Property and Casualty Insurance – Exam FX Practice Questions, exam review and preparation material (2026)

Exam Fx Property And Casualty
Questions with 100% Correct Answers
2026
1. In dwelling policies, automatic increase in insurance is


(Choose from the following options)
1. Coverage for newly acquired property.
2. Coverage by endorsement.
3. Automatic coverage.
4. Coverage without additional premium. - Correct answer-2. Coverage by
endorsement.

2. Personal business property out in the open is covered under Commercial Property
Policy only while


(Choose from the following options)
1. Within 150 feet of the described premises.
2. Within 100 feet of the described premises.
3. Located on the described premises.
4. Specifically described on the declarations. - Correct answer-2. Within 100 feet of the
described premises.

3. Under a Commercial Crime Coverage Part, following a covered loss, the insured
must submit a written proof of loss within


(Choose from the following options)
1. 60 days.
2. 90 days.
3. 120 days.
4. One year. - Correct answer-3. 120 days.

4. Which of the following provisions requires an insurer to document all correspondence
with an insured?


(Choose from the following options)
1. Claims settlement
2. Entire contract

,3. Errors and omissions
4. Unfair trade practices - Correct answer-3. Errors and omissions

5. Which statement is true regarding Workers Compensation law in California?


(Choose from the following options)
1. Injured workers may sue an employer for negligence only when fault is clearly
established against the employer.
2. Injured workers may always sue an employer for negligence regardless of the degree
of fault against the employer.
3. Injured workers cannot sue an employer for negligence.
4. Injured workers may sue an employer for negligence when any degree of fault is
established against the employer. - Correct answer-3. Injured workers cannot sue an
employer for negligence.

6. In order to determine whether to test a life insurance applicant for HIV or AIDS, the
insurer may do which of the following: I. Base its decision to test on the incidence of
AIDS in the person's ZIP code; II. Test only persons who are single and under age 30;
III. Establish minimum uniform standards for testing all applicants for insurance; or IV.
Not test anyone for HIV or AIDS, because it is discriminatory.


(Choose from the following options)
1. III only.
2. I and II.
3. IV only.
4. I, II, III and IV. - Correct answer-1. III only.

7. A provision found in most claims-made liability policy forms that provide a specified
period of time following the policy expiration, during which claims arising out of
occurrences during the policy period may be made against the policy at no extra cost, is
called


(Choose from the following options)
1. Extension of coverage.
2. Supplemental extended reporting period.
3. Grace period.
4. Basic extended reporting period. - Correct answer-4. Basic extended reporting
period.

8. The personal injury liability endorsement to an HO policy applies to all the following
EXCEPT

,(Choose from the following options)
1. False arrest.
2. A third party breaks a leg when the insured knocks him down.
3. Slander.
4. Invasion of privacy. - Correct answer-2. A third party breaks a leg when the insured
knocks him down.

9. What license allows an agent to transact only automobile, personal watercraft,
residential property, earthquake, flood, inland marine and umbrella insurance?


(Choose from the following options)
1. Limited Lines
2. Applicable Lines
3. Personal Lines
4. Fire and Casualty - Correct answer-3. Personal Lines

10. Norm has a Personal Auto Policy with both comprehensive (other than collision) and
collision coverage. His car is stolen and recovered five days later. If Norm claims
transportation expenses of $20 per day, how much will his policy pay?


(Choose from the following options)
1. $60
2. $75
3. $100
4. $45 - Correct answer-1. $60

11. The Standard Fire Policy would provide coverage in which of these cases?


(Choose from the following options)
1. Insured's neglect
2. Fire
3. Acts of war
4. Theft - Correct answer-2. Fire

12. The major portion of the premium for a boiler and machinery policy pays


(Choose from the following options)
1. Repair to prevent.
2. Coverage for BI & PD of others.
3. For replacement parts.
4. For inspections and examinations. - Correct answer-4. For inspections and
examinations.

, 13. Which of the following homeowners forms is designed for individuals that own and
reside in a condominium?


(Choose from the following options)
1. HO-6
2. HO-2
3. HO-3
4. HO-4 - Correct answer-1. HO-6

14. Under the dwelling policy, Coverage C - Personal Property is


(Choose from the following options)
1. A prohibited coverage in the dwelling form.
2. Limited to 50% of the amount of insurance that is written as Coverage A.
3. Limited to covering a servant's property while at the insured location.
4. Automatically provided as 50% of Coverage A. - Correct answer-3. Limited to
covering a servant's property while at the insured location.

15. If a claimant contacts an agent regarding her life insurance policy and clearly
expects a response, within what span of time must a complete response be issued?


(Choose from the following options)
1. 15 days
2. 21 days
3. 31 days
4. 90 days - Correct answer-1. 15 days

16. While cutting grass in your yard with your brother's borrowed lawnmower, the fuel
line ruptures and the lawnmower is destroyed in the fire. How will your HO liability
react?


(Choose from the following options)
1. It will pay your brother's property insurance deductible.
2. Your HO liability and your brother's property coverage will share on a prorated basis.
3. It will cover the damage.
4. It will not cover the damage because you are not liable. - Correct answer-3. It will
cover the damage.

17. According to the standard mortgage clause, who has the right to bring a suit in their
own name to recover damages, pay policy premiums, and submit a proof of loss?