PSI Exam Property and Casualty
All of the following are authorized activities for the limited lines automobile insurance
agents EXCEPT if the agent - ANS- Charges and collects a brokers fee for service
Which of the following describes a contract of reinsurance? - ANS- A first insurer issues
insurance to compensate another insurer for losses on contracts issued by that second
insurer
A personal lines licensee is an agent-broker who is able to transact coverage for all the
following EXCEPT - ANS- Personal Aircraft
All of the following are requirements for determining an area that qualifies for Low Cost
Automobile Insurance EXCEPT - ANS- The number of automobile accidents that occur
within the county
What criteria must a person meet in order to be qualified to purchase a good driver
discount policy? - ANS- Being licensed to drive a motor vehicle for the previous 3 years
and has not had more than 1 violation point as determined by the CIC
Which of the following must be prominently displayed so that it can be readily inspected
on the licensee? - ANS- Currency and capacity
What is the primary function of the California Automotive Assigned Risk Plan? CARRP -
ANS- To put people who have trouble obtaining insurance in touch with insurers who
may be required by law to insure them.
Which is NOT a duty of the Workers Compensation Bureau? - ANS- Determine which
claims are approved and which are denied.
When can a person who sells real property require the use of a specific insurance agent,
broker or solicitor? - ANS- A buyer is always ale to choose their insurance
representative
At which point is a person licensed as a broker-agent deemed to be acting as an
insurance agent? - ANS- when a notice of appointment is filed with the insurance
commissioner
Who must be able to inspect records of insurance transactions made available by
agent-brokers at any time? - ANS- The Insurance commissioner
, Where must the address be printed for the principal office that is required for every
broker agent and resident insurance casualty broker-agent? - ANS- Applications for
license and renewals
How many classes of insurance are defined under California insurance law including
"miscellaneous" and "reserved"? - ANS- There are a total of 20 classes of insurance
under CA insurance law with sub classes
When can a rate be denied by the Department? - ANS- when it is inadequate and
excessive
A "personal lines" agent or broker is allowed to transact what type of insurance
coverage? - ANS- Noncommercial automobile and residential property
What is the required rate discount under a good driver discount policy? - ANS- 20%
below the rate the insured would have been charged otherwise for the same coverage
Which condition is NOT required to be met for a surplus line broker to advise any home
state insured or applicate that coverage has been, or will be obtained from a nonadmitted
insurer? - ANS- An annual payment has been received by the insurer?
Who is authorized to adjust or pay claims in excess of an amount determined by the
commissioner? - ANS- The managing general agent
In order for an insurer to contract with the state compensation insurance fund it must
meet all of the following criteria EXCEPT - ANS- The insurer has met all ration
requirements for risk based capital RBC
In conducting the business and affairs of the state compensation insurance fund it must
meet all of the following criteria EXCEPT - ANS- Sell life insurance covering
compensation benefits
Who is able to place business through the California Automobile Assessed Risk
Program? - ANS- Only agent/brokers licensed in fire and casualty who have also been
certified through CAARP
Under the California Vehicle Code all of the following are acceptable to satisfy the
financial responsibility requirement EXCEPT - ANS- A company with an escrow account
that is licensed to do business in California
Which two pieces of information are required to be on all business cards, printed quotes,
and printed advertisements distributed exclusively within the state? - ANS- The license
number of the licensee and the word "insurance"
All of the following are authorized activities for the limited lines automobile insurance
agents EXCEPT if the agent - ANS- Charges and collects a brokers fee for service
Which of the following describes a contract of reinsurance? - ANS- A first insurer issues
insurance to compensate another insurer for losses on contracts issued by that second
insurer
A personal lines licensee is an agent-broker who is able to transact coverage for all the
following EXCEPT - ANS- Personal Aircraft
All of the following are requirements for determining an area that qualifies for Low Cost
Automobile Insurance EXCEPT - ANS- The number of automobile accidents that occur
within the county
What criteria must a person meet in order to be qualified to purchase a good driver
discount policy? - ANS- Being licensed to drive a motor vehicle for the previous 3 years
and has not had more than 1 violation point as determined by the CIC
Which of the following must be prominently displayed so that it can be readily inspected
on the licensee? - ANS- Currency and capacity
What is the primary function of the California Automotive Assigned Risk Plan? CARRP -
ANS- To put people who have trouble obtaining insurance in touch with insurers who
may be required by law to insure them.
Which is NOT a duty of the Workers Compensation Bureau? - ANS- Determine which
claims are approved and which are denied.
When can a person who sells real property require the use of a specific insurance agent,
broker or solicitor? - ANS- A buyer is always ale to choose their insurance
representative
At which point is a person licensed as a broker-agent deemed to be acting as an
insurance agent? - ANS- when a notice of appointment is filed with the insurance
commissioner
Who must be able to inspect records of insurance transactions made available by
agent-brokers at any time? - ANS- The Insurance commissioner
, Where must the address be printed for the principal office that is required for every
broker agent and resident insurance casualty broker-agent? - ANS- Applications for
license and renewals
How many classes of insurance are defined under California insurance law including
"miscellaneous" and "reserved"? - ANS- There are a total of 20 classes of insurance
under CA insurance law with sub classes
When can a rate be denied by the Department? - ANS- when it is inadequate and
excessive
A "personal lines" agent or broker is allowed to transact what type of insurance
coverage? - ANS- Noncommercial automobile and residential property
What is the required rate discount under a good driver discount policy? - ANS- 20%
below the rate the insured would have been charged otherwise for the same coverage
Which condition is NOT required to be met for a surplus line broker to advise any home
state insured or applicate that coverage has been, or will be obtained from a nonadmitted
insurer? - ANS- An annual payment has been received by the insurer?
Who is authorized to adjust or pay claims in excess of an amount determined by the
commissioner? - ANS- The managing general agent
In order for an insurer to contract with the state compensation insurance fund it must
meet all of the following criteria EXCEPT - ANS- The insurer has met all ration
requirements for risk based capital RBC
In conducting the business and affairs of the state compensation insurance fund it must
meet all of the following criteria EXCEPT - ANS- Sell life insurance covering
compensation benefits
Who is able to place business through the California Automobile Assessed Risk
Program? - ANS- Only agent/brokers licensed in fire and casualty who have also been
certified through CAARP
Under the California Vehicle Code all of the following are acceptable to satisfy the
financial responsibility requirement EXCEPT - ANS- A company with an escrow account
that is licensed to do business in California
Which two pieces of information are required to be on all business cards, printed quotes,
and printed advertisements distributed exclusively within the state? - ANS- The license
number of the licensee and the word "insurance"
