age 1 of 69
Property & Casualty Insurance Exam Prep – Part One:
Essential Questions & Answers
No rate shall be approved or remain in effect for the following
reasons EXCEPT ......ANSWER........The rate is based on actuary
principles
All of the following are requirements to offer earthquake
insurance with residential property coverage EXCEPT
......ANSWER........A separate policy to cover the earthquake is
required, an endorsement is insufficient
What document must be provided to the insured prior to any
residential insurance policy being issued or renewed?
......ANSWER........A copy of the California residential property
disclosure statement
,age 2 of 69
Which type of coverage protects against loss caused by earth
movement? ......ANSWER........A stand-alone earthquake insurance
What is the required rate discount under a Good Driver Discount
policy? ......ANSWER........20% below the rate the insured would
have been otherwise charged for the same coverage
All the following are authorized activities for the Limited
Automobile Insurance Agent EXCEPT if the agent
......ANSWER........Charges and collects a brokers fee for service
What is the procedure for refusing uninsured motorist coverage
in a liability policy? ......ANSWER........Prior to issuance or
renewal, the insured may state in writing that they do not want
the coverage
How many classes of insurance are defined under California
Insurance Law, including "miscellaneous" and "reserved"
,age 3 of 69
......ANSWER........There are a total of 20 classes of insurance
defined under California Law, with many sub-classes.
When can a person who sells real property require the use of a
specific insurance agent, broker or solicitor? ......ANSWER........A
buyer is always able to choose their own insurance
representative
All the following are requirements for determining an area that
qualifies for Low Cost Automobile Insurance EXCEPT
......ANSWER........The number of auto accidents that occur within
the country
Which of the following describes a contract of reinsurance?
......ANSWER........The first insurer issues insurance to compensate
another insurer for losses on contracts issued by that second
insurer
, age 4 of 69
The managing General Agent negotiates and binds ceding
Insurance on behalf of whom? ......ANSWER........The insurer
All of the following are duties of a Managing General Agent
EXCEPT ......ANSWER........Delivering policies to the insured
Who is able to place business through the California Automobile
Assessed Risk Program? ......ANSWER........Only agent/brokers
licensed in fire and Casualty who have also been certified
through CAARP
Can a lender, as a condition of making a loan, require that any
insurance be placed through a particular insurance agent or
broker? ......ANSWER........The loan recipient may always select a
particular agent or broker of their choosing
Property & Casualty Insurance Exam Prep – Part One:
Essential Questions & Answers
No rate shall be approved or remain in effect for the following
reasons EXCEPT ......ANSWER........The rate is based on actuary
principles
All of the following are requirements to offer earthquake
insurance with residential property coverage EXCEPT
......ANSWER........A separate policy to cover the earthquake is
required, an endorsement is insufficient
What document must be provided to the insured prior to any
residential insurance policy being issued or renewed?
......ANSWER........A copy of the California residential property
disclosure statement
,age 2 of 69
Which type of coverage protects against loss caused by earth
movement? ......ANSWER........A stand-alone earthquake insurance
What is the required rate discount under a Good Driver Discount
policy? ......ANSWER........20% below the rate the insured would
have been otherwise charged for the same coverage
All the following are authorized activities for the Limited
Automobile Insurance Agent EXCEPT if the agent
......ANSWER........Charges and collects a brokers fee for service
What is the procedure for refusing uninsured motorist coverage
in a liability policy? ......ANSWER........Prior to issuance or
renewal, the insured may state in writing that they do not want
the coverage
How many classes of insurance are defined under California
Insurance Law, including "miscellaneous" and "reserved"
,age 3 of 69
......ANSWER........There are a total of 20 classes of insurance
defined under California Law, with many sub-classes.
When can a person who sells real property require the use of a
specific insurance agent, broker or solicitor? ......ANSWER........A
buyer is always able to choose their own insurance
representative
All the following are requirements for determining an area that
qualifies for Low Cost Automobile Insurance EXCEPT
......ANSWER........The number of auto accidents that occur within
the country
Which of the following describes a contract of reinsurance?
......ANSWER........The first insurer issues insurance to compensate
another insurer for losses on contracts issued by that second
insurer
, age 4 of 69
The managing General Agent negotiates and binds ceding
Insurance on behalf of whom? ......ANSWER........The insurer
All of the following are duties of a Managing General Agent
EXCEPT ......ANSWER........Delivering policies to the insured
Who is able to place business through the California Automobile
Assessed Risk Program? ......ANSWER........Only agent/brokers
licensed in fire and Casualty who have also been certified
through CAARP
Can a lender, as a condition of making a loan, require that any
insurance be placed through a particular insurance agent or
broker? ......ANSWER........The loan recipient may always select a
particular agent or broker of their choosing
