LOUISIANA PERSONAL LINES INSURANCE EXAM 115
QUESTIONS & CORRECT ANSWERS LATEST 2025
Driver A has a personal auto policy with Part C: UM/UIM limits of 100/300. He is
injured by Driver B who has Part A: Bodily Injury Liability limits of 50/100. It is
determined that Driver B is at fault for the accident. Driver A has $125,000 in
medical expenses. How much will his Part C: UM/UIM coverage pay?
a) $125,000
b) $75,000
c) $50,000
d) $25,000 - ANSWER-c) $50,000
Underinsured motorist coverage acts as excess over the at-fault motorist's
coverage. It will pay the difference between the insured's UIM limits and the at-
fault driver's bodily injury limits (in this scenario, $100,000 of the insured's
coverage minus $50,000 of the other driver's). Because of the per person limits of
Driver A's underinsured motorist coverage, the policy will pay the amount
necessary to bring payment up to the per person limit. The policy will not pay
more than the limits of liability.
Because an insured owns a lot of expensive jewelry, her insurance agent has
advised her to purchase a scheduled personal property endorsement. If the insured
adds this endorsement to her homeowners policy, which of the following
statements would be correct?
a) The endorsement becomes primary coverage and the HO contract is secondary.
,b) Coverage C limits will no longer apply to the jewelry insured by the
endorsement.
c) The amount of coverage will be doubled.
d) The endorsement becomes excess coverage. - ANSWER-b) Coverage C limits
will no longer apply to the jewelry insured by the endorsement.
When items are scheduled, they are excluded from Coverage C as insured items,
and are covered only under the scheduled personal property endorsement.
Which of the following statements is NOT true regarding a personal umbrella
liability policy?
a) It provides excess liability coverage over underlying personal liability.
b) It provides errors and omissions coverage for an agency.
c) It may cover certain exposures not provided under the primary layer.
d) It may require the payment of a self-insured retention. - ANSWER-b) It
provides errors and omissions coverage for an agency.
Personal umbrella policies cover the personal exposure of the insured. Errors and
omissions coverage is provided only in a professional liability policy.
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?
a) The entire loss is payable to the insured.
b) The loss is payable to the insured and the mortgagee.
,c) The mortgagee should submit a claim to its insurer, and the insured should
submit a claim to the HO policy.
d) The entire loss is payable to the mortgagee. - ANSWER-b) The loss is payable
to the insured and the mortgagee.
Loss is payable to the insured and mortgagee to protect the mortgage company's
interest. This prevents the insured from cashing the check and not completing
repairs.
In a personal auto policy, the medical payments coverage is similar to
a) Accident insurance, because it pays medical expenses regardless of fault.
b) Accident insurance, because it has the same limits.
c) Bodily injury coverage, because it pays the insured's doctor bills.
d) Bodily injury coverage, because it provides legal protection if the insured causes
injuries to others. - ANSWER-a) Accident insurance, because it pays medical
expenses regardless of fault.
Medical payments will pay for accidental bodily injury of an insured, regardless of
fault or auto. It will pay medical expenses of others occupying the insured auto.
All of the following are true of Coverage B - Other Structures EXCEPT
a) It must be added by endorsement to a homeowners policy.
b) This coverage is not applicable on the HO-4 policy form.
c) The amount of coverage provided by Coverage B is an amount equal to 10% of
Coverage A.
, d) Land where the other structures are located is not covered. - ANSWER-a) It
must be added by endorsement to a homeowners policy.
Homeowners policies automatically provide an amount of insurance in Coverage B
that is equal to 10% of the amount written as Coverage A. This amount may be
increased by endorsement.
All of the following are supplemental payments included in the liability section of
a personal auto policy EXCEPT
a) Up to $100 for the cost to secure the release of a vehicle from an impoundment
lot following a covered accident.
b) Up to $200 a day for loss of earnings due to attendance at hearings or trials.
c) Premiums on appeal bonds in any suit the insurer defends.
d) Up to $250 for bail bonds required because of a covered accident. - ANSWER-
a) Up to $100 for the cost to secure the release of a vehicle from an impoundment
lot following a covered accident.
A personal auto policy does not pay the cost of the release of a vehicle impounded
by a law enforcement agency.
Charla wants to serve as a producer for Commissions Galore Insurance Company.
In addition to obtaining her producer's license, what else must happen before she
can officially transact insurance for CGIC?
a) She must submit a list of 5 references to CGIC.
b) She must be appointed by the Commissioner.
c) She must be appointed specifically by CGIC.
QUESTIONS & CORRECT ANSWERS LATEST 2025
Driver A has a personal auto policy with Part C: UM/UIM limits of 100/300. He is
injured by Driver B who has Part A: Bodily Injury Liability limits of 50/100. It is
determined that Driver B is at fault for the accident. Driver A has $125,000 in
medical expenses. How much will his Part C: UM/UIM coverage pay?
a) $125,000
b) $75,000
c) $50,000
d) $25,000 - ANSWER-c) $50,000
Underinsured motorist coverage acts as excess over the at-fault motorist's
coverage. It will pay the difference between the insured's UIM limits and the at-
fault driver's bodily injury limits (in this scenario, $100,000 of the insured's
coverage minus $50,000 of the other driver's). Because of the per person limits of
Driver A's underinsured motorist coverage, the policy will pay the amount
necessary to bring payment up to the per person limit. The policy will not pay
more than the limits of liability.
Because an insured owns a lot of expensive jewelry, her insurance agent has
advised her to purchase a scheduled personal property endorsement. If the insured
adds this endorsement to her homeowners policy, which of the following
statements would be correct?
a) The endorsement becomes primary coverage and the HO contract is secondary.
,b) Coverage C limits will no longer apply to the jewelry insured by the
endorsement.
c) The amount of coverage will be doubled.
d) The endorsement becomes excess coverage. - ANSWER-b) Coverage C limits
will no longer apply to the jewelry insured by the endorsement.
When items are scheduled, they are excluded from Coverage C as insured items,
and are covered only under the scheduled personal property endorsement.
Which of the following statements is NOT true regarding a personal umbrella
liability policy?
a) It provides excess liability coverage over underlying personal liability.
b) It provides errors and omissions coverage for an agency.
c) It may cover certain exposures not provided under the primary layer.
d) It may require the payment of a self-insured retention. - ANSWER-b) It
provides errors and omissions coverage for an agency.
Personal umbrella policies cover the personal exposure of the insured. Errors and
omissions coverage is provided only in a professional liability policy.
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?
a) The entire loss is payable to the insured.
b) The loss is payable to the insured and the mortgagee.
,c) The mortgagee should submit a claim to its insurer, and the insured should
submit a claim to the HO policy.
d) The entire loss is payable to the mortgagee. - ANSWER-b) The loss is payable
to the insured and the mortgagee.
Loss is payable to the insured and mortgagee to protect the mortgage company's
interest. This prevents the insured from cashing the check and not completing
repairs.
In a personal auto policy, the medical payments coverage is similar to
a) Accident insurance, because it pays medical expenses regardless of fault.
b) Accident insurance, because it has the same limits.
c) Bodily injury coverage, because it pays the insured's doctor bills.
d) Bodily injury coverage, because it provides legal protection if the insured causes
injuries to others. - ANSWER-a) Accident insurance, because it pays medical
expenses regardless of fault.
Medical payments will pay for accidental bodily injury of an insured, regardless of
fault or auto. It will pay medical expenses of others occupying the insured auto.
All of the following are true of Coverage B - Other Structures EXCEPT
a) It must be added by endorsement to a homeowners policy.
b) This coverage is not applicable on the HO-4 policy form.
c) The amount of coverage provided by Coverage B is an amount equal to 10% of
Coverage A.
, d) Land where the other structures are located is not covered. - ANSWER-a) It
must be added by endorsement to a homeowners policy.
Homeowners policies automatically provide an amount of insurance in Coverage B
that is equal to 10% of the amount written as Coverage A. This amount may be
increased by endorsement.
All of the following are supplemental payments included in the liability section of
a personal auto policy EXCEPT
a) Up to $100 for the cost to secure the release of a vehicle from an impoundment
lot following a covered accident.
b) Up to $200 a day for loss of earnings due to attendance at hearings or trials.
c) Premiums on appeal bonds in any suit the insurer defends.
d) Up to $250 for bail bonds required because of a covered accident. - ANSWER-
a) Up to $100 for the cost to secure the release of a vehicle from an impoundment
lot following a covered accident.
A personal auto policy does not pay the cost of the release of a vehicle impounded
by a law enforcement agency.
Charla wants to serve as a producer for Commissions Galore Insurance Company.
In addition to obtaining her producer's license, what else must happen before she
can officially transact insurance for CGIC?
a) She must submit a list of 5 references to CGIC.
b) She must be appointed by the Commissioner.
c) She must be appointed specifically by CGIC.
