Utah Property-Property and Casualty Basics (Complete answers)

Which of the following is a property policy with a provision agreed upon by the insurer and insured as to the amount of insurance that represents a fair valuation for the property at the time the insurance is written and suspends any coinsurance or other contribution clauses in the policy? a) Market value b) Agreed value c) Replacement cost d) Stated amount. correct answers B With regard to fire insurance premiums, structures with which of the following type of construction would most likely have the most favorable premium rate for the peril of fire? a) Masonry b) Noncombustible c) Fire-resistive d) Frame. correct answers C A contractor who builds homes has never made a claim on his business insurance policy. His agent discovers that his policy is written on a scheduled rating. If the contractor changes to an experience rating policy, which is most likely? a) Premiums would be unchanged b) Coinsurance would be necessary c) Premiums would go down d) Premiums would go up. correct answers C Property insurance that provides $100,000 coverage for a building and $50,000 coverage for personal property at a single location is called a) Blanket coverage b) Described coverage c) Specific coverage d) Schedule coverage. correct answers C The secretary of the treasury estimates that a recent terrorist attack caused losses of more than $100 billion. According to the 2007 reauthorization of the Terrorism Risk Insurance Program, how many days' notice must the secretary provide to Congress? a) 15 b) 30 c) 45 d) 60. correct answers A Compared with other drivers in his age group, a driver has had more minor accidents and traffic violation. Which of the following rating types would most accurately reflect the driver's true insurance risk? a) Retrospective b) Special c) Schedule d) Experience. correct answers A An additional loss that results from a direct loss of property is called a/an a) Liability loss b) Punitive loss c) Indirect loss d) Proximate loss. correct answers C If a producer sold policies at the loss cost rate, the result would be a) Manual rates b) Low future rates c) Loss to the insurer d) Rate discrimination. correct answers C In property insurance, actual cash value is defined as which of the following? a) Market value of the property at the time of the loss b) Stated value of the property as shown on the declaration c) The actual amount of a loss payable, less the policy deductible d) Replacement cost at the time of the loss, less depreciation. correct answers D In what year does the 2007 reauthorization of the Terrorism Risk Insurance Program expire? a) 2008 b) 2010 c) 2014 d) 2015 correct answers C