NEW CEFM Practice Test – CEFM Practice Pass with Confidence
Using Verified Answers! (100% Correct Answers Graded A+)
In forming an insurance contract, when does acceptance usually occur?
A: When an insurer delivers the policy
B: When an insurer receives an application
C: When an insured submits an application
D: What an insurer approves a prepaid application - When an insurer approves a prepaid application
What is the purpose of the government crime coverage form?
A: To protect the federal government from employee dishonesty
B: To provide those who do qualify for crime coverage in the normal market with extra crime
insurance
C: To protect state government buildings from vandalism
D: To provide crime coverage to those who do not qualify in the normal market - To provide crime
coverage to those who do not qualify in the normal market
A farmer is remodeling his 100-year-old farmhouse. He is in the process of painting the porch and
hanging shutters. He keeps his ladder, paint and other materials used to remodel his home under the
porch. Which of the following provides coverage for his remodeling materials?
A: Coverage B
B: Coverage C
C: Coverage D
D: Coverage A - Coverage A
Which of the following statements concerning the builders risk coverage form is correct
A: It may be written on a reporting form or the completed value of the structure
B: It usually continues in effect for 1 year after completion of the structure
C: It covers the interest of the builder only, and cannot include coverage for the owner.
, D: It may not be written for perils other than fire and extended coverage - It may be written on a
reporting from or the completed value of the structure
Following a property loss that is covered under a Businessowners policy, if the insurer and insured
cannot agree on the amount of the loss, what method is used to resolve the issue?
A: No-fault procedure
B: Appraisal
C: Arbitration
D: Abjudication - Appraisal
A business hosted an annual holiday party for employees and customers, after which a customer
who had too much to drink was involved in an automobile accident. Occupants of the other car
involved in the accident sued the business for serving the customer too much alcohol. Will the
businessowners policy provide coverage?
A: Yes, none of the exclusions will apply
B: Yes, employer liability obligates the company to pay
C: No, accidents outside the company premises are not covered
D: No, liquor liability is exluded - Yes none of the exclusions will APPLY
A business owner whose inventory changes significantly throughout the year should consider having
enough written on what type of form?
A: Fluctuating inventory form
B: Blanket form
C: Comprehensive form
D: Reporting form - Reporting form
The ABC corporation has $100,000 of coverage on its building through insurance company A, and
$50,000 of identical coverage on the same building through insurance Company B. Assuming
coinsurance is not an issue, when a $24,000 loss occurs and the pro rata method is used, how much
will each insurer pay?
Using Verified Answers! (100% Correct Answers Graded A+)
In forming an insurance contract, when does acceptance usually occur?
A: When an insurer delivers the policy
B: When an insurer receives an application
C: When an insured submits an application
D: What an insurer approves a prepaid application - When an insurer approves a prepaid application
What is the purpose of the government crime coverage form?
A: To protect the federal government from employee dishonesty
B: To provide those who do qualify for crime coverage in the normal market with extra crime
insurance
C: To protect state government buildings from vandalism
D: To provide crime coverage to those who do not qualify in the normal market - To provide crime
coverage to those who do not qualify in the normal market
A farmer is remodeling his 100-year-old farmhouse. He is in the process of painting the porch and
hanging shutters. He keeps his ladder, paint and other materials used to remodel his home under the
porch. Which of the following provides coverage for his remodeling materials?
A: Coverage B
B: Coverage C
C: Coverage D
D: Coverage A - Coverage A
Which of the following statements concerning the builders risk coverage form is correct
A: It may be written on a reporting form or the completed value of the structure
B: It usually continues in effect for 1 year after completion of the structure
C: It covers the interest of the builder only, and cannot include coverage for the owner.
, D: It may not be written for perils other than fire and extended coverage - It may be written on a
reporting from or the completed value of the structure
Following a property loss that is covered under a Businessowners policy, if the insurer and insured
cannot agree on the amount of the loss, what method is used to resolve the issue?
A: No-fault procedure
B: Appraisal
C: Arbitration
D: Abjudication - Appraisal
A business hosted an annual holiday party for employees and customers, after which a customer
who had too much to drink was involved in an automobile accident. Occupants of the other car
involved in the accident sued the business for serving the customer too much alcohol. Will the
businessowners policy provide coverage?
A: Yes, none of the exclusions will apply
B: Yes, employer liability obligates the company to pay
C: No, accidents outside the company premises are not covered
D: No, liquor liability is exluded - Yes none of the exclusions will APPLY
A business owner whose inventory changes significantly throughout the year should consider having
enough written on what type of form?
A: Fluctuating inventory form
B: Blanket form
C: Comprehensive form
D: Reporting form - Reporting form
The ABC corporation has $100,000 of coverage on its building through insurance company A, and
$50,000 of identical coverage on the same building through insurance Company B. Assuming
coinsurance is not an issue, when a $24,000 loss occurs and the pro rata method is used, how much
will each insurer pay?
