Colorado Property & Casualty - from practice exam Questions With Complete Solutions
If a producer misrepresents a part of a policy, will the Insurer cover a claim made for the
misrepresentation? - ANSWER-Yes, if an agent mistakenly says something untrue about a policy, the company WILL cover the loss b/c the agent legally represents the insurer. The insurer may seek reimbursement from Agent for their error.
When must a certificate of Authority be renewed each year in the State of Colorado? - ANSWER-June 30th
Estoppel - ANSWER-Prevents a party from enforcing a right that it voluntarily waived by
its past conduct.
Captive Insurance Company - ANSWER-Formed to cover the risks of the parent organization that owns it. Sophisticated form of Self-Insurance.
Indemnity - ANSWER-When a loss victim is financially restored to the amount of the loss.
How long must disclosures be kept on record? - ANSWER-Disclosures must be kept on record for 3 years.
Legal Contract - ANSWER-Legal contract is formed when application is completed, sent
with premium to the insurer, and accepted by the insurer.
What producer is exempt from CO continuing education courses? - ANSWER-A Title Insurance Producer.
What source of funds are used during prosecution of alleged Insurance Fraud? - ANSWER-During prosecution of alleged Insurance fraud, the source of funds is from fees collected from entities regulated by the Division.
What is the time limit to pay or reject claims in Colorado? - ANSWER-Insurers must reject or pay claims within 60 days.
Are Averse Economic Conditions a cause for revision of a policy upon renewal? - ANSWER-Adverse economic conditions will NOT cause an insurer to revise a standard policy form at renewal.
Licensee vs Invitee - ANSWER-Licensee would be a Door to Door salesman. A Delivery
person is an invitee. Proximate Causation - ANSWER-Proximate Causation is where a plaintiff must prove that the defendants action set in motion a chain of events that could've reasonably been
anticipated to lead to the damage suffered.
Strict Liability - ANSWER-Strict Liability holds people responsible even if they haven't been careless/negligent. But because they broke the law or ignored clear signs for specific behavior.
Contributory Negligence - ANSWER-Contributory Negligence considers the plaintiffs conduct as a cause of their own injury, and bars them from any recovery. (Ex. a pedestrian walking when they don't have the right of way, red flashing light, and get hit by a car legally moving through the green light.)
Is damage caused by flood a covered peril under a Home property insurance policy? - ANSWER-No, damage caused by flood is excluded under a property insurance policy's water damage exclusion.
Compensatory Damages - ANSWER-Special and General damages
Policy Reduction Coverage - ANSWER-Policy reduction coverage occurs when a property is vacant for 60 days.
Negligence - ANSWER-Negligence is the failure to use the degree of reasonable care, without intent to injure.
Territory Provision of a casualty policy - ANSWER-Territory Provision of a casualty policy indicates where coverage would apply if a loss occurs.
If an Insurer fails to meet the requirement before an existing policy expires... - ANSWER-the insurer must renew the policy to the same terms, conditions, and premium for an identical policy period.
No Benefit to Bailee - ANSWER-No Benefit to Bailee provision makes it clear that no coverage is provided if it benefits a bailee.
Morale Hazards - ANSWER-Morale Hazards arise from a state of mind, attitude, or indifference to loss.
Abandonment Provision - ANSWER-An Abandonment Provision in property policies specifies that the insured cannot walk away from damaged property and turn it over to the insurer. The insurer ISN'T required to accept any property that an insured has abandoned.
Loss of Income by a business - ANSWER-The loss of income sustained by a business while repairing damage to its facility is an indirect loss resulting from damage.
If a producer misrepresents a part of a policy, will the Insurer cover a claim made for the
misrepresentation? - ANSWER-Yes, if an agent mistakenly says something untrue about a policy, the company WILL cover the loss b/c the agent legally represents the insurer. The insurer may seek reimbursement from Agent for their error.
When must a certificate of Authority be renewed each year in the State of Colorado? - ANSWER-June 30th
Estoppel - ANSWER-Prevents a party from enforcing a right that it voluntarily waived by
its past conduct.
Captive Insurance Company - ANSWER-Formed to cover the risks of the parent organization that owns it. Sophisticated form of Self-Insurance.
Indemnity - ANSWER-When a loss victim is financially restored to the amount of the loss.
How long must disclosures be kept on record? - ANSWER-Disclosures must be kept on record for 3 years.
Legal Contract - ANSWER-Legal contract is formed when application is completed, sent
with premium to the insurer, and accepted by the insurer.
What producer is exempt from CO continuing education courses? - ANSWER-A Title Insurance Producer.
What source of funds are used during prosecution of alleged Insurance Fraud? - ANSWER-During prosecution of alleged Insurance fraud, the source of funds is from fees collected from entities regulated by the Division.
What is the time limit to pay or reject claims in Colorado? - ANSWER-Insurers must reject or pay claims within 60 days.
Are Averse Economic Conditions a cause for revision of a policy upon renewal? - ANSWER-Adverse economic conditions will NOT cause an insurer to revise a standard policy form at renewal.
Licensee vs Invitee - ANSWER-Licensee would be a Door to Door salesman. A Delivery
person is an invitee. Proximate Causation - ANSWER-Proximate Causation is where a plaintiff must prove that the defendants action set in motion a chain of events that could've reasonably been
anticipated to lead to the damage suffered.
Strict Liability - ANSWER-Strict Liability holds people responsible even if they haven't been careless/negligent. But because they broke the law or ignored clear signs for specific behavior.
Contributory Negligence - ANSWER-Contributory Negligence considers the plaintiffs conduct as a cause of their own injury, and bars them from any recovery. (Ex. a pedestrian walking when they don't have the right of way, red flashing light, and get hit by a car legally moving through the green light.)
Is damage caused by flood a covered peril under a Home property insurance policy? - ANSWER-No, damage caused by flood is excluded under a property insurance policy's water damage exclusion.
Compensatory Damages - ANSWER-Special and General damages
Policy Reduction Coverage - ANSWER-Policy reduction coverage occurs when a property is vacant for 60 days.
Negligence - ANSWER-Negligence is the failure to use the degree of reasonable care, without intent to injure.
Territory Provision of a casualty policy - ANSWER-Territory Provision of a casualty policy indicates where coverage would apply if a loss occurs.
If an Insurer fails to meet the requirement before an existing policy expires... - ANSWER-the insurer must renew the policy to the same terms, conditions, and premium for an identical policy period.
No Benefit to Bailee - ANSWER-No Benefit to Bailee provision makes it clear that no coverage is provided if it benefits a bailee.
Morale Hazards - ANSWER-Morale Hazards arise from a state of mind, attitude, or indifference to loss.
Abandonment Provision - ANSWER-An Abandonment Provision in property policies specifies that the insured cannot walk away from damaged property and turn it over to the insurer. The insurer ISN'T required to accept any property that an insured has abandoned.
Loss of Income by a business - ANSWER-The loss of income sustained by a business while repairing damage to its facility is an indirect loss resulting from damage.
