CA Adjusters License PSI Exam Questions
With Correct Answers
Other |structures |are |excluded |from |coverage |under |the |HO-3 |when |they |are:
Smaller |than |100 |square |feet |or |larger |than |1,000 |square |feet |
Smaller |than |100 |square |feet |or |larger |than |500 |square |feet |
Used |for |storage |purposes |
Used |for |business |purposes |- |CORRECT |ANSWER✔✔-Used |for |business |purposes |is |correct.
EXPLANATION:
When |the |other |structures |are |used |for |business |purposes |they |are |not |covered |under |the |
homeowner |form. |This |structure |and |its |contents |could |be |covered |under |a |commercial |
property |policy. |An |exception |would |be |a |detached |structure |used |to |store |business |property |
of |a |non-flammable, |non-gaseous |nature.
An |insurance |company |must |give |how |many |days |notice |of |cancellation |for |a |vacancy |of |more |
than |60 |days, |when |the |government |has |ordered |demolition, |or |when |fixed |items |are |being |
removed |and |not |replaced?
5|
21 |
10 |
30 |- |CORRECT |ANSWER✔✔-5 |is |correct.
EXPLANATION:
The |cancellation |changes |endorsement |is |the |"mandatory |endorsement" |referred |to |in |the |
question. |In |California, |the |endorsement |must |be |included |in |every |commercial |property |
,policy. |It |allows |cancellation |by |the |insurer |with |5 |days' |notice |for |several |reasons: |vacancy |or |
unoccupancy |for |60 |or |more |days; |damages |from |a |prior |covered |loss |haven't |been |started; |
the |government |has |ordered |demolition |or |to |vacate; |fixed |items |are |being |removed |and |not |
replaced; |and, |utilities |are |shut |off |for |30 |or |more |days, |or |property |taxes |are |more |than |one |
year |past |due.
Upon |request |made |by |the |consumer, |a |person |who |procures |an |investigative |consumer |
report |on |the |consumer |must |make |a |complete |and |accurate |disclosure |to |the |consumer |of |
the |nature |of |the |report |and |investigation |within:
In |writing |and |mailed |to |the |consumer |within |30 |days |of |the |request. |
In |writing |and |mailed |to |the |consumer |within |15 |days |of |the |request. |
In |writing |and |mailed |to |the |consumer |within |10 |days |of |the |request. |
In |writing |and |mailed |to |the |consumer |within |5 |days |of |the |request. |- |CORRECT |ANSWER✔✔-
In |writing |and |mailed |to |the |consumer |within |5 |days |of |the |request..
EXPLANATION:
This |disclosure |must |be |made |in |writing |and |mailed |or |otherwise |delivered |to |the |consumer |
no |later |than |five |days |after |the |date |on |which |the |request |for |the |disclosure |was |received |
from |the |consumer.
The |insured |has |primary |bodily |injury |and |property |damage |liability |coverage |with |a |$100,000 |
limit, |and |a |$1 |million |umbrella |liability |policy |with |a |$5,000 |self-insured |retention |limit. |In |
which |one |of |the |following |situations |would |the |insured's |umbrella |liability |policy |typically |not
|provide |defense |coverage?
Answer |Choices: |Select |the |Correct |Answer
Five |people |sued |the |insured |for |property |damage |arising |out |of |one |occurrence. |One |of |the |
cases |was |settled |out |of |court |for |$100,000. |
The |insured |was |sued |for |$150,000 |in |personal |injury |damages. |
The |insured |was |sued |for |$10,000 |in |bodily |injury |damages. |
,The |umbrella |liability |policy |would |provide |a |defense |in |all |three |cases. |- |CORRECT |
ANSWER✔✔-The |correct |answer |is: |The |insured |was |sued |for |$10,000 |in |bodily |injury |
damages. |
EXPLANATION:
The |claim |would |fall |under |the |underlying |coverage |and |not |the |umbrella |because |the |
underlying |coverage |has |sufficient |limits |in |place.
Question |5 |of |100
The |BAP |liability |exclusion |pertaining |to |pollution |removes |coverage |for |each |of |the |following, |
except:
Answer |Choices: |Select |the |Correct |Answer
The |cost |of |governmentally |ordered |clean-up |of |pollutants. |
The |escape |of |pollutants |while |being |transported |by |a |covered |auto. |
The |escape |of |pollutants |caused |by |damage |to |the |property |containing |them |when |the |
damage |results |from |the |use |of |a |covered |auto. |
The |escape |of |pollutants |before |they |are |accepted |by |the |insured |for |movement |onto |a |
covered |auto. |- |CORRECT |ANSWER✔✔-The |escape |of |pollutants |caused |by |damage |to |the |
property |containing |them |when |the |damage |results |from |the |use |of |a |covered |auto. |is |correct.
EXPLANATION:
If |the |insured's |vehicle |causes |an |accident |with |another |vehicle |or |other |property |(owned |by |a
|third |party) |containing |the |pollutants, |the |loss |is |covered.
Which |of |the |following |would |not |be |covered |under |the |specified |cause |of |loss |physical |
damage |coverage |under |the |commercial |auto |form?
Glass |breakage |
Fire |
, Lightning |
Flood |- |CORRECT |ANSWER✔✔-The |correct |answer |is: |Glass |breakage.
EXPLANATION:
The |specified |cause |of |loss |form |covers |the |following |perils: |fire, |lighting, |explosion, |theft, |
windstorm, |hail, |earthquake, |flood, |vandalism |or |mischief, |transportation |by |a |conveyance. |
The |coverage |does |not |include |glass |breakage, |hitting |a |bird |or |animal |nor |falling |objects |or |
missiles.
All |of |the |following |events |are |considered |acts |of |terrorism, |EXCEPT:
Acts |of |riot |and |civil |commotion. |
Acts |considered |dangerous |to |human |life, |property |or |infrastructure. |
Acts |resulting |in |damage |within |or |outside |the |United |States. |
Acts |at |the |premises |of |any |United |States |mission. |- |CORRECT |ANSWER✔✔-The |correct |
answer |is: |Acts |of |riot |and |civil |commotion. |.
EXPLANATION:
Acts |of |riot |and |civil |commotion |are |not |covered |by |the |Act. |These |are |perils |that |are |covered |
by |property |insurance |policies.
A |company |or |staff |adjuster |represents |the |interests |of:
The |insurer. |
The |insured. |
The |claimant. |
The |public. |- |CORRECT |ANSWER✔✔-The |insurer. |is |correct.
EXPLANATION:
Company |or |staff |adjusters |are |individuals |employed |by |a |property |and |casualty |insurance |
company |to |settle |on |its |behalf |claims |brought |by |insureds. |They |work |directly |for |the |
With Correct Answers
Other |structures |are |excluded |from |coverage |under |the |HO-3 |when |they |are:
Smaller |than |100 |square |feet |or |larger |than |1,000 |square |feet |
Smaller |than |100 |square |feet |or |larger |than |500 |square |feet |
Used |for |storage |purposes |
Used |for |business |purposes |- |CORRECT |ANSWER✔✔-Used |for |business |purposes |is |correct.
EXPLANATION:
When |the |other |structures |are |used |for |business |purposes |they |are |not |covered |under |the |
homeowner |form. |This |structure |and |its |contents |could |be |covered |under |a |commercial |
property |policy. |An |exception |would |be |a |detached |structure |used |to |store |business |property |
of |a |non-flammable, |non-gaseous |nature.
An |insurance |company |must |give |how |many |days |notice |of |cancellation |for |a |vacancy |of |more |
than |60 |days, |when |the |government |has |ordered |demolition, |or |when |fixed |items |are |being |
removed |and |not |replaced?
5|
21 |
10 |
30 |- |CORRECT |ANSWER✔✔-5 |is |correct.
EXPLANATION:
The |cancellation |changes |endorsement |is |the |"mandatory |endorsement" |referred |to |in |the |
question. |In |California, |the |endorsement |must |be |included |in |every |commercial |property |
,policy. |It |allows |cancellation |by |the |insurer |with |5 |days' |notice |for |several |reasons: |vacancy |or |
unoccupancy |for |60 |or |more |days; |damages |from |a |prior |covered |loss |haven't |been |started; |
the |government |has |ordered |demolition |or |to |vacate; |fixed |items |are |being |removed |and |not |
replaced; |and, |utilities |are |shut |off |for |30 |or |more |days, |or |property |taxes |are |more |than |one |
year |past |due.
Upon |request |made |by |the |consumer, |a |person |who |procures |an |investigative |consumer |
report |on |the |consumer |must |make |a |complete |and |accurate |disclosure |to |the |consumer |of |
the |nature |of |the |report |and |investigation |within:
In |writing |and |mailed |to |the |consumer |within |30 |days |of |the |request. |
In |writing |and |mailed |to |the |consumer |within |15 |days |of |the |request. |
In |writing |and |mailed |to |the |consumer |within |10 |days |of |the |request. |
In |writing |and |mailed |to |the |consumer |within |5 |days |of |the |request. |- |CORRECT |ANSWER✔✔-
In |writing |and |mailed |to |the |consumer |within |5 |days |of |the |request..
EXPLANATION:
This |disclosure |must |be |made |in |writing |and |mailed |or |otherwise |delivered |to |the |consumer |
no |later |than |five |days |after |the |date |on |which |the |request |for |the |disclosure |was |received |
from |the |consumer.
The |insured |has |primary |bodily |injury |and |property |damage |liability |coverage |with |a |$100,000 |
limit, |and |a |$1 |million |umbrella |liability |policy |with |a |$5,000 |self-insured |retention |limit. |In |
which |one |of |the |following |situations |would |the |insured's |umbrella |liability |policy |typically |not
|provide |defense |coverage?
Answer |Choices: |Select |the |Correct |Answer
Five |people |sued |the |insured |for |property |damage |arising |out |of |one |occurrence. |One |of |the |
cases |was |settled |out |of |court |for |$100,000. |
The |insured |was |sued |for |$150,000 |in |personal |injury |damages. |
The |insured |was |sued |for |$10,000 |in |bodily |injury |damages. |
,The |umbrella |liability |policy |would |provide |a |defense |in |all |three |cases. |- |CORRECT |
ANSWER✔✔-The |correct |answer |is: |The |insured |was |sued |for |$10,000 |in |bodily |injury |
damages. |
EXPLANATION:
The |claim |would |fall |under |the |underlying |coverage |and |not |the |umbrella |because |the |
underlying |coverage |has |sufficient |limits |in |place.
Question |5 |of |100
The |BAP |liability |exclusion |pertaining |to |pollution |removes |coverage |for |each |of |the |following, |
except:
Answer |Choices: |Select |the |Correct |Answer
The |cost |of |governmentally |ordered |clean-up |of |pollutants. |
The |escape |of |pollutants |while |being |transported |by |a |covered |auto. |
The |escape |of |pollutants |caused |by |damage |to |the |property |containing |them |when |the |
damage |results |from |the |use |of |a |covered |auto. |
The |escape |of |pollutants |before |they |are |accepted |by |the |insured |for |movement |onto |a |
covered |auto. |- |CORRECT |ANSWER✔✔-The |escape |of |pollutants |caused |by |damage |to |the |
property |containing |them |when |the |damage |results |from |the |use |of |a |covered |auto. |is |correct.
EXPLANATION:
If |the |insured's |vehicle |causes |an |accident |with |another |vehicle |or |other |property |(owned |by |a
|third |party) |containing |the |pollutants, |the |loss |is |covered.
Which |of |the |following |would |not |be |covered |under |the |specified |cause |of |loss |physical |
damage |coverage |under |the |commercial |auto |form?
Glass |breakage |
Fire |
, Lightning |
Flood |- |CORRECT |ANSWER✔✔-The |correct |answer |is: |Glass |breakage.
EXPLANATION:
The |specified |cause |of |loss |form |covers |the |following |perils: |fire, |lighting, |explosion, |theft, |
windstorm, |hail, |earthquake, |flood, |vandalism |or |mischief, |transportation |by |a |conveyance. |
The |coverage |does |not |include |glass |breakage, |hitting |a |bird |or |animal |nor |falling |objects |or |
missiles.
All |of |the |following |events |are |considered |acts |of |terrorism, |EXCEPT:
Acts |of |riot |and |civil |commotion. |
Acts |considered |dangerous |to |human |life, |property |or |infrastructure. |
Acts |resulting |in |damage |within |or |outside |the |United |States. |
Acts |at |the |premises |of |any |United |States |mission. |- |CORRECT |ANSWER✔✔-The |correct |
answer |is: |Acts |of |riot |and |civil |commotion. |.
EXPLANATION:
Acts |of |riot |and |civil |commotion |are |not |covered |by |the |Act. |These |are |perils |that |are |covered |
by |property |insurance |policies.
A |company |or |staff |adjuster |represents |the |interests |of:
The |insurer. |
The |insured. |
The |claimant. |
The |public. |- |CORRECT |ANSWER✔✔-The |insurer. |is |correct.
EXPLANATION:
Company |or |staff |adjusters |are |individuals |employed |by |a |property |and |casualty |insurance |
company |to |settle |on |its |behalf |claims |brought |by |insureds. |They |work |directly |for |the |
