Created by
Alexander_LemosTeacher
Terms in this set (220)
A-If faulty work causes damage to other property of the claimant, then coverage extends to include the faulty work
B-Bodily injury arising from negligent or faulty work of the insured is not covered if it occurs after the work is completed and turned over to its owner
C-The coverage will pay for bodily injury and/or property damage caused by negligent or faulty work by the insured, but not for the cost of replacing the work that caused the loss
D-Coverage applies only during the period that the insured has custody and control of the work deemed faulty or inadequately performed
C
B-Bodily injury arising from negligent or faulty work of the insured is not covered if it occurs after the work is completed and turned over to its owner
C-The coverage will pay for bodily injury and/or property damage caused by negligent or faulty work by the insured, but not for the cost of replacing the work that caused the loss
D-Coverage applies only during the period that the insured has custody and control of the work deemed faulty or inadequately performed
C
A-Section I limits coverage on utility trailers up to $500
B-The HO-4 provides open peril coverage on both the dwelling and contents
C-The Section I deductible does not apply to property covered under the Scheduled Personal Property Endorsement
D-Section I limits coverage on fire department service charge to $100
C
B-The HO-4 provides open peril coverage on both the dwelling and contents
C-The Section I deductible does not apply to property covered under the Scheduled Personal Property Endorsement
D-Section I limits coverage on fire department service charge to $100
C
Which of the following is a duty required of the insured in the event of a loss under the PAP?A-Give notice of the accident to the insurer within 5 days
B-Allow an inspection and appraisal of the damage before an auto is repaired
C-Immediately initiate repairs to the vehicle to protect it from further damage
D-If the vehicle was stolen, contact the insurer for permission to report the theft to the policeWhich of the following covers equipment during transportation, unloading and installation up to the point control is given to the buyer?A-Equipment Dealer's Coverage Form
B-Installation Floater
C-Electronic Data Processing Floater
D-Contractor's Equipment Floater
BPremium refunds to the insured must be paid or credited to the insured's account within __________ after received by the producer.A-1 week
B-5 business days
C-3 calendar days
D-10 calendar days
BUnder Personal Inland Marine Insurance, the Personal Articles Floater is:A-Used to provide replacement cost coverage on personal property
B-Used to replace Coverage C of the Homeowners Policy
C-Used to insure individual personal property on an itemized or scheduled basis
D-Used to insure personal property on a blanket basis
Under Personal Inland Marine Insurance, the Personal Articles Floater is:H's liability policy has the following limits: $35,000 per person, $350,000 per occurrence, and $2,000,000 aggregate. This year, three claimants file in the amount $15,000, $30,000, and $45,000. How much will the policy pay?A-$80,000
B-$350,000
C-$90,000
D-$35,000
AAll of the following are covered under a BOP, except:A-Outdoor furniture
B-Permanently installed machinery or equipment
C-Building fixtures, including outdoor fixtures
D-Money and securities
DThe Annual Transit Form is designed for which of the following?A-Businesses that desire coverage only on their shipments to others
B-Protecting property being shipped to others or being received from others on multiple occasions throughout the year
C-Businesses that do not make regular shipments
D-Businesses that desire coverage only on shipments received from others
BAn insurance producer may not become licensed in which of the following lines of authority?A-Variable annuity
B-Limited lines
C-Title
D-Funeral
DRetrocession is:A-Transfer of risk from one insurer to a reinsurer
B-Transfer of a limited amount of risk
C-Transfer of risk for investment purposes
D-Transfer of risk from one reinsurer to another reinsurer
DWhich coverage form may not be added to the Commercial Property Coverage Part?A-Homeowners Special Form
B-Building and Personal Property Coverage Form
C-Legal Liability Coverage Form
D-Commercial Builders Risk Coverage Form
CWhich of the following is covered under Section II of a Homeowners Policy?A-An injury to a guest of the insured
B-Liability arising from a business pursuit
C-An injury to the insured's 10-year-old son
D-An injury to the insured's employeeWhich of the following describes the term General Average under Ocean Marine Insurance?A-The average value per item of all the cargo on the ship
B-A partial loss where the loss is not shared
C-A partial loss where the loss is shared
D-The average freight charges on the entire cargo of the ship
CFor how many hours after the first tremor would earth movement damage be covered under the Businessowners Earthquake endorsement?A-168 hours
B-24 hours
C-144 hours
D-72 hours
DWhich type of producer authority is not spelled out in the contract, but is necessary for carrying out the producer's duties?A-Assumed
B-Express
C-Implied
D-Admitted
CIf the insured and insurer do not agree on the value of a property loss, what condition would apply?A-Abandonment
B-Appraisal
C-Arbitration
D-Subrogation
BWhich of the following would not be covered under Coverage A of the CGL?A-While working at a trade show, an insured's employee started a small fire
B-An insured's client was injured when she slipped on a loose rug on the insured's premises
C-An insured's employee is injured when a bookcase in the office falls on her
D-An insured was visiting a client in Canada, who was injured after he tripped over the insured's briefcase
COther Than Collision coverage would cover losses to an insured vehicle caused by all of the following, except:A-Larceny
B-Driving into a tree
C-Hail
D-Fire
BWhich term describes coverage that applies only to loss by the perils stated in a policy?A-Special Form
B-Open peril
C-All risk
D-Named peril
DIn liability insurance, which of the following is the maximum amount that the coverage will pay for loss to any one person regardless of overall policy limits?A-The per occurrence limit
B-The aggregate limit
C-The split limit
D-The per person limit
DWhich statement about the Homeowners Policy is false?A-Under Section II, coverage includes defense costs, at the insurer's expense, even if the suit is groundless
B-The policy will not provide coverage for an insured that has intentionally concealed or misrepresented any material fact or circumstance
C-First Aid Expenses include first aid to an insured in the event of an injury
D-Under Section II, coverage applies only to bodily injury or property damage that occurs during the policy period
D-The Outdoor Property Extension under the Building and Personal Coverage Form insures against which perils?A-Fire, lightning, windstorm, hail, explosion, aircraft, and vehicle
B-Fire, lightning, riot, civil commotion, aircraft, and vandalism
C-Fire, lightning, explosion, riot, civil commotion and aircraft
D-Fire, lightning, windstorm, hail, riot, civil commotion and aircraft
CWhich of the following terms refers to the risk management technique of assuming the responsibility for a loss?A-Retention
B-Reduction
C-Transfer
D-Avoidance
AEndorsements that coordinate CPP coverages to avoid duplication are called:A-Interline
B-Special
C-Panel
D-Coordinating
AThe Commissioner may fine a licensed agent for unknowingly violating an unfair method of competition no more than __________.A-$1,000
B-$2,500
C-$5,000
D-$500
AAfter Company B's computer network is damaged during an intrusion by hackers, which coverage would indemnify the loss?A-Fund transfer fraud
B-Inside the premises: Robbery or safe burglary coverage
C-No crime coverage is available for this loss
D-Computer fraud
CWhich type of reporting period is provided automatically under the CGL written on a claims-made basis?A-Primary Extended Reporting Period
B-Basic Extended Reporting Period
C-Premium Extended Reporting Period
D-Supplemental Extended Reporting Period
BWhich of the following vehicle uses is not excluded under Personal Auto Medical Payments?A-Livery
B-Farm use
C-Occupying a vehicle as a residence
D-Racing
BPolicyholder S has an HO-5 policy with a $250,000 Coverage A limit. After a strong wind blows a mailbox into S's front picture window, causing $2,500 damage, S immediately buys $250 of wood and plastic sheeting to cover the damaged window and prevent further damage. How much will S's policy pay?A-$2,750
B-$250
C-$500
D-$1,500
AABC Industries contracts with municipal governments to build bridges, viaducts, and similar engineering projects. If a bridge completed in the prior year by ABC Industries were to collapse, which kind of liability exposure would this be an example of?A-Completed operations
B-Contingent liability
C-Premises and operations
D-Products
AIf personal injury coverage is not provided by an insured's homeowners policy, but is provided by the insured's umbrella policy, and the insured is sued for slander, which of the following statements is correct?A-The insured's homeowners policy will pay defense costs
B-The homeowners policy will pay the entire claim
C-The insured must pay 5% of the total claim
D-The insured must pay the umbrella policy's self-insured retention
DHow many categories of fraud are described under the New Jersey Insurance Fraud Prevention Act?A-8
B-4
C-6
D-2
AWhich of the following is NOT considered as rebating?A-Readjusting premium rates for a group insurance policy based on the loss or expense experience
B-Promising stock options as an inducement to purchase a policy
C-Providing a premium discount at the time of renewal that is not specified in the policy
D-Providing a premium discount not specified in the policyWhich of the following provides coverage for commercial crime losses which occur during the policy period and are discovered within a specified time?A-Occurrence Form
B-Discovery Form
C-Loss-Sustained Form
D-Employee Theft
CA deer chews a hole in an insured's shed sitting next to a pond. Which of the following forms could cover this damage?A-HO-8
B-DP-1
C-HO-2
D-HO-3
DUnder the Commercial Property policy, debris removal and fire department service charge coverage are examples of:A-Endorsements
B-Exclusions
C-Additional Coverages
D-Optional coverages
CThe Personal Articles Floater is used to do which of the following?A-Replace Coverage B of the Homeowners Policy
B-Provide replacement cost coverage on personal property
C-Insure personal property on a blanket basis
D-Insure individual personal property on a scheduled basis
DWhere in the Dwelling policy is it stated that earth movement, landslide, mine subsidence, and mudflow are not covered unless resulting from direct loss by fire or explosion?A-Insuring Agreement
B-Other Coverages
C-Endorsements
D-General Exclusions
AWhich of the following is not an element of a temporary total disability?A-The length of the disability must exceed the waiting period
B-The employee is expected to return to work
C-Retroactive benefits will be paid if disability
exceeds the waiting period
D-The employee can work while recovering
DWhich of the following is not covered under the BAP specified causes of loss coverage?A-Flood
B-Malicious mischief
C-Earthquake
D-Glass breakageAll of the following about the CGL's products liability coverage are correct, except:A-Coverage applies to bodily injury the product causes
B-Coverage applies to property damage the product causes
C-Damage to the product itself is covered
D-Coverage applies to bodily injury occurring away from premises the insured owns or rentsAll of the following are true in regard to commercial property coverage, except:A-The Basic Form insures against water damage
B-The Broad Form does not cover settling, cracking, bulging or expansion
C-The Special Form insures against open perils except those specifically excluded
D-Vandalism coverage is limited to 60 days if the property is vacantWhich of the following losses would be covered under all Dwelling forms?A-Collapse due to settling
B-Damage caused by subsidence of land the dwelling is sitting on
C-Fire damage to building materials and supplies that are located on the insured premises
D-Damage caused by a sewer or drain backupWhich of the following losses would be covered under all Dwelling forms?A-Collapse due to settling
B-Damage caused by subsidence of land the dwelling is sitting on
C-Fire damage to building materials and supplies that are located on the insured premises
D-Damage caused by a sewer or drain backup
CWhich type of coverage does the BOP provide for preservation of property?A-Named perils coverage for 10 days
B-Open perils coverage for 30 days
C-Open perils coverage for 10 days
D-Named perils coverage for 30 daysWhich of the following is not a valid reason to cancel a personal auto policy after the first 60 days of coverage?A-Material misrepresentation
B-Non-payment of premium
C-Driver's license suspension
D-Claims history
DWhat type of Workers' Compensation benefits are provided to the dependents of a deceased employee?A-Medical benefit
B-Survivor benefit
C-Rehabilitation benefit
D-Disability benefitWhich of the following is true of supplementary payments under Part A of the Personal Auto Policy?A-Any payments made reduce the liability limits by a like amount
B-They are paid in addition to the liability limits of the policy
C-They are paid only once during the policy term
D-They are paid as supplementary benefits only after the limit of liability is exhaustedWhich statement about property insurance terminology is correct?A-Arbitration is when a disputed claim is decided by the insurer
B-A spark that jumps from a fireplace and ignites a nearby rug would be deemed a hostile fire
C-Most property policies include inherent vice as a covered peril
D-Loss of profits resulting from a fire is a direct lossWhich statement is correct regarding the Supplemental Extended Reporting Period?A-It covers claims that take place after the policy term, during the Supplemental Extended Reporting Period
B-The charge for the Supplemental Extended Reporting Period shall not exceed the premium of the expiring policy
C-The premium is a one-time charge and fully earned at issuance
D-Cancellation by the insurer requires 90 days notice of cancellationWhich of the following would be covered by a law firm's professional liability policy?A-A lawyer causes bodily injury to a witness
B-An angry client sideswipes a lawyer's car
C-A lawyer causes property damage when visiting a client's home
D-A client sues a lawyer for purposely losing his case
DThe Personal Auto Policy may be used to insure all of the following, except:A-A conversion van
B-A farm pickup
C-A motorcycle
D-A station wagon
CAn insured accidentally backs into the neighbor's son on his skateboard. The son has medical expenses and there is damage to the skateboard. Which sections of the insured's policy will pay?A-Bodily injury and property damage
B-Medical payments and collision
C-Personal injury and property damage
D-Bodily injury and collision
AWhich of the following is designed for a firm that transports goods of others, rather than its own goods?A-Motor Carrier Coverage Form
B-Truckers Coverage Form
C-Garage Form
D-Business Auto FormPolicy A provides liability coverage to Fred's Grocery up to $500,000. Policy B provides coverage for the same risks up to $1.5 million. Both policies pay on a pro rata basis. If Fred's Grocery is determined to have a legal liability of $400,000 to a claimant who was injured on the property, how much will Policy A pay?A-$500,000
B-$100,000
C-$400,000
D-$50,000
BWhich of the following is the best explanation of liability insurance?A-It provides coverage for bodily injury or property damage arising out of the insured's premises or operations regardless of fault or negligence
B-It provides coverage for bodily injury or property damage to the insured and the insured's property
C-It provides coverage to any party for injury that is expected to happen
D-It provides protection in the event the insured's negligence causes bodily injury or property damage to others and the insured becomes legally obligated to pay damagesWhich of the following claims would not be covered under Workers' Compensation Insurance?A-An employee injured on the job by a product of the employer
B-An employee who contracts a cold in the winter
C-An employee injured by machinery in the work place
D-An employee who becomes ill because of exposure to chemicals used in the employee's workplaceWhich of the following covers an employee in a position of private trust and protects an employer against loss caused by the employee's dishonesty.A-License bond
B-Fidelity bond
C-Lender's bond
D-Performance bond
BWhich of the following is correct regarding coverage under the Farm Property Coverage Form?A-The limit for Coverage G is the same as the limit of Coverage A
B-For coverage to apply, there must be a limit shown in the Declarations
C-Coverage B - Other Private Structures includes farm buildings and silos
D-Coverage G includes loss of useUnder a BOP, the insurer may examine and audit the insured's books and records at any time during the policy period and up to what duration after policy expiration?A-1 year
B-3 years
C-7 years
D-5 yearsOcean marine hull insurance covers a vessel for:A-Physical damage
B-Seaworthiness
C-Liability
D-Cargo damageInland Marine Insurance is not typically used to insure which type of property?A-Stamps
B-Cameras
C-Autos
D-Jewelry
CAll of the following regarding Commercial Auto coverage are true, except:A-The Business Auto Coverage Form will cover liability from transporting mobile equipment
B-Section II of the Garage Coverage Form does not provide physical damage coverage to a customer's car
C-Section II of the Garage Coverage Form does not include completed operations coverage
D-The most frequently used commercial auto policy is the Business Auto Coverage FormUnder the CGL, which of the following would exclude from coverage the legal liability associated with a product?A-Strict liability
B-Negligence
C-Expected or intended injury
D-Breach of warranty
CWhich of the following is not a power of the Commissioner of Insurance?A-Examine a licensee under oath
B-Determine all matters of policy
C-Adopt regulations for insurance companies
D-Formulate the insurance laws for New JerseyThe Replacement Cost optional coverage of the Building and Personal Property Coverage Form applies automatically to all of the following types of property, except:A-Merchandise held in storage or for sale
B-The insured's business personal property
C-The building listed in the Declarations
D-Personal property of others___________ risks are commercial lines insurance risks of an unusual nature, difficult to rate, and subject to high losses, for which the Commissioner can change without a hearing.A-Surplus lines
B-Special
C-Competitive
D-UniversalAll of the following statements regarding property insurance are correct, except:A-A property that contains neither occupants nor personal property is deemed vacant
B-A binder is a temporary proof of insurance
C-The insurer may cancel a policy, after providing proper notice
D-The owner of clothing left in the care of a dry cleaner is called a baileeThe BOP policy provides the same liability coverage as which of the following policies?A-Commercial General Liability
B-Commercial Inland Marine
C-Business & Personal Property
D-Commercial Auto
AA guest falls in K's house and is injured in an amount of $1,000. How much will K's Homeowners Policy pay regardless of fault, if the Coverage F limit is $1,500?A-$1,000
B-Nothing
C-$500
D-$1,500
AWhich of the following is true regarding the HO-4 and HO-6 forms?A-They are used to insure the personal property and personal liability of the insured, but do not include the structure itself
B-Losses are paid on a replacement cost basis
C-The amount of insurance on the dwelling containing personal property is 10% of the Coverage C amount of insurance
D-They provide open perils coverage on the personal propertyFine arts and antiques are classes of property insured on a:A-Market value basis
B-Replacement cost basis
C-Actual cash basis
D-Valued basisMotels may not be written insured by a Businessowners Policy if they exceed:A-100,000 square feet
B-25,000 square feet
C-2 stories
D-3 stories
DWhich of the following is true about specialty or professional liability insurance?A-They protect businesses with few liability exposures
B-They provide excess coverage over the CGL policy
C-Volunteer workers are excluded from coverage
D-They are written on non-standard formsUnder the BOP, what is the insurer's obligation following a loss when other insurance is written with exactly the same basis?A-To pay for a share of the loss according to the limits
B-To pay the full amount of the loss in addition to the other insurance
C-To pay only after the other insurance coverage is exhausted
D-To pay 50% of the loss
BWhich is not included in the general section of the Workers' Compensation policy?A-State
B-Work locations
C-State Workers' Compensation law
D-Other insuranceWhat type of liability policy requires the injured party to collect benefits from his/her own insurance as if it were first-party coverage, eliminating the process of determining negligence?A-Excess
B-No fault
C-Absolute liability
D-Pro rataWhich of the following is not a type of personal and advertising Injury under the CGL?A-Infringement of copyright
B-Malicious prosecution
C-Breach of contract
D-SlanderWhich of the following statements is true with regard to suspension or revocation of a producer's license?A-License fees for the unexpired term of the license may be refunded
B-Any existing agency relationships with insurance or other licensed organizations may be retained if the producer is planning on reinstating his/her license
C-Advertising in the producer's legal or business name may not be used
D-The producer may keep his/her license if the producer is planning on reinstating his/her licenseThe law provides for an expedited process for the FAIR Plan, to file changes to its rating system for:A-Tornado damage
B-Coastal areas where there is a demonstrated risk of hurricanes
C-Earthquakes
D-Hail damageUnder which section of the Workers' Compensation and Employers Liability policy would the insured's duties be found?A-Section III
B-Section II
C-Section I
D-Section IVProduct liability would cover:A-Contractual liability
B-Product recall
C-A vending machine that injured a customer's hand
D-A restaurant customer who contracts food poisoningAll of the following are true of the Personal Auto Policy, except:A-It provides insurance for vehicles with a gross vehicle weight of 10,000 pounds or less
B-It provides no coverage for personal effects in the vehicle
C-It provides no-fault in states that require it
D-It is written only with split limits of liabilityWhich of the following Part D claims would be denied under the Personal Auto Policy?A-Loss to electronic ignition equipment of the covered auto
B-Earthquake damage to the covered auto
C-Loss to the covered auto caused by road damage to tires
D-Loss to permanently installed sound reproduction equipment of the covered autoMedical expense benefits under PIP must be at least:A-$100, payable weekly
B-$12 per day
C-$15,000, up to $250,000 per person per accident
D-$10,000, up to $250,000 per person per accidentUnder the BOP, if coverage for business property equals 100% of the average monthly values for the preceding 12 months, an automatic increase of what amount is provided to offset seasonal variations in stock values?A-15%
B-10%
C-25%
D-5%Under Equipment Breakdown Insurance, which of the following is considered 'one breakdown'?A-The last accident, when there is more than one accident causing a loss
B-The accident that apparently caused the damage
C-The first accident, when there is more than one accident causing a loss
D-All breakdowns occurring at the same time that are the direct result of the same cause
DWhich statement is false concerning a Homeowners Policy?A-The HO-4 is sometimes called a Tenants Form
B-The HO-3 covers the dwelling on an open perils basis
C-The HO-3 covers the contents against the Broad Form Perils
D-The HO-4 covers the dwelling against the Broad Form PerilsUnder Marine Policies, the term uncontrolled means forms that:A-Are not standardized by any rating bureau
B-Are filed with the State Insurance Department
C-Must be tailored to the individual insured by endorsement
D-Are not approved by the National Association of Insurance CommissionersInland Marine Policies are primarily designed to insure:A-Exclusively for property being transported on inland waters
B-Buildings and contents used for manufacturing
C-Overseas shipments
D-Property that is mobile in nature and may be away from insured's premisesWhich of the following are eligible to be insured under a Dwelling Policy?A-Farms
B-Dwellings used for incidental business
C-Mobile homes on wheels
D-Dwellings with any type of business in themWhat is the Exportable List?A-A list of insurance risks which may be covered for exports
B-A list of insurance risks for which there is no reasonable or adequate market in New Jersey
C-A list of surplus lines agents eligible to transact surplus lines business in New Jersey
D-A list of insurers eligible to transact surplus lines business in New JerseyThe Businessowners Coverage Form to the Businessowners Policy provides coverage on which of the following basis?A-Broad Perils
B-Open Perils
C-Modified Perils
D-Simplified PerilsWhen acting as an __________, this person represents the insurance applicant in negotiating an insurance contract.A-Insurance Sales Manager
B-Insurance Agent
C-Insurance Consultant
D-Insurance BrokerWhich of the following federal laws resolved that regulation and taxation of the insurance business by individual states is in the public's best interest?A-U.S. vs. South Eastern Underwriters Association
B-Paul vs. Virginia
C-McCarran-Ferguson Act
D-COBRAA first-time applicant for bail bond authority must complete:A-6 classroom hours on ethics
B-6 classroom hours on regulation of the insurance industry
C-10 classroom hours on regulation of the insurance industry
D-A total of 26 classroom hours on regulation of the insurance industryPolicyholder L owns a dwelling, and rents the detached garage to tenants. The premises are insured under a DP-3 with a Coverage A limit of $100,000. How much is the detached garage insured for if damaged by a covered claim?A-$10,000
B-$50,000
C-$20,000
D-$5,000How is Mobile Home insurance written?A-Either by writing a separate Mobile Homeowners Policy or by adding an endorsement to a Homeowners Policy
B-By writing a separate Mobile Homeowners Policy only
C-By adding a Mobile Home Endorsement to a Homeowners Policy only
D-Mobile homes cannot be coveredWhich of the following would not be an insured under Section II of the Homeowners Policy?A-Relatives of the named insured, meaning they are related by blood, marriage, or adoption
B-The insured's tenant
C-Members of the family under the age of 24 living at school away from the home
D-Any person legally responsible for watercraft owned by an insuredWhich of the following is a false statement about the National Flood Insurance Program?A-There is no deductible
B-The federal government administers the program
C-It covers direct loss from overflow of inland or tidal waters
D-It covers direct loss from mudslides caused by the accumulation of waterK gets a horrible rash after using wrinkle-prevention cream for 2 months. This is considered:A-An occurrence
B-An accident
C-Negligence
D-Punitive damagesWhich of the following terms includes pain and suffering, disfigurement, and mental anguish?A-Strict liability
B-Specific damages
C-Loss of consortium
D-General damagesWhich statement regarding liability coverage and limits is false?A-Primary coverage pays first with respect to other policies
B-An excess coverage policy pays only after a primary policy has been exhausted
C-Pro rata liability is proportionate distribution of liability among insurers that have policies on the same risk'
D-The per occurrence limit is the maximum amount recoverable during the policy periodWhat additional penalty may be imposed by the Commissioner for a policy cancelled or nonrenewed in violation of state law?A-Imprisonment for up to 1 year
B-Punitive damages
C-A fine of up to $20,000
D-Immediate reinstatement of the policyA notice of cancellation for suspension of a license for refusal to submit to a chemical test must be mailed as least _______ days prior to the effective date of the cancellation.A-90
B-30
C-20
D-60A commercial fleet is a risk with __________ vehicles.A-Commercial and semi-trailer
B-5 or more
C-8 or more
D-More than 2An insured has a Homeowners Broad Form with a $200,000 limit on the dwelling and the standard deductible. If the insured's $2,500 boat and trailer are stolen from their driveway, what is the most the insured will collect from the policy?A-$1,250
B-$2,250
C-$1,500
D-$2,500Which statement is true of Section I of a Homeowners Policy?A-Theft of a boat while away from the premises is covered
B-A special limit of $1,500 limit applies to watercraft
C-Coverage is provided on owned golf carts and owned snowmobiles off premises
D-Coverage on utility trailers is limited to $2,000How much will the Dwelling Policy pay for additional living expenses after a dwelling insured for $100,000 under Coverage A is damaged by a fire?A-$20,000
B-$30,000
C-$50,000
D-$10,000Which of the following would not be covered under Coverage B?A-Swimming pool
B-Grain silo
C-Shed
D-Pole barnWhich of the following statements is NOT correct regarding the principles associated with ethical conduct?A-Provide advertising and sales materials which are clear as to purpose and honest and fair as to content
B-Provide competent and customer-focused sales and service
C-Engage in reducing competition
D-Provide for fair and expeditious handling of customer complaints and disputesUnder the Homeowners Forms, Coverage C includes which type of coverage?A-Additional Living Expense
B-Other Structures
C-Contents and Personal Property
D-Special DamagesIt is not in the public interest for The Fair Act to:A-Allow automobile insurers to make an adequate profit
B-Continue merit rating surcharges
C-Mandate an auto policy to be the primary source for paying medical costs from auto accidents
D-Charge temporary assessments for practicing certain professionsA producer's license that has been suspended may be reinstated:A-After submitting a completed application and required affidavit
B-On what would have been the next renewal date
C-After 5 years
D-After one yearAll of the following are true of a Homeowners Policy, Coverage F, except:A-Under Coverage F, coverage applies to persons that are on the insured location with permission
B-Under Coverage F, a covered accident may occur during the policy period
C-Under Coverage F, payments apply to necessary medical expenses incurred within a maximum of 1 year
D-Under Coverage F, coverage does not apply to injuries of the named insured or any regular resident of the insured's householdThe Compensation Rating and Inspection Bureau (CRIB) does not have the authority to:A-Sue or be sued regarding recovery of assessments
B-Prepare policy forms
C-Establish rules for member assessment
D-Approve classification system or risks and premiumsUnder the unendorsed Homeowners Policy, jewelry is covered up to what amount?A-$1,500 for loss by any peril
B-$2,500 for loss by fire
C-$1,500 for loss by theft
D-$1,000 for loss by collapseIf the insured fails to use an available fire extinguisher to put out a shed fire that results in $1,000 damage, how much will an HO-3 Policy pay for the claim?A-$900
B-Zero
C-$1,000
D-$500What is the only policy section that may change or be different for each customer?A-The Declarations
B-The Insuring Agreement
C-The Exclusions
D-The ConditionsWhich of the following is used to resolve differences between the insured and the insurer?A-Subrogation
B-Nonrenewal
C-Arbitration
D-LiberalizationA fire sprinkler system installed in a factory is considered which of the following methods of managing risk?A-Retention
B-Reduction
C-Transfer
D-AvoidanceWhich of the following incidents would not be considered theft?A-Merchandise stolen while the store is open and caught on video tape
B-A cashier being handed a threatening note to hand over all the cash in the cash register
C-Quarterly inventory shows a shortage of 3 stock items
D-Missing merchandise and a broken store window discovered by a manager when opening the store for the dayThe voluntary surrender of a right is known as which of the following?A-Estoppel
B-Waiver
C-Liability
D-Tort LawWhat is the term for continuous exposure to the same harmful conditions?A-Accident
B-Proximate cause
C-Risk
D-OccurrenceHow long after a loss before the Period of Restoration begins for Business Income coverage?A-48 hours
B-168 hours
C-72 hours
D-24 hoursCoverage D of the Dwelling Policy provides coverage for:A-Additional Living Expenses
B-Other Structures
C-Fair Rental Value
D-Trees, Shrubs, and Other PlantsWhich of the following is true with regard to requirements for filing rates and policy forms?A-Rates must be filed at least 30 days before use and policy forms must be filed within 30 days after becoming effective
B-Rates must be filed within 30 days after use and policy forms must be filed at least 30 days prior to becoming effective
C-Rates must be filed within 30 days after use and policy forms must be filed within 30 days after becoming effective
D-Rates must be filed at least 30 days before use and policy forms must be filed at least 30 days prior to becoming effectiveThe Garage Liability section of the Garage Coverage Form covers which of the following?A-Injuries covered by Workers' Compensation
B-Property damage for which the insured is legally responsible
C-Product recall
D-Property in the care and custody of the insuredWhich of the following is true regarding the New Jersey Insurance Fraud Prevention Act?A-Only criminal activities will be litigated by the Insurance Fraud Prosecutor
B-Suspicious information regarding an accident obtained by the State Police must be referred to an insurance investigator within 48 hours
C-A claimant will receive twice the damages if the court determines that the defendant violated the Act
D-Concealing information requested on an insurance application is a violation of the ActUnder the Builders Risk Coverage Form, all of the following are true, except:A-There is no vacancy provision in the Commercial Builders Risk Coverage Form
B-Coverage on the structures under construction includes materials, supplies, and equipment intended to become a permanent part of the building
C-Coverage terminates 90 days after completion, or when the building is occupied
D-Coverage includes trees, plants, outside antennas and signs that are not attached to the buildingWhich of the following defenses against negligence prevents recovery for injuries caused by a negligent party if the claimant was also negligent?A-Comparative negligence
B-Intervening cause
C-Assumption of risk
D-Contributory negligenceWhich of the following is an example of vicarious liability?A-An employer's liability for the acts of an employee
B-The liability of a negligent party whose identity cannot be determined
C-The liability of any group of people, acting together
D-Liability of members of the clergyWhich vehicle would not be covered under a Personal Auto Policy with no added endorsements?A- A pickup truck with a gross vehicle weight of 7,600 pounds
B-An eight passenger van with a gross vehicle weight of 8,600 pounds
C-A motorcycle
D-An owned trailerWhen the insured and the insurer fail to agree on the amount to be paid for a property loss, the dispute resolution method is called a(n):A-Approximate Clause
B-Abandonment
C-Appraisal
D-Agreement ClauseWhich is true of Coverage C of the Dwelling Policy?A-Coverage C provides coverage for pets
B-Coverage C provides coverage for a car stereo owned by the insured
C-Coverage C provides coverage for the personal property of a guest
D-Coverage C provides coverage for grave markersWhich of the following statements is false regarding cancellation for nonpayment of premium?A-The insured may not file a written complaint with the New Jersey Department
B-The insured may file a written complaint with the New Jersey Department
C-The notice must inform the insured that the policy will not be cancelled if payment is made before the cancellation date
D-The insurer must mail notice of cancellation at least 10 days prior to cancellationWhat is the correct term for a secondary loss that occurs as a result of a direct loss from a covered peril?A-Provisional Loss
B-Secondary Loss
C-Consequential Loss
D-Delayed LossThe part of a property policy that gives basic information such as the named insured, a description of the property, the location of the property, and the amount of premium involved, is known as the:A-Policy Provisions
B-Conditions
C-Insuring Agreement
D-DeclarationsWhich of the following perils is not covered under the Dwelling Broad Form?A-Weight of ice and snow
B-Burglary damage
C-Vehicle damage to the dwelling
D-Smoke damage from industrial operations
DThe Part of the Workers' Compensation Policy that includes States that are listed in the Information Page, is called:A-Part Three - Other States Insurance
B-The General Section
C-The All-States Endorsement
D-Part Six - Conditions
AWhich construction classification uses materials that can withstand fire for at least 2 hours?A-Frame
B-Masonry
C-Fire Resistive
D-Noncombustible
CWhich of the following is not true about medical payments under the Personal Auto Policy?A-The coverage limit applies per person, per accident
B-Coverage applies only for medical expenses incurred within one year of the accident
C-Medical expenses of all persons occupying the insured auto are covered
D-Medical expenses of the insured and family members are covered
BUnder a Commercial Crime policy, the definition of securities includes all of the following, except:A-Bank notes
B-Evidences of debt
C-Tokens
D-Revenue stamps
AWhich of the following is the best explanation of liability insurance?A-It provides coverage for bodily injury or property damage to the insured and the insured's property
B-It provides coverage to any party for injury that is expected to happen
C-It provides coverage for bodily injury or property damage arising out of the insured's premises or operations regardless of fault or negligence
D-It provides protection in the event the insured's negligence causes bodily injury or property damage to others and the insured becomes legally obligated to pay damages
DWhich of the following is true regarding Coverage A under the Dwelling Policy?A-Coverage A includes a detached carport
B-Coverage for land is restricted to the land upon which the dwelling is sitting
C-Outdoor equipment is not covered
D-The policy does not include coverage for wind loss of television antennasWhich of the following claims would be excluded under the Business Auto Policy?A-Bodily injury after a person is struck by a mechanical device attached to a covered truck
B-Damage to property in the insured's care, custody, or control
C-Injury to another motorist
D-Bail bonds required after a covered accident
BWhich of the following would not be eligible to purchase a Homeowners Policy?A-A person who provides daycare in their home
B-A person whose dwelling contains an accounting office
C-A person who owns and lives on a farm
D-A person who owns and occupies a two-family dwelling
CWhich of the following is least likely to be a factor when determining the eligibility of a person for property insurance?A-Whether the premium will be paid in full or billed to the insured
B-The claims history showing when prior claims occurred and how much was paid to settle the claim
C-Existence of any hazards such as a nearby gas station exposure
D-The nature of the risk, such as the type of building and the number of families living in the building
AMedical expenses of the Farm Liability Coverage Form provide coverage if the accident is reported within:A-3 years
B-2 years
C-4 years
D-1 year
AWhich of the following would NOT be found in the Common Policy Declarations page of a Commercial Package Policy?A-The inception and expiration date
B-The insured's name and address
C-Exclusions
D-The policy premium
CWhich of the following claims would be insured under Uninsured Motorists Coverage?A-The insured's resident son suffered severe injuries after being rear-ended by an uninsured driver
B-The insured was driving his uninsured car at the time of the accident
C-A thief stole the insured's car and was paralyzed after being struck by a drunk driver
D-An insured is sued and the other party is awarded an injury settlement and punitive damages
AA business individual that carries people and property belonging to the general public for a fee from one place to another is called which of the following?A-Motor carrier
B-Contract carrier
C-Livery carrier
D-Common carrier
DChoose the false statement regarding the Businessowners Policy.A-Watercraft and associated equipment while afloat are not covered
B-Pollution clean up and removal are covered as an Additional Coverage
C-Manufacturers are eligible for coverage
D-Named perils coverage is available by endorsement
CUnder the BOP, what is the insurer's obligation following a loss when other insurance is written with exactly the same basis?A-To pay the full amount of the loss in addition to the other insurance
B-To pay only after the other insurance coverage is exhausted
C-To pay for a share of the loss according to the limits
D-To pay 50% of the loss
AWhat is the name of the uniform document that common carriers are required to issue to the shipper of the goods being transported?A-Bill of Acceptance
B-Bill of Transportation
C-Bill of Lading
D-Shipping Receipt
CAfter being rejected by an insurer due to underwriting guidelines an applicant may request homeowners coverage under which of the following?A-Write Your Own Homeowners Program
B-An Umbrella policy
C-A DP-3 Special Dwelling Plan
D-FAIR Plan
DPersonal Injury includes all of the following, except:A-Malicious prosecution
B-Bodily Injury from eviction
C-False Arrest
D-Libel and Slander
BWhich of the following describes the Lay Up Warranty under the Yacht Policy?A-It is an additional coverage that applies when the yacht is being repaired or serviced
B-It applies when the insured yacht is in storage and allows a return of premium due to the lower risk
C-It states that coverage is suspended while the yacht is laid up
D-It is a limitation of coverage on the yacht that applies when the yacht is outside its navigational limits
BIf an insurer offers more than one rate under the Basic Auto Insurance Policy, which of the following rates would not be included?A-Surplus
B-Non-standard
C-Standard
D-Preferred
AA false statement in the application for insurance is ___________.A-Concealment
B-Unilateral
C-Representation
D-Misrepresentation
DChoose the true statement regarding the Value Reporting Form.A-Late reporting or under-reporting will result in a penalty in the event of a loss
B-The form may be attached to any Commercial Property coverage forms
C-The Value Reporting Form contains an 80% coinsurance clause
D-The final premium is based on the values reported in the last report of the policy term
AWhich term is defined as the possibility of loss?A-Liability
B-Risk
C-Peril
D-Negligence
BWhich of the following is NOT excluded under Part A of the CGL form?A-Operation of mobile equipment
B-Product recall
C-Discrimination
D-Damage to insured's work
AWhich of the following risks is not eligible for coverage under the Businessowners policy?A-A construction company with $300,000 total annual payroll
B-A 10-story office building
C-A wholesaler with 25% of the floor space open to the public
D-An apartment building of any size
BWhich of the following claims would be covered by the First Aid Expenses under the Homeowners Policy?A-A member of the insured's family is injured while on the premises
B-Nonfamily residents of the household are injured while on the premises
C-The named insured is injured while off the premises
D-A neighbor is injured while helping the insured install a carpet
DUnder the Basic Dwelling Form, when is damage caused by vandalism included as covered peril?A-This coverage is not available in the Basic Dwelling Policy
B-When the VMM Endorsement is added to the DP-1
C-When the Extended Coverage perils are added to the DP-1
D-When under the unendorsed DP-1
BWhich coverage is not available under the Garage Coverage Form?A-Product liability
B-Garagekeepers
C-Physical damage
D-Advertising liability
DA second negligent act that interferes with the chain of events leading to a loss is known as a(n):A-Foreseeable consequence
B-Loss of consortium
C-Tort
D-Intervening cause
DWhich of the following is covered by Medical Payments under the CGL?A-Bodily injury to an insured that is injured while playing tennis
B-Bodily injury to an insured's customer while shopping on the insured's business premises
C-Bodily injury to a person hired to do work for the insured
D-Bodily injury to a person on a part of the premises that the insured owns or rents and that the person normally occupies
BA 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:A-$25,000
B-$60,000
C-$75,000
D-$50,000
DAll of the following are false concerning the National Flood Insurance Program, except:A-Flood policies are available only from the National Flood Insurance Program
B-Dwelling coverage includes trees, shrubs, and plants
C-Payment for losses are made by the federal government
D-Agents may bind flood insurance for up to 15 days prior to submitting the final application
AWhich of the following is not an insured under a Personal Auto Policy?A-The resident teenage son of the insured who drives the vehicle without a license
B-A thief involved in a high-speed police chase
C-A spouse living in the same household
D-A foreign exchange student living with the insured for the school year
BWhich of the following perils is not covered by Crop/Hail insurance?A-Lightning
B-Fire
C-Pollution
D-Drought
CThe formal statement that verifies details so the insurer can determine liability is called:A-A certificate of authority
B-A certificate of insurance
C-A binder
D-A proof of loss
DAn unintended and unforeseen event from which a loss results is called which of the following?A-Accident
B-Proximate cause
C-Risk
D-Peril
AUnder all the Dwelling Forms, the dwelling described in the Declarations is covered under:A-Coverage A
B-Coverage C
C-Coverage E
D-Coverage B
AWhich section of the BAP provides coverage for autos in the care, custody and control of the insured?A-This coverage is not provided under the Business Auto Coverage Form
B-Section I
C-Section III
D-Section II
AAll of the following are covered perils under the Extended Coverage Endorsement to the DP-1, except:A-Vehicles
B-Windstorm
C-Weight of ice, snow, or sleet
D-Volcanic eruption
CEmployees exempted from Workers' Compensation laws include all of the following, except:A-Independent contractors
B-Farm laborers
C-Part-time employees
D-Casual workers
CThe purpose of an Advisory Organization is to:A-Assist insurers in making their own rates
B-Approve rate filings submitted by insurers
C-Develop rates on behalf of insurers
D-Provide legal advice to insurers
AWhich of the following expenses would not be reimbursed under the Workers' Compensation policy?A-Premiums for appeal bonds
B-Loss of insured's earnings because the insurer requested the insured come to court
C-Defense costs
D-Claim expenses
BUnder the Building and Personal Property Coverage Form, a limit of how much is applied to business personal property temporarily away from the premises.A-$5,000
B-$15,000
C-$10,000
D-$2,500
CThe Personal Articles Floater is written:A-Only on a replacement cost basis
B-Only on a named perils basis
C-Only on moveable property
D-Only as an endorsement on the Dwelling policy
CAll of the following are true, except:A-Coverage D of a Homeowners Policy covers additional living expenses
B-Home schooling is permitted under a Homeowners Policy
C-A Homeowners Policy will not cover theft of a boat away from premises
D-Coverage D of a Homeowners Policy includes loss of income from an incidental business
DWhich of the following correctly describes the practice of twisting?A-Misleading an insured in order to induce them to terminate or exchange an existing policy for a different one
B-Offering anything of value that is not already part
of the policy, as an incentive to buy insurance
C-Spreading false rumors about another insurer
D-Recommending a new type of coverage to an insured
AWhich of the following is not included in the definition of Money under Commercial Crime Coverage?A-Evidence of debt
B-Travelers checks
C-Currency
D-Bank notes
APlaintiff K was injured after losing control of their skis on a slope with well-marked signs indicating the degree of difficulty. What legal defense is available to the ski resort to avoid liability for the injury?A-Statute of limitations
B-Assumption of risk
C-Contributory negligence
D-Comparative negligence
BClaimant A has bodily injuries in the amount of $49,500; claimant B, $19,500; and claimant C $14,000 arising out of a 4-car accident caused by the insured, whose PAP carries limits of 25/50/10. What will the insurer pay?A-$50,000
B-$83,000
C-$14,000
D-$49,500
AWhich statement is true regarding the Accounts Receivable coverage form?A-It covers the insured's uncollectibles from customers due to a direct physical loss of the insured's business records
B-It does not cover the cost of reconstructing lost records
C-It covers only the cost of reproducing the insured's accounts receivables records that are destroyed by an insured peril
D-It does not cover collection fees
AChoose the correct statement regarding the HO-3.A-The dwelling and other structures are written on a Broad Form perils basis
B-Coverages A, B, and C are all written on a replacement cost basis
C-The contents are written on an open perils basis
D-The dwelling and other structures are written on an open perils basis
AAll of the following are included in Section I of the Businessowners Coverage Form, except:A-Business Income and Extra Expense coverages
B-An automatic increase in Business Personal Property Coverage to offset seasonal variations in stock
C-An automatic increase in the limit of insurance for the building
D-An automatic 90% coinsurance clause
DWhich of the following statements regarding Multi-Peril Crop Insurance is correct:A-Multi-peril crop insurance is reinsured by the federal government by FCIC
B-Insects and plant disease are excluded from coverage
C-Multi-peril crop insurance protects against the perils of lightning, wind, and pollution
D-Multi-peril crop insurance is not reinsured by the federal government, but through CHIAA
AWhich of the following is true regarding an unendorsed HO-4?A-It includes open perils coverage on an actual cash value basis
B-It includes open perils coverage on a replacement cost basis
C-It includes the Broad Form named perils on a replacement cost basis
D-It includes the Broad Form named perils on an actual cash value basis
DA Personal Auto Policy is designed to cover:A-Only the non-business use of a personal automobile
B-An individual's or family's personal use of an auto
C-The use, by an individual and/or spouse only, of a personal automobile
D-Personal and commercial autos that are owned by an individual or family
BWhich of the following vehicles is covered by Liability coverage under the Personal Auto Policy?A-Motorcycle
B-Uninsured owned vehicle
C-Non-owned golf cart
D-Company car
CWhich of the following is covered under Section II of the Businessowners Coverage Form?A-Employers Liability
B-Professional Liability
C-Medical payments to volunteer workers
D-Watercraft Liability
COn the Personal Auto Policy, the Collision coverage provides payment for losses:A-To the car you run into, regardless of liability
B-To your car, and regardless of liability
C-To your car and the car you run into
D-To your car, but only if you are legally liable
BA process by which a surplus lines producer places coverage after a risk has been declined is called:A-Diligent effort
B-Exempt commercial purchaser
C-Exempt coverage
D-Surplus lines insurer
AMost of H's jewelry is covered under the Coverage C special limits of H's Homeowners Policy, except for a $10,000 necklace inherited from H's mother. Which of the following endorsements might H's agent recommend?A-Personal Property Replacement Cost
B-Increased Limits - Coverage C
C-Open Peril Personal Property
D-Scheduled Personal Property
DWhich statement about the Builders Risk form is not correct?A-Coverage terminates 90 days after construction is completed, when a policy expires, is cancelled, or 60 days after the owners fully occupy the dwelling, whichever is soonest
B-There is no vacancy provision
C-Coverage is always written on an open peril basis
D-Coverage does not apply to outside radio and television antennas
CWhich commercial crime policy will cover any occurrence that took place during policy period, even if it was not immediately discovered?A-Claims-made form
B-Occurrence form
C-Loss-Sustained form
D-Discovery form
CL owns a home covered under an HO-3 for $200,000. Under Coverage D, how much coverage does L have for lost income if his basement apartment becomes uninhabitable due to a fire loss?A-$60,000
B-$150,000
C-$300,000
D-$30,000
AWhich of the following is not covered under the Condominium Commercial Unit-Owners Coverage Form?A-Improvements
B-Appliances
C-Business personal property
D-Building exterior wall
CIn addition to conducting accounting business in his own office, Tom also goes to client's offices for appointments, which represents which type of exposure?A-Contingent Liability
B-Product
C-Completed Operations
D-Premises and Operations
DAll of the following are true of the Dwelling Special Form, except:A-Losses to the dwelling are paid on a replacement cost basis
B-Both the dwelling and contents are covered on an open perils basis
C-Mobile homes are not eligible
D-The dwelling must be used principally for residential dwelling purposes
BA hearing will be held within ______ days after the date the notice of hearing is served.A-30
B-45
C-15
D-10
D$250,000 Personal Injury Protection coverage is available for medical expense benefits in the Basic Auto Insurance Policy for all but which of the following?A-Cuts and bruises
B-Disfigurement
C-Spinal cord injury
D-Permanent injury at an acute care hospital
AAll of the following statements about the Fine Arts Floater are true, except:A-It has a 90-day automatic coverage for newly acquired items
B-It covers such items as paintings, rare manuscripts and antiques
C-Coverage applies only to scheduled items
D-Coverage is written on a replacement cost basis
DWhich of the following would be included under Scheduled Farm Personal Property?A-Chutes
B-Trees
C-Livestock
D-Fences
CWhich of the following lines of authority require a total of 10 course hours?A-Bail bonds
B-Personal lines
C-Limited lines
D-Title insurance
AWhich of the following penalties may be imposed by the Commissioner for a violation or deceptive act or practice?A-A penalty of up to $2,000 per violation, and up to $5,000 if the violation or act should have been known
B-A penalty of up to $5,000 per violation, and up to $10,000 if the violation or act should have been known
C-A penalty of up to $5,000 per violation, and up to $10,000 if the violation or act should have been
known, and the costs of investigation and prosecution as well as possible restitution
D-A penalty of up to $1,000 per violation, and up to $5,000 if the violation or act should have been known
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