PROPERTY AND CASUALTY
INSURANCE EXAM QUESTIONS AND
ANSWERS PART ONE
Which vccof vccthe vccfollowing vccare vccthe vccauthorities vccthat vccan vccagent vcccan vcchold?
vcc- vccAnswerExpress vccand vccimplied
Which vccof vccthe vccfollowing vccterms vccrefers vccto vccsuch vccdisabilities vccthe vccloss vccof
vcca vcclimb, vcchearing vcc, vccor vcceye vccsight? vcc- vccAnswerPermanent vccpartial
vccdisability
Who vccis vccNOT vccconsidered vccan vccemployee vccin vccan vcccommercial vccgeneral
vccliability vcc(CGL) vccpolicy? vcc- vccAnswerTemporary vccworker
The vccmajor vccportion vccof vccthe vccpremium vccof vccan vccequipment vccbreakdown
vccpolicy vccpays? vcc- vccAnswerFor vccinspections vccand vccexaminations
An vccinsured vccowns vcca vccbuilding vccvalued vccat vcc$400,000. vccTo vcccomply vccwith
vccthe vcc80% vcccoinsurance vccprovision vccof vcchis vccinsurance vccpolicy, vcchow vcc,
vccmuch vccshould vcche vccinsure vccthe vccproperty vccfor? vcc- vccAnswer80% vccof vccthe
vccproperty's vccreplacement vcccost vccor vccmore
Under vccthe vccFair vccCredit vccReporting vccAct, vccif vccthe vccconsumer vccchallenges vccthe
vccaccuracy vccof vccthe vccinformation vcccontained vccin vcchis vccor vccher vccreport, vccthe
vccreporting vccagency vccmust vcc- vccAnswerRespond vccto vccthe vccconsumer's
vcccomplaint.
All vccof vccthe vccfollowing vccare vccfound vccin vccthe vccdeclarations vccsection vccof vcca
vccpolicy vccEXCEPT vccthe vcc- vccAnswerExclusions.
The vcccost vccof vccrestoring vccfarm vccrecords vccis vccan vccadditional vcccoverage vccoffered
vccunder vcca vccfarm vccpolicy. vccHow vccmuch vccwill vccthe vccpolicy vccpay vccto vccrestore
vccthe vccrecords? vcc- vccAnswerUp vccto vcc$2,000
All vccof vccthe vccfollowing vcccould vccbe vccconsidered vccrebates vccif vccoffered vccto vccan
vccinsured vccin vccthe vccsale vccof vccinsurance vccEXCEPT vcc- vccAnswerDividends vccfrom
vcca vccmutual vccinsurer.
,Which vccof vccthe vccfollowing vccmay vccbe vcccovered vccby vccelectronic vccdata
vccprocessing vcccoverage vccform vccunder vccan vccinland vccmarine vccpolicy? vcc-
vccAnswera) vccComputer vcchardware vccthat vccis vccspecifically vccscheduled.
b) vccExtra vccexpense vccthe vccinsured vccincurs vccto vcccontinue vccthe vccbusiness
vccfollowing vcca vccloss.
c) vccData vccprocessing vccmedia, vccincluding vccmagnetic vcctapes vccor vccpaper vcctapes,
vccpunch vcccards vccand vccdiscs
The vccparty vccto vcca vccsurety vccor vccfidelity vccbond vccwho vccpromises vccto vccfulfill vccthe
vccobligation vccis vccthe vcc- vccAnswerPrincipal
The vcctransfer vccof vccmoney vccfrom vccinside vcca vccbanking vccpremises vccto vcca
vccperson vccother vccthan vcca vccmessenger vccoutside vccthose vccpremises vccor vccto vcca
vccplace vccoutside vccthose vccpremises vccis vcccovered vccunder vccwhich vcccommercial
vcccrime vcccoverage? vcc- vccAnswerComputer vccfraud
Which vccof vccthe vccfollowing vccwould vccNOT vccbe vcccovered vccunder vccthe vccliability
vccsection vccof vcca vccpersonal vccauto vccpolicy? vcc- vccAnswerBodily vccinjury vccis
vcccaused vccby vccthe vccinsured's vccnegligence vccwhile vccdriving vcca vccthree-wheel vccall-
terrain vccvehicle.
When vcca vccproducer vccholding vcca vcccertificate vccor vcca vccbroker's vcclicense vcchas vcca
vccchange vccin vcchis/her vccresidence vccor vccbusiness vccaddress, vcche/she vccmust
vccnotify vccthe vccDepartment vccof vccInsurance vccand vccany vcccompany vccfor vccwhich
vccthe vccproducer vccholds vccan vccappointment vccwithin vcc- vccAnswer30 vccdays.
What vccwill vcchappen vccif vcca vcchouse vcccovered vccby vcca vccstandard vccmortgage
vccclause vccis vcca vcctotal vccloss? vcc- vccAnswerThe vccinsurer vccpays vccthe vccmortgagee
vccaccording vccto vccthe vccmortgagee's vccinterest vccin vccthe vccproperty.
What vccis vccthe vcccivil vccpenalty vccfor vccviolating vcca vcccease vccand vccdesist vccorder
vccof vccthe vccCommissioner? vcc- vccAnswer$10,000
The vccBusiness vccPursuits vccendorsement vccunder vccSection vccII vccof vcca
vcchomeowners vccpolicy vccwill vcccover vccall vccof vccthe vccfollowing vccEXCEPT vcc-
vccAnswerBusiness vccliability.
If vcca vccproperty vccis vcccovered vccby vccCompany vccA vccfor vcc$20,000 vccand vccCompany
vccB vcccovers vccthe vccsame vccproperty vccfor vcc$40,000, vcchow vccmuch vccwill vccCompany
vccA vccpay vccon vcca vcc$24,000 vccloss? vcc- vccAnswer$8,000
The vccrisk vccmanagement vcctechnique vccthat vccis vccused vccto vccprevent vcca vccspecific
vccloss vccby vccnot vccexposing vcconeself vccto vccthat vccactivity vccis vcccalled vcc-
vccAnswerAvoidance.
, In vcca vccfarm vccpolicy, vccany vcccost vccincurred vccby vccthe vccinsurer vccfor vccthe
vccinvestigation vccor vccdefense vccof vcca vccclaim vccwill vccbe vccpaid vccby vcc- vccAnswerThe
vccinsurer.
Which vccof vccthe vccfollowing vccentities vccmust vccapprove vccall vcccontinuing vcceducation
vcccourses vccin vccthis vccstate? vcc- vccAnswerThe vccCommissioner
An vccapplicant vccknowingly vccfails vccto vcccommunicate vccinformation vccthat vccwould
vcchelp vccan vccunderwriter vccmake vcca vccsound vccdecision vccregarding vcccoverage.
vccThis vccis vccan vccexample vccof vcc- vccAnswerConcealment
A vcccommon vccexclusion vccfound vccunder vccphysical vccdamage vccto vccyour vccauto
vccincludes vcc- vccAnswerMechanical vccbreakdown.
Which vccof vccthe vccfollowing vccis vcctrue vccregarding vcca vccrisk vccretention vccgroup? vcc-
vccAnswerIt vccis vcca vccliability vccinsurance vcccompany vccowned vccby vccits vccmembers.
Which vccof vccthe vccfollowing vccbest vccdescribes vcca vccmisrepresentation? vcc-
vccAnswerIssuing vccsales vccmaterial vccwith vccexaggerated vccstatements vccabout
vccpolicy vccbenefits
A vccbuilder's vccrisk vccform vccis vccmost vccoften vccwritten vccas vccwhich vccof vccthe
vccfollowing? vcc- vccAnswerCompleted vccvalue vccform
An vccinsured vcchas vcca vccliability vccpolicy vccthat vccsets vccthe vccamount vccfor vccall
vccclaims vccthat vccarise vccfrom vcca vccsingle vccincident vccat vcc$50,000. vccWhich vcctype
vccof vcclimit vccof vccliability vccdoes vccthis vccinsured's vccpolicy vcchave? vcc- vccAnswerPer
vccoccurrence
Which vccof vccthe vccfollowing vccis vccan vccexample vccof vcca vccprotective vccsafeguard vccin
vcca vccbusinessowners vccpolicy? vcc- vccAnswerAutomatic vccsprinkler vccsystem
If vcca vcclicensee vccwants vccto vcctransact vccinsurance vccunder vcca vccdifferent vccname
vccthan vccthat vcclisted vccon vcchis vccor vccher vccproducer's vcclicense, vccwhich vccof vccthe
vccfollowing vccmust vccoccur? vcc- vccAnswerThe vccchange vccmust vccbe vccreported vccto
vccthe vccCommissioner.
If vccmore vccthan vccone vccperson vcchas vccan vccinsurable vccinterest vccin vccthe vccproperty
vcccovered vccunder vcca vccdwelling vccpolicy, vcc- vccAnswerThe vccinsurer vccwill vccbe
vccliable vccfor vcconly vccthe vccinsured's vccinterest vccin vccthe vccdamaged vccproperty.
Bob's vcchome vccis vccinsured vccfor vcc$100,000 vccunder vcca vccdwelling vccpolicy.
vccYesterday vcchis vcchome vccsuffered vcc$20,000 vccdamage vccfrom vcca vccfire. vccToday
vccthe vcchome vccwas vccstruck vccby vcclightning, vccstarting vccanother vccfire vccthat
INSURANCE EXAM QUESTIONS AND
ANSWERS PART ONE
Which vccof vccthe vccfollowing vccare vccthe vccauthorities vccthat vccan vccagent vcccan vcchold?
vcc- vccAnswerExpress vccand vccimplied
Which vccof vccthe vccfollowing vccterms vccrefers vccto vccsuch vccdisabilities vccthe vccloss vccof
vcca vcclimb, vcchearing vcc, vccor vcceye vccsight? vcc- vccAnswerPermanent vccpartial
vccdisability
Who vccis vccNOT vccconsidered vccan vccemployee vccin vccan vcccommercial vccgeneral
vccliability vcc(CGL) vccpolicy? vcc- vccAnswerTemporary vccworker
The vccmajor vccportion vccof vccthe vccpremium vccof vccan vccequipment vccbreakdown
vccpolicy vccpays? vcc- vccAnswerFor vccinspections vccand vccexaminations
An vccinsured vccowns vcca vccbuilding vccvalued vccat vcc$400,000. vccTo vcccomply vccwith
vccthe vcc80% vcccoinsurance vccprovision vccof vcchis vccinsurance vccpolicy, vcchow vcc,
vccmuch vccshould vcche vccinsure vccthe vccproperty vccfor? vcc- vccAnswer80% vccof vccthe
vccproperty's vccreplacement vcccost vccor vccmore
Under vccthe vccFair vccCredit vccReporting vccAct, vccif vccthe vccconsumer vccchallenges vccthe
vccaccuracy vccof vccthe vccinformation vcccontained vccin vcchis vccor vccher vccreport, vccthe
vccreporting vccagency vccmust vcc- vccAnswerRespond vccto vccthe vccconsumer's
vcccomplaint.
All vccof vccthe vccfollowing vccare vccfound vccin vccthe vccdeclarations vccsection vccof vcca
vccpolicy vccEXCEPT vccthe vcc- vccAnswerExclusions.
The vcccost vccof vccrestoring vccfarm vccrecords vccis vccan vccadditional vcccoverage vccoffered
vccunder vcca vccfarm vccpolicy. vccHow vccmuch vccwill vccthe vccpolicy vccpay vccto vccrestore
vccthe vccrecords? vcc- vccAnswerUp vccto vcc$2,000
All vccof vccthe vccfollowing vcccould vccbe vccconsidered vccrebates vccif vccoffered vccto vccan
vccinsured vccin vccthe vccsale vccof vccinsurance vccEXCEPT vcc- vccAnswerDividends vccfrom
vcca vccmutual vccinsurer.
,Which vccof vccthe vccfollowing vccmay vccbe vcccovered vccby vccelectronic vccdata
vccprocessing vcccoverage vccform vccunder vccan vccinland vccmarine vccpolicy? vcc-
vccAnswera) vccComputer vcchardware vccthat vccis vccspecifically vccscheduled.
b) vccExtra vccexpense vccthe vccinsured vccincurs vccto vcccontinue vccthe vccbusiness
vccfollowing vcca vccloss.
c) vccData vccprocessing vccmedia, vccincluding vccmagnetic vcctapes vccor vccpaper vcctapes,
vccpunch vcccards vccand vccdiscs
The vccparty vccto vcca vccsurety vccor vccfidelity vccbond vccwho vccpromises vccto vccfulfill vccthe
vccobligation vccis vccthe vcc- vccAnswerPrincipal
The vcctransfer vccof vccmoney vccfrom vccinside vcca vccbanking vccpremises vccto vcca
vccperson vccother vccthan vcca vccmessenger vccoutside vccthose vccpremises vccor vccto vcca
vccplace vccoutside vccthose vccpremises vccis vcccovered vccunder vccwhich vcccommercial
vcccrime vcccoverage? vcc- vccAnswerComputer vccfraud
Which vccof vccthe vccfollowing vccwould vccNOT vccbe vcccovered vccunder vccthe vccliability
vccsection vccof vcca vccpersonal vccauto vccpolicy? vcc- vccAnswerBodily vccinjury vccis
vcccaused vccby vccthe vccinsured's vccnegligence vccwhile vccdriving vcca vccthree-wheel vccall-
terrain vccvehicle.
When vcca vccproducer vccholding vcca vcccertificate vccor vcca vccbroker's vcclicense vcchas vcca
vccchange vccin vcchis/her vccresidence vccor vccbusiness vccaddress, vcche/she vccmust
vccnotify vccthe vccDepartment vccof vccInsurance vccand vccany vcccompany vccfor vccwhich
vccthe vccproducer vccholds vccan vccappointment vccwithin vcc- vccAnswer30 vccdays.
What vccwill vcchappen vccif vcca vcchouse vcccovered vccby vcca vccstandard vccmortgage
vccclause vccis vcca vcctotal vccloss? vcc- vccAnswerThe vccinsurer vccpays vccthe vccmortgagee
vccaccording vccto vccthe vccmortgagee's vccinterest vccin vccthe vccproperty.
What vccis vccthe vcccivil vccpenalty vccfor vccviolating vcca vcccease vccand vccdesist vccorder
vccof vccthe vccCommissioner? vcc- vccAnswer$10,000
The vccBusiness vccPursuits vccendorsement vccunder vccSection vccII vccof vcca
vcchomeowners vccpolicy vccwill vcccover vccall vccof vccthe vccfollowing vccEXCEPT vcc-
vccAnswerBusiness vccliability.
If vcca vccproperty vccis vcccovered vccby vccCompany vccA vccfor vcc$20,000 vccand vccCompany
vccB vcccovers vccthe vccsame vccproperty vccfor vcc$40,000, vcchow vccmuch vccwill vccCompany
vccA vccpay vccon vcca vcc$24,000 vccloss? vcc- vccAnswer$8,000
The vccrisk vccmanagement vcctechnique vccthat vccis vccused vccto vccprevent vcca vccspecific
vccloss vccby vccnot vccexposing vcconeself vccto vccthat vccactivity vccis vcccalled vcc-
vccAnswerAvoidance.
, In vcca vccfarm vccpolicy, vccany vcccost vccincurred vccby vccthe vccinsurer vccfor vccthe
vccinvestigation vccor vccdefense vccof vcca vccclaim vccwill vccbe vccpaid vccby vcc- vccAnswerThe
vccinsurer.
Which vccof vccthe vccfollowing vccentities vccmust vccapprove vccall vcccontinuing vcceducation
vcccourses vccin vccthis vccstate? vcc- vccAnswerThe vccCommissioner
An vccapplicant vccknowingly vccfails vccto vcccommunicate vccinformation vccthat vccwould
vcchelp vccan vccunderwriter vccmake vcca vccsound vccdecision vccregarding vcccoverage.
vccThis vccis vccan vccexample vccof vcc- vccAnswerConcealment
A vcccommon vccexclusion vccfound vccunder vccphysical vccdamage vccto vccyour vccauto
vccincludes vcc- vccAnswerMechanical vccbreakdown.
Which vccof vccthe vccfollowing vccis vcctrue vccregarding vcca vccrisk vccretention vccgroup? vcc-
vccAnswerIt vccis vcca vccliability vccinsurance vcccompany vccowned vccby vccits vccmembers.
Which vccof vccthe vccfollowing vccbest vccdescribes vcca vccmisrepresentation? vcc-
vccAnswerIssuing vccsales vccmaterial vccwith vccexaggerated vccstatements vccabout
vccpolicy vccbenefits
A vccbuilder's vccrisk vccform vccis vccmost vccoften vccwritten vccas vccwhich vccof vccthe
vccfollowing? vcc- vccAnswerCompleted vccvalue vccform
An vccinsured vcchas vcca vccliability vccpolicy vccthat vccsets vccthe vccamount vccfor vccall
vccclaims vccthat vccarise vccfrom vcca vccsingle vccincident vccat vcc$50,000. vccWhich vcctype
vccof vcclimit vccof vccliability vccdoes vccthis vccinsured's vccpolicy vcchave? vcc- vccAnswerPer
vccoccurrence
Which vccof vccthe vccfollowing vccis vccan vccexample vccof vcca vccprotective vccsafeguard vccin
vcca vccbusinessowners vccpolicy? vcc- vccAnswerAutomatic vccsprinkler vccsystem
If vcca vcclicensee vccwants vccto vcctransact vccinsurance vccunder vcca vccdifferent vccname
vccthan vccthat vcclisted vccon vcchis vccor vccher vccproducer's vcclicense, vccwhich vccof vccthe
vccfollowing vccmust vccoccur? vcc- vccAnswerThe vccchange vccmust vccbe vccreported vccto
vccthe vccCommissioner.
If vccmore vccthan vccone vccperson vcchas vccan vccinsurable vccinterest vccin vccthe vccproperty
vcccovered vccunder vcca vccdwelling vccpolicy, vcc- vccAnswerThe vccinsurer vccwill vccbe
vccliable vccfor vcconly vccthe vccinsured's vccinterest vccin vccthe vccdamaged vccproperty.
Bob's vcchome vccis vccinsured vccfor vcc$100,000 vccunder vcca vccdwelling vccpolicy.
vccYesterday vcchis vcchome vccsuffered vcc$20,000 vccdamage vccfrom vcca vccfire. vccToday
vccthe vcchome vccwas vccstruck vccby vcclightning, vccstarting vccanother vccfire vccthat
