Property and Casualty Insurance Exam l l l l
1. Which of the following are the authorities that an agent can hol
l l l l l l l l l l l l
d?
Express and implied l l
2. Which of the following terms refers to such disabilities the loss
l l l l l l l l l l l l
of a limb, hearing, or eye sight?
l l l l l l
Permanent partial disability l l
3. Who is NOT considered an employee in a commercial general li
l l l l l l l l l l l
ability (CGL) policy? l l
Temporary worker l
4. The major portion of the premium of an equipment breakdown
l l l l l l l l l l l
policy pays? l
For inspections and examinations
l l l
5. An insured owns a building valued at $400,000. To comply with
l l l l l l l l l l l l
the 80% coinsurance provision of his insurance policy, how, mu
l l l l l l l l l
ch should he insure the property for?
l l l l l l
80% of the property's replacement cost or more
l l l l l l l
6. Under the Fair Credit Reporting Act, if the consumer challenge
l l l l l l l l l l
s the accuracy of the information contained in his or her report, th
l l l l l l l l l l l l
e reporting agency must:
l l l
Respond to the consumer's complaint. l l l l
7. All of the following are found in the declarations section of a pol
l l l l l l l l l l l l l
icy EXCEPT the: l l
Exclusions.
,8. The cost of restoring farm records is an additional coverage off
l l l l l l l l l l l
ered under a farm policy. How much will the policy pay to restore t
l l l l l l l l l l l l l
he records? l
Up to $2,000 l l
9. All of the following could be considered rebates if offered to an i
l l l l l l l l l l l l l
nsured in the sale of insurance EXCEPT: l l l l l l
Dividends from a mutual insurer. l l l l
10. Which of the following may be covered by electronic data pro
l l l l l l l l l l l
cessing coverage form under an inland marine policy? l l l l l l l
a) Computer hardware that is specifically scheduled.
l l l l l l
b) Extra expense the insured incurs to continue the business following
l l l l l l l l l l l
a loss.
l
c) Data processing media, including magnetic tapes or paper tapes, pu
l l l l l l l l l l
nch cards and discs l l l
11. The party to a surety or fidelity bond who promises to fulfill the
l l l l l l l l l l l l l
obligation is the:
l l l
Principal
12. The transfer of money from inside a banking premises to a per
l l l l l l l l l l l l
son other than a messenger outside those premises or to a place
l l l l l l l l l l l l
outside those premises is covered under which commercial cri
l l l l l l l l
me coverage? l
Computer fraud l
13. Which of the following would NOT be covered under the liabili
l l l l l l l l l l l
ty section of a personal auto policy?
l l l l l l
Bodily injury is caused by the insured's negligence while driving a three
l l l l l l l l l l l
-wheel all-terrain vehicle. l l
14. When a producer holding a certificate or a broker's license ha
l l l l l l l l l l l
s a change in his/her residence or business address, he/she mus
l l l l l l l l l l
,t notify the Department of Insurance and any company for which t
l l l l l l l l l l l
he producer holds an appointment within: 30 days.
l l l l l l l
15. What will happen if a house covered by a standard mortgage c
l l l l l l l l l l l l
lause is a total loss? l l l l
The insurer pays the mortgagee according to the mortgagee's interest
l l l l l l l l l l
in the property.
l l
16. What is the civil penalty for violating a cease and desist order
l l l l l l l l l l l l l
of the Commissioner?
l l
$10,000
17. The Business Pursuits endorsement under Section II of a ho
l l l l l l l l l l
meowners policy will cover all of the following EXCEPT: Business l l l l l l l l l
liability.
l
18. If a property is covered by Company A for $20,000 and Compa
l l l l l l l l l l l l
ny B covers the same property for $40,000, how much will Compa
l l l l l l l l l l l
ny A pay on a $24,000 loss?
l l l l l l
$8,000
19. The risk management technique that is used to prevent a spec
l l l l l l l l l l l
ific loss by not exposing oneself to that activity is called:
l l l l l l l l l l
Avoidance.
20. In a farm policy, any cost incurred by the insurer for the investi
l l l l l l l l l l l l l
gation or defense of a claim will be paid by: l l l l l l l l l
The insurer. l
21. Which of the following entities must approve all continuing ed
l l l l l l l l l l
ucation courses in this state? l l l l
The Commissioner l
, 22. An applicant knowingly fails to communicate information tha
l l l l l l l l
t would help an underwriter make a sound decision regarding co
l l l l l l l l l l
verage. This is an example of: l l l l l
Concealment
23. A common exclusion found under physical damage to your a
l l l l l l l l l l
uto includes-: l
Mechanical breakdown. l
24. Which of the following is true regarding a risk retention group
l l l l l l l l l l l
?
It is a liability insurance company owned by its members.
l l l l l l l l l
25. Which of the following best describes a misrepresentation?
l l l l l l l l
Issuing sales material with exaggerated statements about policy bene
l l l l l l l l
fits
26. A builder's risk form is most often written as which of the follo
l l l l l l l l l l l l l
wing?
Completed value form l l
27. An insured has a liability policy that sets the amount for all clai
l l l l l l l l l l l l l
ms that arise from a single incident at $50,000. Which type of limit
l l l l l l l l l l l l l
of liability does this insured's policy have?
l l l l l l
Per occurrence l
28. Which of the following is an example of a protective safeguard
l l l l l l l l l l l
in a businessowners policy?
l l l l
Automatic sprinkler system l l
29. If a licensee wants to transact insurance under a different nam
l l l l l l l l l l l
e than that listed on his or her producer's license, which of the foll
l l l l l l l l l l l l l
owing must occur? l l
The change must be reported to the Commissioner.
l l l l l l l
1. Which of the following are the authorities that an agent can hol
l l l l l l l l l l l l
d?
Express and implied l l
2. Which of the following terms refers to such disabilities the loss
l l l l l l l l l l l l
of a limb, hearing, or eye sight?
l l l l l l
Permanent partial disability l l
3. Who is NOT considered an employee in a commercial general li
l l l l l l l l l l l
ability (CGL) policy? l l
Temporary worker l
4. The major portion of the premium of an equipment breakdown
l l l l l l l l l l l
policy pays? l
For inspections and examinations
l l l
5. An insured owns a building valued at $400,000. To comply with
l l l l l l l l l l l l
the 80% coinsurance provision of his insurance policy, how, mu
l l l l l l l l l
ch should he insure the property for?
l l l l l l
80% of the property's replacement cost or more
l l l l l l l
6. Under the Fair Credit Reporting Act, if the consumer challenge
l l l l l l l l l l
s the accuracy of the information contained in his or her report, th
l l l l l l l l l l l l
e reporting agency must:
l l l
Respond to the consumer's complaint. l l l l
7. All of the following are found in the declarations section of a pol
l l l l l l l l l l l l l
icy EXCEPT the: l l
Exclusions.
,8. The cost of restoring farm records is an additional coverage off
l l l l l l l l l l l
ered under a farm policy. How much will the policy pay to restore t
l l l l l l l l l l l l l
he records? l
Up to $2,000 l l
9. All of the following could be considered rebates if offered to an i
l l l l l l l l l l l l l
nsured in the sale of insurance EXCEPT: l l l l l l
Dividends from a mutual insurer. l l l l
10. Which of the following may be covered by electronic data pro
l l l l l l l l l l l
cessing coverage form under an inland marine policy? l l l l l l l
a) Computer hardware that is specifically scheduled.
l l l l l l
b) Extra expense the insured incurs to continue the business following
l l l l l l l l l l l
a loss.
l
c) Data processing media, including magnetic tapes or paper tapes, pu
l l l l l l l l l l
nch cards and discs l l l
11. The party to a surety or fidelity bond who promises to fulfill the
l l l l l l l l l l l l l
obligation is the:
l l l
Principal
12. The transfer of money from inside a banking premises to a per
l l l l l l l l l l l l
son other than a messenger outside those premises or to a place
l l l l l l l l l l l l
outside those premises is covered under which commercial cri
l l l l l l l l
me coverage? l
Computer fraud l
13. Which of the following would NOT be covered under the liabili
l l l l l l l l l l l
ty section of a personal auto policy?
l l l l l l
Bodily injury is caused by the insured's negligence while driving a three
l l l l l l l l l l l
-wheel all-terrain vehicle. l l
14. When a producer holding a certificate or a broker's license ha
l l l l l l l l l l l
s a change in his/her residence or business address, he/she mus
l l l l l l l l l l
,t notify the Department of Insurance and any company for which t
l l l l l l l l l l l
he producer holds an appointment within: 30 days.
l l l l l l l
15. What will happen if a house covered by a standard mortgage c
l l l l l l l l l l l l
lause is a total loss? l l l l
The insurer pays the mortgagee according to the mortgagee's interest
l l l l l l l l l l
in the property.
l l
16. What is the civil penalty for violating a cease and desist order
l l l l l l l l l l l l l
of the Commissioner?
l l
$10,000
17. The Business Pursuits endorsement under Section II of a ho
l l l l l l l l l l
meowners policy will cover all of the following EXCEPT: Business l l l l l l l l l
liability.
l
18. If a property is covered by Company A for $20,000 and Compa
l l l l l l l l l l l l
ny B covers the same property for $40,000, how much will Compa
l l l l l l l l l l l
ny A pay on a $24,000 loss?
l l l l l l
$8,000
19. The risk management technique that is used to prevent a spec
l l l l l l l l l l l
ific loss by not exposing oneself to that activity is called:
l l l l l l l l l l
Avoidance.
20. In a farm policy, any cost incurred by the insurer for the investi
l l l l l l l l l l l l l
gation or defense of a claim will be paid by: l l l l l l l l l
The insurer. l
21. Which of the following entities must approve all continuing ed
l l l l l l l l l l
ucation courses in this state? l l l l
The Commissioner l
, 22. An applicant knowingly fails to communicate information tha
l l l l l l l l
t would help an underwriter make a sound decision regarding co
l l l l l l l l l l
verage. This is an example of: l l l l l
Concealment
23. A common exclusion found under physical damage to your a
l l l l l l l l l l
uto includes-: l
Mechanical breakdown. l
24. Which of the following is true regarding a risk retention group
l l l l l l l l l l l
?
It is a liability insurance company owned by its members.
l l l l l l l l l
25. Which of the following best describes a misrepresentation?
l l l l l l l l
Issuing sales material with exaggerated statements about policy bene
l l l l l l l l
fits
26. A builder's risk form is most often written as which of the follo
l l l l l l l l l l l l l
wing?
Completed value form l l
27. An insured has a liability policy that sets the amount for all clai
l l l l l l l l l l l l l
ms that arise from a single incident at $50,000. Which type of limit
l l l l l l l l l l l l l
of liability does this insured's policy have?
l l l l l l
Per occurrence l
28. Which of the following is an example of a protective safeguard
l l l l l l l l l l l
in a businessowners policy?
l l l l
Automatic sprinkler system l l
29. If a licensee wants to transact insurance under a different nam
l l l l l l l l l l l
e than that listed on his or her producer's license, which of the foll
l l l l l l l l l l l l l
owing must occur? l l
The change must be reported to the Commissioner.
l l l l l l l
