
$500
b.
$1,000
c.
$1,400
d.
$1,700
$1,700
Ocean Marine covers:
Select one:
a.
loading bridges
b.
buildings
Loading bridges
In comparing an HO-2 and HO-3, the HO-3 has:
Select one:
a.
better Property Damage limits.
b.
better Bodily Injury limits.
c.
higher Med Pay coverage limits.
d.
None of the above.
None of the above
A Fine Art Floater:
Select one:
a.
covers private art works.
b.
covers public art collections.
Covers private art works
Ocean Marine Insurance covers:
Select one:
a.
single family homes
b.
warehouses
c.
buildings
d.
ships’ cargo
Ship’s’ cargo
The Building and Personal Property policy (BPP) covers:
Select one:
a.
retaining walls not attached to the building
b.
automobiles
c.
a rowboat stored in the building
d.
fences not attached to the building
A rowboat stored in the building
Which section of a Special (Extended Coverage) form BPP contains information regarding whether a peril is covered?
Select one:
a.
exclusions
b.
insuring agreement
c.
declarations
d.
definitions
Exclusions
A Business Income policy has a $10,000 limit of liability with a 25% monthly limit of liability. The Business is destroyed by a covered peril. The actual loss of income was $2,000 for the first month and $3,000 for the second month. The Business Income policy will pay a total of how much for the two months?
Select one:
a.
$2,000
b.
$2,500
c.
$4,500
d.
$5,000
$4,500
Which is least likely to be eligible for a BOP?
Select one:
a.
jewelry stores
b.
small office buildings
c.
shoe stores
d.
large restaurants
Large restaurants
The purpose of the National Flood Insurance Program is to:
Select one:
a.
provide flood insurance at subsidized rates.
b.
require all Americans to have flood insurance.
Provide flood insurance at subsidized rates
Which coverage applies under an Ocean Marine policy when cargo is jettisoned to save the ship?
Select one:
a.
sue and labor expense
b.
particular average
c.
total loss
d.
general average
General average
When there is no transfer of title, flood insurance is effective how many days after application?
Select one:
a.
1
b.
5
c.
10
d.
30
30
The definition of vacancy under a Homeowner policy is:
Select one:
a.
10 days
b.
15 days
c.
20 days
d.
30 days
30 days
Inland Marine policies are called?
Select one:
a.
floaters
b.
certificates
c.
mariners
d.
reservations
Floaters
A person who owns jewelry worth over $50,000 should get a:
Select one:
a.
Personal Effects Floater
b.
Personal Articles Floater
Personal articles floater
After 60 days, a property with no people and no significant amount of personal property is considered to be:
Select one:
a.
vacant
b.
unoccupied
Vacant
Earth movement insurance is available:
Select one:
a.
only as a stand-alone policy
b.
only as an endorsement
Only as an endorsement
Section I of the HO covers each of these EXCEPT?
Select one:
a.
Additional Living Expenses
b.
Appurtenant structures
c.
Unscheduled personal property
d.
Bodily Injury Liability
Bodily injury liability
Inland Marine covers each of the following EXCEPT:
Select one:
a.
domestic shipments
b.
real estate and buildings
c.
exports
d.
imports
Real estate and buildings
Boiler policies cover losses due to:
Select one:
a.
Corrosion
b.
Accidental breakdown
Accidental breakdown
An accident is:
Select one:
a.
sudden and unintended
b.
repeated and continuous
Sudden and unintended
The HO’s Personal Property coverage applies to:
Select one:
a.
property owned by an unrelated tenant.
b.
the insured’s automobile.
c.
the insured’s dog.
d.
the insured’s clothing.
The insured’s clothing
