PC Exam
In an insurance contract, only the company makes legally enforceable promises, which means the
contract is _______. - Answer-unilateral
Insurance binders are _______. - Answer-interim
An insured construction contractor completes a project. Later a person in the building is injured due to
the careless actions of the contractor. How would a Commercial General Liability policy define this
injury? - Answer-Operations liability
Products liability
Completed Operations liability
What must happen after cancellation of an Auto policy for any reason other than nonpayment of
premium? - Answer-The insurance company must inform the insured of possible eligibility for the
Automobile Assigned Risk Plan.
Which of the following statements is FALSE regarding a Businessowners policy? - Answer-Banks can be
covered
The XYZ Insurance Company decided to cancel Johnny Goof-Up's Auto policy after he didn't pay his
premium. The cancellation will be effective on the 20th day of the month. By what day must the
company mail Johnny his Notice of Cancellation? - Answer-10
An insured is struck by a vehicle while crossing the road to check his mail. Which section of which policy
will pay for his injuries? - Answer-Homeowners Medical Payments
Homeowners Liability
,The insured's Automobile Medical Payments
Who would NOT be covered under an insured's Personal Auto policy? - Answer-A child at college driving
his own car
A relative driving the insured's car
A mechanic test driving the insured's car
Which coverage cannot be added as property coverage to a Homeowners policy through endorsement?
- Answer-animals
What is the maximum amount an Unendorsed Homeowners policy would pay for theft of a firearm? -
Answer-2500
How would a Commercial General Liability policy define an injury suffered by a customer in the business
of the insured? - Answer-Operations liability
Products liability
Premises liability
Which of the following is NOT a common method of settling P&C losses? - Answer-Original purchase
price
Which element is not always found in a valid contract? - Answer-Offer
Counter-offer
Acceptance
An insured with liability limits of 100/300/100 causes an accident hurting a woman and damaging her
car. If there was only one occupant in the other vehicle, what is the maximum amount the insured's
policy will pay for this occurrence? - Answer-400000
, A family that regularly leaves their house unlocked would be considered to be which of the following
hazards? - Answer-Morale hazard
Physical hazard
Premises hazard
Which injury would be excluded in a Commercial General Liability policy? - Answer-An injury caused by
the insured's bulldozer operating offsite
An injury caused by the insured's forklift in his hardware store
An injury caused by the insured's delivery van
Which of the following would NOT be considered a flood under a flood insurance policy? - Answer-
Sewer back-up
Shauna was a licensed Producer in Texas when she moved to Alabama. Which of the following steps is
NOT required for her to obtain an Alabama resident license? - Answer-Pass the Alabama written
examination
An insurance company is within its legal rights to disclose that a claimant is the victim of domestic abuse
to which of the following parties? - Answer-health care
A condition creating or increasing the chance for a loss is a _______. - Answer-Peril
Hazard
Exposure
An insurance agency purchases Commercial General Liability. Which liability would be covered under the
policy? - Answer-Employee Injury Liability
Liquor Liability
In an insurance contract, only the company makes legally enforceable promises, which means the
contract is _______. - Answer-unilateral
Insurance binders are _______. - Answer-interim
An insured construction contractor completes a project. Later a person in the building is injured due to
the careless actions of the contractor. How would a Commercial General Liability policy define this
injury? - Answer-Operations liability
Products liability
Completed Operations liability
What must happen after cancellation of an Auto policy for any reason other than nonpayment of
premium? - Answer-The insurance company must inform the insured of possible eligibility for the
Automobile Assigned Risk Plan.
Which of the following statements is FALSE regarding a Businessowners policy? - Answer-Banks can be
covered
The XYZ Insurance Company decided to cancel Johnny Goof-Up's Auto policy after he didn't pay his
premium. The cancellation will be effective on the 20th day of the month. By what day must the
company mail Johnny his Notice of Cancellation? - Answer-10
An insured is struck by a vehicle while crossing the road to check his mail. Which section of which policy
will pay for his injuries? - Answer-Homeowners Medical Payments
Homeowners Liability
,The insured's Automobile Medical Payments
Who would NOT be covered under an insured's Personal Auto policy? - Answer-A child at college driving
his own car
A relative driving the insured's car
A mechanic test driving the insured's car
Which coverage cannot be added as property coverage to a Homeowners policy through endorsement?
- Answer-animals
What is the maximum amount an Unendorsed Homeowners policy would pay for theft of a firearm? -
Answer-2500
How would a Commercial General Liability policy define an injury suffered by a customer in the business
of the insured? - Answer-Operations liability
Products liability
Premises liability
Which of the following is NOT a common method of settling P&C losses? - Answer-Original purchase
price
Which element is not always found in a valid contract? - Answer-Offer
Counter-offer
Acceptance
An insured with liability limits of 100/300/100 causes an accident hurting a woman and damaging her
car. If there was only one occupant in the other vehicle, what is the maximum amount the insured's
policy will pay for this occurrence? - Answer-400000
, A family that regularly leaves their house unlocked would be considered to be which of the following
hazards? - Answer-Morale hazard
Physical hazard
Premises hazard
Which injury would be excluded in a Commercial General Liability policy? - Answer-An injury caused by
the insured's bulldozer operating offsite
An injury caused by the insured's forklift in his hardware store
An injury caused by the insured's delivery van
Which of the following would NOT be considered a flood under a flood insurance policy? - Answer-
Sewer back-up
Shauna was a licensed Producer in Texas when she moved to Alabama. Which of the following steps is
NOT required for her to obtain an Alabama resident license? - Answer-Pass the Alabama written
examination
An insurance company is within its legal rights to disclose that a claimant is the victim of domestic abuse
to which of the following parties? - Answer-health care
A condition creating or increasing the chance for a loss is a _______. - Answer-Peril
Hazard
Exposure
An insurance agency purchases Commercial General Liability. Which liability would be covered under the
policy? - Answer-Employee Injury Liability
Liquor Liability
