NJ P+C (UPDATED) EXAM | 135 QUESTIONS | 2025
WITH COMPLETE SOLUTIONS.
A producer acting as an agent for an insurance company may take which of the
following actions? Answer - discount the premiums
When a corporation purchases a Commercial General Liability Policy, all of the
following are named insureds EXCEPT: Answer - clients
A policy with an 80% coinsurance clause protects a building valued at
$100,000. The insured carries $85,000 of coverage, and a $30,000 loss occurs.
How much will the insurer pay? Answer - $30,000
Which of the following is a valid reason for cancellation of a property insurance
policy? Answer - material change in exposure
A commercial property's basic cause of loss form does NOT cover water
damage resulting from: Answer - an overflowing sewer
Which of the following is an example of an indirect loss? Answer - a
manufacturing plant is unable to operate because one of its suppliers lost its
production plant in a fire
A farm fertilizer company has four claims-made policies with a retro-date of
1995: policy W went into effect in 1995; policy X went into effect in 1996;
policy Y went into effect in 1997; and policy Z went into effect in 1998. Under a
claims-made policy, if a loss occurred in 1995 generating a claim in 1997, which
policy will pay this claim? Answer - Y (1997)
,When New Jersey law requires that double compensation be paid for a
Workers Compensation claim, the extra amount is paid solely by which of the
following entities? Answer - the employer of the claimant
A producer must maintain client records for a MINIMUM of how many years
after a client's coverage is terminated? Answer - 5
Before a Pennsylvania corporation can open an insurance agency in New Jersey,
it MUST Answer - obtain authorization from the New Jersey Department of
Treasury to conduct business in New Jersey
All commercial package policies contain four key components. Which of the
following is NOT one of them? Answer - deductible amount
Which is NOT covered in Commercial General Liability Policies? Answer - recall
and warranties
Strict liability is best defined as Answer - liability without regard to fault
A grocery tore worker drops a box on a customer while stocking a shelf. What
type of coverage applies? Answer - premises liability
The declarations page of a Homeowners Insurance policy does NOT list the
Answer - coverage territory
Under the regulations of the Producer Licensing Act, a producer may name an
insurance agency Answer - Jones Insurance Brokerage
, On an individual insurance application, which of the following signatures is NOT
required? Answer - the insurer
A producer offers a prospective insured an auto policy that contains
deductibles but tells the prospect that it contains no deductibles. In this
situation, the producer may be found guilty of Answer - misrepresentation
Misrepresentation of what facts will result in a voided contract Answer -
material
The Commissioner of Banking and Insurance may waive an applicant's
prelicensing education requirement for all of the following reasons EXCEPT that
the applicant Answer - has been employed in the insurance industry for a
minimum of five years
What is the MINIMUM amount an automobile liability policy with limits of
$100,000/$300,000/$25,000 will provide to cover each property damage
claim? Answer - $25,000
Workers Compensation Coverage A provides benefits for which of the following
claims? Answer - a job-incurred occupational disease
A businessowners policy (BOP) would NEVER be an appropriate way to provide
insurance coverage for a Answer - general contractor
What element of an insurance contract demonstrates that each party is giving
something of value? Answer - consideration
Which condition specifies that the insurer can take possession of damaged
property after payment of loss? Answer - salvage
WITH COMPLETE SOLUTIONS.
A producer acting as an agent for an insurance company may take which of the
following actions? Answer - discount the premiums
When a corporation purchases a Commercial General Liability Policy, all of the
following are named insureds EXCEPT: Answer - clients
A policy with an 80% coinsurance clause protects a building valued at
$100,000. The insured carries $85,000 of coverage, and a $30,000 loss occurs.
How much will the insurer pay? Answer - $30,000
Which of the following is a valid reason for cancellation of a property insurance
policy? Answer - material change in exposure
A commercial property's basic cause of loss form does NOT cover water
damage resulting from: Answer - an overflowing sewer
Which of the following is an example of an indirect loss? Answer - a
manufacturing plant is unable to operate because one of its suppliers lost its
production plant in a fire
A farm fertilizer company has four claims-made policies with a retro-date of
1995: policy W went into effect in 1995; policy X went into effect in 1996;
policy Y went into effect in 1997; and policy Z went into effect in 1998. Under a
claims-made policy, if a loss occurred in 1995 generating a claim in 1997, which
policy will pay this claim? Answer - Y (1997)
,When New Jersey law requires that double compensation be paid for a
Workers Compensation claim, the extra amount is paid solely by which of the
following entities? Answer - the employer of the claimant
A producer must maintain client records for a MINIMUM of how many years
after a client's coverage is terminated? Answer - 5
Before a Pennsylvania corporation can open an insurance agency in New Jersey,
it MUST Answer - obtain authorization from the New Jersey Department of
Treasury to conduct business in New Jersey
All commercial package policies contain four key components. Which of the
following is NOT one of them? Answer - deductible amount
Which is NOT covered in Commercial General Liability Policies? Answer - recall
and warranties
Strict liability is best defined as Answer - liability without regard to fault
A grocery tore worker drops a box on a customer while stocking a shelf. What
type of coverage applies? Answer - premises liability
The declarations page of a Homeowners Insurance policy does NOT list the
Answer - coverage territory
Under the regulations of the Producer Licensing Act, a producer may name an
insurance agency Answer - Jones Insurance Brokerage
, On an individual insurance application, which of the following signatures is NOT
required? Answer - the insurer
A producer offers a prospective insured an auto policy that contains
deductibles but tells the prospect that it contains no deductibles. In this
situation, the producer may be found guilty of Answer - misrepresentation
Misrepresentation of what facts will result in a voided contract Answer -
material
The Commissioner of Banking and Insurance may waive an applicant's
prelicensing education requirement for all of the following reasons EXCEPT that
the applicant Answer - has been employed in the insurance industry for a
minimum of five years
What is the MINIMUM amount an automobile liability policy with limits of
$100,000/$300,000/$25,000 will provide to cover each property damage
claim? Answer - $25,000
Workers Compensation Coverage A provides benefits for which of the following
claims? Answer - a job-incurred occupational disease
A businessowners policy (BOP) would NEVER be an appropriate way to provide
insurance coverage for a Answer - general contractor
What element of an insurance contract demonstrates that each party is giving
something of value? Answer - consideration
Which condition specifies that the insurer can take possession of damaged
property after payment of loss? Answer - salvage
