Page 1 of 31
CPCU 552, CP&L FINAL EXAM 2025
GUARANTEED PASS
ABC Plumbing entered into a contract with Bill to install a commercial
grade septic system on his property. The installation of the septic septic
was time sensitive because the rest of Bill's construction project could not
go forward until the septic system was in place. The contract required that
the work be done within 30 days of contract signing, or ABC would have to
pay a penalty of $1,000 per day. Which one of the following categories of
damages does the $1,000 per day penalty specified in the contract fall
into?
Liquidated damages
Many states have funds from which employers may purchase workers
compensation insurance. Such funds may be either
Competitive or monopolistic
Railroad owners commonly require contractors to purchase a Railroad
Protective Liability Coverage Form. Which one of the following statements
about this form is true?
One of the coverage limits applies to physical damage to property owned
by or leased or entrusted to the railroad
Which one of the following statements about the general aggregate limit
under a Commercial General Liability (CGL) Coverage Form is true?
It is reduced by an claims paid for medical payments under Coverage C.
Tom often runs errands for his boss at XYZ Company, using the boss' car.
On one of these errands, Tom is involved in a serious auto accident. He
spends a couple of weeks in the hospital; misses four weeks of work; and
must undergo physical therapy. Does XYZ's Workers Compensation and
Employers Liability Insurance (WC&EL) Policy cover Tom's injuries, lost
income, and rehabilitation expenses?
, Page 2 of 31
Yes, the workers compensation policy would pay all of Tom's expenses,
because his injuries arose out of his employment at XYZ Company.
Aircraft have a significant exposure to catastrophe losses. Of the many
reasons for the catastrophic loss potential of aircraft, the most significant is
The physical properties of aircraft.
A security guard is employed at a pier where shipping containers are
loaded and unloaded from barges. There is also a small marina for
pleasure craft at the pier. The security guard trips over equipment left on a
dock alongside a pleasure craft and is injured. The pier only has insurance
coverage that provides benefits under the Longshore and Harbor Workers
Compensation Act (LHWCA). Is the guard's injury covered under LHWCA?
The injury is covered by LHWCA because the guard is not covered under a
state's workers compensation law.
Section II—Who Is an Insured identifies the persons and organizations that
qualify as insureds under the Commercial General Liability (CGL)
Coverage Form. Which one of the following statements regarding who is
considered an insured is most accurate?
When a CGL policy covers one or more individuals as named insureds, any
person or organization having proper temporary custody of the named
insured's property following the named insured's death is an insured.
What is the name given to a claim by an employee who says that he or she
was fired because of the filing of a workers compensation claim?
Retaliation claim
Javier's business auto policy contains a personal injury protection (PIP)
endorsement. He is involved in an auto accident in the covered auto,
resulting in $30,000 in property damage, $5,000 in third-party bodily injury,
and $10,000 in personal medical expenses. If Javier's business auto policy
has a general aggregate limit of $100,000 and a PIP limit of $15,000 and
he is at fault for the accident, how much will his insurer pay under the PIP
coverage
, Page 3 of 31
PIP provides first-party benefits for medical expenses, loss of income, loss
of services, and funeral expenses resulting from bodily injury to occupants
of a covered auto because of an auto accident. It pays regardless of which
party was at fault in the accident. Therefore, Javier's insurer will pay him
$10,000 in medical expenses from the PIP coverage. The other damages
will be payable under different coverages available on his policy.
Which one of the following statements about coverage triggers in cyber risk
insurance policies is most accurate?
Both claims-made coverage triggers and occurrence coverage triggers are
available, but occurrence coverage triggers are more appropriate for some
insuring agreements than for others
According to the Terrorism Risk Insurance Act (TRIA), one of the two
required conditions that an insurer must meet at the time of an initial offer,
purchase, and renewal of insurance is the disclosure of the premium for
terrorism coverage. What is the other condition
A make-available provision
Acme Insurance cannot agree with insured Jill Jenkins on the amount of a
covered physical damage loss under Jill's Business Auto Coverage Form.
Jill requested an appraisal. Acme and Jill each appoint an appraiser, and
the appraisers appoint an umpire. An award in writing signed by any two of
the three binds both Acme and Jill. One appraiser and the umpire ruled for
Jill and against Acme. Which one of the following statements is true
regarding this scenario?
Jill and Acme will share the cost of the umpire.
Matthew Jones, the named insured under an unendorsed Business Auto
Coverage Form (BACF), requires his employees to use their own cars for
business purposes. One of Matthew's employees, Paul, causes an
accident while driving his own truck for the business. Matthew's BACF
shows symbol 1 for liability coverage. Which one of the following correctly
indicates whether Paul is an insured under the policy for the accident?
Paul is not covered because employees are not insured while using their
own autos in the named insured's business.
, Page 4 of 31
ABC Corporation is insured under a standard unendorsed workers
compensation policy for only the state of Florida. Three months before the
present policy began, ABC opened a sales office in Georgia due to
business volume growing in that state. ABC failed to report the new
location and new state at policy inception. The manager of the Georgia
office fell and was injured and missed work for three weeks after the
inception of the ABC policy. The manager made claim for Georgia benefits.
Which one of the following is true regarding ABC's coverage for Georgia
benefits?
Coverage for this claim would not be covered by ABC's insurance.
The claims-made trigger in a site specific environmental impairment liability
policy differs in three ways from the trigger in other claims-made liability
policies. Which one of the following best describes one of those three
ways?
A site-specific environmental impairment liability policy typically does not
have a retroactive date.
The Grey Corporation has a Commercial General Liability Coverage Form
with the following limits:
Each Occurrence $1,000,000
Damage to rented premises $100,000 each occurrence
Medical expense $5,000 any one person
Personal and advertising injury $1,000,000 any one person or organization
General aggregate limit $2,000,000
Product/completed operations aggregate limit $2,000,000
Assuming the policy is written on an occurrence basis, how much of the
general aggregate limit, if any, remains if the following claims have been
paid under the policy?
a premises/operations liability claim of $600,000
a products liability claim of $1,200,000
$3,000 of medical expenses to a customer injured on the premises.
a personal and advertising injury liability claim of $300,000
The general aggregate is reduced by any amounts paid under Coverages
A, B, and C, except for those that arise out of products/completed
operations. Therefore, the general aggregate limit is reduced by $600,000
CPCU 552, CP&L FINAL EXAM 2025
GUARANTEED PASS
ABC Plumbing entered into a contract with Bill to install a commercial
grade septic system on his property. The installation of the septic septic
was time sensitive because the rest of Bill's construction project could not
go forward until the septic system was in place. The contract required that
the work be done within 30 days of contract signing, or ABC would have to
pay a penalty of $1,000 per day. Which one of the following categories of
damages does the $1,000 per day penalty specified in the contract fall
into?
Liquidated damages
Many states have funds from which employers may purchase workers
compensation insurance. Such funds may be either
Competitive or monopolistic
Railroad owners commonly require contractors to purchase a Railroad
Protective Liability Coverage Form. Which one of the following statements
about this form is true?
One of the coverage limits applies to physical damage to property owned
by or leased or entrusted to the railroad
Which one of the following statements about the general aggregate limit
under a Commercial General Liability (CGL) Coverage Form is true?
It is reduced by an claims paid for medical payments under Coverage C.
Tom often runs errands for his boss at XYZ Company, using the boss' car.
On one of these errands, Tom is involved in a serious auto accident. He
spends a couple of weeks in the hospital; misses four weeks of work; and
must undergo physical therapy. Does XYZ's Workers Compensation and
Employers Liability Insurance (WC&EL) Policy cover Tom's injuries, lost
income, and rehabilitation expenses?
, Page 2 of 31
Yes, the workers compensation policy would pay all of Tom's expenses,
because his injuries arose out of his employment at XYZ Company.
Aircraft have a significant exposure to catastrophe losses. Of the many
reasons for the catastrophic loss potential of aircraft, the most significant is
The physical properties of aircraft.
A security guard is employed at a pier where shipping containers are
loaded and unloaded from barges. There is also a small marina for
pleasure craft at the pier. The security guard trips over equipment left on a
dock alongside a pleasure craft and is injured. The pier only has insurance
coverage that provides benefits under the Longshore and Harbor Workers
Compensation Act (LHWCA). Is the guard's injury covered under LHWCA?
The injury is covered by LHWCA because the guard is not covered under a
state's workers compensation law.
Section II—Who Is an Insured identifies the persons and organizations that
qualify as insureds under the Commercial General Liability (CGL)
Coverage Form. Which one of the following statements regarding who is
considered an insured is most accurate?
When a CGL policy covers one or more individuals as named insureds, any
person or organization having proper temporary custody of the named
insured's property following the named insured's death is an insured.
What is the name given to a claim by an employee who says that he or she
was fired because of the filing of a workers compensation claim?
Retaliation claim
Javier's business auto policy contains a personal injury protection (PIP)
endorsement. He is involved in an auto accident in the covered auto,
resulting in $30,000 in property damage, $5,000 in third-party bodily injury,
and $10,000 in personal medical expenses. If Javier's business auto policy
has a general aggregate limit of $100,000 and a PIP limit of $15,000 and
he is at fault for the accident, how much will his insurer pay under the PIP
coverage
, Page 3 of 31
PIP provides first-party benefits for medical expenses, loss of income, loss
of services, and funeral expenses resulting from bodily injury to occupants
of a covered auto because of an auto accident. It pays regardless of which
party was at fault in the accident. Therefore, Javier's insurer will pay him
$10,000 in medical expenses from the PIP coverage. The other damages
will be payable under different coverages available on his policy.
Which one of the following statements about coverage triggers in cyber risk
insurance policies is most accurate?
Both claims-made coverage triggers and occurrence coverage triggers are
available, but occurrence coverage triggers are more appropriate for some
insuring agreements than for others
According to the Terrorism Risk Insurance Act (TRIA), one of the two
required conditions that an insurer must meet at the time of an initial offer,
purchase, and renewal of insurance is the disclosure of the premium for
terrorism coverage. What is the other condition
A make-available provision
Acme Insurance cannot agree with insured Jill Jenkins on the amount of a
covered physical damage loss under Jill's Business Auto Coverage Form.
Jill requested an appraisal. Acme and Jill each appoint an appraiser, and
the appraisers appoint an umpire. An award in writing signed by any two of
the three binds both Acme and Jill. One appraiser and the umpire ruled for
Jill and against Acme. Which one of the following statements is true
regarding this scenario?
Jill and Acme will share the cost of the umpire.
Matthew Jones, the named insured under an unendorsed Business Auto
Coverage Form (BACF), requires his employees to use their own cars for
business purposes. One of Matthew's employees, Paul, causes an
accident while driving his own truck for the business. Matthew's BACF
shows symbol 1 for liability coverage. Which one of the following correctly
indicates whether Paul is an insured under the policy for the accident?
Paul is not covered because employees are not insured while using their
own autos in the named insured's business.
, Page 4 of 31
ABC Corporation is insured under a standard unendorsed workers
compensation policy for only the state of Florida. Three months before the
present policy began, ABC opened a sales office in Georgia due to
business volume growing in that state. ABC failed to report the new
location and new state at policy inception. The manager of the Georgia
office fell and was injured and missed work for three weeks after the
inception of the ABC policy. The manager made claim for Georgia benefits.
Which one of the following is true regarding ABC's coverage for Georgia
benefits?
Coverage for this claim would not be covered by ABC's insurance.
The claims-made trigger in a site specific environmental impairment liability
policy differs in three ways from the trigger in other claims-made liability
policies. Which one of the following best describes one of those three
ways?
A site-specific environmental impairment liability policy typically does not
have a retroactive date.
The Grey Corporation has a Commercial General Liability Coverage Form
with the following limits:
Each Occurrence $1,000,000
Damage to rented premises $100,000 each occurrence
Medical expense $5,000 any one person
Personal and advertising injury $1,000,000 any one person or organization
General aggregate limit $2,000,000
Product/completed operations aggregate limit $2,000,000
Assuming the policy is written on an occurrence basis, how much of the
general aggregate limit, if any, remains if the following claims have been
paid under the policy?
a premises/operations liability claim of $600,000
a products liability claim of $1,200,000
$3,000 of medical expenses to a customer injured on the premises.
a personal and advertising injury liability claim of $300,000
The general aggregate is reduced by any amounts paid under Coverages
A, B, and C, except for those that arise out of products/completed
operations. Therefore, the general aggregate limit is reduced by $600,000
