Property and Casualty

Question 1

What should the mortgagee do if the insured fails to submit a proof of loss form?

Answer 1

File a proof of loss form.

Question 2

What is the limit that the mortgagee can recover?

Answer 2

The balance owed on the mortgage debt.

Question 3

Who selects an appraiser under the appraisal provision?

Answer 3

Each party.

Question 4

The insured cancels a policy halfway through its term yet receives less than a 50% refund. This is:

Answer 4

Short-rate refund

Question 5

A business losing money due to a fire is what?

Answer 5

An indirect loss

Question 6

An application says no fire wood will be stored on the premises. If a later fire is caused by fire wood stored on the premises, the insurer may refuse coverage if the insured

Answer 6

Misrepresented material fact.

Question 7

Can a policy be voided if proof of loss form is not filed?

Answer 7

no

Question 8

Q sold a building but did not cancel the policy. The building was later destroyed by a covered peril. Q will not collect under the policy due to:

Answer 8

Lack of insurable interest

Question 9

What decreases the insurer’s loss?

Answer 9

A deductible

Question 10

Consideration is evidenced by

Answer 10

Paying a premium

Question 11

The insurer’s exposure under a policy is restricted by:

Answer 11

the Limit of Liability.

Question 12

Which section of the policy contains the Insured’s right to bring legal action against the Insurer?

Answer 12

Conditions

Question 13

Which insured person controls the policy?

Answer 13

The first-named

Question 14

The proximate cause of the loss is a

Answer 14

Peril

Question 15

Which section of the policy requires the Insurer to provide coverage?

Answer 15

Insuring Agreements

Question 16

The conditions section of the policy contains:

Answer 16

the insured’s obligations if a loss occurs

Question 17

Which section of a Special form policy determines whether a peril is covered?

Answer 17

Exclusions

Question 18

To prevent recovery beyond the amount of the insured’s actual loss, the policy will contain:

Answer 18

an Other Insurance Clause

Question 19

Which section of a property policy requires the Insured to submit a sworn proof of loss form?

Answer 19

Conditions

Question 20

A promise by the insured that certain future conditions will exist is a?

Answer 20

Warranty

Question 21

Which section of the policy contains the Insurer’s obligation to repair, replace or pay?

Answer 21

Insuring agreements

Question 22

Which section of the policy contains the cancellation provisions?

Answer 22

Conditions

Question 23

One who can lose financially in the event of a loss has:

Answer 23

Insurable interest

Question 24

Which section of the policy contains the covered perils?

Answer 24

Insuring agreements

Question 25

If your building is destroyed by fire, you must notify the Insurer:

Answer 25

Promptly

Question 26

Liability insurance is a:

Answer 26

two-party contract with payment to a third party.

Question 27

Uncertainty of future outcomes is:

Answer 27

Risk

Question 28

If the Insured tries to turn partially or totally destroyed property over to the Insurer while demanding full payment is, this could be construed as the Insured’s illegal attempt at:

Answer 28

Abandonment

Question 29

Negligence is determined by:

Answer 29

how a reasonable person would have acted under the circumstances

Question 30

The rules of conduct between the Insurer and Insured are set forth in which section of the policy?

Answer 30

Conditions

Question 31

What does the mortgage clause do?

Answer 31

Grants the mortgagee specific rights not granted to the Insured

Question 32

There is no negligence without what?

Answer 32

Injury or damage

Question 33

A person with an alleged injury notifies a Producer that the Producer’s client negligently caused the injury. The producer should first notify the:

Answer 33

The insurer

Question 34

The limit payable for all losses in a policy year is the:

Answer 34

Aggregate limit

Question 35

A store owner is held liable when a store employee carelessly drops a box on a customer’s foot. This is an example of what?

Answer 35

Vicarious liability

Question 36

The burden of proving a loss rests on the:

Answer 36

The insured

Question 37

Nonrenewal requires the Insurer to:

Answer 37

mail notice to the insured in advance.

Question 38

Which of the following is considered to be a “participating” Insurer?

Answer 38

A mutual insurer

Question 39

“Acts of God” are best covered by:

Answer 39

Special form

Question 40

To guarantee that depreciation will not be a factor in calculating the amount to be paid at the time of a loss, an Insured should purchase:

Answer 40

Replacement cost

Question 41

The mortgagee should receive how much notice of cancellation?

Answer 41

10 days

Question 42

A consequential loss is:

Answer 42

an indirect loss

Question 43

What forms cover glass breakage

Answer 43

Broad and special

Question 44

In addition to requiring that Insurers protect clients’ privacy rights, the Gramm-Leach-Bliley Act:

Answer 44

encourages the states to adopt uniform licensing requirements to make it easier for Producers to sell insurance across state lines.

Question 45

The Actual Cash Value formula is:

Answer 45

Replacement cost minus physical depreciation

Question 46

An assignment must be:

Answer 46

agreed to in writing by the insurer.

Question 47

To avoid the concentration of insurance risks, an insurer should:

Answer 47

spread the risk

Question 48

Binders must have:

Answer 48

Name of insurer and insured, date effective, list of covered items

Question 49

Using a disinterested third party to resolve a claim dispute is:

Answer 49

Arbitration

Question 50

The applicant believes the statement to be true with a/an?

Answer 50

Representation

Question 51

An Insurer’s required assignment of rights of recovery after paying a claim is:

Answer 51

Subrogation