EXAM FX- Simulated Exam
With Verified Solutions
2025/2026
Which of the following policies does NOT contain an automatic reinstatement
provision?
a) Business automobile liability
b) Personal automobile liability with split limits
c) Homeowners
d) General liability written with an aggregate limit - Correct Answers-General
Liability written with an aggregate limit
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?
a) Company A will pay $24,000; Company B will pay $0.
b) Company A will pay $16,000; Company B will pay $8,000.
c) Company A will pay $20,000; Company B will pay $4,000.
d) Company A will pay $12, - Correct Answers-Company A will pay $16,000;
Company B will pay $8,000.
Farm fences (except field and pasture fences) are covered by which farm
coverage form?
a) Coverage A
b) Coverage B
c) Coverage E
d) Coverage G - Correct Answers-Coverage G
What type of coverage does a homeowners policy include that a dwelling policy
does not?
a) Personal property
b) Other structures
c) Broad form
d) Liability - Correct Answers-Liability
Which of the following is NOT one of the 3 requirements for property to be
eligible for FAIR plan coverage?
a) Coverage could not be purchased through the normal insurance market
, b) It must be valued at an amount under the maximum value amount set by
the state
c) It must be located in a specific area defined by the state
d) It must be considered insurable based on reasonable underwriting
standards - Correct Answers-It must be valued at an amount under the
maximum value amount set by the state
Which of the following liability exposures is most likely for a small specialty
clothing retail boutique?
a) Operations liability exposure
b) Product liability exposure
c) Completed operations liability exposure
d) Premises liability exposure - Correct Answers-Premises Liability Exposure
All of the following types of property are covered by a standard builders risk
form EXCEPT
a) Tools 50 feet away from the building.
b) The building itself.
c) Temporary structures.
d) Machinery that will be permanently attached to the building. - Correct
Answers-Tools 50 feet away from the building
If a consumer requests additional information concerning an investigative
consumer report, how long does the insurer or reporting agency have to
comply?
a) 10 days
b) 3 days
c) 5 days
d) 7 days - Correct Answers-5 days
Which of the following would be named on the declarations page of a property
or liability policy?
a) Beneficiaries
b) All insureds
c) Additional insureds
d) First named insured - Correct Answers-First Named insured
When is a hired and nonowned auto liability endorsement available in a
businessowners policy (BOP)?
a) Only if the insured has 4 or more employees.
b) Never
c) Only if the insured does not have commercial auto coverage
d) Only in addition to commercial auto coverage. - Correct Answers-Only if the
insured does not have commercial auto coverage
Which of the following persons may be covered under farm Coverage J?
With Verified Solutions
2025/2026
Which of the following policies does NOT contain an automatic reinstatement
provision?
a) Business automobile liability
b) Personal automobile liability with split limits
c) Homeowners
d) General liability written with an aggregate limit - Correct Answers-General
Liability written with an aggregate limit
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?
a) Company A will pay $24,000; Company B will pay $0.
b) Company A will pay $16,000; Company B will pay $8,000.
c) Company A will pay $20,000; Company B will pay $4,000.
d) Company A will pay $12, - Correct Answers-Company A will pay $16,000;
Company B will pay $8,000.
Farm fences (except field and pasture fences) are covered by which farm
coverage form?
a) Coverage A
b) Coverage B
c) Coverage E
d) Coverage G - Correct Answers-Coverage G
What type of coverage does a homeowners policy include that a dwelling policy
does not?
a) Personal property
b) Other structures
c) Broad form
d) Liability - Correct Answers-Liability
Which of the following is NOT one of the 3 requirements for property to be
eligible for FAIR plan coverage?
a) Coverage could not be purchased through the normal insurance market
, b) It must be valued at an amount under the maximum value amount set by
the state
c) It must be located in a specific area defined by the state
d) It must be considered insurable based on reasonable underwriting
standards - Correct Answers-It must be valued at an amount under the
maximum value amount set by the state
Which of the following liability exposures is most likely for a small specialty
clothing retail boutique?
a) Operations liability exposure
b) Product liability exposure
c) Completed operations liability exposure
d) Premises liability exposure - Correct Answers-Premises Liability Exposure
All of the following types of property are covered by a standard builders risk
form EXCEPT
a) Tools 50 feet away from the building.
b) The building itself.
c) Temporary structures.
d) Machinery that will be permanently attached to the building. - Correct
Answers-Tools 50 feet away from the building
If a consumer requests additional information concerning an investigative
consumer report, how long does the insurer or reporting agency have to
comply?
a) 10 days
b) 3 days
c) 5 days
d) 7 days - Correct Answers-5 days
Which of the following would be named on the declarations page of a property
or liability policy?
a) Beneficiaries
b) All insureds
c) Additional insureds
d) First named insured - Correct Answers-First Named insured
When is a hired and nonowned auto liability endorsement available in a
businessowners policy (BOP)?
a) Only if the insured has 4 or more employees.
b) Never
c) Only if the insured does not have commercial auto coverage
d) Only in addition to commercial auto coverage. - Correct Answers-Only if the
insured does not have commercial auto coverage
Which of the following persons may be covered under farm Coverage J?
