Texas Insurance Practice Exam
questions and answers
Subrogration may follow which of the following events? - ANSWER>>An insured
collects from her insurance company for damages caused by a third party
Medical payments coverage under a BOP applies to expenses incurred by non-
insureds for bodily injury and reported to the insurer within: - ANSWER>>One
year after the accident
Claims expenses covered under Section II - Personal Liability of the standard
Homeowners forms do NOT pay for which of the following? - ANSWER>>Loss of
the insured's earnings subject to a pre-determined limit of $300 per day
Which statement best describes "defense" coverage under the Section II - Liability
coverage of the Businessowners policy? - ANSWER>>Defense costs are not
subject to a limit
Under an aircraft policy what is NOT a covered territory usually covered (unless
endorsed) while the aircraft is in flight? - ANSWER>>Costa Rico
Under a standard Equipment Breakdown policy, the full replacement cost will be
paid on the claim, if the equipment is repaired within what time period following
the loss? - ANSWER>>24 months
When a licensee in Texas receives an inquiry from the Insurance Department
regarding their insurance transactions, he or she must respond in writing: -
ANSWER>>Not later than the 15th day after the date the inquiry is received
, The sprinkler leakage coverage of a Commercial Property form does not provide
coverage for: - ANSWER>>damage to growing crops from malfunctioning
sprinklers
Under the appraisal clause in a commercial inland form, which of the following is
true? - ANSWER>>the insurer still retains its right to deny the claim entirely
All of the following statements are true regarding state Guaranty Associations,
Except: - ANSWER>>The fund assists insurers in gaining new insurance business
by allowing them to advertise their membership in the Guaranty Association.
The Personal Inland Marine coverage form that covers clothing, cameras and
other portable property worn or carried by tourists and travelers is known as a: -
ANSWER>>Personal Effects floater.
Each of the following is a feature of Business Income Coverage, EXCEPT -
ANSWER>>Monetary deductibles. .
The limits of the Employers' Liability section of a standard workers' compensation
policy are: - ANSWER>>Listed on the Information page..
The term "time element coverage" is used when the amount of loss depends on: -
ANSWER>>The time it takes to repair, rebuild or restore damaged property.
Under a personal automobile policy with uninsured motorists coverage, a
disagreement between an insurance company and an insured on the amount of a
loss can be settled by: - ANSWER>>Arbitration
Aaron purchases a Homeowners insurance policy for $700,000 with a 4%
deductible. A few months later, a heavy hailstorm destroys his roof, porch, and
windows, causing $50,000 in damages. How much should Aaron expect to receive
from the insurance company to pay for the damages? - ANSWER>>$22,000
questions and answers
Subrogration may follow which of the following events? - ANSWER>>An insured
collects from her insurance company for damages caused by a third party
Medical payments coverage under a BOP applies to expenses incurred by non-
insureds for bodily injury and reported to the insurer within: - ANSWER>>One
year after the accident
Claims expenses covered under Section II - Personal Liability of the standard
Homeowners forms do NOT pay for which of the following? - ANSWER>>Loss of
the insured's earnings subject to a pre-determined limit of $300 per day
Which statement best describes "defense" coverage under the Section II - Liability
coverage of the Businessowners policy? - ANSWER>>Defense costs are not
subject to a limit
Under an aircraft policy what is NOT a covered territory usually covered (unless
endorsed) while the aircraft is in flight? - ANSWER>>Costa Rico
Under a standard Equipment Breakdown policy, the full replacement cost will be
paid on the claim, if the equipment is repaired within what time period following
the loss? - ANSWER>>24 months
When a licensee in Texas receives an inquiry from the Insurance Department
regarding their insurance transactions, he or she must respond in writing: -
ANSWER>>Not later than the 15th day after the date the inquiry is received
, The sprinkler leakage coverage of a Commercial Property form does not provide
coverage for: - ANSWER>>damage to growing crops from malfunctioning
sprinklers
Under the appraisal clause in a commercial inland form, which of the following is
true? - ANSWER>>the insurer still retains its right to deny the claim entirely
All of the following statements are true regarding state Guaranty Associations,
Except: - ANSWER>>The fund assists insurers in gaining new insurance business
by allowing them to advertise their membership in the Guaranty Association.
The Personal Inland Marine coverage form that covers clothing, cameras and
other portable property worn or carried by tourists and travelers is known as a: -
ANSWER>>Personal Effects floater.
Each of the following is a feature of Business Income Coverage, EXCEPT -
ANSWER>>Monetary deductibles. .
The limits of the Employers' Liability section of a standard workers' compensation
policy are: - ANSWER>>Listed on the Information page..
The term "time element coverage" is used when the amount of loss depends on: -
ANSWER>>The time it takes to repair, rebuild or restore damaged property.
Under a personal automobile policy with uninsured motorists coverage, a
disagreement between an insurance company and an insured on the amount of a
loss can be settled by: - ANSWER>>Arbitration
Aaron purchases a Homeowners insurance policy for $700,000 with a 4%
deductible. A few months later, a heavy hailstorm destroys his roof, porch, and
windows, causing $50,000 in damages. How much should Aaron expect to receive
from the insurance company to pay for the damages? - ANSWER>>$22,000
