NJ PSI PROPERTY AND CASUALTY EXAMS SET 2025/2026
ANSWERS AND QUESTIONS GRADED A+
✔✔Strict Liability - ✔✔Applied in product liability cases when a product is faulty.
✔✔Vicarious Liability - ✔✔Transferring the liability to someone who has greater ability
to pay.
✔✔Application for Insurance - ✔✔Applying for insurance begins with the applicant
(buyer) completing and signing an application ('app'), usually with the producer's
assistance.
✔✔Agent's Report - ✔✔Producers may need to provide an evaluation of the risk to the
insurer.
✔✔Commercial Insurance Information - ✔✔For commercial insurance, additional
information like business operations, growth potential, and safety programs may be
required.
✔✔Loss History Data - ✔✔Applicants must list their past loss (claims) history and
provide a loss report from previous insurers, including claim details and amounts paid.
✔✔Motor Vehicle Records (MVR) - ✔✔A report that provides details about an auto
insurance applicant's driving history, including violations of traffic laws, accidents, and
license suspensions or restrictions.
✔✔Certificate of Insurance - ✔✔Issued by the insurer, it proves that the required
insurance is in place and is often required in construction contracts.
✔✔Deposit Premium - ✔✔Found in commercial and professional liability policies; pay
the estimated premium in full in advance.
✔✔Deposit Premium Audit - ✔✔insurer may audit insured's books and records to
determine if adequate premium was charged
✔✔Declarations - ✔✔First page of the policy that has the Who, What, When, Where,
and How much (Basic underwriting information).
✔✔Definitions Section - ✔✔Words that are in bold and italics are defined in this section.
✔✔Insuring Agreement (clause) - ✔✔Section of the policy that defines the obligations of
the insurance company, describing the coverage and covered perils.
✔✔Conditions - ✔✔Rules and Procedures.
, ✔✔Exclusion - ✔✔Specifies people or perils not covered, eliminates or reduces
overlapping coverage, and removes coverage not needed by a typical insured.
✔✔Endorsements - ✔✔Any changes that are added for an extra premium are found
here.
✔✔Additional Coverage - ✔✔Extra coverage added to the policy without an additional
premium
✔✔Named Insured - ✔✔Anyone listed on the declarations page
✔✔First Named Insured - ✔✔The person whose name is listed first. Has control of the
policy (cancel, renew, pay the premium, file claims)
✔✔Additional Insured - ✔✔Anyone not covered listed on the policy but covered by the
policy
✔✔Mortgage Clause - ✔✔A mortgagee, as the lender, has an insurable interest in the
property used as collateral, ensuring they are protected in case of damage or loss. The
clause ensures the mortgagee is paid for covered losses, continues coverage if the
policy is voided, and provides advance notice of policy cancellation.
✔✔Loss Payable Clause - ✔✔Lenders with a secured interest in property, like autos,
want to be listed as a loss payee on the property owner's policy. This clause ensures
the lender (loss payee) is included in any claim payment, typically by making the claim
check payable to both the insured and the loss payee.
✔✔No Benefits to Bailee - ✔✔This provision in a property insurance policy states that
the insurer will not cover property under the care of a bailee. Inland marine insurance,
specifically bailee coverage, is available to cover property held by a bailee.
✔✔Assignment Provision - ✔✔Insured is not allowed to transfer their policy without the
consent of the insurer
✔✔Cancellation - ✔✔Done during the policy period by either the insured or insurer
✔✔Nonrenewal - ✔✔At the policy expiration rate.
✔✔Policy Territory - ✔✔On the declarations page that details where coverage applies
✔✔Occurrence - ✔✔Continuous or repeated exposure
✔✔Accident - ✔✔Sudden, unplanned, and unexpected event
ANSWERS AND QUESTIONS GRADED A+
✔✔Strict Liability - ✔✔Applied in product liability cases when a product is faulty.
✔✔Vicarious Liability - ✔✔Transferring the liability to someone who has greater ability
to pay.
✔✔Application for Insurance - ✔✔Applying for insurance begins with the applicant
(buyer) completing and signing an application ('app'), usually with the producer's
assistance.
✔✔Agent's Report - ✔✔Producers may need to provide an evaluation of the risk to the
insurer.
✔✔Commercial Insurance Information - ✔✔For commercial insurance, additional
information like business operations, growth potential, and safety programs may be
required.
✔✔Loss History Data - ✔✔Applicants must list their past loss (claims) history and
provide a loss report from previous insurers, including claim details and amounts paid.
✔✔Motor Vehicle Records (MVR) - ✔✔A report that provides details about an auto
insurance applicant's driving history, including violations of traffic laws, accidents, and
license suspensions or restrictions.
✔✔Certificate of Insurance - ✔✔Issued by the insurer, it proves that the required
insurance is in place and is often required in construction contracts.
✔✔Deposit Premium - ✔✔Found in commercial and professional liability policies; pay
the estimated premium in full in advance.
✔✔Deposit Premium Audit - ✔✔insurer may audit insured's books and records to
determine if adequate premium was charged
✔✔Declarations - ✔✔First page of the policy that has the Who, What, When, Where,
and How much (Basic underwriting information).
✔✔Definitions Section - ✔✔Words that are in bold and italics are defined in this section.
✔✔Insuring Agreement (clause) - ✔✔Section of the policy that defines the obligations of
the insurance company, describing the coverage and covered perils.
✔✔Conditions - ✔✔Rules and Procedures.
, ✔✔Exclusion - ✔✔Specifies people or perils not covered, eliminates or reduces
overlapping coverage, and removes coverage not needed by a typical insured.
✔✔Endorsements - ✔✔Any changes that are added for an extra premium are found
here.
✔✔Additional Coverage - ✔✔Extra coverage added to the policy without an additional
premium
✔✔Named Insured - ✔✔Anyone listed on the declarations page
✔✔First Named Insured - ✔✔The person whose name is listed first. Has control of the
policy (cancel, renew, pay the premium, file claims)
✔✔Additional Insured - ✔✔Anyone not covered listed on the policy but covered by the
policy
✔✔Mortgage Clause - ✔✔A mortgagee, as the lender, has an insurable interest in the
property used as collateral, ensuring they are protected in case of damage or loss. The
clause ensures the mortgagee is paid for covered losses, continues coverage if the
policy is voided, and provides advance notice of policy cancellation.
✔✔Loss Payable Clause - ✔✔Lenders with a secured interest in property, like autos,
want to be listed as a loss payee on the property owner's policy. This clause ensures
the lender (loss payee) is included in any claim payment, typically by making the claim
check payable to both the insured and the loss payee.
✔✔No Benefits to Bailee - ✔✔This provision in a property insurance policy states that
the insurer will not cover property under the care of a bailee. Inland marine insurance,
specifically bailee coverage, is available to cover property held by a bailee.
✔✔Assignment Provision - ✔✔Insured is not allowed to transfer their policy without the
consent of the insurer
✔✔Cancellation - ✔✔Done during the policy period by either the insured or insurer
✔✔Nonrenewal - ✔✔At the policy expiration rate.
✔✔Policy Territory - ✔✔On the declarations page that details where coverage applies
✔✔Occurrence - ✔✔Continuous or repeated exposure
✔✔Accident - ✔✔Sudden, unplanned, and unexpected event
