Property and casualty insurance Exam
Questions and Answers Part one Latest Update
2025-2026 260 Questions and 100% Verified
Correct Answers Guaranteed A+
A banker is ready to close on a customer's loan. The bank is prepared to offer the loan
but only if the customer purchases a life insurance policy from the bank in the amount of
the loan. This is an example of - CORRECT ANSWER: Coercion.
A builder's risk form is most often written as which of the following? - CORRECT
ANSWER: Completed value form
A building is insured, but no one has lived or worked in it for 10 years. The building is
completely empty of any furniture or personal belongings. From an insurance
standpoint, the building is considered - CORRECT ANSWER: Vacant.
A business using its own trucks to move its own cargo would insure the cargo using -
CORRECT ANSWER: Motor truck cargo - owners form.
A commercial package policy (CPP) allows the insured to select the coverage needed
and customize the policy to meet the needs of the insured's business. In a CPP, the
business owner may select from all of the following types of coverage EXCEPT -
CORRECT ANSWER: Workers compensation coverage
A commercial property special form covers property in transit up to - CORRECT
ANSWER: $5,000.
A common exclusion found under physical damage to your auto includes - CORRECT
ANSWER: Mechanical breakdown.
,A licensee serving in the military is unable to fulfill her continuing education requirement.
What would the licensee have to do to renew the license? - CORRECT ANSWER: The
licensee may submit a request to the department to have requirements and fees
waived. The department will then determine if the request is permissible.
A meteorite hits the insured's car, causing damage. Under which of the following
coverages in a personal auto policy would this loss be paid? - CORRECT ANSWER:
Other-than-collision
A mortgage company is named as a loss payee on the insured's homeowners policy,
under the standard mortgage clause. If the insured suffers a loss due to a fire, which of
the following is true? - CORRECT ANSWER: The loss is payable to the insured and the
mortgagee.
A municipality can protect itself against the construction or repair of properties that do
not conform to the building codes established by ordinance by requiring the contractors
to obtain - CORRECT ANSWER: License and permit bonds.
A participating insurance policy may do which of the following? - CORRECT ANSWER:
Pay dividends to the policyowner
A person applying for a manager or exclusive general agent license must meet all of the
following criteria EXCEPT - CORRECT ANSWER: Be responsible for at least 25% of
total commissions collected by the office that he or she manages.
A person who does not lock the doors or does not repair leaks shows an indifferent
attitude. This person presents what type of hazard? - CORRECT ANSWER: Morale
A person who is not named as an insured on the declarations page of a policy but is
protected by the policy is known as the - CORRECT ANSWER: Additional insured.
,A premium discount is the term that describes when an insured owes a total standard
premium greater than - CORRECT ANSWER: $5,000.
A producer licensed in Pennsylvania must notify the Insurance Department of any
change of address in his or her residence or business address within how many days? -
CORRECT ANSWER: 30
A ranchowners policy is most similar to which of the following? - CORRECT ANSWER:
Homeowners
A recent college graduate bought a new car and is trying to get automobile insurance on
it as required by the lienholder. After being rejected by several insurance companies
due to his driving record, he finally talked to an agent who can get him coverage. His
agent called him a residual market risk. From which type of automobile insurance plan
can the applicant purchase insurance? - CORRECT ANSWER: Assigned risk
A restaurant is out of business for 3 days after an insured's automobile hits an electrical
pole. The pole falls and hits the building, knocking out all electrical power supply. Which
of the following is NOT covered under the insured driver's auto policy? - CORRECT
ANSWER: Lost revenues from the restaurant
A trucking business swaps trailers with other carriers. What coverage is necessary to
cover loss to the other's trailer while in the borrower's possession? - CORRECT
ANSWER: Trailer interchange coverage
A trucking company owns a large fleet of trucks that transport oil across state lines.
According to the financial responsibility requirements set by the Motor Carrier Act of
1980, what is the minimum amount of insurance the company must carry on vehicles
that transport oil? - CORRECT ANSWER: $1 million
A type of policy that is used to provide a specific amount of replacement cost for a given
risk after it has been destroyed is called a(n) - CORRECT ANSWER: Valued policy.
, ABC Trucking hauls products for Acme, Inc. as a contract carrier. On one shipment, the
driver stopped at a truck stop for lunch. Leaving the truck in the parking lot, he made
certain that the truck was locked before leaving it. Upon returning to the truck, he
discovered that someone had broken into the truck and stolen the cargo. Is ABC legally
liable for this loss? - CORRECT ANSWER: No, the driver had taken reasonable
measures to protect the property by locking the truck.
According to the loss payment condition in HO policies, losses must be paid within how
many days of the insurer receiving proof of loss? - CORRECT ANSWER: 60 days
According to the principles of ocean marine insurance, an actual total loss may occur in
all of the following situations EXCEPT - CORRECT ANSWER: When cargo is
misplaced.
According to the privacy of consumer financial information regulation, if a consumer
decides to opt out, this means - CORRECT ANSWER: The consumer directs the
licensee not to disclose the consumer's nonpublic personal financial information to a
third party.
According to the standard workers compensation and employer liability policy form, a
state should be listed in Part Three - other states' insurance of the workers
compensation and employers liability policy when - CORRECT ANSWER: The insured
expects to extend operations to that state.
After a hearing, if the Commissioner finds that a licensee is in violation of the state
insurance laws, the Commissioner can do any of the following EXCEPT - CORRECT
ANSWER: Imprison the licensee.
Agents who persuade insureds to cancel a policy in favor of another one when it might
not be in the insured's best interest are guilty of - CORRECT ANSWER: Twisting.
All of the following actions by a person could be described as risk avoidance EXCEPT -
CORRECT ANSWER: Investing in the stock market.
Questions and Answers Part one Latest Update
2025-2026 260 Questions and 100% Verified
Correct Answers Guaranteed A+
A banker is ready to close on a customer's loan. The bank is prepared to offer the loan
but only if the customer purchases a life insurance policy from the bank in the amount of
the loan. This is an example of - CORRECT ANSWER: Coercion.
A builder's risk form is most often written as which of the following? - CORRECT
ANSWER: Completed value form
A building is insured, but no one has lived or worked in it for 10 years. The building is
completely empty of any furniture or personal belongings. From an insurance
standpoint, the building is considered - CORRECT ANSWER: Vacant.
A business using its own trucks to move its own cargo would insure the cargo using -
CORRECT ANSWER: Motor truck cargo - owners form.
A commercial package policy (CPP) allows the insured to select the coverage needed
and customize the policy to meet the needs of the insured's business. In a CPP, the
business owner may select from all of the following types of coverage EXCEPT -
CORRECT ANSWER: Workers compensation coverage
A commercial property special form covers property in transit up to - CORRECT
ANSWER: $5,000.
A common exclusion found under physical damage to your auto includes - CORRECT
ANSWER: Mechanical breakdown.
,A licensee serving in the military is unable to fulfill her continuing education requirement.
What would the licensee have to do to renew the license? - CORRECT ANSWER: The
licensee may submit a request to the department to have requirements and fees
waived. The department will then determine if the request is permissible.
A meteorite hits the insured's car, causing damage. Under which of the following
coverages in a personal auto policy would this loss be paid? - CORRECT ANSWER:
Other-than-collision
A mortgage company is named as a loss payee on the insured's homeowners policy,
under the standard mortgage clause. If the insured suffers a loss due to a fire, which of
the following is true? - CORRECT ANSWER: The loss is payable to the insured and the
mortgagee.
A municipality can protect itself against the construction or repair of properties that do
not conform to the building codes established by ordinance by requiring the contractors
to obtain - CORRECT ANSWER: License and permit bonds.
A participating insurance policy may do which of the following? - CORRECT ANSWER:
Pay dividends to the policyowner
A person applying for a manager or exclusive general agent license must meet all of the
following criteria EXCEPT - CORRECT ANSWER: Be responsible for at least 25% of
total commissions collected by the office that he or she manages.
A person who does not lock the doors or does not repair leaks shows an indifferent
attitude. This person presents what type of hazard? - CORRECT ANSWER: Morale
A person who is not named as an insured on the declarations page of a policy but is
protected by the policy is known as the - CORRECT ANSWER: Additional insured.
,A premium discount is the term that describes when an insured owes a total standard
premium greater than - CORRECT ANSWER: $5,000.
A producer licensed in Pennsylvania must notify the Insurance Department of any
change of address in his or her residence or business address within how many days? -
CORRECT ANSWER: 30
A ranchowners policy is most similar to which of the following? - CORRECT ANSWER:
Homeowners
A recent college graduate bought a new car and is trying to get automobile insurance on
it as required by the lienholder. After being rejected by several insurance companies
due to his driving record, he finally talked to an agent who can get him coverage. His
agent called him a residual market risk. From which type of automobile insurance plan
can the applicant purchase insurance? - CORRECT ANSWER: Assigned risk
A restaurant is out of business for 3 days after an insured's automobile hits an electrical
pole. The pole falls and hits the building, knocking out all electrical power supply. Which
of the following is NOT covered under the insured driver's auto policy? - CORRECT
ANSWER: Lost revenues from the restaurant
A trucking business swaps trailers with other carriers. What coverage is necessary to
cover loss to the other's trailer while in the borrower's possession? - CORRECT
ANSWER: Trailer interchange coverage
A trucking company owns a large fleet of trucks that transport oil across state lines.
According to the financial responsibility requirements set by the Motor Carrier Act of
1980, what is the minimum amount of insurance the company must carry on vehicles
that transport oil? - CORRECT ANSWER: $1 million
A type of policy that is used to provide a specific amount of replacement cost for a given
risk after it has been destroyed is called a(n) - CORRECT ANSWER: Valued policy.
, ABC Trucking hauls products for Acme, Inc. as a contract carrier. On one shipment, the
driver stopped at a truck stop for lunch. Leaving the truck in the parking lot, he made
certain that the truck was locked before leaving it. Upon returning to the truck, he
discovered that someone had broken into the truck and stolen the cargo. Is ABC legally
liable for this loss? - CORRECT ANSWER: No, the driver had taken reasonable
measures to protect the property by locking the truck.
According to the loss payment condition in HO policies, losses must be paid within how
many days of the insurer receiving proof of loss? - CORRECT ANSWER: 60 days
According to the principles of ocean marine insurance, an actual total loss may occur in
all of the following situations EXCEPT - CORRECT ANSWER: When cargo is
misplaced.
According to the privacy of consumer financial information regulation, if a consumer
decides to opt out, this means - CORRECT ANSWER: The consumer directs the
licensee not to disclose the consumer's nonpublic personal financial information to a
third party.
According to the standard workers compensation and employer liability policy form, a
state should be listed in Part Three - other states' insurance of the workers
compensation and employers liability policy when - CORRECT ANSWER: The insured
expects to extend operations to that state.
After a hearing, if the Commissioner finds that a licensee is in violation of the state
insurance laws, the Commissioner can do any of the following EXCEPT - CORRECT
ANSWER: Imprison the licensee.
Agents who persuade insureds to cancel a policy in favor of another one when it might
not be in the insured's best interest are guilty of - CORRECT ANSWER: Twisting.
All of the following actions by a person could be described as risk avoidance EXCEPT -
CORRECT ANSWER: Investing in the stock market.
