Terms in this set (181)
An agent for a direct writing company is
a salaried or commissioned representative of the company.
When one takes action to minimize the severity of a potential loss
powers describes the authority stated in an agent's agency contract?
Insurance is not designed to cover
a speculative risk, only a pure risk.
organized under the laws of California, whether or not it is admitted to do business in this state.
Relevant content:1.4 Insurer Domicile
A domestic insurer
the Law of Large Numbers, except
The prediction of individual losses is based upon past experience
The prediction of individual losses is based upon past experience
Stockholders have ownership
Stock Insurance Company
The company is directed by officers and directors and has a stated amount of capital stock owned by stockholders
responsible for risk selection.
Principle of Indemnity under insurance
The insured is restored to the same financial condition as prior to the loss, with no intent of loss or gain
risks is protected by insurance
not true about a Reciprocal Insurance Company
Members are grouped into syndicates
A cause of loss, such as the theft of a car
Fire, wind and hail
classified as an insurance broker
A person who negotiates insurance contracts on behalf of an insured
In pro rata cancellations
the premium refund is directly proportional to the unused portion of the policy term. Any unearned premium is refunded to the insured.
The insuring agreement is
the company's commitment of protection to the insured & description of the perils.
a form that provides for monthly or quarterly reporting of the values to be insured. The premium charged is based upon the values reported.
to clarify the policy language
describes the perils
A description of the insured property is found in the
sometimes known as the pro rata liability provision because it provides for claim settlement to be proportioned to the amount of other insurance.
The Other Insurance provision
provides a method of settling disputes between the insurer and the insured as an alternative to legal action.
Bailee Coverage, except
A retail shoe store
Assignment in the Conditions of a property policy is
The insured may not transfer ownership of the policy without the insurer's written permission
responsible for premium payments, and will receive any return of premium that the insurer pays
The First Named Insured
duties of an insured after a loss,
Giving prompt notice to the insurer, Protecting property from further damage, Forwarding any demands to the insurance company
A Liability Policy contains a per person bodily injury limit of $25,000 and a per occurrence limit of $50,000. If an accident were to occur and three persons have claims of $20,000 each, the total amount paid is:
The policy pays up to $25,000 for each person injured, but no more than $50,000 per occurrence, regardless of the number of persons injured. Therefore, the limit for this accident is $50,000.
Which Statutory Law Defense states that damages are reduced in proportion to the degree of negligence?
In Liability Insurance, the most coverage will pay for a loss arising out of any one occurrence regardless of overall policy limits, is known as:
The Per Occurrence Limit
the maximum amount payable for loss (per location and/or per person) from all occurrences within a policy period regardless of the number of separate accidents (occurrences), is known as:
The Aggregate Limit
When a claimant can prove that a product caused the injury, the fact that the manufacturer will be held liable regardless of whether the product was defective or not, is considered which of the following?
Bodily Injury includes
such items as medical expenses, lost wages(Loss of Earning), mental anguish, and disfigurement. The remaining responses are types of Personal Injury.
Bodily Injury coverage covers
physical injury, sickness or disease sustained by a person including death resulting from any of these. Breach of contract does not fall under this definition.
Policies with Split Limits
provide a per occurrence limit of insurance for bodily injury claims and a separate limit for property damage claims.
When damages are reduced in proportion to the degree of negligence, this is an example of:
When responsibility without fault or negligence applies, such as employers are absolutely liable for work related injuries, or owners of wild animals kept in captivity are absolutely liable for injuries caused by those animals
A liability policy provides coverage for:
Unintentional torts.A tort is a wrong against another person, other than breach of contract.
In insurance, the person specifically designated in the policy as the one protected, and the person with whom the contract of insurance has been made, is considered to be:
The Named Insured.
When there is more than one entity designated as Named Insured in the policy, then contractual obligations are transacted with the first one designated, known as the First Named Insured.
In Liability Insurance, the maximum amount that the coverage will pay for loss to any one person regardless of overall policy limits, is known as
The Per Person Limit
When the Limit of Liability of the policy may be applied to either bodily injury (BI) or property damage (PD), wherever it is needed or in any combination, it is known as
Combined Single Limits
Automatic Increase in Insurance Endorsement?
The endorsement will automatically raise the limits of insurance at periodic intervals.
The function of the Automatic Increase in Insurance endorsement is to protect adequately the insured when the property increases in value because of inflation.
Coverage A under the Dwelling Policy?
The policy does not include coverage for wind loss of television antennas
liability coverage under the Dwelling Policy Program?
Personal Liability Supplement. It is similar to the Liability coverage of the Homeowners Policy.
The Broad Form Theft endorsement is
attached to owner-occupied Dwelling policies to provide theft coverage for the owner-occupant's Personal Property. On-premises and off-premises coverage is available.
Under the Dwelling Under Construction Endorsement of a Dwelling Policy
The premium is based upon the average amount of insurance during construction
Under the Dwelling policies, which is correct regarding coverage of trees, shrubs or plants?
Damage by wind, hail, weight of ice, snow or sleet is not covered
Under the Broad Form Dwelling Policy (DP-2), which peril is not included for coverage without an endorsement?
Theft or the Broad Theft
It provides coverage for claim expenses, first aid expenses and damage to property of others
In the Dwelling Policy, the fact that earth movement, landslide, mine substance, or mudflow are not covered is stated where?
The perils of earth movement, landslide, mine substance, and mudflow are perils that, because of their geographic nature, are insured under Earthquake or Flood insurance policies designed specifically for these perils.
First Aid Expenses under the Homeowners Policy would cover:
A neighbor who gets injured while helping the insured install a carpet -
First Aid Expenses coverage applies to first aid to others caused by Bodily Injury covered under the policy, but does not pay for first aid to an insured.
Section I of the Homeowners Policy coverages are
Personal Injury Property,Other Structures, Dwelling
Personal Injury Liability
Under Section II of the Homeowners Policy, a 1-4 family dwelling where the insured resides in one of the units, including other structures and grounds at that location, is defined as:
The Residence Premises
is one of eight possible Insured Locations.
Relevant content:5.3 Definitions
Under a Homeowners Policy, how much coverage is provided for theft or unauthorized use of a credit card?
The following are all additional coverages under a Homeowners Policy,
Collapse, Property Removed, Loss Assessment
Governmental action is
Section II is Liability coverage
The insured's liability for bodily injury to others,The insured's liability for damages to property of others,Medical expenses for an accident arising out of the premises or non business activities of an insured
The insured's liability for damages to property of others
The Broad Form Perils
Insured Location under Section II of a Homeowners Policy, except:
Vacant land, other than farmland, owned by or rented to an insured is included in the definition of Insured Location.
When a person owns a watch or personal jewelry valued at $10,000, they should purchase which of the following?
Scheduled Personal Property Endorsement onto their Homeowners Policy
Loss by theft of watches and personal jewelry is limited to
$1,500 in the basic Homeowners Policy. This property can be scheduled with specific higher amounts of insurance by the SPP endorsement.
resident under the Homeowners Policy,
The definition of insured includes certain relatives and persons in the care of the insured who are residents of the household.
residents of the household
The insured's relatives who are residents of the household, A 22-year-old relative enrolled in school full time that was a resident of the household before moving out to attend school, A 20 year old exchange student who is a resident of the household.
Under the Homeowners Policy, Medical Payments coverage will apply to expenses that are incurred within what length of time?
The amount of insurance provided to cover personal property under Coverage C of a Homeowners Policy, is:
50% of Coverage A Limit.
This amount can be increased by payment of an additional premium.
Homeowners Policy provides coverage for all of the following
A riding lawn mower pulling a two-wheel garden trailer,An ATV on the insured's premises,A motorized wheelchair, The golf cart must be on a golf course for coverage to apply.
Under Section II of the Homeowners Policy, an employee whose duties are related to the maintenance or use of the residence premises, is defined as:
A Residence Employee might be either an inside domestic servant or an outside premise maintenance employee
A Homeowners Policy HO-3 provides:
Open Perils Coverage on the dwelling and Broad Form Coverage on the personal property.
Losses to the dwelling are paid replacement cost and losses to personal property are paid actual cash value.
Home Day Care Coverage Endorsement to the Homeowners Policy?
The endorsement extends Section II coverages to the insured's home day care business
Which of the following would not be eligible to purchase a Homeowners Policy?
A person who owns and lives on a farm.
Homeowners eligibility does not include farm property, but does include certain incidental business occupancies.
A Residence Employee
Household or domestic servants are included in the definition
To be eligible for the California Automobile Assigned Risk Program, an applicant's household must have a gross annual income no higher than:
250% of the Federal Poverty Level-The household must have a gross annual income no higher than 250% of the Federal Poverty Level.
Minimum limits of personal auto liability in California are:
The minimum policy limits required in California are: $15,000 per person for bodily injury, $30,000 per accident for bodily injury, $5,000 per accident for property damage.
Territorial Limits of the Personal Auto Policy?
The United States, its territories and possessions, Puerto Rico and Canada, and while being transported between covered ports
A person may purchase a Good Driver Discount Policy if he/she has not accumulated more than o
The previous 3 years and has not accumulated more than one driving violation 'point' during that time.
Duties After a Loss - Part E of the Personal Auto Policy states that after a loss the insured must:
When making a claim under Part D, protect the auto from further damage, notify the police promptly if the vehicle was stolen, and allow the insurer to inspect and appraise the damaged vehicle before repairs are made
The Single Limit of $100,000 is the most the policy will pay per occurrence regardless of the number of persons injured or claims made.
A Personal Auto Policy is written with a single limit of $100,000 for bodily injury. When 6 people are injured in a covered accident amounting to a total of $150,000, how much will the policy pay? $100,000
After an accident under the Personal Auto Policy, the insured is required to do all of the following
Cooperate with the investigation and settlement of any claim, Submit a proof-of-loss when required by the insurer, promptly send the insurer copies of notices or legal papers received.
would not be included in coverage under a Personal Auto Policy?
Generally, vehicles that have fewer than 4 wheels are excluded from coverage.
Under the Personal Auto Policy, which of the following is correct when there are two or more auto policies on the same auto?
When issued by the same insurer, and all policies cover the same accident, the maximum that will be paid is equal to the policy with the highest limit
The FAIR Plan is a joint reinsurance association, Every insurer in the state must participate in the program, Agent do not have binding authority. Neither farm nor auto risks are covered by the FAIR Plan
The regular flood program provides up to $100,000 in coverage for:
Contents of residential structures
The camera floater provides blanket coverage for:
Under a camera floater, insured items are scheduled, with the exception that blanket coverage is provided on accessories such as shades and filters.
It provides Open Perils Coverage, and losses are settled on an actual cash value basis
Section I of the boatowners policy provides which coverage?
Open perils on an ACV basis ( for a watercraft's hull, motor, trailer, equipment, and accessories )
the National Flood Insurance Program,
Payment for losses are made by the federal government - Although private insurers sell and service flood insurance in addition to that provided by the National Flood Insurance Program, the federal government 100% reinsures all flood insurance.
the Lay Up Warranty under the Yacht Policy?
It applies when the insured yacht is in storage and allows a return of premium due to the lower risk
the Optional Coverage - Inflation Guard under the Building and Personal Property
The annual percentage of increase is applied to the policy at the rate of 1/365 each year.
Inflation Guard coverage, intended to offset the effect of inflation on property values, becomes effective immediately at the inception of the policy and is effective throughout the policy term.
The Builders Risk form requires what amount of coinsurance to pay the full amount of a loss?
100% ( Unlike the Homeowners policy, which pays the full amount of the loss as long as 80% coinsurance is carried, the Builder's Risk form requires 100% coinsurance. Any amount of coverage carried less than the full completed value will proportionately reduce the coverage paid. )
Under the Vacancy Clause of a Building and Personal Property Coverage Form, losses caused by vandalism are not covered if the property has been vacant for:
A period of 60 days or more
Under the Commercial Building and Personal Property Coverage Form, the building is considered vacant, unless:
At least 31% or more of the square footage is rented or is used to conduct operations ( Buildings under construction are not considered vacant )
A building is insured for $80,000 and its replacement value is $150,000. If the commercial property policy insuring the building has an 80% coinsurance clause, how much will the pay for a $12,000 covered loss? Disregard any deductible.
- The coinsurance clause requires insurance at 80% of the replacement value, or $120,000. Because the policy limit of insurance is only $80,000, or 2/3 of $120,000, the claim payment would be 2/3 of $12,000, or $8,000.
Commercial Package Policy?
Permanently installed machinery (The rest are excluded on the CP form)
not considered a covered peril under the Basic Cause of Loss Form?
Falling Objects ( Falling Objects are covered by the broad form. )
Basic Cause of Loss Form
Business Personal property is covered if it is within how many feet of the premises?
100 - Business Personal Property includes furniture and fixtures, machinery and equipment, merchandise, raw materials; and other personal property owned by the insured that is used in the business either in or on the building or within 100 feet of the premises.
The Building and Personal Property Coverage Form pays for covered losses on an actual cash value (ACV), except:
A loss of $2,500 or less to a building and the coinsurance requirement is met (A loss to the building of $2,500 or less would be paid at replacement cost, all others mentioned are always at actual cash value.)
A tourist's car is damaged by paint spilled by a work c
Operations - A business owner may be held legally liable in the event of bodily injury and/or property damage arising out of conditions on or (in the case of operations liability) away from owned or rented premises.
Which of the following is not a coverage of the CGL policy?
Professional liability - BI and PD are covered under Coverage A. Medical payments are covered under Coverage C. Professional Liability coverage is not provided by the CGL.
Coverage B of the CGL provides which type of coverage?
Personal and advertising injury - BI and PD are covered under Coverage A. Medical payments are covered under Coverage C. Professional Liability coverage is not provided by the CGL.
Which of the following is not a limit of liability under the CGL?
Supplementary Payments Limit - There is no separate supplementary payments limit.
Which of the following is not considered a wrongful act under the EPLI?
Workers strike - Strikes and large scale layoffs are excluded under the policy.
a wrongful act under the EPLI?
Sexual harassment,Wrongful termination,Discrimination
A customer in a housewares store is cut while handling a broken piece of glassware. Which type of liability would apply?
Premises - Because the product was still under the insured's care, custody and control, premises liability, not product liability, would apply.
Which of the following is not covered by Supplementary payments?
First aid-First aid expenses are included in Medical Expenses coverage
The CGL condition 'Insured's Right to Claim Information' applies to which form(s)?
Coverage B of the CGL provides
Personal and Advertising Injury
Transportation expenses begin how many hours after the theft of the vehicle?
All of the following are excluded under a BAP
BI and PD are covered
under Section II, Liability.
Which of the following is not a covered peril under the Garagekeepers' Specified Causes of Loss property damage coverage?
Hail - While hail is a specified peril on the BAP form and under the PD coverage of the garage form, it is not a specified peril under garagekeepers coverage.
not a covered peril under the BAP's Specified Causes of Loss property damage coverage?
Glass Breakage - is not a specified cause of loss. This kind of PD would be covered by comprehensive coverage.
An employee with custody of the insured's property inside the premises is a:
Custodian - A custodian is the insured or any of the insured's partners or employees, while having care and custody of the property while inside the premises, excluding any person while acting as a watchperson or janitor.
Which type of bonds guarantee that an obligation will be fulfilled?
Surety - Surety bonds guarantee that specific obligations will be fulfilled. If the principal defaults, the surety must perform the contract, duty, or obligation of the principal, or indemnify the obligee for actual loss. Consequently, before accepting a risk, the surety considers the principal's ability to perform, financial capability, and previous contracts completed.
not part of the definition of an employee?
Someone on contract with the insured
The party who provides the bond and guarantees fulfillment of the obligation by paying damages if the principal defaults is known as the:
Surety - The Surety, or Guarantor, is the party who provides the bond and guarantees fulfillment of the obligation by paying damages if the principal defaults.
Which of the following best describes FOB (Free on Board) Point of Destination?
The seller retains interest in the property until after the trip is completed
A shipping term which indicates that the supplier pays the shipping costs (and usually also the insurance costs) from the point of manufacture to a specified destination, at which point the buyer takes responsibility.
Inland Marine policies generally cover property that is:
On land only - Inland Marine policies, as their name implies, are designed to cover property moving on land, as opposed to at sea, by means of the different modes of transportation common on land.
When a person is shipping a single shipment and wants to insure it, he/she would use:
A Trip Transit Form - The Trip Transit Form is used for those who do not make regular shipments.
The Accounts Receivable Coverage Form will cover loss of records that results from:
The collapse of a building damaged by fire ( would be considered a direct loss by fire.)
The Collision or Running Down Clause in Ocean Marine Insurance covers:
It covers collision damage to another vessel - A Collision and Running Down Provision is contained in the standard Hull Policy to cover liability incurred for damage to another vessel or structure.
Under Ocean Marine Insurance, Hull Coverage includes:
The ship itself, including fittings and machinery of the vessel - The hull, for insurance purposes, essentially includes the entire ship, excluding cargo.
Having custody of, or responsibility for any money collected or received from a person on behalf of the insurer - A Fiduciary is a person holding the funds or property of another in a position of trust, as is the case when a producer or agent collects premiums for the insurer.
Under the Equipment Breakdown Protection Coverage Form, what describes expediting expenses?
It is coverage that is available to make temporary repairs, or to expedite permanent repairs or replacement of damaged property
Hull Coverage and Cargo Coverage under Ocean Marine Insurance is generally written on which of the following basis?
Valued basis - Cargo and Hull Insurance are written on a valued basis. The valuation of the cargo includes the stated value of the invoice, import duties, and freight charges.
the term General Average under Ocean Marine Insurance?
A partial loss where the loss is shared, where jettison of cargo is necessary to save the ship - General Average refers to loss resulting from a voluntary sacrifice of any part of the vessel or cargo to safeguard the vessel and the rest of the cargo. When such a loss occurs, the ship owner and all cargo owners pay it on a pro rata basis.
Under Equipment Breakdown Insurance, all breakdowns that manifest themselves at the same time and are the direct result of the same cause, are considered:
To be one breakdown - The Equipment Breakdown policy further states that if an initial breakdown causes other breakdowns, all will be considered one breakdown.
Under Transit Coverage Forms, the Annual Transit Form is designed for which of the following?
Business firms that want to protect property of all kinds being shipped to others or being received from other shippers during the year via common carrier - The Annual Transit Form is designed for firms that send or receive substantial amounts of shipments by common carrier.
A trucker shipping its own goods using unowned trucks would use which form?
Shippers form - The Truckers Coverage Form covers the transport of the cargo of others. The Shippers Form covers the shipper's own goods. The Owners form adds coverage for owned trucks used in shipping.
Damage to a vessel from a bursting boiler would be covered by which type of Ocean Marine coverage?
Inchmaree Clause - The Inchmaree Clause is an addition to Hull Insurance that covers damage caused by the bursting of boilers, the breaking of propeller shafts, or loss due to faults or errors in navigation by the crew.
Cargo Coverage under Ocean Marine Insurance provides coverage
During the time the insured has an interest in the property - Interest in the cargo may reside in either the seller or the buyer of the cargo, depending upon the terms of shipment.
Which is not a coverage provided by the Equipment Breakdown policy?
Builders Risk - Builders Risk is a Commercial Property form, not a coverage of the Equipment Breakdown form.
Which of the following is true of the Equipment Breakdown Protection Coverage Form?
Business income is defined as net income that would have been earned or incurred, and continuing operating expenses, including - Equipment Breakdown Coverage specifically excludes pressure and electronic testing, damage from windstorm and hail, and damage to a foundation supporting insured equipment.
An insured wishing to procure coverage for electronic data would purchase which of the following?
Electronic Data Processing Floater - The EDP floater is used to insure computers and other electronic data processing equipment and media, including hardware, software, extra expense, and business interruption.
Under the Electronic Data Processing Floater, which of the following is true?
Hardware and software must be described in the Declarations - This Open Perils coverage policy is designed to cover property described in the Declarations.
considered an insured under a BOP?
Anyone driving the named insured's mobile equipment on public roads with the named insured's permission, however, is an insured.
covered property under the BOP?
Completed additions, permanently installed machinery and equipment - Completed additions, as well as additions under construction including materials and supplies, are covered if not insured elsewhere.
The Businessowners Liability Coverage Form includes coverage for bodily injury, property damage, personal injury, and advertising injury to which coverage applies, plus:
Liability assumed under an insured contract - There is a rather extensive definition of insured contract in the definitions section of the Businessowners Policy.
The BOP coverage extension for valuable papers and records provides coverage up to what amount at the described premises?
$10,000 - The insured may extend the insurance that applies to Business Personal Property to apply to direct physical loss of valuable papers and records that they own or that are in their care, custody, or control up to $10,000 at the described premises, and up to $5,000 away from the described premises
Which is not a coverage provided by the BOP's business liability coverage?
Medical payments - Medical payments are provided by a separate section of the policy. Business liability comprises BI, PD, personal injury and advertising injury.
The BOP coverage extension for newly acquired or constructed property insured buildings, up to what amount for up to 30 days?
$250,000 - The extended coverage for Newly Acquired or Constructed Property insures buildings, up to $250,000 at each building for up to 30 days. Business Personal Property up to $100,000 at each premise for up to 30 days
Which of the following is not covered by Supplementary payments under a BOP?
First aid - First aid expenses are included in Medical Expenses coverage.
optional coverage under the BOP?
Mechanical breakdown - The four optional coverages, available for an extra premium, are Outdoor Signs, Money and Securities, Employee Dishonesty, and Mechanical Breakdown.
Under Medical Expenses of the Businessowners Coverage Form Section II - Liability, how much time is allowed for medical expenses to incur and to be reported?
1 year - Medical expenses incurred and reported to the insurer within one year of the date of the accident are covered.
In California, who may transact 24-Hour Care Coverage?
Either an accident and health agent, or a property and casualty broker-agent - In the State of California, an Accident and Health Agent or a Fire and Casualty Broker-Agent are authorized to transact 24-Hour Care Coverage.
The purpose of the Second Injury Fund is
To encourage employers to hire people with disabilities - The Second Injury Fund is designed to encourage employers to hire people with disabilities by limiting employers' liability for subsequent injuries.
The kind of Workers' Compensation rating system which pays a dividend to the insured if experience falls within a set guideline is called:
Participating Plans - Under the Participating Plan rating system, the insured is eligible for a premium refund (dividend) if the experience over the policy period falls within the guideline established by the insurer. This provides for effective insurance based upon the current policy period
An employee injured subsequent to a prior disabling injury would be eligible for compensation from:
The Second Injury Fund - The Second Injury Fund pays compensation to an employee who has already suffered a prior disabling injury, and now sustains a subsequent injury, when the combination of the two injuries creates a greater disability than the second injury would have created by itself. The employer is responsible only for that compensation that would have been paid had the second injury occurred without the existence of the prior injury, and the fund pays the difference.
What is the type of injury that prevents the employee from doing any work, but from which the employee will recover?
Temporary Total - Temporary total disability describes an injury from which an employee is expected to recover and return to work, but which prevents the employee from doing any work while recovering.
Which type of Workers' Compensation benefits are usually unlimited?
Medical - Most states, including California, provide unlimited coverage for all necessary medical (including hospital) expenses related to a covered injury.
After receiving a claim, the insurer must correspond with the claimant at intervals of not less than how many days until the claim is resolved
30 - An insurer must correspond with the claimant not less often than every 30 days. Following the initial receipt of a claim, the insurer is required to acknowledge the claim within 15 days.
Who writes the regulations found in the CCR ( California Code of Regulations )?
The insurance commissioner - The Commissioner enforces the Code by writing and adopting regulations that specify the manner of enforcement or provide details that are not explicitly cited in the Code.
In a presentation to the local life underwriter association, Randy wrongly stated that ABC insurer is in financial difficulty. Randy may be guilty of:
Defamation - A statement critical of an insurer's financial condition is called defamation
An insurer may refuse to accept an application for insurance in which of the following circumstances?
The application is incomplete - An insurer is not required to accept an incomplete application, but it may not discriminate on the basis of marital status, national origin, or gender.
The Insurance Commissioner has all of the following powers, except:
Sentencing a person to state prison for conviction of insurance fraud - Only a state court may convict and sentence a person who commits insurance fraud.
Commissioner has all of the following powers
1.Assess civil penalties for failure of an insurance company to provide requested information concerning insurance fraud
2.Investigate suspected insurance fraud
3.Suspending or revoking the license of a producer convicted of insurance fraud
Which of the following is not an example of an unfair trade practice?
Sharing of commissions with other licensed producers-It is a permitted practice to share commissions with those licensed to receive them.
an unfair trade practice?
1.Disparaging another insurer's financial status
2.The rebating of premiums or other consideration
3.The discriminating of rates betweens similar risks.
In California, all of the following are true
1.A standard market insurer is one who offers rates of insurance coverage to insureds who have an average, or better than average, loss exposure
2.An insurance agent is a person authorized by an insurer to act as its representative in the transaction of insurance
3.A resident agent is a person licensed to represent an California.
the termination of a contract from the beginning (as if it never existed).
A Broker-Agent whose license certificate is in the possession of a former employer may terminate his or her license in which of the following ways?
Notifying the Commissioner in writing of the intent to terminate and the inability to return the license - If the Broker-Agent is unable to retrieve the license from the former employer, he or she may simply notify the Commissioner in writing of the intent to terminate the license.
a duty of the California Insurance Commissioner?
1.To make sure that insurer rates are adequate, not excessive, or unfairly discriminatory
2.To subpoena witnesses/documents for testimony on any insurance-related matter
3.To issue Certificates of Authority to companies that meet the requirements of state law
The Commissioner does not prosecute
lawbreakers, though he/she may issue cease and desist orders for committing unfair practices.
Files and records must be maintained for inspection by the Commissioner for no fewer than how many years?
4 - Data must be available for all open and closed files for the current year, and the 4 preceding years.
The California Property and Casualty Guarantee Association will pay non-Workers' Compensation claims up to what limit?
$500,000 - Workers' Compensation claims are payable in full and without limitations. All other claims are payable up to the limits allowed under the Code (claims other than Workers' Compensation payable by the CIGA ( California Insurance Guarantee Association ) are generally limited to the policy's limit of liability or $500,000, whichever is less).
A Property & Casualty Broker-Agent also licensed as a Life-Only or Accident & Health agent must do all of the following prior to renewing his or her license,
1.Complete 24 hours of continuing education in any line of licensing
2.Complete 3 hours of ethics continuing education
3.Complete all mandatory continuing education required for any line of licensing, regardless of the total hours of CE already credited toward renewal
a permissible activity of a Property or Casualty Broker-Agent?
Referring a client to a Surplus Line Broker - It is appropriate for a licensed producer to refer business to a Surplus Line Broker that the producer is unable to place with an admitted insurer.
Which of the following is not a responsibility of the Insurance Commissioner?
Set the rates for Workers' Compensation insurance
The Commissioner has broad authority to
1.Reject a requested rate increase for Workers' Compensation insurance
2.Order rates for Workers' Compensation insurance increased
3.Order rates for Workers' Compensation insurance reduced
How much time does a licensee have to respond to the Department of Insurance after receiving an inquiry concerning a claim?
21 calendar days - If the licensee is initially unable to provide the requested information within 21 calendar days, an extension of time must be requested within 21 days, which indicates the amount of additional time that will be needed.
The amount of insurance provided to cover personal property under Coverage C of a Homeowners Policy, is:
A cause of loss, such as the theft of a car, is which of the following?
An underwriter will consider each of the following factors when considering a risk, except:
A nonprofit social organization that engages in charitable activities and provides insurance primarily to its members is known as a:
A good example of Risk Reduction might be:
Assignment in the Conditions of a property policy is best described as:
The Insuring Agreement in an insurance policy is best described as:
When damages are reduced in proportion to the degree of negligence, this is an example of:
Under Section II of the Homeowners Policy, all of the following would be considered an Insured Location, except:
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