Personal Lines Insurance Exam Questions and
Verified Answers
An Umbrella Policy: Correct Answer: Provides broad excess liability coverage over one or more primary
policies.
Minimum requirement for CAARP? Correct Answer: 15/30/5
What is true about Pure No-Fault Insurance? Correct Answer: No answers are correct.
Under the financial responsibility law requirements in California, what is the minimum limit for several
people injured in one accident? Correct Answer: $30,000
All of the following vehicles are eligible for coverage under a personal auto policy except: Correct
Answer: A private passenger auto owned by a partnership.
Ian, your married homeowner's insured, does not own a car. He is planning a vacation trip to Florida and
will be renting a car. He also drives cars belonging to friends occasionally. To protect Ian in these
situations, you would recommend a personal auto policy with a: Correct Answer: Named non-owner
coverage endorsement.
If an individual does not own an auto nor have regular use of an auto, what endorsement to a personal
auto policy could be used to properly protect that individual? Correct Answer: Named non-owner
coverage endorsement.
If a motor home is scheduled on a miscellaneous type vehicle endorsement all of the following property
is covered except: Correct Answer: Luggage
If an insured purchases an all-terrain vehicle (ATV), what endorsement can be added to the personal
auto policy to insure the vehicle? Correct Answer: Miscellaneous type of vehicle endorsement.
If an insured rents a vehicle while on a two week vacation in the USA what coverage is provided under
the person auto policy? Correct Answer: All coverage is in force in the personal auto policy.
If an auto insurance policy is cancelled after it has been in force for 1/2 of its original period resulting in
the insurer refunding 1/2 of the premium paid back to the insured, this is known as what type of
cancellation? Correct Answer: Pro-rata.
A car is insured using a personal auto policy. The car is damaged by hail. The loss is: Correct Answer:
Covered as an other than collision loss.
, Which of the following losses would be covered under Dick's personal auto policy by other than
collision coverage? Correct Answer: Someone shoots Dick's car rear window while the car is parked on
the street overnight.
The insured has a $300 deductible on collision and $50 deductible on OTC. She runs off the road and hits
a light post causing $1,350 to her car. How much will she receive from the Insurance Company? Correct
Answer: $1,050
An insured has a personal auto policy, but does not pay the initial insurance premium when it is due.
The insurer cancels the policy for non-payment. How many days must the insurer give? Correct Answer:
10
The insured has a Personal Auto Policy (PAP) with medical payments of $1,000. Which of the following
is an incorrect statement? Correct Answer: The insured's son is hit by a car while walking to school. He is
covered for $1,000 of medical insurance.
Damage done by an earthquake to an insured's auto is covered by the personal auto policy: Correct
Answer: If the other than collision coverage is purchased.
Your insured client has an auto policy with liability and collision coverages. The insured experiences an
at-fault accident the first time he uses his neighbor's truck which has liability coverage only. His PAP
will provide coverage and will pay for the entire loss since he was driving the truck. Correct Answer:
This is NOT how the insurer would handle this claim.
A woman purchased another car and adds it to her policy. She does not pay the additional premium and
the insurer cancels the policy for non-payment. How many days notice is the Insurer to give to her?
Correct Answer: 10 days.
A boat owner's policy and a yacht policy are different in their approach to coverage. A personal auto
policy is similar to: Correct Answer: Boat owner's policy.
N.F.I.P. (National Flood Insurance Plan) may only be written to: Correct Answer: Participating
communities.
Boat owners insurance differs from yacht insurance. To which of the following is a boat owners policy
most similar? Correct Answer: Auto policy.
Insurable interest could exist in a policy in all of the following except: Correct Answer: A tenant in
leased property.
Which of these would be a substandard risk? Correct Answer: All answers are correct.
Verified Answers
An Umbrella Policy: Correct Answer: Provides broad excess liability coverage over one or more primary
policies.
Minimum requirement for CAARP? Correct Answer: 15/30/5
What is true about Pure No-Fault Insurance? Correct Answer: No answers are correct.
Under the financial responsibility law requirements in California, what is the minimum limit for several
people injured in one accident? Correct Answer: $30,000
All of the following vehicles are eligible for coverage under a personal auto policy except: Correct
Answer: A private passenger auto owned by a partnership.
Ian, your married homeowner's insured, does not own a car. He is planning a vacation trip to Florida and
will be renting a car. He also drives cars belonging to friends occasionally. To protect Ian in these
situations, you would recommend a personal auto policy with a: Correct Answer: Named non-owner
coverage endorsement.
If an individual does not own an auto nor have regular use of an auto, what endorsement to a personal
auto policy could be used to properly protect that individual? Correct Answer: Named non-owner
coverage endorsement.
If a motor home is scheduled on a miscellaneous type vehicle endorsement all of the following property
is covered except: Correct Answer: Luggage
If an insured purchases an all-terrain vehicle (ATV), what endorsement can be added to the personal
auto policy to insure the vehicle? Correct Answer: Miscellaneous type of vehicle endorsement.
If an insured rents a vehicle while on a two week vacation in the USA what coverage is provided under
the person auto policy? Correct Answer: All coverage is in force in the personal auto policy.
If an auto insurance policy is cancelled after it has been in force for 1/2 of its original period resulting in
the insurer refunding 1/2 of the premium paid back to the insured, this is known as what type of
cancellation? Correct Answer: Pro-rata.
A car is insured using a personal auto policy. The car is damaged by hail. The loss is: Correct Answer:
Covered as an other than collision loss.
, Which of the following losses would be covered under Dick's personal auto policy by other than
collision coverage? Correct Answer: Someone shoots Dick's car rear window while the car is parked on
the street overnight.
The insured has a $300 deductible on collision and $50 deductible on OTC. She runs off the road and hits
a light post causing $1,350 to her car. How much will she receive from the Insurance Company? Correct
Answer: $1,050
An insured has a personal auto policy, but does not pay the initial insurance premium when it is due.
The insurer cancels the policy for non-payment. How many days must the insurer give? Correct Answer:
10
The insured has a Personal Auto Policy (PAP) with medical payments of $1,000. Which of the following
is an incorrect statement? Correct Answer: The insured's son is hit by a car while walking to school. He is
covered for $1,000 of medical insurance.
Damage done by an earthquake to an insured's auto is covered by the personal auto policy: Correct
Answer: If the other than collision coverage is purchased.
Your insured client has an auto policy with liability and collision coverages. The insured experiences an
at-fault accident the first time he uses his neighbor's truck which has liability coverage only. His PAP
will provide coverage and will pay for the entire loss since he was driving the truck. Correct Answer:
This is NOT how the insurer would handle this claim.
A woman purchased another car and adds it to her policy. She does not pay the additional premium and
the insurer cancels the policy for non-payment. How many days notice is the Insurer to give to her?
Correct Answer: 10 days.
A boat owner's policy and a yacht policy are different in their approach to coverage. A personal auto
policy is similar to: Correct Answer: Boat owner's policy.
N.F.I.P. (National Flood Insurance Plan) may only be written to: Correct Answer: Participating
communities.
Boat owners insurance differs from yacht insurance. To which of the following is a boat owners policy
most similar? Correct Answer: Auto policy.
Insurable interest could exist in a policy in all of the following except: Correct Answer: A tenant in
leased property.
Which of these would be a substandard risk? Correct Answer: All answers are correct.
