PERSONAL LINES EXAM QUESTIONS
WITH CORRECT ANSWERS
A licensed insurance producer who is unable to comply with CE requirements due to
military service or long-term medical disability may request a WAIVER for CE
requirements. A long-term medical disability must be certified on an ANNUAL basis
by an attending physician to the licensee. True Or False. - ANSWER-True
Each rate or loss costs filing must become effective on the date specified in the filing,
but not earlier than ___ days from the date the filing is received by the Commissioner
- ANSWER-210 days
The Commissioner may give notice to the NCRB within ____ days of the filing that
the proposed rates are not within the regulations of North Carolina - ANSWER-50
days
An insurer may terminate a deviation only if the deviation has been in effect for a
period of ___ months before the effective date of the termination and the insurer
notifies the Commissioner of the termination no later than ____ days before the
effective date of the termination. - ANSWER--6 Months
-15 days
No policy form applying to insurance on risks or operations covered by the Rate
Bureau may be delivered or issued for delivery unless it has been filed with the
Commissioner by the Rate Bureau and either he has approved it, or _____ days
have elapsed and it has not disapproved. - ANSWER-90 days
Premium surcharges based on driving records are applied to policies for ___ years.
A surcharge will be applied to individuals who have less than ___ years driving
experience. - ANSWER-3 years
At-Fault Major Accidents are those resulting in bodily injury or death and/or property
damage of $_____ or more - ANSWER-$3,085
At-Fault Intermediate Accidents are those resulting in property damage of more than
$____ but less than $___ - ANSWER--$1,850 but less than $3,085
At-Fault Minor Accidents are those resulting in property damage of $__or less. -
ANSWER-$1850
An "At-Fault Minor Accident" involving property damage ONLY receives no
surcharge as long as no licensed operator in the household has any other
chargeable accidents or convictions for moving traffic violations during the
experience period. You may have heard of this being referred to as "accident
forgiveness." True or False - ANSWER-True
Property Damage" means damage or loss to a rented vehicle in excess of two
hundred fifty dollars ($250.00), including loss of use and any costs or expenses
,incident to the damage or loss, for which the renter is legally obligated to pay; and
"rented" means rented on a daily rate basis for a period of ___ consecutive days or
less. - ANSWER-21 consecutive days
The North Carolina Motor Vehicle Reinsurance Facility (AKA, "The Facility") was
created to provide auto insurance for individuals who would not be able to obtain
coverage through the standard market. This is referred to as an "involuntary market"
since insurers would ordinarily reject the applicant due to the applicants driving
record. True or False - ANSWER-True
Motor Vehicle insurance placed through the Facility is classified as what type of risk?
- ANSWER-Substandard Risk
No licensed insurance producer of an insurer authorized to solicit and accept
premiums for motor vehicle insurance for the company he represents may refuse on
behalf of said company to accept any application from an eligible risk for such
insurance and to immediately bind the coverage applied for and for a period of not
less than ___ months. - ANSWER-6 Months
Insurance producers who signs any blank contract or policy of insurance is guilty of a
Class 3 Misdemeanor and, upon conviction, will be punished by a fine of $______ to
$_____. - ANSWER-$1,000 to $5,000
A Class 1 Misdemeanor has a penalty of $1,000 - $5,000 and/or an imprisonment for
_____days but no more than ___ year. - ANSWER--30 days
-1 year
An insurer or insurance producer must provide a "_______________" to all
applicants or insured parties involved with the insurance transactions during the time
of application. - ANSWER-Notice of Insurance Information Practices
What did the Federal Fair Credit Reporting Act of 1971 Establish? - ANSWER-
established the right of a consumer to know what information has been collected on
him or her.
What did the Federal Privacy Act establish? - ANSWER-established the requirement
that personal information collected by the insurance industry could not be given to
any other party without the consent of the affected party.
The Disclosure Authorization Form will remain valid from the date signed for ____
months for Property or Casualty Insurance applications. - ANSWER-12 months
Within ___________ business days from the date when the written request was
received from an individual to correct recorded personal information, the insurer
must (a) correct, amend or delete the recorded personal information in dispute; or (b)
notify the individual of the refusal to make the requested changes. - ANSWER-30
business days
Within ___________ days of the notice date from the insurer of an adverse
underwriting decision, the applicant may request the insurer furnish within _____
,business days the specific reason for the adverse decision if not initially furnished in
writing and specific items of personal and privileged information that support those
reasons. - ANSWER-90 days
21 business days
Any person who violates a Cease and Desist Order issued by the Commissioner is
subject to a fine of $______ for each violation with a maximum of $_______.Also,
the violator's license may be suspended or revoked by the Commissioner. -
ANSWER--$10,000
-$50,000
Any person who obtains information about an individual from an insurer, insurance
producer or ISO under false pretenses will, upon conviction, be guilty of a _______. -
ANSWER-Class 1 Misdemeanor
Any person who willfully violates a Cease and Desist Order of the Commissioner
after it has become final and while such order is in effect will forfeit and pay a fine for
the use of PUBLIC SCHOOLS of the violation a sum of $_____to$_____. -
ANSWER-$1,000 to $5,000
A person who attempts to obtain anything of value from another by false pretenses
with intent to cheat, embezzle or defraud is guilty of ________ - ANSWER-Class H
felony
All licensees are required to complete _________ hours of NCDOI approved CE
every ___ years - ANSWER-24 hours and 2 years
CE is due by the LAST DAY of the MONTH OF THE LICENSEE' BIRTHDAY in each
compliance period. True or False - ANSWER-True
every resident licensee must complete a minimum ____ hour "Ethics" course
approved by the NCDOI in EACH compliance period. - ANSWER-3 hour
All Property, Casualty, Personal Lines or Adjuster licensees must complete a
minimum ____hour "Flood" course approved by the NCDOI in EVERY OTHER
compliance period. - ANSWER-3 hour
The licensee may, within ___days after the end of his or her compliance period,
complete the CE requirements and request a reinstatement of the license and pay a
$_____reinstatement fee to have his or her license reinstated. - ANSWER-120 days
-$75.00
A licensee may request a ____ day extension of his or her normal compliance period
from the NCDOI by completing the appropriate request form and paying a $___ fee.
Requests must be made no sooner than _____ days before the end of their
compliance period and no later than the last day of their compliance period -
ANSWER--30 days
-$75.00
, Licensees must maintain records of all CE credits earned for a period of ___ years
after obtaining the credits. - ANSWER-5 years
No insurance company or insurance producer may knowingly issue any fire
insurance policy on property in North Carolina for an amount which, together with
any existing insurance, exceeds the fair value of the property and not for a term
exceeding ____ years. - ANSWER-7 Years
The NCIUA will have the power on behalf of its members:
(1) To cause to be issued policies of insurance to applicants.
(2) To assume reinsurance from its members.
(3) To cede reinsurance to its members and to purchase reinsurance in behalf of its
members.
True or False. - ANSWER-True
No licensee may solicit a power-of-attorney from a consumer that authorizes the
licensee to sign insurance-related forms. True or False - ANSWER-True
The Personal Auto Policy (PAP) sold in North Carolina is a policy designed to
provide no less than the minimum liability limits as required by the state of North
Carolina on a "______" basis. - ANSWER-Per Occurrence
The PAP will also have coverage for "Uninsured and Underinsured Motorists" to
protect persons from drivers who carry insufficient liability limits or if they have no
auto insurance. True or False. - ANSWER-True
What vehicles are eligible for the Personal Auto Policy (PAP)? - ANSWER-1. Four-
wheel, private passenger auto including station wagons
2. Pickup or van provided it is less than 10,000 lbs.
3. Owned or leased private passenger-type autos are eligible if leased under a
written agreement and the lease is for a continuous period of at least six (6) months.
Newly Acquired Vehicle in the Personal Auto Policy (PAP) :
1. Replacement Vehicle - This vehicle will have the SAME coverage as the vehicle it
replaces. The insurer must be notified within ______ days of acquisition. If the
insured wishes to add or continue coverage for "Damage to the Insured's Auto," the
coverage must be requested. - ANSWER-30 days
Newly Acquired Vehicle in the Personal Auto Policy (PAP) :
2. Additional Vehicle - This vehicle will have the _____ coverage of any vehicle
described on the Declarations page. The new vehicle must be reported within ____
days of acquisition. - ANSWER--Broadest
-30 days
Personal Auto Policy (PAP) Part A Insuring Agreement :
WITH CORRECT ANSWERS
A licensed insurance producer who is unable to comply with CE requirements due to
military service or long-term medical disability may request a WAIVER for CE
requirements. A long-term medical disability must be certified on an ANNUAL basis
by an attending physician to the licensee. True Or False. - ANSWER-True
Each rate or loss costs filing must become effective on the date specified in the filing,
but not earlier than ___ days from the date the filing is received by the Commissioner
- ANSWER-210 days
The Commissioner may give notice to the NCRB within ____ days of the filing that
the proposed rates are not within the regulations of North Carolina - ANSWER-50
days
An insurer may terminate a deviation only if the deviation has been in effect for a
period of ___ months before the effective date of the termination and the insurer
notifies the Commissioner of the termination no later than ____ days before the
effective date of the termination. - ANSWER--6 Months
-15 days
No policy form applying to insurance on risks or operations covered by the Rate
Bureau may be delivered or issued for delivery unless it has been filed with the
Commissioner by the Rate Bureau and either he has approved it, or _____ days
have elapsed and it has not disapproved. - ANSWER-90 days
Premium surcharges based on driving records are applied to policies for ___ years.
A surcharge will be applied to individuals who have less than ___ years driving
experience. - ANSWER-3 years
At-Fault Major Accidents are those resulting in bodily injury or death and/or property
damage of $_____ or more - ANSWER-$3,085
At-Fault Intermediate Accidents are those resulting in property damage of more than
$____ but less than $___ - ANSWER--$1,850 but less than $3,085
At-Fault Minor Accidents are those resulting in property damage of $__or less. -
ANSWER-$1850
An "At-Fault Minor Accident" involving property damage ONLY receives no
surcharge as long as no licensed operator in the household has any other
chargeable accidents or convictions for moving traffic violations during the
experience period. You may have heard of this being referred to as "accident
forgiveness." True or False - ANSWER-True
Property Damage" means damage or loss to a rented vehicle in excess of two
hundred fifty dollars ($250.00), including loss of use and any costs or expenses
,incident to the damage or loss, for which the renter is legally obligated to pay; and
"rented" means rented on a daily rate basis for a period of ___ consecutive days or
less. - ANSWER-21 consecutive days
The North Carolina Motor Vehicle Reinsurance Facility (AKA, "The Facility") was
created to provide auto insurance for individuals who would not be able to obtain
coverage through the standard market. This is referred to as an "involuntary market"
since insurers would ordinarily reject the applicant due to the applicants driving
record. True or False - ANSWER-True
Motor Vehicle insurance placed through the Facility is classified as what type of risk?
- ANSWER-Substandard Risk
No licensed insurance producer of an insurer authorized to solicit and accept
premiums for motor vehicle insurance for the company he represents may refuse on
behalf of said company to accept any application from an eligible risk for such
insurance and to immediately bind the coverage applied for and for a period of not
less than ___ months. - ANSWER-6 Months
Insurance producers who signs any blank contract or policy of insurance is guilty of a
Class 3 Misdemeanor and, upon conviction, will be punished by a fine of $______ to
$_____. - ANSWER-$1,000 to $5,000
A Class 1 Misdemeanor has a penalty of $1,000 - $5,000 and/or an imprisonment for
_____days but no more than ___ year. - ANSWER--30 days
-1 year
An insurer or insurance producer must provide a "_______________" to all
applicants or insured parties involved with the insurance transactions during the time
of application. - ANSWER-Notice of Insurance Information Practices
What did the Federal Fair Credit Reporting Act of 1971 Establish? - ANSWER-
established the right of a consumer to know what information has been collected on
him or her.
What did the Federal Privacy Act establish? - ANSWER-established the requirement
that personal information collected by the insurance industry could not be given to
any other party without the consent of the affected party.
The Disclosure Authorization Form will remain valid from the date signed for ____
months for Property or Casualty Insurance applications. - ANSWER-12 months
Within ___________ business days from the date when the written request was
received from an individual to correct recorded personal information, the insurer
must (a) correct, amend or delete the recorded personal information in dispute; or (b)
notify the individual of the refusal to make the requested changes. - ANSWER-30
business days
Within ___________ days of the notice date from the insurer of an adverse
underwriting decision, the applicant may request the insurer furnish within _____
,business days the specific reason for the adverse decision if not initially furnished in
writing and specific items of personal and privileged information that support those
reasons. - ANSWER-90 days
21 business days
Any person who violates a Cease and Desist Order issued by the Commissioner is
subject to a fine of $______ for each violation with a maximum of $_______.Also,
the violator's license may be suspended or revoked by the Commissioner. -
ANSWER--$10,000
-$50,000
Any person who obtains information about an individual from an insurer, insurance
producer or ISO under false pretenses will, upon conviction, be guilty of a _______. -
ANSWER-Class 1 Misdemeanor
Any person who willfully violates a Cease and Desist Order of the Commissioner
after it has become final and while such order is in effect will forfeit and pay a fine for
the use of PUBLIC SCHOOLS of the violation a sum of $_____to$_____. -
ANSWER-$1,000 to $5,000
A person who attempts to obtain anything of value from another by false pretenses
with intent to cheat, embezzle or defraud is guilty of ________ - ANSWER-Class H
felony
All licensees are required to complete _________ hours of NCDOI approved CE
every ___ years - ANSWER-24 hours and 2 years
CE is due by the LAST DAY of the MONTH OF THE LICENSEE' BIRTHDAY in each
compliance period. True or False - ANSWER-True
every resident licensee must complete a minimum ____ hour "Ethics" course
approved by the NCDOI in EACH compliance period. - ANSWER-3 hour
All Property, Casualty, Personal Lines or Adjuster licensees must complete a
minimum ____hour "Flood" course approved by the NCDOI in EVERY OTHER
compliance period. - ANSWER-3 hour
The licensee may, within ___days after the end of his or her compliance period,
complete the CE requirements and request a reinstatement of the license and pay a
$_____reinstatement fee to have his or her license reinstated. - ANSWER-120 days
-$75.00
A licensee may request a ____ day extension of his or her normal compliance period
from the NCDOI by completing the appropriate request form and paying a $___ fee.
Requests must be made no sooner than _____ days before the end of their
compliance period and no later than the last day of their compliance period -
ANSWER--30 days
-$75.00
, Licensees must maintain records of all CE credits earned for a period of ___ years
after obtaining the credits. - ANSWER-5 years
No insurance company or insurance producer may knowingly issue any fire
insurance policy on property in North Carolina for an amount which, together with
any existing insurance, exceeds the fair value of the property and not for a term
exceeding ____ years. - ANSWER-7 Years
The NCIUA will have the power on behalf of its members:
(1) To cause to be issued policies of insurance to applicants.
(2) To assume reinsurance from its members.
(3) To cede reinsurance to its members and to purchase reinsurance in behalf of its
members.
True or False. - ANSWER-True
No licensee may solicit a power-of-attorney from a consumer that authorizes the
licensee to sign insurance-related forms. True or False - ANSWER-True
The Personal Auto Policy (PAP) sold in North Carolina is a policy designed to
provide no less than the minimum liability limits as required by the state of North
Carolina on a "______" basis. - ANSWER-Per Occurrence
The PAP will also have coverage for "Uninsured and Underinsured Motorists" to
protect persons from drivers who carry insufficient liability limits or if they have no
auto insurance. True or False. - ANSWER-True
What vehicles are eligible for the Personal Auto Policy (PAP)? - ANSWER-1. Four-
wheel, private passenger auto including station wagons
2. Pickup or van provided it is less than 10,000 lbs.
3. Owned or leased private passenger-type autos are eligible if leased under a
written agreement and the lease is for a continuous period of at least six (6) months.
Newly Acquired Vehicle in the Personal Auto Policy (PAP) :
1. Replacement Vehicle - This vehicle will have the SAME coverage as the vehicle it
replaces. The insurer must be notified within ______ days of acquisition. If the
insured wishes to add or continue coverage for "Damage to the Insured's Auto," the
coverage must be requested. - ANSWER-30 days
Newly Acquired Vehicle in the Personal Auto Policy (PAP) :
2. Additional Vehicle - This vehicle will have the _____ coverage of any vehicle
described on the Declarations page. The new vehicle must be reported within ____
days of acquisition. - ANSWER--Broadest
-30 days
Personal Auto Policy (PAP) Part A Insuring Agreement :
