Property / Law Test Guide Flashcards
What evaluation is defined as the cost to replace damaged property with less expensive and more modern construction or equipment?
Functional replacement Cost
True or False: An insured operates a home day care business out of his house, he can ensure the liability exposure coverage by attaching a home day care coverage endorsement to the HO policy.
True
True or False: The insure agreement is a commonly found condition in an insurance policy.
No
What do the declarations cover?
The who, what, when and where information of a contract.
What is the insuring agreement?
It provides information on the policy coverage and the legal obligations of the parties.
What is a type of agent authority, that is also called “Perceived Authority”?
Apparent
True or False: Damage to the dwelling caused by ash or dust from a volcanic eruption losses will be paid under HO-3 in addition to HO-2.
True
Assuming agreement for a covered loss how soon after received proof of loss, must the insurer make payment?
60 Days
If the insured dies the policy what happens to the rights and duties?
Automatically transfer to a legal representative.
What do the exclusions cover?
What perils are insured and not insured against.
What do the policy conditions cover?
How parties to the contract must act following a loss.
The livestock form covers what following a loss?
Named peril coverage for death of livestock?
True or False: The declaration page of a Homeowners policy covers has a statement that earthquake damage is not covered.
False - This would be in exclusions
True or False: For business income coverage the insured is reimbursed for the loss from the date of loss to the date of restoration or policy expiration.
False.
True or False: The duties of the insurer found in policy conditions include that the insurer is to notify the insured in the event of financial difficulty.
False
If an insurance company states their policies are guaranteed by the Insurance Guaranty Association, they would be guilty of what?
An unfair trade practice
If there is a criminal prosecution taken against a producer, when must the producer report that the director?
Within 30 days of the initial pre-trial hearing date.
How long does an agent have to notify the Commissioner if he or she has a change of address?
30-Days
If an insured covered under a mobile homeowners policy moves the mobile home to protect it from a covered peril the policy will pay up to how much?
$500
True or False: Medical Payments to Others is included in an unendorsed homeowners policy?
True
What are the conditions?
Sets forth the obligations and duties of the insurer and the insured.
True or False: Personal injury is an additional liability coverage provided in a homeowners policy.
False - May be added by endorsement.
True or False: Homeowners policies provide coverage for business property while on the residence premises up to $2,500.
True
What is not a consideration in a policy?
The applications given to a prospective insured.
What homeowner form is designed to provided named peril coverage for personal property to renters?
HO-4
If a court ordered payment for a loss that was not covered in the policy even if it was clearly worded would be an example of what?
Reasonable Expectations
According to the loss payment condition in HO policies, losses must be paid within how many days?
60-Days
How many units are allowed in a dwelling policy?
4
True or False: Personal injury liability endorsement to an HO policy applies to a third party who breaks a leg when the insured knocks him/her down.
False
How long does the director serve?
4-Years
How much notice to the insured is required when non-renewing an auto policy?
30-Days
How much is covered for debris removal under the HO property additional coverages?
All reasonable costs.
True or False: Provisions are considered parts of the policy structure.
False
True or False: Coverage must be written as part of farm coverage for mobile agricultural equipment.
False
True or False: Bodily injury to a residence employee would be included in the farm liability coverage forms?
True
The policy provision found in property insurance policies that prevents the insured from collecting twice is called what?
Subrogation
Which dwelling policy forms primarily insures a structure on an ACV basis?
DP-1
An insured condo unit owner wants to purchase fire and extended coverage for personal property and liability coverage. What should they get?
HO-6
True or False: Accident and health insurance is considered a limited line of authority.
False
What is the agreement called between an insurer and an insured where the insurer agrees to covered the insured for specific losses in exchange for a premium?
The insurance contract
How are state Insurance Guaranty Associations funded?
By their members
What effect does the the Terrorism Risk Insurance Act of 2002 have?
Nullifies exclusion of certified acts of terrorism as covered by the act.
When the director requests a hearing, written notice must be submitted how many days in advance?
14-Days
True or False: Special personal property limits includes $500 for business personal property on the insured premises.
False.
In property insurance ACV is defined as what?
Replacement cost at the time of loss, less depreciation.
What is the liberalization clause in a policy?
Changes adopted by the insurer that broadens coverage automatically.
In dwelling policies, automatic increases in insurance is what?
Coverage by endorsements
True or False: Common carrier cargo liability is a class of inland marine.
False
What is not a consideration of the policy structure?
Provisions
In a commercial package policy, who may cancel the policy in writing and make changes to the policy with the consent of the insurer?
First named insured.
True or False: A coin collection valued at $500 lost in a fire is covered by a homeowners policy.
False - Coins are valued at $200
True or False: Damage from rising flood waters would be covered by the basic causes of loss form under a Commercial Property Policy.
False
A specific coverage on a policy declaration page that has no premium shown means what?
There is no coverage
True or False: The dwelling must be owner-occupied is a characteristic of a dwelling policy.
False
What is a risk that eligible for coverage under a BOP?
Condominiums
A commercial property special form covers property in transit up to what amount?
$5,000
True or False: Theft is a covered peril, covered under the broad form dwelling policy.
False
True or False: Fire department service is an additional coverage service charge under the builders risk form.
True
If there is a complaint regarding an insurer and the matter can be cleared by looking at a record, who would most likely conduct the investigation?
The Director
In Idaho what kinds of insurance policies are the basis for all property insurance policy and is the only policy with its word standardized by state law?
Fire
All insurance policies written in the state must be countersigned by licensed agents. In these instances, the agent may grant the power of attorney to individuals over the age of what?
21
Two individuals in the same age and risk class are charged different rates for their insurance policies is caused what?
Discrimination
A parking garage owner completed Manor major renovations to a parking garage prior to selling to another company. Three months later overhead concrete fell on the cars in the second-floor garage. Who is liable?
The damage occurred when the concrete fell.
Cruise of ships are covered under what?
Jones Act
An owner of a parking lot wants liability coverage for damage to vehicles in her custody what does she need?
Garage keepers coverage
True or false, the individual named insured endorsement a used by individual business owners who use company vehicles for personal use rather than purchasing a personal vehicle?
True
A store employee suspect someone of shoplifting and escorts them to the back office, but later determines they have not stolen anything. What are they guilty of?
False arrest
Who is not considered an employee in a commercial general liability policy?
Temp employees
True or false to minimize the insured‘s level of liability in the event of a loss is not a goal of risk retention?
True
True or false, proof of carelessness is one of the four primary elements considered establishing negligence?
False / Legal Duty
What is also called perceived authority?
Apparent
When an umbrella policy is broader than underlying policy insurance it pays a loss that is not covered by the underlying policy, it usually only pays what?
The excess over the self insured retention
SIR stands for what?
Self-insured retention
What is the basic limit for costs incurred at the place a vehicle is disabled provided by the towing and labor cost endorsement?
$25
What type of information would be found in a policies insuring agreement?
Renewal dates
Imposter worker has finished a job work coverage would protect them if the plaster falls and hurts someone because he did not do the job correctly?
Completed operation
Under the Worker’s Compensation system who is responsible for the expenses resulting from work related injuries in occupational diseases?
The employer regardless of whether it was at fault for the injury or disease.
True or false, in the event of a claim under a commercial general liability policy the insured is responsible for submitting to a medical exam when requested.
False
What type of compensation damages will pay for pain and suffering disfigurement?
General
What fundamental principle and property insurance holds that when there is an unbroken connection between an occurrence and damage the grows out of occurrence than the resulting damage is all part of the occurrence?
Proximate cause
On a personal auto policy that has $5000 of medical coverage what does that amount represent?
The limit is not more than $5000 per person per accident.
True or false comparative negligence is a statutory Defense?
True
Under the business auto coverage form mobile equipment is covered for liability insurance when what?
When it is being carried or towed by a covered auto.
What is the legal defense they can be used in most states in which proportion it damages may be awarded on both the plaintiff and defendant were negligent?
Comparative negligence
An employee drives a company auto but does not own a vehicle herself. What endorsement could be added to the insurance policy covering the company auto that would provide coverage the employee when she drives someone else’s car for her personal use?
Drive other car coverage
A market was sued when an employee detained a person to believe to be a shopper but the person turned out to be the meter reader which coverage would apply to the suit?
Personal and advertising injury liability
The insured must be given written notice 10 days in advance of the cancellation for nonpayment of premium or 20 days for what reason?
Any other reason for cancellation
If an applicant for insurance producer licenses Is denied licensing, how long must they wait to reapply?
1 year
A policy owner provides a check to the producer for her initial premium, how soon from receiving the check master producer remit the payment to the insurance company?
21 days
True or false a certificate of insurance must include the policy and it’s endorsements?
False
Who has to provide proof of financial responsibility in Idaho?
Only individuals who operate a motor vehicle
What is the maximum penalty for habitual well for noncompliance with a fair credit reporting act?
$2,500
To legally transact business insurance in the state the insurer must obtain what?
Certificate of authority
Excluded classification of employees under a Worker’s Compensation policy are what?
Statutorily defined
When the Director conduct an examination of alien insures what is the typical extent of the examination?
Transactions occurring in the United States only
A driver is convicted of failing to maintain auto insurance. He must now provide proof of financial responsibility for at least what time period?
12 months
