CALIFORNIA PROPERTY AND CASUALTY EXAM
PRACTICE QUESTIONS AND ANSWERS 100%
PASS
What is the name of the insurance principle that refers to an insurer giving up its right to
recover money or damages paid out to the insured from another party?
A. Subrogation
B. Subrogree Waiver
C. Waiver of subrogation
D. Subrogor - ✔✔ - C. Waiver of subrogation
Which portion of an insurance policy states that the insurance company will make
payment in the event a covered loss occurs?
A. Insuring agreement
B. Declarations
C. Exclusions
D. Conditions
E. Compensatory - ✔✔ - A. Insuring agreement
NRG Oil Company fails to repair its pipeline despite the development of large cracks
and is found to have recklessly caused an oil spill. The government requests that the
company be punished with a large damages award against it. What is the name of the
type of damages that were requested?
A. Punitive
B. Compensatory
C. General
D. Special - ✔✔ - A. Punitive
,Kylie lives in a condominium. A storm causes the brick façade of the building to
collapse. If Kylie has a Homeowners policy, which of the following would represent the
amount of her policy benefit?
A .Unlimited
B. $50,000
C. $1,000
D. $100,000
E. No coverage - ✔✔ - C. $1000
Which provision requires the policyholder to maintain a specific amount of insurance in
order to obtain full payment for a loss?
A. Cash
B. Valuation
C. Special
D. Coinsurance - ✔✔ - D. Coinsurance
A group of businesses with similar exposures that get grouped together for rating
purposes is a(n):
A. Association
B. Grouping class
C. Classification
D. Class - ✔✔ - D. Class
What must an insurance company provide an applicant if it orders an investigative credit
report?
A. It has no obligation to the applicant
B. Send the applicant an initial written notice within 3 days
C. Send the applicant an initial written notice within 5 business days
D. A notice only if the insurance company uses the information to deny an application -
✔✔ - B. Send the applicant an initial written notice within 3 days
, What is the name of the provision in an insurance policy that requires the insured to
notify the carrier of a loss for which a claim for reimbursement is made?
A. Memorialization of claim
B. Proof of claim
C. Notice of claim
D. Proof of loss
E. Evidence of claim - ✔✔ - C. Notice of claiim
Costs that are covered by liability insurance, aside from costs paid for any injuries or
damages, are:
A. Supplemental costs
B. Ancillary costs
C. Consequential damages
D. Aleatory - ✔✔ - A. Supplemental costs
All but which of the following require coverage under a hired auto insurance policy?
A. A vehicle that is leased for personal use
B. A minivan rented from a car rental business that is used to drive a child to college
C. A vehicle that is borrowed from an employee
D. Car borrowed by insured from leasing center - ✔✔ - C. A vehicle that is borrowed
from an employee
Your client Empire Financial Company discovers that an employee stole several
thousand untraceable shares of the company's stock. Unfortunately, they cannot solve
the crime and Empire has no insurance coverage for the loss. What type of coverage
would you recommend for the future?
A. Insider trading coverage
B. Insider fraud coverage
C. Employee dishonesty coverage
D. Representative benefits of fraud coverage - ✔✔ - C. Employee dishonesty coverage
PRACTICE QUESTIONS AND ANSWERS 100%
PASS
What is the name of the insurance principle that refers to an insurer giving up its right to
recover money or damages paid out to the insured from another party?
A. Subrogation
B. Subrogree Waiver
C. Waiver of subrogation
D. Subrogor - ✔✔ - C. Waiver of subrogation
Which portion of an insurance policy states that the insurance company will make
payment in the event a covered loss occurs?
A. Insuring agreement
B. Declarations
C. Exclusions
D. Conditions
E. Compensatory - ✔✔ - A. Insuring agreement
NRG Oil Company fails to repair its pipeline despite the development of large cracks
and is found to have recklessly caused an oil spill. The government requests that the
company be punished with a large damages award against it. What is the name of the
type of damages that were requested?
A. Punitive
B. Compensatory
C. General
D. Special - ✔✔ - A. Punitive
,Kylie lives in a condominium. A storm causes the brick façade of the building to
collapse. If Kylie has a Homeowners policy, which of the following would represent the
amount of her policy benefit?
A .Unlimited
B. $50,000
C. $1,000
D. $100,000
E. No coverage - ✔✔ - C. $1000
Which provision requires the policyholder to maintain a specific amount of insurance in
order to obtain full payment for a loss?
A. Cash
B. Valuation
C. Special
D. Coinsurance - ✔✔ - D. Coinsurance
A group of businesses with similar exposures that get grouped together for rating
purposes is a(n):
A. Association
B. Grouping class
C. Classification
D. Class - ✔✔ - D. Class
What must an insurance company provide an applicant if it orders an investigative credit
report?
A. It has no obligation to the applicant
B. Send the applicant an initial written notice within 3 days
C. Send the applicant an initial written notice within 5 business days
D. A notice only if the insurance company uses the information to deny an application -
✔✔ - B. Send the applicant an initial written notice within 3 days
, What is the name of the provision in an insurance policy that requires the insured to
notify the carrier of a loss for which a claim for reimbursement is made?
A. Memorialization of claim
B. Proof of claim
C. Notice of claim
D. Proof of loss
E. Evidence of claim - ✔✔ - C. Notice of claiim
Costs that are covered by liability insurance, aside from costs paid for any injuries or
damages, are:
A. Supplemental costs
B. Ancillary costs
C. Consequential damages
D. Aleatory - ✔✔ - A. Supplemental costs
All but which of the following require coverage under a hired auto insurance policy?
A. A vehicle that is leased for personal use
B. A minivan rented from a car rental business that is used to drive a child to college
C. A vehicle that is borrowed from an employee
D. Car borrowed by insured from leasing center - ✔✔ - C. A vehicle that is borrowed
from an employee
Your client Empire Financial Company discovers that an employee stole several
thousand untraceable shares of the company's stock. Unfortunately, they cannot solve
the crime and Empire has no insurance coverage for the loss. What type of coverage
would you recommend for the future?
A. Insider trading coverage
B. Insider fraud coverage
C. Employee dishonesty coverage
D. Representative benefits of fraud coverage - ✔✔ - C. Employee dishonesty coverage
