PRC 112 - - Focusing on Commercial Coverage Solutions -
Course Quiz with Error-free Answers.
For which one of these does the Coverage A Mobile Equipment exclusion eliminate coverage?
Select one:
A. The transportation of mobile equipment by an auto that is owned by an insured
B. A watercraft owned by the insured
C. An auto owned by the insured
D. An airplane owned by the insured correct answers A. The transportation of mobile equipment
by an auto that is owned by an insured
Which one of the following property loss exposures can a business most likely avoid by leasing
an auto instead of buying it?
Select one:
A. Cost of auto repairs
B. Employers nonownership liability
C. Liability to parties injured by the operation of the auto
D. Decrease in or loss of the auto's value correct answers D. Decrease in or loss of the auto's
value
Which one the following statements is true regarding schedule rating and individual risk
premium modification plans?
Select one:
A. Schedule rating plans have been filed for optional use primarily for personal auto liability
insurance.
B. As with class rating, schedule rating must be used on every account that qualifies.
C. Generally, those insureds that are eligible to use experience rating are also eligible to use
schedule rating.
D. Both rating plans are used to modify final premium for liability insurance coverages. correct
answers C. Generally, those insureds that are eligible to use experience rating are also eligible to
use schedule rating.
Which one of the following would be covered under the Extra Expense insuring agreement of the
Business Income (and Extra Expense) Coverage Form?
Select one:
A. Costs to move to a temporary location
B. Interest Expense
C. Property taxes
D. Normal operating expenses correct answers A. Costs to move to a temporary location
There must be at least how many coverage parts in an ISO Commercial Package Policy (CPP)?
Select one:
A. One
B. Two
C. Three
D. Four correct answers B. Two
, Matthew Jones, the named insured under a Business Auto Coverage Form (BACF), requires his
employees to use their own cars for business purposes. One of Matthew's employees, Paul,
causes an accident while driving his own truck for the business.
Matthew's BACF shows symbol 1 for liability coverage. Which one of the following correctly
indicates whether Mathew is an insured under the policy for Paul's use of his own truck in this
situation?
Select one:
A. Matthew is an insured under the policy because Matthew is an insured for any auto.
B. Matthew is not an insured under the policy because Matthew is not the driver of the truck.
C. Matthew is an insured under the policy because Paul's truck is a commercial type vehicle.
D. Matthew is not an insured under the policy because Matthew is not the owner of the truck.
correct answers A. Matthew is an insured under the policy because Matthew is an insured for any
auto.
An insured keeps his truck in a garage. A deer gets trapped in the garage and, in an attempt to
escape, climbs on top of the truck, breaking the windshield and causing several dents in the
hood. The insured's Business Auto Coverage Form (BACF) provides physical damage coverage
for specified causes of loss with a $100 deductible and collision with a $250 deductible. It will
cost the insured $750 to replace the broken windshield and $1,200 to repair the dents. How
much, if anything, will the business auto insurer pay for this loss?
Select one:
A. $0
B. $1,600
C. $1,700
D. $1,850 correct answers A. $0
An electrical contractor was hired to install a new 100-amp fuse box in the Smith's home. During
installation, the contractor inadvertently left a small screwdriver in a duct space behind the panel.
Three weeks later, the screwdriver caused an electrical short which led to a fire. Which one of
the following loss exposures best categorizes the electrical contractor's legal liability exposure
for the fire damages?
Select one:
A. Completed operations liability
B. Liability for operations by others
C. Property damage liability
D. Products liability correct answers A. Completed operations liability
Which one of the following statements is correct with respect to the Building and Personal
Property Coverage Form (BPP)?
Select one:
A. The policy limit is the maximum the insurer will pay over any one year.
B. Due to coverage extensions, it is possible for the total payment for one loss to exceed the
policy limit.
C. No payments under coverage extensions are made if the limit of insurance in the declarations
is paid in full.
Course Quiz with Error-free Answers.
For which one of these does the Coverage A Mobile Equipment exclusion eliminate coverage?
Select one:
A. The transportation of mobile equipment by an auto that is owned by an insured
B. A watercraft owned by the insured
C. An auto owned by the insured
D. An airplane owned by the insured correct answers A. The transportation of mobile equipment
by an auto that is owned by an insured
Which one of the following property loss exposures can a business most likely avoid by leasing
an auto instead of buying it?
Select one:
A. Cost of auto repairs
B. Employers nonownership liability
C. Liability to parties injured by the operation of the auto
D. Decrease in or loss of the auto's value correct answers D. Decrease in or loss of the auto's
value
Which one the following statements is true regarding schedule rating and individual risk
premium modification plans?
Select one:
A. Schedule rating plans have been filed for optional use primarily for personal auto liability
insurance.
B. As with class rating, schedule rating must be used on every account that qualifies.
C. Generally, those insureds that are eligible to use experience rating are also eligible to use
schedule rating.
D. Both rating plans are used to modify final premium for liability insurance coverages. correct
answers C. Generally, those insureds that are eligible to use experience rating are also eligible to
use schedule rating.
Which one of the following would be covered under the Extra Expense insuring agreement of the
Business Income (and Extra Expense) Coverage Form?
Select one:
A. Costs to move to a temporary location
B. Interest Expense
C. Property taxes
D. Normal operating expenses correct answers A. Costs to move to a temporary location
There must be at least how many coverage parts in an ISO Commercial Package Policy (CPP)?
Select one:
A. One
B. Two
C. Three
D. Four correct answers B. Two
, Matthew Jones, the named insured under a Business Auto Coverage Form (BACF), requires his
employees to use their own cars for business purposes. One of Matthew's employees, Paul,
causes an accident while driving his own truck for the business.
Matthew's BACF shows symbol 1 for liability coverage. Which one of the following correctly
indicates whether Mathew is an insured under the policy for Paul's use of his own truck in this
situation?
Select one:
A. Matthew is an insured under the policy because Matthew is an insured for any auto.
B. Matthew is not an insured under the policy because Matthew is not the driver of the truck.
C. Matthew is an insured under the policy because Paul's truck is a commercial type vehicle.
D. Matthew is not an insured under the policy because Matthew is not the owner of the truck.
correct answers A. Matthew is an insured under the policy because Matthew is an insured for any
auto.
An insured keeps his truck in a garage. A deer gets trapped in the garage and, in an attempt to
escape, climbs on top of the truck, breaking the windshield and causing several dents in the
hood. The insured's Business Auto Coverage Form (BACF) provides physical damage coverage
for specified causes of loss with a $100 deductible and collision with a $250 deductible. It will
cost the insured $750 to replace the broken windshield and $1,200 to repair the dents. How
much, if anything, will the business auto insurer pay for this loss?
Select one:
A. $0
B. $1,600
C. $1,700
D. $1,850 correct answers A. $0
An electrical contractor was hired to install a new 100-amp fuse box in the Smith's home. During
installation, the contractor inadvertently left a small screwdriver in a duct space behind the panel.
Three weeks later, the screwdriver caused an electrical short which led to a fire. Which one of
the following loss exposures best categorizes the electrical contractor's legal liability exposure
for the fire damages?
Select one:
A. Completed operations liability
B. Liability for operations by others
C. Property damage liability
D. Products liability correct answers A. Completed operations liability
Which one of the following statements is correct with respect to the Building and Personal
Property Coverage Form (BPP)?
Select one:
A. The policy limit is the maximum the insurer will pay over any one year.
B. Due to coverage extensions, it is possible for the total payment for one loss to exceed the
policy limit.
C. No payments under coverage extensions are made if the limit of insurance in the declarations
is paid in full.
