CP&L FINAL EXAM NEWEST 2025 ACTUAL EXAM
COMPLETE 200 QUESTIONS AND CORRECT
DETAILED ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+||BRAND NEW VERSION!!
Tom and Jerry own a General Motors vehicle dealership, and they have purchased
an Auto Dealers Coverage Form (ADCF) with the False Pretense Coverage
endorsement. In January, Chuck (one of their salespeople) makes a deal with Max
for a new car. Chuck gives Max $30,000 for his two trade-in vehicles and Max
drives away with a new car worth $40,000. Later that week, the dealership
business office discovers that Max did not have proper title to either of the trade-
in vehicles, and now the dealership cannot sell them.How much, if anything, will
Tom and Jerry's ADCF pay towards the loss suffered by the taking of these two
cars? - ans-Tom and Jerry's ADCF will pay $25,000 for this loss - the maximum
amount payable under the False Pretense endorsement for losses caused by any
one person in a year.
Larry is an employee of XYZ Company and works solely in State A which is the only
state listed on XYZ's workers compensation policy. XYZ obtained a small job in
neighboring State B and while Larry is working in State B he injured himself.
Which one of the following would be the response from XYZ's workers
compensation insurer to Larry's claim for benefits? - ans-It would provide State A
workers compensation benefits to Larry
QRS, LLC has been a small town's largest employer for a long time. When the
owner of QRS, LLC died, the company was forced to lay off 25 percent of its
workforce, because the proper life insurance was not in force for the owner.
These mass lay-offs resulted in bad publicity in the town paper and much
negativity directed at the company in various town meetings. The employment
practices liability (EPL) policy in force for QRS, LLC provided money to cover QRS's
costs to retain a PR firm.Such costs are called - ans-Reputation management
costs.
Mitchell is a highway contractor whose company is covered with a workers
compensation policy and an unendorsed Business Auto Coverage Form (BACF).
,Which one of the following losses would be covered by his business auto policy? -
ans-An employee runs over a subcontractor's equipment with an owned auto.
Which one of the following statements is true about an excess policy? - ans-It
provides coverage no broader than is provided by underlying polices.
Although professional liability policies for financial and legal professionals contain
many of the same provisions of those for other professionals, there are important
differences. Which one of the following would be covered under the professional
liability policies for financial and legal professionals that contain the broadest
definition of professional services? - ans-Claims arising from any professional
service performed for others for a fee
An excess liability insurance policy that covers a claim in excess of the underlying
limits only if the loss is covered by the underlying policy is called - ans-A following-
form excess policy
A dealership keeps a customer's auto overnight. The auto, while on premises, is
damaged by hail. The dealership has garagekeepers coverage on a legal liability
basis on an Auto Dealers Coverage Form. The customer has a Liability-only policy.
The customer asks the dealership to pay for the hail damage, but the claim is
denied by the insurer. The only way the dealership's policy would have paid the
claim is if the dealership had purchased - ans-One of the garagekeepers direct
coverage options.
The Broad Form Products Coverage endorsement can be used - ans-To delete the
Auto Dealers Coverage Form (ADCF) exclusion for defective products.
Cox Corporation recently had a covered personal liability judgment against it for
$5 million. It has an underlying commercial general liability policy with a $1
million limit, which is the amount required by the umbrella insurer. The umbrella
policy has a $10 million limit with a $10,000 SIR. How much is the ultimate net
loss to the umbrella insurer? - ans-The ultimate net loss to the umbrella insurer is
$4,000,000.
The Supplementary Payments section of the Commercial General Liability (CGL)
Coverage Form contains provisions concerning the insurer's duty to defend
,indemnitees of the insured, but only if specific conditions are met. Which one of
the following is one of these conditions? - ans-The indemnitee and the insured
must ask the insurer to conduct and control the defense.
Which one of the following statements about the Liquor Liability Coverage Form is
true? - ans-It contains an each common cause limit as well as an aggregate limit.
Under the Business Auto Coverage Form (BACF), collision is generally understood
to mean - ans-A striking together with violent impact.
A common endorsement to the Business Auto Coverage Form (BACF) is the
Employee Hired Auto endorsement. This endorsement states that an employee of
the named insured is an insured - ans-The employee is an insured while operating
an auto rented in the employee's name with the named insured's permission.
The legislated liability imposed by the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA or Superfund) altered traditional
common law concerning responsibilities for environmental pollution by - ans-
Superfund imposes strict liability without regard to fault, even on a retroactive
basis.
Before the enactment of Workers Compensation statutes, employers were
protected against employee suits by common-law defenses. Under which one of
the following common-law defenses were employees unsuccessful in recovering
damages from occupational injuries resulting in part from the employee's own
negligence? - ans-Contributory negligence
An organization may incur losses from legal liabilities in a number of different
ways. Which one of the following actions would best be described as an
intentional tort? - ans-A newspaper mistakenly identifies the driver in an alcohol-
related hit and run accident as John Doe, a prominent local attorney.
An employee, while working for the Brown Corporation, was negligent when
lighting a cigarette and started a small fire that caused a fellow employee's
clothes to catch fire. The injured employee suffered burns as well as the loss of
clothes. To what extent, if any, does the corporation's Commercial General
Liability Coverage Form provide coverage for the negligent employee if he is sued
, by the injured employee? - ans-There is no coverage for the negligent employee
because he is not an insured under the policy for bodily injury to a co-employee
or damage to such an employee's property
Adam is an executive at Blithe Manufacturing (Blithe). He drives a car that is
owned by Blithe and insured under the company's Business Auto Coverage Form
(BACF). Adam is permitted to drive the vehicle for both business and personal use.
One Sunday morning, Adam is driving the car on a highway when he is struck by
another vehicle and pushed into the guardrail. The car that struck Adam did not
stop, but several other people who witnessed the accident did stop. They all
confirmed that Adam was struck by another reckless driver who never stopped.
Adam was seriously injured and car was totaled. Which one of the following
endorsements to Blithe's BACF would best cover Adam's significant medical
expenses and the damage to the vehicle? - ans-The Uninsured Motorists Coverage
endorsement (UM) would best cover Adam's medical expenses and the damage
to the vehicle, because it was an owned vehicle involved in a hit and run accident.
Adam's injuries are significant and because the accident occurred on a Sunday it
would not be covered by workers compensation.
A claim representative is handling a claim for an auto dealership insured under
the Auto Dealers Coverage Form (ADCF). Several new autos and autos left for
service by customers were damaged when a fire started in the service building.
The representative has verified that the loss occurred to the named insured at an
insured location during the policy period; that Sections I and II of the ADCF apply
to the losses and that the autos qualify as covered autos. The next step that the
representative should take in determining whether coverage applies is to - ans-
Review the policy conditions to determine whether they preclude coverage at the
time of loss.
John is a painting contractor. He has just been hired to complete a job for Bill's
company building. John, in his painting contract, agreed to indemnify Bill for any
bodily injury or property damage made against him if it has any connection with
his work on Bill's premises. While the job was being performed, one of John's
employees was badly injured at the premises site and Bill was responsible. As a
result, the employee filed a negligence claim on Bill because he thought he would
recover damages in a tort suit that would be greater than worker's compensation
benefits.
COMPLETE 200 QUESTIONS AND CORRECT
DETAILED ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+||BRAND NEW VERSION!!
Tom and Jerry own a General Motors vehicle dealership, and they have purchased
an Auto Dealers Coverage Form (ADCF) with the False Pretense Coverage
endorsement. In January, Chuck (one of their salespeople) makes a deal with Max
for a new car. Chuck gives Max $30,000 for his two trade-in vehicles and Max
drives away with a new car worth $40,000. Later that week, the dealership
business office discovers that Max did not have proper title to either of the trade-
in vehicles, and now the dealership cannot sell them.How much, if anything, will
Tom and Jerry's ADCF pay towards the loss suffered by the taking of these two
cars? - ans-Tom and Jerry's ADCF will pay $25,000 for this loss - the maximum
amount payable under the False Pretense endorsement for losses caused by any
one person in a year.
Larry is an employee of XYZ Company and works solely in State A which is the only
state listed on XYZ's workers compensation policy. XYZ obtained a small job in
neighboring State B and while Larry is working in State B he injured himself.
Which one of the following would be the response from XYZ's workers
compensation insurer to Larry's claim for benefits? - ans-It would provide State A
workers compensation benefits to Larry
QRS, LLC has been a small town's largest employer for a long time. When the
owner of QRS, LLC died, the company was forced to lay off 25 percent of its
workforce, because the proper life insurance was not in force for the owner.
These mass lay-offs resulted in bad publicity in the town paper and much
negativity directed at the company in various town meetings. The employment
practices liability (EPL) policy in force for QRS, LLC provided money to cover QRS's
costs to retain a PR firm.Such costs are called - ans-Reputation management
costs.
Mitchell is a highway contractor whose company is covered with a workers
compensation policy and an unendorsed Business Auto Coverage Form (BACF).
,Which one of the following losses would be covered by his business auto policy? -
ans-An employee runs over a subcontractor's equipment with an owned auto.
Which one of the following statements is true about an excess policy? - ans-It
provides coverage no broader than is provided by underlying polices.
Although professional liability policies for financial and legal professionals contain
many of the same provisions of those for other professionals, there are important
differences. Which one of the following would be covered under the professional
liability policies for financial and legal professionals that contain the broadest
definition of professional services? - ans-Claims arising from any professional
service performed for others for a fee
An excess liability insurance policy that covers a claim in excess of the underlying
limits only if the loss is covered by the underlying policy is called - ans-A following-
form excess policy
A dealership keeps a customer's auto overnight. The auto, while on premises, is
damaged by hail. The dealership has garagekeepers coverage on a legal liability
basis on an Auto Dealers Coverage Form. The customer has a Liability-only policy.
The customer asks the dealership to pay for the hail damage, but the claim is
denied by the insurer. The only way the dealership's policy would have paid the
claim is if the dealership had purchased - ans-One of the garagekeepers direct
coverage options.
The Broad Form Products Coverage endorsement can be used - ans-To delete the
Auto Dealers Coverage Form (ADCF) exclusion for defective products.
Cox Corporation recently had a covered personal liability judgment against it for
$5 million. It has an underlying commercial general liability policy with a $1
million limit, which is the amount required by the umbrella insurer. The umbrella
policy has a $10 million limit with a $10,000 SIR. How much is the ultimate net
loss to the umbrella insurer? - ans-The ultimate net loss to the umbrella insurer is
$4,000,000.
The Supplementary Payments section of the Commercial General Liability (CGL)
Coverage Form contains provisions concerning the insurer's duty to defend
,indemnitees of the insured, but only if specific conditions are met. Which one of
the following is one of these conditions? - ans-The indemnitee and the insured
must ask the insurer to conduct and control the defense.
Which one of the following statements about the Liquor Liability Coverage Form is
true? - ans-It contains an each common cause limit as well as an aggregate limit.
Under the Business Auto Coverage Form (BACF), collision is generally understood
to mean - ans-A striking together with violent impact.
A common endorsement to the Business Auto Coverage Form (BACF) is the
Employee Hired Auto endorsement. This endorsement states that an employee of
the named insured is an insured - ans-The employee is an insured while operating
an auto rented in the employee's name with the named insured's permission.
The legislated liability imposed by the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA or Superfund) altered traditional
common law concerning responsibilities for environmental pollution by - ans-
Superfund imposes strict liability without regard to fault, even on a retroactive
basis.
Before the enactment of Workers Compensation statutes, employers were
protected against employee suits by common-law defenses. Under which one of
the following common-law defenses were employees unsuccessful in recovering
damages from occupational injuries resulting in part from the employee's own
negligence? - ans-Contributory negligence
An organization may incur losses from legal liabilities in a number of different
ways. Which one of the following actions would best be described as an
intentional tort? - ans-A newspaper mistakenly identifies the driver in an alcohol-
related hit and run accident as John Doe, a prominent local attorney.
An employee, while working for the Brown Corporation, was negligent when
lighting a cigarette and started a small fire that caused a fellow employee's
clothes to catch fire. The injured employee suffered burns as well as the loss of
clothes. To what extent, if any, does the corporation's Commercial General
Liability Coverage Form provide coverage for the negligent employee if he is sued
, by the injured employee? - ans-There is no coverage for the negligent employee
because he is not an insured under the policy for bodily injury to a co-employee
or damage to such an employee's property
Adam is an executive at Blithe Manufacturing (Blithe). He drives a car that is
owned by Blithe and insured under the company's Business Auto Coverage Form
(BACF). Adam is permitted to drive the vehicle for both business and personal use.
One Sunday morning, Adam is driving the car on a highway when he is struck by
another vehicle and pushed into the guardrail. The car that struck Adam did not
stop, but several other people who witnessed the accident did stop. They all
confirmed that Adam was struck by another reckless driver who never stopped.
Adam was seriously injured and car was totaled. Which one of the following
endorsements to Blithe's BACF would best cover Adam's significant medical
expenses and the damage to the vehicle? - ans-The Uninsured Motorists Coverage
endorsement (UM) would best cover Adam's medical expenses and the damage
to the vehicle, because it was an owned vehicle involved in a hit and run accident.
Adam's injuries are significant and because the accident occurred on a Sunday it
would not be covered by workers compensation.
A claim representative is handling a claim for an auto dealership insured under
the Auto Dealers Coverage Form (ADCF). Several new autos and autos left for
service by customers were damaged when a fire started in the service building.
The representative has verified that the loss occurred to the named insured at an
insured location during the policy period; that Sections I and II of the ADCF apply
to the losses and that the autos qualify as covered autos. The next step that the
representative should take in determining whether coverage applies is to - ans-
Review the policy conditions to determine whether they preclude coverage at the
time of loss.
John is a painting contractor. He has just been hired to complete a job for Bill's
company building. John, in his painting contract, agreed to indemnify Bill for any
bodily injury or property damage made against him if it has any connection with
his work on Bill's premises. While the job was being performed, one of John's
employees was badly injured at the premises site and Bill was responsible. As a
result, the employee filed a negligence claim on Bill because he thought he would
recover damages in a tort suit that would be greater than worker's compensation
benefits.
