NY Independent General Adjuster Exam – GRADED A – New York Department of Financial Services (DFS) Independent Adjuster – 202 6 /20 27 Edition – Verified Questions and Answers

NY Independent General Adjuster Exam – GRADED A – New York Department of Financial Services (DFS) Independent Adjuster – 202 6 /20 27 Edition – Verified Questions and Answers What does a misrepresentation involve that could void a policy? information that may change the insurer's interest in issuing the policy if known at the time of the application All of the following are Unfair Claims Settlement Practices EXCEPT 1. misrepresentation of policy provisions. 2. failure to acknowledge pertinent communications. 3. failure to respond to a first notice of loss within 24 hours. 4. denial of claim without a reasonable investigation. failure to respond to a first notice of loss within 24 hours. Which of the following characteristics of an insurance contract expresses the principle that the policyholder is returned to the approximate financial condition as before the loss? Indemnity Compensatory damages are awarded For actual loss suffered An insured with split liability limits of $400/500/400 is at fault in an automobile accident and the other vehicle sustains $15000 in property damages, as well as two passengers have bodily injury and are claiming $81500 each. What is the MOST insurance will pay to each occupant? $400,000 Who does a public adjuster represent? 1. an adjustment bureau 2. the government 3. the insured 4. the insurer the insured Which of the following is a duty of the insured after a loss? 1. assigning risk to future loss 2. investigating cause of loss 3. minimizing further loss 4. appraising value of loss minimizing further loss What is the insurance adjuster's first step in an investigation? 1. determine if a loss occurred 2. determine the amount covered 3. determine if the type of loss is covered in the contract 4. determine if the loss occurred during the coverage period determine if a loss occurred What allows insurance agents to issue payment on behalf of their company? draft authority What is typically the first option available for the insured who disagrees with a loss settlement amount? 1. appeal 2. lawsuit 3. arbitration 4. grievance claim arbitration Which party is required to provide proof of loss to establish entitlement? 1. the insurer 2. the insured 3. selling agent 4. law enforcement the insured Jane takes her vehicle to the local garage to have new brakes installed. After completing the job, the mechanic takes the car out for a test drive. The mechanic runs a red light and hits another vehicle. The damage to Jane's car would be covered PRIMARILY by the repair shop's Garagekeepers Liability Policy. During the first 60 days an automobile policy is in force, when may an insurer cancel the policy? by a statement of the specific reason Which of the following is how defense costs are paid in relation to the limit of insurance under the personal auto policy for bodily injury and property damage part A-liability coverage? in excess of the limit All of the following are TRUE regarding a nonowned auto EXCEPT bodily Injury to an insured's nonresident family member or relative. The insured has a commercial auto policy with a drive other car broadened coverage liability for named individuals (DOC) endorsement. In which of the following would the named individual be covered? driving neighbor's auto All of the following are TRUE regarding torts EXCEPT 1. a tort is always unintentional. 2. another term for tort is negligence. 3. torts involve private relationships. 4. a tort is a civil wrong that violates the rights of another. a tort is always unintentional. Which of the following is considered temporary substitute auto for physical damage? 1. a covered auto 2. a nonowned auto 3. an undefined risk 4. a noninsured auto a nonowned auto All of the following are common exclusions in a liability policy EXCEPT damage caused by acts of civil disobedience and riots. An annuitant is paying into an annuity. The annuity contract is in the annuitization period. The insured causes an accident in which three persons are injured. One person claims $50,000, the second claims $100,000, and the third claims $250,000. The insured has a combined single limit of $250,000 liability on his automobile policy. What is the sum total the policy will pay? $250,000 Which of the following causes of loss to a vehicle will trigger collision coverage on the personal auto policy Part D- coverage for damage to your auto? 1. Contact with an animal 2. Explosion or earthquake 3. Missiles or falling objects 4. Vehicle upset Vehicle upset When an individual with a pre-existing condition is in an automobile accident and the insurance covers rehabilitation only to the level of the condition prior to the accident, this is because of which of the following principles? indemnity All of the following are excluded losses under Part D-damage to an auto of the personal auto policy EXCEPT to caps, covers, or bedliners on pickup trucks. Which of the following is one of the objectives of the Terrorism Risk Insurance Act of 2002? It limits the exposure of individual insurers and the insurance industry as a whole. An insured with split liability limits of $300/400/400 is at fault in an automobile accident and the other vehicle sustains $15000 in property damages, as well as two passengers have bodily injury and are claiming $9500 each. What is the MOST insurance will pay to each occupant? $300,000 In which of the following types of contracts is only one party legally required to do something after the insured has completed the act of paying the premium? Unilateral All of the following are commonly included in the declarations page EXCEPT the birth date of the insured. Which cost-control mechanism allows employers and insurers to monitor the quality and necessity of patient care? 1. mandated care 2. utilization review 3. excessive capacity 4. health savings account utilization review Which of the following represents the difference between paid and incurred losses? 1. claim reserves 2. the combined ratio 3. policyholder's surplus 4. statutory profit or loss claim reserves Exclusions common to liability coverage for both the personal auto policy and the business auto policy include all of the following EXCEPT 1. work related injuries to insured's employees. 2. vehicles used in prearranged racing or speed contests. 3. for bodily injury or property damage caused intentionally by the insured. 4. for liability arising while the insured auto is being used in an auto business. for liability arising while the insured auto is being used in an auto business. Which is an example of when an immediate annuity would be appropriate? 1. upon receipt of large insurance proceeds 2. when an emergency situation arises 3. upon the death of a beneficiary 4. when retirement is many years away upon receipt of large insurance proceeds After a loss occurs whose duty is it to complete a proof of loss? insured For the purpose of workers' compensation insurance all of the following are subject to the workers' compensation laws, either as an employer or employee EXCEPT 1. an insurance agent. 2. a building contractor. 3. the employee of a party store. 4. a crew member of an ocean going vessel. a crew member of an ocean going vessel. Employees are barred from suing employers in court to obtain compensation for injuries covered by workers' compensation because of which of the following doctrines? 1. employer liability 2. exclusive remedy 3. workman liability 4. no fault insurance exclusive remedy ABC Company takes out a Workers' Compensation policy and pays a deposit premium based on the company's estimated payroll that is subject to an audit at the end of the annual term. Which premium basis is the policy issued on? Reporting Workers' compensation benefits for loss of wages include all of the following EXCEPT cosmetic and weight loss expense. An injured employee covered under workers' compensation is entitled to reasonably justifiable expenses for retraining. This benefit falls under which of the following? 1. medical rehabilitation 2. physical rehabilitation 3. vocational rehabilitation 4. educational rehabilitation vocational rehabilitation Which of the following sides represent the front surface of the patient? 1. anterior 2. midline 3. posterior 4. superior anterior Which technology is the only reliable way to determine if there is bleeding in the brain? computerized tomography What happens when a dislocation occurs? 1. A bone is broken on the surface. 2. A torn muscle swells due to bruising. 3. The bones are no longer in contact at the joint. 4. The connecting joint ligaments are partially torn. The bones are no longer in contact at the joint. What term describes the straightening of a joint? 1. abduction 2. adduction 3. extension 4. flexion extension Where are blood cells produced? 1. bones 2. heart 3. liver 4. muscles bones What is it called when large companies have the resources to withstand losses and set aside funds for claims than to pay for insurance coverage? self-insurance Which word describes an insurance company incorporated outside of the state in which it is doing business? foreign Which of the following terms means giving something of value, not specified in the policy, to induce a customer to buy insurance? rebating Which of the following describes market value? It is what property could be sold for In accordance with the Fair Credit Reporting Act, in what way must a consumer be informed that an investigative report has been ordered by an insurer? They must be informed in writing before or soon after the report has been ordered and be allowed more information upon written request about the report. Which of the following is one of the ways the Gramm-Leach Bliley Act affects the insurance industry? It establishes which insurance products banks and bank subsidiaries may provide as principal. All of the following are TRUE of the emergency type of flood insurance under the National Flood Insurance Progam EXCEPT the insured may buy limited amounts of flood insurance coverage at subsidized rates for buildings only. Which of the following is EXEMPT from the Telemarketing Sales Rule that established the National Do Not Call Registry? calls from or on behalf of political campaigns or organizations and charities All of the following establish a defense against negligence EXCEPT repudiation of the claim in a court of law. Which term BEST describes when the leather seats in the policyholder's car begins to wear and tear? Occurrence A person who intentionally defrauds an insurance company to gain from a claim is an example of which type of hazard? moral hazard An insurance company's right to cancel a policy is often limited by state laws but is generally permitted under which of the following conditions? 1. insured files three claims 2. catastrophic loss event 3. non-payment of premium 4. underwriting action non-payment of premium Which of the following is an example of risk reduction? installing a fire hose system on every floor of a building Which of the following does a binder of coverage guarantee? coverage is in place immediately Which policy condition encourages policyholder to insure to at least 80% of replacement value to avoid a penalty with partial losses? coinsurance A property damage liability policy would offer protection for which of the following losses? 1. The neighbor's injury sustained at the insured's outdoor party. 2. Damages done to a gas station due to insured's parking collision. 3. A slip and fall injury that happened on the insured's premises. 4. Damages to the insured's home caused by a family member. Damages done to a gas station due to insured's parking collision. An insureds place of business is broken in to and merchandise unlawfully taken during the night, the insured is the victim of which type of crime? burglary Which of the following is an example of a financial loss caused by a home being damaged in a windstorm? direct loss All of the following are examples of insurable interest EXCEPT insuring your friend's automobile. All of the following is TRUE regarding vacancy and unoccupancy EXCEPT premiums cost less for vacant or unoccupied property due to lower risk. With which of the following methods are losses settled on an actual cash value (ACV) basis? less depreciation All of the following are responsibilities of the insured after a loss EXCEPT providing a police report to the insurer. Which part of an insurance contract describes a loss for which the insured will not be indemnified for? 1. conditions 2. declarations 3. exclusions 4. insuring agreement exclusions What does the insuring agreement that is known as "the heart of the policy" detail? losses covered under the insurance agreement How does functional replacement cost differ from replacement cost? Functional replacement provides for less expensive but serviceable equivalent items. How does a concealment differ from a warranty or representation? A concealment is an omission of detail by the insured designed to distort the truth, while the others are perceived as true. What does an application for insurance contractually represent for the insured? an offer What is another term used to describe the premium payments? consideration Which of the following terms refers to the transfer of the insured's right of recovery against others to his insurance company? subrogation All of the following would be considered to be incompetent to enter into a contract EXCEPT someone who is incarcerated. Why is an insurance contract a contract of adhesion? The insurance company wields more power than the insured. Why is an insurance policy an aleatory contract? The policy is contingent on an uncertain event. How long is the broad theft coverage endorsement invalid if the property is vacant? More than 60 consecutive days Which of the following is attached to and used to modify or change the original policy in some way? endorsement Which exposure is unique to mobile homes? 1. loss from foreclosure 2. loss from collapse of awnings 3. loss from flood damage 4. loss from collision damage loss from collision damage Which of the following represents the maximum amount reimbursable for tree debris removal for one occurrence under all Homeowners forms? $1,000 Which of the following situations under dwelling policy conditions describe how the insurance company will settle a loss? 1. pay the full value of a pair of earrings when only one is lost 2. company has the option to repair to pre-loss condition 3. if loss is covered by other insurance the other insurance pays full loss 4. property is replaced by company at full replacement value at loss company has the option to repair to pre-loss condition Which of the following is the special limit of coverage on the homeowners policy form for property damage to personal watercraft? $1,500 Which of the following losses would be covered under Coverage A Dwelling? lightning strike on home's chimney Which of the following conditions best describes the type of home that the HO-8 modified coverage form was designed for? replacement value far exceeding market value Which of the following is the standard amount of Coverage A-dwelling provided by the HO-6 Unit-Owners Policy? 1. $5002. 2. $1,000 3. $5,000 4. $10,000 $1,000 Which of the following represents the primary amount of insurance for the HO-4? 1. Coverage A 2. Coverage B 3. Coverage C 4. Coverage D Coverage C Which of the following homeowners forms is most appropriate for older homes with replacement values that may far exceed their market values? HO-8 Homeowners Coverage E personal liability applies to liability or property damage arising from all of the following insured locations EXCEPT acreage the insured is renting for cash crop farming and livestock. Which of the following is EXCLUDED as a covered loss under the DP-3 coverage? 1. Freezing of pipes when water is shut off during a vacancy 2. Vandalism in a house vacant for 30 days 3. Sudden seepage from an air conditioning system 4. Damage by ice to outdoor radio and television antennas and aerials Damage by ice to outdoor radio and television antennas and aerials Which of the following would be covered perils under the DP-1 Basic policy form? riot or civil commotion All of the following are TRUE for the hired auto liability policy EXCEPT 1. leased or borrowed vehicles are considered hired. 2. personal injury or property damage by employees is included. 3. the endorsement is available with other commercial auto insurance. 4. vehicles borrowed from an executive officer are not considered hired. the endorsement is available with other commercial auto insurance. Which statement is INCORRECT regarding personal liability coverage? it is standard coverage in a dwelling policy. All of the following actions require post notification under the Fair Credit Reporting Act EXCEPT lowering of the premium. All the following are TRUE regarding assigned risk plans EXCEPT the insurer participation in the assigned risk program is mandatory. Which of the following is how defense costs are paid in relation to the limit of insurance under the personal auto policy for bodily injury and property damage part A-liability coverage? in excess of the limit Which of the following is correct for comparative negligence? Both parties are found to have contributed to the loss. When the insured's child spills red juice on the carpet of insured's covered automobile, which of the following coverages will apply? comprehensive Which of the following is how the transportation expenses coverage on a personal auto policy will respond when an insured rents a car while on vacation and the vehicle is subject to a total theft loss? There is a 48 hour waiting period. What type of damage is specifically excluded under uninsured motorists coverage? punitive damages All of the following is TRUE regarding an umbrella policy EXCEPT the policy can be issued alone without an underlying liability policy. All of the following situations represent additional personal liability exposures that can be met with an umbrella policy EXCEPT liability arising out of business pursuits. When an agent tries to convince a policyholder to replace an existing policy to buy another one, what are they practicing? 1. rebating 2. misrepresentation 3. upselling 4. consulting misrepresentation Which of the following means that the contract involves two parties: one who makes an offer and one who accepts it? Agreement Which situation is an example of vicarious liability? The insured's employee causes an injury while on the job. Before taking legal action, what third-party can help end disputes over the value of a loss? 1. adjuster 2. arbitrator 3. counselor 4. underwriter arbitrator What is the major reason that insurance regulators are often critical of dread disease insurance policies? Buyers often think they are getting broader coverage than they actually purchase. Which of the following sides represent the back surface of the patient? 1. anterior 2. midline 3. posterior 4. superior Posterior In a Whole Life Policy, all of the following factors are guaranteed EXCEPT dividends. Which of the following limits of insurance on the dwelling are available and apply to Coverage D-Fair Rental Value? 1. 10% 2. 15% 3. 20% 4. 25% 20% What does homeowners Coverage B - Other Structures cover? 1. structures located at adjacent properties in the insured's care custody and control. 2. structures located on the insured's property separated from the dwelling by clear space. 3. additions added to the original structure after the policy is written. 4. rental apartments added to the structure to provide additional income. structures located on the insured's property separated from the dwelling by clear space. Which of the following is the correct timeframe for earthquake shocks to be considered as single earthquake? 168hrs All of the following are TRUE regarding underinsured motorists ccoverage EXCEPT it is of little consequence who was at fault for the coverage to apply. The Causes of Loss form for farm property lists which of the following? perils property is insured against Which of the following business liability exposures does a slip and fall loss fall under? 1. indirect and contingent 2. medical expense 3. premises and operations 4. retail hazards premises and operations The property coverage of a BOP includes which of the following? 1. motor vehicles 2. outdoor fencing 3. outdoor signs that are not attached to the building 4. carpeting that is permanently installed inside the building carpeting that is permanently installed inside the building In a Surety Bond, the principal is the person who performs certain acts under the contract. Which type of bond specifically protects against dishonesty by employees whose names or positions are listed in the policy? 1. special 2. blanket 3. scheduled 4. key person scheduled Which type of endorsement covers causes of loss specifically listed in the policy? 1. named risks 2. named perils 3. specified risks 4. specified perils named perils Which of the following is excluded from coverage under an aircraft liability policy?1. external communication equipment 2. medical payment for non-employees 3. passenger personal property 4. cockpit windows passenger personal property Which of the following professionals would purchase Errors And Omissions insurance to manage the liability risk associated with their business endeavors? attorney Watercraft and boatowners who wish to insure for values over $1,500 can find coverage in all of the following EXCEPT a homeowners policy. Which of the following liability insurance policies would provide coverage to ABC Company in a suit brought by a fired employee for wrongful discharge? 1. Employers Liability 2. Workers Compensation 3. Commercial General Liability 4. Employment Practices Liability Employment Practices Liability In which of the following DP forms is the dwelling covered under open perils and the personal property on a named peril basis? 1. DP-1 2. DP-2 3. DP-3 4. DP-4 DP-3 When an insured selects Symbol 2 on the automobile declarations, indicating coverage for any auto titled to the insured, which of the following automobile types will be covered? 1. any auto 2. mobile equipment 3. owned autos only 4. temporary substituted owned autos only Which of the following is TRUE for a flexible premium annuity? 1. The actual amount of the annuity benefit is determined in advance. 2. A single set amount premium is paid by the annuitant on an annual basis. 3. The company promises to pay the annuitant an amount each period beginning after a single lump sum payment. 4. The purchaser has the option to vary the amount of each premium payment falling between a minimum and maximum amount. The purchaser has the option to vary the amount of each premium payment falling between a minimum and maximum amount. Offer, acceptance, and consideration are necessary elements of 1. a warranty. 2. a representation. 3. a contract. 4. insurable interest. a contract. A bank customer's identity was compromised and the thieves made numerous purchases from a retailer by signing the customer's checks. When the bank refused to make payment for the goods, the retailer brought suit against the bank. Which coverage indemnified the bank for liability in the suit? 1. shopkeeper's coverage 2. forgery and alteration 3. lender's liability 4. anti fraud coverage forgery and alteration A Basic Hospital Policy pays expenses for 1. surgical services. 2. hospital room and board. 3. in-hospital physician visits. 4. post-operative care. hospital room and board. Which of the following is the party who agrees to be responsible for loss in the case of a fidelity bond? 1. the surety 2. the oblige 3. the principal 4. the bondholder the surety The Terrorism Risk Insurance Act and the National Flood Insurance Program are similar by providing which of the following? 1. relief for victims of flood loss 2. coverage for loss caused by terrorism acts 3. subsidies, loss sharing or excess coverage 4. government oversight of specialized insurance subsidies, loss sharing or excess coverage In which of the following situations would workers' compensation benefits be covered for an injured employee? 1. sole proprietor lifting heavy boxes 2. a slip and fall while on the job at work 3. spouse of employee at company picnic 4. shopping after work at place of employment a slip and fall while on the job at work Which of the following is a qualified plan? 1. Deferred Compensation. 2. Split-Dollar. 3. 401(k). 4. Individual Annuity. 401(k). When a policy or certificate containing an accelerated benefit provision is applied for or delivered, the producer is responsible for providing the applicant a summary of coverage that includes all of the following EXCEPT 1. a detailed and comprehensive summary of the accelerated benefit 2. definitions of the conditions or occurrences triggering payment of the benefit 3. an explanation of any effects an accelerated benefit on the cash value, death benefit, premium payments, and loans. 4. a statement that benefit payments may adversely affect eligibility for Medicaid a detailed and comprehensive summary of the accelerated benefit Liability arising out of any of the following is excluded from the personal and advertising injury liability coverage EXCEPT 1. unknowingly inflicting injury that violates the rights of another. 2. oral or written publication of material that the insured knows is false. 3. criminal acts committed by or at the direction of the insured. 4. failure of goods or products to conform with advertised quality. unknowingly inflicting injury that violates the rights of another. All of the following areas of supplementary payments are paid in addition to the regular limit for coverage in a liability policy EXCEPT 1. expenses incurred during the investigation of the claim are paid. 2. expenses for first aid to others at the time of the accident are paid. 3. prejudgment interest when it is included as part of the damages for the insured is paid. 4. loss of earnings when an insured is required to miss work for court appearances is paid. prejudgment interest when it is included as part of the damages for the insured is paid. The description of the insured will be found in which part of an insurance policy? 1. conditions 2. declarations 3. definitions 4. exclusions definitions A basic vision care package includes all of the following EXCEPT 1. safety glasses. 2. the annual eye exam. 3. lenses and frames. 4. contact lenses. safety glasses. Which of the following provides insurance for employers when workers not covered by workers' compensation insurance are injured on the job and sue for compensation? 1. employer liability 2. no fault insurance 3. worker insurance 4. employee indemnity employer liability All of the following are listed in the duties of the insured following loss EXCEPT 1. notice of claim. 2. proof of loss. 3. submitting to examination. 4. contracting for restoration. contracting for restoration. What increases the potential loss of an unforeseen event that causes injury to an insured or damage to property? 1. Hazard 2. Insurance 3. Peril 4. Risk Hazard Under the insured's personal auto policy, which of the following is CORRECT for a newly acquired car to be covered prior to reporting it to the insurance company? 1. for physical damage coverage to extend it must be a brand new vehicle. 2. for liability coverage to extend it must only be driven by an insured. 3. all coverage extends if the insured reports the car within fourteen days. 4. for uninsured motorist coverage to extend the driver must be the insured. all coverage extends if the insured reports the car within fourteen days. The term exclusive remedy used in Workers' Compensation is defined as 1. the only means available to employees to receive compensation from employers for work related injuries. 2. the employer must obtain Workers' Compensation Insurance only from the state fund. 3. injured employees must choose a doctor selected by the insurance company. 4. the employee will not be covered if doing any work for the employer that is not within the employee's job description. the only means available to employees to receive compensation from employers for work-related injuries. Which of the following created The National Flood Insurance Program? 1. an association of mortgage banks 2. the United States Congress 3. governors of flood prone states 4. a consortium of insurance companies the United States Congress When an insured is driving his covered automobile causes an accident that results in injury, his automobile medical payments will pay medical expenses for all of the following EXCEPT 1. the insured's own injuries. 2. the brother's injury, an occupant in insured's vehicle. 3. his daughter's injuries, an occupant in insured's vehicle. 4. any occupant of the other not at fault vehicle. When does the coverage begin for a builders risk form? 1. The date the policy premium is paid 2. On the date any construction begins 3. On the date construction starts above the highest basement floor if there is a basement 4. On the date construction starts above the lowest basement floor if there is a basement On the date construction starts above the lowest basement floor if there is a basement Which of the following is the financial injury sustained by the insured caused by an accident for which the insurer, in consideration of the premium, has undertaken to indemnify the insured? 1. exposure 2. loss 3. peril 4. risk All of the following demonstrate insurable interest EXCEPT 1. purchasing fire insurance on a newly acquired cottage. 2. adding collision coverage on auto due to a new loan. 3. deciding to insure an inherited firearms collection. 4. insuring an engagement ring given to fiancée. insuring an engagement ring given to fiancée. Which of the following best describes the commercial general liability's general aggregate annual limit as it applies to the coverage parts of the CGL?1. Coverage A and C limits are excess of the general annual aggregate limit. 2. Coverage B limit is not subject to the general aggregate annual limit. 3. Coverage A, B, and C apply separately to non-consecutive annual periods. 4. Coverage A, B, and C apply in sum and are the most that will be paid subject to the general aggregate annual limit. Coverage A, B, and C apply in sum and are the most that will be paid subject to the general aggregate annual limit. Which of the following would be covered by a commercial package policy? 1. small to medium sized businesses 2. ocean marine 3. loss due to crime 4. injury to worker on the job loss due to crime What is the purpose of the causes of loss form that lists specific exclusions? 1. to inform the insurer what the loss is in a claim 2. to state which properties are covered in a loss 3. to state which perils are insured against 4. to inform the insured whether the loss in a claim is covered to state which perils are insured against Which Homeowner Form covers fixtures, installations, and improvements made or acquired at the insured's expense? 1. HO-6 2. HO-5 3. HO-4 4. HO-2 HO-4 The Gramm-Leach-Bliley Act was enacted to protect consumer's right to privacy and made mandatory which of the following? 1. non-disclosure of corporate financial records 2. collection of personal private information 3. regulation of banks and financial companies 4. financial institutions must have a privacy policy in place Which of the following terms applies to a policy that pays first when two policies cover the same property? 1. excess 2. pro rata 3. primary 4. non-assigned primary Mobile homes can be insured in all of the following ways EXCEPT 1. with a HO-8 Modified Coverage form. 2. on a separate mobile homeowners package policy. 3. with a DP-1 if the mobile home is on a foundation. 4. on a mobile homeowners endorsement to a HO-3 form. with a HO-8 Modified Coverage form. Which of the following is considered a hired auto under the commercial auto policy Symbol 8? 1. any auto the insured owns and rents 2. autos rented or borrowed from employees 3. autos the insured leases, borrows or rents 4. any auto the insured will use during the policy period autos the insured leases, borrows or rents Which of the following describes why the insuring agreement is the heart of an insurance policy? 1. It states the ground rules for the policy. 2. It describes the losses for which the insured is not covered. 3. It lists the amount of coverage provided. 4. It describes property covered and perils insured. It describes property covered and perils insured. A DP-2 policy covers all of the following EXCEPT 1. damage to awnings from weight of snow. 2. damage to property caused by burglars. 3. freezing of automatic fire sprinkler systems. 4. accidental discharge of steam from a plumbing system. damage to awnings from weight of snow. Which of the following would be eligible to collect survivor and death benefits from workers' compensation in the event of the covered injury resulting in the death of an employee? 1. medical provider 2. insured's legal team 3. spouse of employee 4. owner of the business All of the following are exclusions found under the personal auto policy Part A liability coverage, EXCEPT 1. damage to property owned or being transported by the insured. 2. damage to property rented to, used by, or in the care of the insured. 3. motorized vehicles with fewer than four wheels or designed for off road use. 4. bodily Injury to an insured's nonresident family member or relative. bodily Injury to an insured's nonresident family member or relative. The Fair Credit Reporting Act permits consumer reporting agencies to include applicant information about bankruptcies MORE than 10 years old under which of the following circumstances? 1. The applicant has been convicted of a felony or fraud. 2. The applicant is a public or political figure. 3. The applicant is seeking a transaction greater than $150,000. 4. The applicant is employed in the financial industry. Which of the following does HO-6 provide? 1. coverage for tenant living in a condominium 2. coverage for personal property of a condominium owner 3. broad dwelling coverage for a condominium owner 4. coverage for the rehabilitation of a condominium structure coverage for personal property of a condominium owner All of the following would be considered an insured person under Part A of a personal automobile policy EXCEPT 1. other persons or organizations that use the car to the extent that they share liability with the insured person. 2. anyone using the insured's car with the insured's permission or the reasonable belief that they are entitled to do so. 3. the named insured and members of the insured's family for the ownership, maintenance and use of any auto or trailer. 4. other persons or organizations for their liability from an accident involving an auto or trailer used by the insured but owned by that person or organization. Under the commercial general liability which one of the following is covered under supplementary payments? 1. cost of bail bonds 2. defense costs for the plaintiff 3. court costs taxed against a third party 4. loss of earnings expense of over $250 a day cost of bail bonds The insured carries uninsured motorist coverage limits of 100/300/100 and is struck by an uninsured motorist, who will pay insured's bodily injury damages claimed for $100,000? 1. the state's uninsured motorist fund 2. the uninsured driver 3. the insured's insurance company 4. the insured has no avenue to recover the insured's insurance company Which part of the commercial general liability designates who is an insured? 1. conditions 2. declarations 3. definitions 4. insuring agreement declarations A contract that is against public policy is not enforceable according to which contract characteristic? 1. competent parties 2. consideration 3. legal purpose 4. statute of limitation legal purpose Homeowner Form HO-2 provides coverage for loss of appliances, carpeting, and other household furnishings for a maximum of how much? 1. $3,000 2. $2,500 3. $2,000 4. $500 $2,500 The claims-made liability form provides coverage from a date that precedes the policy effective date. Which of the following defines that date? 1. anniversary date 2. retroactive date 3. occurrence date 4. claims date All of the following specify limits of insurance for the commercial general liability EXCEPT 1. legal defense. 2. medical expense. 3. general aggregate. 4. personal and advertising injury. A cable company uses employees to install equipment in customers' homes. The company purchases a bond from an insurance company to protect itself from potential dishonest acts of the employees. Which of the following types of bond does the cable company purchase? 1. blanket bond 2. fidelity bond 3. schedule bond 4. surety bond fidelity bond All of the following are the most commonly used personal inland marine forms EXCEPT 1. personal property form. 2. personal articles form. 3. builder's floater form. 4. personal effects form. The insured purchased a car for $40,000 and added $5,000 in insured modifications. Four years later it was worth $24,000 when it was totaled in a crash. According to the principle of indemnity, how much should the insured receive from the insurance proceeds? 1. $24,000 2. $29,000 3. $40,000 4. $45,000 $24,000 Which document would a lender ask an insured for as evidence that a policy has been written? 1. Certificate 2. Declarations 3. Endorsement 4. Policy Certificate Underwriters are permitted to use all of the following when underwriting an application for insurance EXCEPT 1. disability. 2. inspection services. 3. credit reports. 4. claim history. disability All of the following activities are subject to the imposition of strict liability EXCEPT 1. chemical processing. 2. in home child care. 3. manufacturing ladders. 4. staging fireworks displays. All of the following are considered compensatory special damages when an insured is found legally liable for the loss of another EXCEPT 1. cost to repair damaged property. 2. lost wages. 3. medical expenses. 4. mental anguish. Which of the following would trigger coverage under business income form with extra expense coverage? 1. Carpet cleaning after a water main break 2. Employee pay after a building structure is damaged 3. Building inspectors fees after a loss 4. Unit rent when tenant is liable Which of the following forms trigger coverage for a loss under the commercial general liability policy if a loss happens during the policy period? 1. claims made form 2. occurrence form 3. period certain form 4. static form occurrence form When an employer sends employees out of state on work related business, which of the following must he do to ensure the appropriate workers' compensation coverage? 1. purchase a separate policy for the state in question 2. list the names of the employees sent out of state 3. list the state on the information page for other states' coverage 4. report the work to the insurance company as soon as it is completed list the state on the information page for other states' coverage Which of the following persons is covered for accidental injury on the insured's premises under the commercial general liability medical payments? 1. a tenant of the premises 2. an employee of the insured 3. person injured in warfare 4. a volunteer worker a volunteer worker Which type of coverage would be appropriate for a detached garage in a DP-1 policy? 1. Coverage A 2. Coverage B 3. Coverage C 4. Coverage D Coverage B Which of the following is the special limit of coverage on the homeowners policy form for property damage to personal watercraft? 1. $1,000 2. $1,500 3. $2,000 4. $2,500 $1,500 All of the following are used by the courts to establish negligence EXCEPT 1. legal duty owed. 2. breech of duty owed. 3. proximate cause. 4. policy exclusions. policy exclusions. Which of the following is an example of replacement cost valuation? 1. fair market value of item at time of loss 2. actual cash value of item at time of loss 3. cost new without depreciation at the time of loss 4. cost of functional value of item at time of loss All of the following describe a nonowned auto under the commercial auto policy Symbol 9 EXCEPT 1. auto not titled to an insured but available for regular use of named insured or family member. 2. nonowned auto is designated for liability coverage only. 3. includes autos owned by employees but used in the insured's business. 4. autos used in the insured's business that are not leased, hired, rented, or borrowed. autos used in the insured's business that are not leased, hired, rented, or borrowed. How does the BOP differ from the CPP? 1. The BOP covers property damage only. 2. The BOP is specifically designed for larger companies. 3. The BOP covers small businesses that have multiple locations. 4. The BOP prepackages a group of coverages desirable to small businesses. The BOP prepackages a group of coverages desirable to small businesses.