STATE FARM INSURANCE LICENSE PREP
EXAM Questions with 100% Correct Answers
Latest Update 2025 TOP RATED A+
1. BOP (ANS) Package policy designed to provide broad property and
liability coverage for small businesses; eligibility requirements are
stricter than the CPP.
2. Business Income Policy (ANS) Pays for loss of income that the
insured sustains due to a direct physical loss from a covered peril that
forces the insured to suspend operations until the property can be
repaired, rebuilt, or replaced with reasonable speed; available with or
without extra expense coverage.
3. Causes of Loss Form (ANS) Separate form used with the
commercial property coverage part of the commercial package policy
that lists covered perils and exclusions. Several different versions
provide increasingly broader coverage from basic to broad to special.
4. Condominium Association Coverage Form (ANS) Commercial
Property coverage form that covers the buildings in a condominium
complex. Does not cover condominium owner's personal property.
5. Coverage D on a HO Policy - Loss of Use (ANS) If property loss
makes the residence premises uninhabitable, the additional living
expenses are covered; or if a covered loss to the insured's property
makes a part of the residence premises uninhabitable that is rented
, to others or held for rental by the insured, this coverage will pay the
fair rental value.
6. coverages excluded on dwelling policy (ANS) Theft, vandalism,
and malicious mischief excluded on basic policy. Liability excluded on
all policies.
7. Coverage B of homeowners policy (ANS) Other structures;
covers building and structures on the premises other than the
dwelling set apart by a clear space from the dwelling; 10% of
Coverage A.
8. Coverage D on a dwelling policy (ANS) Fair rental value is
covered on a dwelling policy.
9. Coverage limit on money in HO (ANS) $200 limit on personal
property with special limits
10. Coinsurance Clause on Property (ANS) Insurance
carried/Insurance required X amount of loss
, 11. Coverage F on homeowners policy (ANS) Medical payments to
others; pays all necessary medical expenses for up to three years
after an accident.
12. Deductible (ANS) The amount of expenses that must be paid out of
pocket before an insurer will pay any expenses from a covered loss.
13. Direct Loss (ANS) Financial loss resulting directly from a loss to
property
14. Equipment Breakdown Coverage; boiler and machinery
coverage (ANS) Part of the commercial package policy that covers
a loss due to breakdown of business equipment due to direct or
indirect loss.
15. Excess Insurance (ANS) When two or more policies or coverage
apply to the same loss, the one that applies only after the limits of the
primary coverage have been exhausted.
16. Difference in Conditions Insurance (DIC) (ANS) Type of
commercial property policy that covers most insurable perils but
excludes basic fire and extended coverage perils.
EXAM Questions with 100% Correct Answers
Latest Update 2025 TOP RATED A+
1. BOP (ANS) Package policy designed to provide broad property and
liability coverage for small businesses; eligibility requirements are
stricter than the CPP.
2. Business Income Policy (ANS) Pays for loss of income that the
insured sustains due to a direct physical loss from a covered peril that
forces the insured to suspend operations until the property can be
repaired, rebuilt, or replaced with reasonable speed; available with or
without extra expense coverage.
3. Causes of Loss Form (ANS) Separate form used with the
commercial property coverage part of the commercial package policy
that lists covered perils and exclusions. Several different versions
provide increasingly broader coverage from basic to broad to special.
4. Condominium Association Coverage Form (ANS) Commercial
Property coverage form that covers the buildings in a condominium
complex. Does not cover condominium owner's personal property.
5. Coverage D on a HO Policy - Loss of Use (ANS) If property loss
makes the residence premises uninhabitable, the additional living
expenses are covered; or if a covered loss to the insured's property
makes a part of the residence premises uninhabitable that is rented
, to others or held for rental by the insured, this coverage will pay the
fair rental value.
6. coverages excluded on dwelling policy (ANS) Theft, vandalism,
and malicious mischief excluded on basic policy. Liability excluded on
all policies.
7. Coverage B of homeowners policy (ANS) Other structures;
covers building and structures on the premises other than the
dwelling set apart by a clear space from the dwelling; 10% of
Coverage A.
8. Coverage D on a dwelling policy (ANS) Fair rental value is
covered on a dwelling policy.
9. Coverage limit on money in HO (ANS) $200 limit on personal
property with special limits
10. Coinsurance Clause on Property (ANS) Insurance
carried/Insurance required X amount of loss
, 11. Coverage F on homeowners policy (ANS) Medical payments to
others; pays all necessary medical expenses for up to three years
after an accident.
12. Deductible (ANS) The amount of expenses that must be paid out of
pocket before an insurer will pay any expenses from a covered loss.
13. Direct Loss (ANS) Financial loss resulting directly from a loss to
property
14. Equipment Breakdown Coverage; boiler and machinery
coverage (ANS) Part of the commercial package policy that covers
a loss due to breakdown of business equipment due to direct or
indirect loss.
15. Excess Insurance (ANS) When two or more policies or coverage
apply to the same loss, the one that applies only after the limits of the
primary coverage have been exhausted.
16. Difference in Conditions Insurance (DIC) (ANS) Type of
commercial property policy that covers most insurable perils but
excludes basic fire and extended coverage perils.
