NJ PROPERTY AND CASUALTY
CERTIFICATION REVIEW 2026
COMPREHENSIVE STUDY GUIDE AND
CORRECT SOLUTIONS
◉ Exclusions
Answer: what the policy will not pay for
◉ Definitions
Answer: names of the persons insured in addition to the named
insured are listed here, along with any other (blank) of terms in the
policy
◉ Additional Coverage
Answer: coverages under a policy that are provided by the insurer at
no extra cost
◉ Casualty Policies
Answer: defense costs over and above liability limits, post-
judgement interest, bail bonds and appeal bonds
,◉ Property Policies
Answer: debris removal, falls within the insured dwelling limit and
cannot exceed the limit
◉ Binder
Answer: temporary proof of coverage before policy is issued (oral is
good for 10 days, written for 60 days)
◉ Bodily Injury and Property Damage Coverage Amounts
Answer: Minimum: 15k per person/30k per accident/5k for
property; Max is $500k
◉ Auto - Personal Assigned Risk Policy
Answer: PAIP; standard risk 0 points, non-standard risk 1-8 points,
assigned risk 9 points. (blank) classification runs for 3 years
◉ Auto - Commercial Assigned Risk Policy
Answer: CAIP; assigned risk policy for commercial vehicles,
including private vehicles owned by the business
◉ Personal Injury Protection
Answer: PIP or No-Fault, NJ Representations Act; mandatory,
encourage the insured to recover under his/her own policy, tries to
reduce premiums and hasten settlements through avoidance of
,lengthy litigation that would normally be the case. The benefits of
the standard policy are statutory and therefor minimal
◉ Fire
Answer: A named peril policy. (blank) policies must be filed with the
DOBI commissioner before use and must provide a fairly uniform
look, and provide ample space for coverage, limits, rates, policy
inception, and expiration dates
◉ Friendly Fire
Answer: fire is within it's intended confines (not covered)
◉ Hostile Fire
Answer: fire is outside it's intended confines
◉ Covered Fire Perils
Answer: fire - hostile, lightening, debris removal, theft within first 5
days
◉ Excluded Fire Perils
Answer: theft (after first 5 days of fire), neglect that gives rise to
proximate cause of fire, war, government action, fire - friendly
, ◉ Fair Plan
Answer: (blank) policies are designed to prevent redlining in urban
areas: improve property conditions from an availability standpoint,
stabilize the property insurance market, provide coverage for risks
which insurance cannot be obtained in the open market
◉ $1.5 million
Answer: FAIR Plan max limit
◉ Covered FAIR Plan Perils
Answer: FAIR: fire, lightening, debris removal
◉ Excluded FAIR Plan Perils
Answer: FAIR: burglary damage, flood, farms (farms are not urban)
◉ Dwelling Policy
Answer: 1st party coverage only, not necessary to be owner-
occupied, no more than 4 families or 5 roomers
◉ Basic Peril Coverage - DP1
Answer: basic peril coverage - named perils - most basic dwelling
policy
CERTIFICATION REVIEW 2026
COMPREHENSIVE STUDY GUIDE AND
CORRECT SOLUTIONS
◉ Exclusions
Answer: what the policy will not pay for
◉ Definitions
Answer: names of the persons insured in addition to the named
insured are listed here, along with any other (blank) of terms in the
policy
◉ Additional Coverage
Answer: coverages under a policy that are provided by the insurer at
no extra cost
◉ Casualty Policies
Answer: defense costs over and above liability limits, post-
judgement interest, bail bonds and appeal bonds
,◉ Property Policies
Answer: debris removal, falls within the insured dwelling limit and
cannot exceed the limit
◉ Binder
Answer: temporary proof of coverage before policy is issued (oral is
good for 10 days, written for 60 days)
◉ Bodily Injury and Property Damage Coverage Amounts
Answer: Minimum: 15k per person/30k per accident/5k for
property; Max is $500k
◉ Auto - Personal Assigned Risk Policy
Answer: PAIP; standard risk 0 points, non-standard risk 1-8 points,
assigned risk 9 points. (blank) classification runs for 3 years
◉ Auto - Commercial Assigned Risk Policy
Answer: CAIP; assigned risk policy for commercial vehicles,
including private vehicles owned by the business
◉ Personal Injury Protection
Answer: PIP or No-Fault, NJ Representations Act; mandatory,
encourage the insured to recover under his/her own policy, tries to
reduce premiums and hasten settlements through avoidance of
,lengthy litigation that would normally be the case. The benefits of
the standard policy are statutory and therefor minimal
◉ Fire
Answer: A named peril policy. (blank) policies must be filed with the
DOBI commissioner before use and must provide a fairly uniform
look, and provide ample space for coverage, limits, rates, policy
inception, and expiration dates
◉ Friendly Fire
Answer: fire is within it's intended confines (not covered)
◉ Hostile Fire
Answer: fire is outside it's intended confines
◉ Covered Fire Perils
Answer: fire - hostile, lightening, debris removal, theft within first 5
days
◉ Excluded Fire Perils
Answer: theft (after first 5 days of fire), neglect that gives rise to
proximate cause of fire, war, government action, fire - friendly
, ◉ Fair Plan
Answer: (blank) policies are designed to prevent redlining in urban
areas: improve property conditions from an availability standpoint,
stabilize the property insurance market, provide coverage for risks
which insurance cannot be obtained in the open market
◉ $1.5 million
Answer: FAIR Plan max limit
◉ Covered FAIR Plan Perils
Answer: FAIR: fire, lightening, debris removal
◉ Excluded FAIR Plan Perils
Answer: FAIR: burglary damage, flood, farms (farms are not urban)
◉ Dwelling Policy
Answer: 1st party coverage only, not necessary to be owner-
occupied, no more than 4 families or 5 roomers
◉ Basic Peril Coverage - DP1
Answer: basic peril coverage - named perils - most basic dwelling
policy
