Practice Exam Flashcards
The AZ Dept of Insurance does all of the following EXCEPT:
recommend insurance products to the public.
To reduce insurance cost, Brittany wants to replace her HO3 policy with a standard dwelling policy. Although the premium will be lower, the dwelling policy will NOT include:
Liability and theft coverage
Lupe must replace your car’s tires. Why will her personal auto policy’s physical damage coverage (collision and other than collision coverage) cover this expense?
Vandals cut them.
Which is NOT a reason for a homeowner to buy a dwelling policy instead of a homeowner’s policy?
The dwelling policy provides more comprehensive coverage for less premium period
Which of the following types of agent authority arises from the impression that the public has about the agent and his or her duty to the principal?
Apparent
In a standard insurance sales transaction involving an applicant, a producer, and an insurance company, which party is the offer?
Applicant
The Terrorism Risk Insurance Act (TRIA) does not compel insurance companies to offer coverage for certified acts of terrorism and which of the following lines of insurance?
Homeowners
It would cost $500,000 to replace angels home today with an identical home at the same location. According to her HO3 policy, no depreciation will be deducted when settling a loss if she buys coverage of at least:
$400,000
Maurice’s personal auto policy on the family car lists him as the name insured. His wife, Sondra, is involved in an accident while using the car as a Charity Organization volunteer. The injured parties sues Maurice, Sondra, and Charity Organization. Which is insured under the policies liability coverage?
Maurice, Sondra, and Charity Organization
What kind of insurer involves mutual agreements to indemnify the insurance from loss?
Reciprocal Insurer
Quentin has a standard HO3 policy with no endorsements. Assuming appropriate insurance to value, loss to which of the following items would be settled on the basis of its replacement cost?
Brick workshop building in the backyard
A house is struck by lightning during a thunderstorm, which starts a fire. The house stands in a floodplain and the basement fills with water from the storm. The homeowner files a claim on her homeowners insurance policy, which excludes losses from floods. What is true about her coverage?
It will cover the loss.
How many motor vehicle identification cards must an insurer issue for auto liability policies?
At least two
When applying for a business owners insurance policy, Brandy did not mention the hazardous and illegal activity that goes on in the back room of her shop because she realized no insurer that knew about it wouldn’t share her business. What is Brandy’s failure to disclose the activity considered?
Concealment
And insurer that fails to pay a claim in a timely manner will owe interest on the amount due from the date on which the:
Insurer received a claim.
Floyd is in an auto accident. Which is NOT among the duties that his personal auto policy (PAP) imposes upon him?
Negotiate a settlement with the other driver
A notice of policy cancellation will not be effective if:
Notices made only verbally to the insured.
Because the wording of a typical insurance policy is drafted by an insurance company and offer to insurance buyers on a take-it-or-leave-it basis, insurance policies are considered:
Contracts of adhesion
A tree limb puts a hole in Leslie’s roof, so she buys a tarp and hires a handyman to place it over the hole. She then notifies her insurance company that provides her HO3 policy. What will the insurer do?
It will pay for the tarp and it’s installation under the reasonable repairs additional coverage.
Which incident that resulted in a liability claim against Ada did NOT involve “bodily injury” as defined in her homeowner’s insurance policy?
A neighbor’s reputation was harmed by rumors Ada spread.
Phoebe rents her home. She loses control of her car on the icy driveway and crashes into the garage door. It will cost $1,000 to repair or replace the door. The property damage liability coverage of Phoebe’s personal auto policy will:
Pay for the damage
A miscellaneous type vehicle endorsement such as PP 13 69 might be included when the miscellaneous type vehicle is which of the following?
Golf cart
Colby mows lawns and shovels snow after high school to save money for college. He is insured under his parents homeowners insurance policy. The liability coverage of this policy contains a business exclusion. What effect, if any, will this exclusion have on bodily injury or property damage claims against Colby as a result of his business activities?
The exclusion has no effect in Colby is covered.
Making sure a recommended insurance product matches a customer’s needs and circumstances means determining the products:
Suitability
