AAI 81 C Final Practice EXAM Questions
with 100% CORRECT ANSWERS (Verified |
Updated2025/2026 RATED A+
Which one of the following is a required component of the commercial property coverage part that
specifies the perils covered?
Select one:
A. Causes of loss form
B. Commercial Property Conditions
C. Perils specified form
D. Commercial property coverage form - CORRECT ANSWERS A. Causes of loss form
A Commercial Package Policy (CPP) may normally include which one of the following?
Select one:
A. Commercial liability, inland marine, and ocean marine
B. Commercial liability, commercial automobile, and difference in conditions (DIC)
C. Commercial property, commercial liability, and workers compensation and employers liability
D. Commercial property, commercial crime, and equipment breakdown - CORRECT ANSWERS
D. Commercial property, commercial crime, and equipment breakdown
Which one of the following is the best practice in commercial account submissions for producers who
discover that an insurance applicant has a significant prior loss?
Select one:
A. Fully disclose the details concerning the loss
B. Disclose as little about the loss as possible
C. Wait to be asked for details about the prior loss
D. Conceal the prior loss - CORRECT ANSWERS A. Fully disclose the details concerning the loss
Which one of the following best describes the locations covered by the Commercial Property Coverage
Part with minor exceptions?
Select one:
A. Commercial property is covered when located at a specific, fixed location identified on the
declarations page.
B. Commercial property is covered anywhere in the world.
C. Commercial property is covered at the location described in the policy and while in transit anywhere
in the U.S.
D. Commercial property is covered anywhere in the U.S. and Mexico. - CORRECT ANSWERS A.
Commercial property is covered when located at a specific, fixed location identified on the declarations
page.
Ace Accounting has a Building and Personal Property Coverage Form (BPP) through Delta Insurance with
a limit of $300,000 on business personal property. The insured's computer system is valued at $150,000
, and it is insured for $100,000 under a separate electronic data processing (EDP) equipment policy issued
by Omicron Insurance. The computer system is totally destroyed by fire, a cause of loss insured under
both policies. Which one of the following correctly describes how the loss would be settled?
Select one:
A. Because Omicron's policy more specifically describes the computer system, it must pay its limit before
Delta pays anything; Delta would pay the remaining $50,000.
B. Because Omicron and Delta both cover the equipment, each insurer would pay half of the loss, or
$75,000.
C. The BPP specifically excludes property otherwise insured, so Omicron would pay $100,000 and the
insured would have to pay the remaining - CORRECT ANSWERS A. Because Omicron's policy
more specifically describes the computer system, it must pay its limit before Delta pays anything; Delta
would pay the remaining $50,000.
Under the Abandonment condition of the Building and Personal Property Coverage Form (BPP), the
insured
Select one:
A. Must not abandon or dispose of any damaged property before the loss can be properly verified by the
insurer.
B. Has the right to abandon damaged property and require the insurer to take possession of it.
C. Cannot abandon damaged property and require the insurer to take possession of it.
D. Is required to abandon or dispose of any damaged property before being indemnified for the loss. -
CORRECT ANSWERS C. Cannot abandon damaged property and require the insurer to take
possession of it.
Wholesale Merchandiser leases five warehouses, each in a different city, to supply retail customers in
each city with timely service. The average value of the merchandise at each warehouse is $750,000.
Which one of the following blanket insurance limits would best suit this insured's needs while
minimizing the cost of over-insuring?
Select one:
A. Blanket $3,750,000 limit
B. Blanket $3,375,000 limit
C. Blanket $4,500,000 limit
D. Blanket $5,000,000 limit - CORRECT ANSWERS B. Blanket $3,375,000 limit
The Causes of Loss—Basic Form differs from the Causes of Loss—Broad Form in which one of the
following ways?
Select one:
A. The Broad Form covers "risks of direct physical loss" subject to the form's exclusions and limitations.
B. The Broad Form adds coverage for flooding, rainfall, sewer backup, and similar causes of water
damage.
C. The Broad Form provides coverage for loss caused by collapse of a building or personal property
resulting from specified perils.
D. The Broad Form specifically excludes rupture or bursting of water pipes and leakage of water or
steam from any part of a system or appliance. - CORRECT ANSWERS C. The Broad Form
with 100% CORRECT ANSWERS (Verified |
Updated2025/2026 RATED A+
Which one of the following is a required component of the commercial property coverage part that
specifies the perils covered?
Select one:
A. Causes of loss form
B. Commercial Property Conditions
C. Perils specified form
D. Commercial property coverage form - CORRECT ANSWERS A. Causes of loss form
A Commercial Package Policy (CPP) may normally include which one of the following?
Select one:
A. Commercial liability, inland marine, and ocean marine
B. Commercial liability, commercial automobile, and difference in conditions (DIC)
C. Commercial property, commercial liability, and workers compensation and employers liability
D. Commercial property, commercial crime, and equipment breakdown - CORRECT ANSWERS
D. Commercial property, commercial crime, and equipment breakdown
Which one of the following is the best practice in commercial account submissions for producers who
discover that an insurance applicant has a significant prior loss?
Select one:
A. Fully disclose the details concerning the loss
B. Disclose as little about the loss as possible
C. Wait to be asked for details about the prior loss
D. Conceal the prior loss - CORRECT ANSWERS A. Fully disclose the details concerning the loss
Which one of the following best describes the locations covered by the Commercial Property Coverage
Part with minor exceptions?
Select one:
A. Commercial property is covered when located at a specific, fixed location identified on the
declarations page.
B. Commercial property is covered anywhere in the world.
C. Commercial property is covered at the location described in the policy and while in transit anywhere
in the U.S.
D. Commercial property is covered anywhere in the U.S. and Mexico. - CORRECT ANSWERS A.
Commercial property is covered when located at a specific, fixed location identified on the declarations
page.
Ace Accounting has a Building and Personal Property Coverage Form (BPP) through Delta Insurance with
a limit of $300,000 on business personal property. The insured's computer system is valued at $150,000
, and it is insured for $100,000 under a separate electronic data processing (EDP) equipment policy issued
by Omicron Insurance. The computer system is totally destroyed by fire, a cause of loss insured under
both policies. Which one of the following correctly describes how the loss would be settled?
Select one:
A. Because Omicron's policy more specifically describes the computer system, it must pay its limit before
Delta pays anything; Delta would pay the remaining $50,000.
B. Because Omicron and Delta both cover the equipment, each insurer would pay half of the loss, or
$75,000.
C. The BPP specifically excludes property otherwise insured, so Omicron would pay $100,000 and the
insured would have to pay the remaining - CORRECT ANSWERS A. Because Omicron's policy
more specifically describes the computer system, it must pay its limit before Delta pays anything; Delta
would pay the remaining $50,000.
Under the Abandonment condition of the Building and Personal Property Coverage Form (BPP), the
insured
Select one:
A. Must not abandon or dispose of any damaged property before the loss can be properly verified by the
insurer.
B. Has the right to abandon damaged property and require the insurer to take possession of it.
C. Cannot abandon damaged property and require the insurer to take possession of it.
D. Is required to abandon or dispose of any damaged property before being indemnified for the loss. -
CORRECT ANSWERS C. Cannot abandon damaged property and require the insurer to take
possession of it.
Wholesale Merchandiser leases five warehouses, each in a different city, to supply retail customers in
each city with timely service. The average value of the merchandise at each warehouse is $750,000.
Which one of the following blanket insurance limits would best suit this insured's needs while
minimizing the cost of over-insuring?
Select one:
A. Blanket $3,750,000 limit
B. Blanket $3,375,000 limit
C. Blanket $4,500,000 limit
D. Blanket $5,000,000 limit - CORRECT ANSWERS B. Blanket $3,375,000 limit
The Causes of Loss—Basic Form differs from the Causes of Loss—Broad Form in which one of the
following ways?
Select one:
A. The Broad Form covers "risks of direct physical loss" subject to the form's exclusions and limitations.
B. The Broad Form adds coverage for flooding, rainfall, sewer backup, and similar causes of water
damage.
C. The Broad Form provides coverage for loss caused by collapse of a building or personal property
resulting from specified perils.
D. The Broad Form specifically excludes rupture or bursting of water pipes and leakage of water or
steam from any part of a system or appliance. - CORRECT ANSWERS C. The Broad Form
