State Farm .1 | Questions with 100% Verified Answers | Latest Update 2026/2027

State Farm .1 | Questions with 100% Verified Answers |
Latest Update 2026/2027
Question: Gaming
Answer: Gaming is a manipulation the solicitation and submission of applications to obtain
compensation and or agent incentives. This type of activity is not in the best interest of
the company of its policyholders and is strictly prohibited.

Question: Tie in sales
Answer: A practice requiring a customer to purchase one product or service in order to qualify
for
a different product or service.

Question: Rebating
Answer: Rebating is offering a prospect or customer a special incentive to purchase or
continue a
policy. This practice is illegal in most states and is against State Farm policy even in states
where it is allowed.

Question: Unapproved vendor
Answer: Any vendor that does not have an agreement in place with state farm, or services
received from an approved vendor that are outside the scope of the vendors agreement
with SF.

Question: Unauthorized Vendor
Answer: A specific Vendor that State Farm has identified as not authorized to be used by SF or
Sf
agents due to the potential risks posed to SF by engagement with the vendor. Agents
should not use an unauthorized vendor. If an agent uses an unauthorized vendor his
could impact the relationship.

Question: Demonstrations
Answer: shows guaranteed premiums for a term policy. In addition it will include guaranteed
cash
values.

Question: Illustrations
Answer: used as a tool to educate the customer concerning the features and provisions of
policy
options.

Question: Submission of an application for an insurance policy is best
described as?
Answer: offer

,Question: Information used in underwriting a policy for an insured, is
made available to in insured because of which of these?
Answer: Financial Services Modernization Act

Question: What must be done to renew your Insurance License?
Answer: 12 Hours of Continuing Education within 2 Years

Question: Which of the following is not a characteristic of a Mutual
Insurance Company?
Answer: A policyholder is a voting member on the Board of Directors

Question: Property insurance policies that apply coverage only to perils
that are stated in the policy, are considered to be written on?
Answer: A named peril basis

Question: A physical hazard describes which of the following?
Answer: The storage of flammables near a furnace

Question: When a producer collects a premium on an insurance contract
and deposits that in a trust account for the insurer. This makes
the producer a?
Answer: Broker

Question: In Property and Casualty Insurance, when a form is attached
to further define certain policy provisions or conditions, or
adds additional coverage, it is known as?
Answer: An endorsement

Question: Alpha Insurance Company does business in all fifty states,
however its home office is located in Rhode Island. To their
business in California, Alpha Insurance Company is?
Answer: Foreign

Question: Agent Z is trying to sell a client a policy. Afraid of losing his
sale he offers to give the client 10% of his commissions if the
client will buy the policy. That agent would be guilty of which
unfair trade practice?
Answer: Rebating

Question: When does the Texas Property and Casualty Insurance
Guarantee Association pay covered claims?
Answer: When an Admitted Insurer becomes insolvent

Question: Before issuing a nonresident license, the Department must find
that the applicant?
Answer: Has not committed an act for which a license may be denie

,Question: All of the following are hazards for insurance underwriting,
EXCEPT?
Answer: Incidental

Question: A person can purchase an insurance policy to cover losses
from all the following, EXCEPT?
Answer: An operation of drug smuggling

Question: Which risk management option, best describes insurance?
Answer: Transfer risk

Question: Which of the following acts does not constitute Transacting
Insurance?
Answer: Making phone calls to set up appointments

Question: A binder would be which of these?
Answer: Temporary proof of insurance

Question: The standardized policy structure for insurance policies does
not include which of the following?
Answer: Duties

Question: The Department of Insurance requires all of these for
Licensing, EXCEPT?
Answer: High School Diploma or GED

Question: The commissioner of Insurance can do which of these?
Answer: Set continuing education requirements in Texas

Question: The Commissioner of insurance is responsible for all of the
following, EXCEPT?
Answer: Make insurance laws when appropriate

Question: The section of a property policy that specifies the obligations
and duties of the insured and the insurer is the?
Answer: Conditions

Question: Which of the following is NOT found in a property insurance
binder?
Answer: Amount of premium

Question: The Texas Property and Casualty Insurance Guaranty
Association pays covered claims against which of the
following?
Answer: Insolvent insurers

, Question: A claimant told their insurer they were sure that a certain piece
of property was in the building that burned. Made a?
Answer: Warranty

Question: M hit F with his personal auto causing damages. F filed on his
own policy and his insurer paid the damages. F's insurer will go
after M and M's insurer for the paid damages. This is called?
Answer: Subrogation

Question: If an Agent makes incomplete comparisons of policies, that
Agent would be guilty of?
Answer: Unfair Comparisons

Question: Which License is required for a person who supervises others
for an Insurance Company?
Answer: Managing General Agent

Question: ___________ insurance is used to provide coverage when
insurance is not available from an admitted carrier.
Answer: Surplus

Question: The named insured is found in what section of a property
policy?
Answer: Declarations

Question: A ___________ covers an employee in a position of private trust
and protects an employer against loss caused by the
employee's dishonesty.
Answer: Fidelity bond

Question: A Builder's Risk policy automatically ends ___________ days after
construction is complete.
Answer: 90

Question: T is the managing lawyer in his firm and wants professional
liability coverage for his firm that would cover which of the
following?
Answer: A client sues the lawyer for purposely losing his case

Question: Inland Marine Policies are generally written on what basis?
Answer: Open Peril

Question: Errors and omissions insurance will NOT pay for which of the
following claims?
Answer: Attorney inadvertently breaks a client's leg