PSI PA Personal Lines Lines Insurance Exam –
Questions With Applicable Solutions
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Terms in this set (222)
Which of the following terms applies Primary (the term that applies to the policy that pays
to a policy that pays first when two first)
policies cover the same property?
Assume Terrance purchases a one- Liberalization
year BOP in January which provides - ensures that any changes made to a policy that
$1,000 to cover any Fire Department favor the policy owner become effective
Service charges he might incur. immediately, without the need for a policy renewal
Further assume that in March, the
company changes its BOP to limit Fire
Department Service charges to $500.
If he has a Fire Department Service
charge claim of $800 in June, the
company pays $800. Which policy
provision dictated this outcome?
Dave's building has a Replacement $7,500
Cost value of $100,000. He insures the - since he did not meet his coinsurance requirement,
building for $70,000 using the his loss will be paid based on ACV
standard deductible. The building - subtract the standard deductible of $500
sustains a covered loss valued at
$8,000 ACV and at $12,000
Replacement Cost. How much does
Dave's company pay?
,All of the following are true regarding a tort is always unintentional
torts EXCEPT:
a.) torts involve private relationships
b.) a tort is a civil wrong that violates
the rights of another
c.) a tort is always unintentional
d.) another term for tort is Negligence
Franco's business is destroyed by a subrogation
journeyman plumber and a blowtorch.
Franco's company pays him, and then
sues the plumber. What is this process
known as?
With Property and Casualty insurance, loss
insurable interest is the extent of your
financial interest at the time of
Which type of hazard is an example of morale hazard
a person who increases the chance of
loss through carelessness or by
irresponsible actions?
All of the following activities would a.) risky transportation
warrant absolute liability EXCEPT - does not inherently involve hazardous operations
a.) risky transportation or dangerous materials or animals
b.) dangerous animals
c.) hazardous operations
d.) dangerous materials
Rose has an at-fault accident while $20,000
driving her car with three additional - Rose has a limit of 5k on her MedPay coverage
passengers. Her Personal Auto - Since the coverage is provided on a PER PERSON
policy's Medical Payments Coverage basis, we need to calculate the total coverage for all
limits are $5,000. If everyone is hurt, the passengers, including Rose
what is the maximum that Rose's
company will pay out in Medical
Payment claims?
,Which of the following is the standard a.) $1,000
amount of Coverage A - Dwelling
provided by the HO-6 unit-owners
policy?
a.) $1,000
b.) $500
c.) $10,000
d.) $5,000
Under the insured's personal auto All coverage extends if the insured reports the car
policy, which of the following is within 14 days.
correct for a newly acquired car to be
covered prior to reporting it to the - when an insured acquires a new car, coverage on
insurer? their PAP automatically extends for 14 days, as long
as they report the car to the insurer within that time
frame
An insured has transportation C.) rental reimbursement of $20 per day, up to $600
expenses coverage under Part D of
the personal auto policy when
involved in a collision. Coverage
provides which of the following?
a.) rental reimbursement until a new
auto is purchased
b.) towing for the covered vehicle
from the crash site
c.) rental reimbursement of $20 per
day, up to $600
d.) immediate coverage for total theft
of the covered auto
, Kevin is driving with PAP liability limits b.) Part B - Medical Payments
of 30/60/25 when he runs a stop sign - this section of the PAP covers injuries sustained by
and hits Calvin and his wife, Clara, in the policyholder (Kevin)
their sedan. Kevin is hurt, both
vehicles are damaged, and both
Calvin and Clara are injured...Calvin in
the amount of $20,000, and Clara in
the amount of $40,000. Which section
of Kevin's policy pays for his own
injuries?
a.) Part A - Liability
b.) Part B - Medical Payments
c.) Part D - Collision
d.) Part D - Other than Collision
Being subject to a loss is called Exposure
What is the primary difference Coverage E pays if the insured is legally responsible,
between Coverage E Personal Liability and Coverage F pays without regards to fault
and Coverage F Med Pay to Others?
All of the following are considered an c.) a stranger who takes the car without permission
insured under the liability part of a
personal auto insurance policy
EXCEPT:
a.) a neighbor who borrows the
vehicle for a trip
b.) a relative with an out of state
drivers license
c.) a stranger who takes the car
without permission
d.) a nonresident relative who has no
insurance
Minimum limits of Auto liability Uninsured Motorist
coverage in State A are 30/60/25.
How would a person driving with
limits of 25/50/10 be classified?
Questions With Applicable Solutions
Save
Terms in this set (222)
Which of the following terms applies Primary (the term that applies to the policy that pays
to a policy that pays first when two first)
policies cover the same property?
Assume Terrance purchases a one- Liberalization
year BOP in January which provides - ensures that any changes made to a policy that
$1,000 to cover any Fire Department favor the policy owner become effective
Service charges he might incur. immediately, without the need for a policy renewal
Further assume that in March, the
company changes its BOP to limit Fire
Department Service charges to $500.
If he has a Fire Department Service
charge claim of $800 in June, the
company pays $800. Which policy
provision dictated this outcome?
Dave's building has a Replacement $7,500
Cost value of $100,000. He insures the - since he did not meet his coinsurance requirement,
building for $70,000 using the his loss will be paid based on ACV
standard deductible. The building - subtract the standard deductible of $500
sustains a covered loss valued at
$8,000 ACV and at $12,000
Replacement Cost. How much does
Dave's company pay?
,All of the following are true regarding a tort is always unintentional
torts EXCEPT:
a.) torts involve private relationships
b.) a tort is a civil wrong that violates
the rights of another
c.) a tort is always unintentional
d.) another term for tort is Negligence
Franco's business is destroyed by a subrogation
journeyman plumber and a blowtorch.
Franco's company pays him, and then
sues the plumber. What is this process
known as?
With Property and Casualty insurance, loss
insurable interest is the extent of your
financial interest at the time of
Which type of hazard is an example of morale hazard
a person who increases the chance of
loss through carelessness or by
irresponsible actions?
All of the following activities would a.) risky transportation
warrant absolute liability EXCEPT - does not inherently involve hazardous operations
a.) risky transportation or dangerous materials or animals
b.) dangerous animals
c.) hazardous operations
d.) dangerous materials
Rose has an at-fault accident while $20,000
driving her car with three additional - Rose has a limit of 5k on her MedPay coverage
passengers. Her Personal Auto - Since the coverage is provided on a PER PERSON
policy's Medical Payments Coverage basis, we need to calculate the total coverage for all
limits are $5,000. If everyone is hurt, the passengers, including Rose
what is the maximum that Rose's
company will pay out in Medical
Payment claims?
,Which of the following is the standard a.) $1,000
amount of Coverage A - Dwelling
provided by the HO-6 unit-owners
policy?
a.) $1,000
b.) $500
c.) $10,000
d.) $5,000
Under the insured's personal auto All coverage extends if the insured reports the car
policy, which of the following is within 14 days.
correct for a newly acquired car to be
covered prior to reporting it to the - when an insured acquires a new car, coverage on
insurer? their PAP automatically extends for 14 days, as long
as they report the car to the insurer within that time
frame
An insured has transportation C.) rental reimbursement of $20 per day, up to $600
expenses coverage under Part D of
the personal auto policy when
involved in a collision. Coverage
provides which of the following?
a.) rental reimbursement until a new
auto is purchased
b.) towing for the covered vehicle
from the crash site
c.) rental reimbursement of $20 per
day, up to $600
d.) immediate coverage for total theft
of the covered auto
, Kevin is driving with PAP liability limits b.) Part B - Medical Payments
of 30/60/25 when he runs a stop sign - this section of the PAP covers injuries sustained by
and hits Calvin and his wife, Clara, in the policyholder (Kevin)
their sedan. Kevin is hurt, both
vehicles are damaged, and both
Calvin and Clara are injured...Calvin in
the amount of $20,000, and Clara in
the amount of $40,000. Which section
of Kevin's policy pays for his own
injuries?
a.) Part A - Liability
b.) Part B - Medical Payments
c.) Part D - Collision
d.) Part D - Other than Collision
Being subject to a loss is called Exposure
What is the primary difference Coverage E pays if the insured is legally responsible,
between Coverage E Personal Liability and Coverage F pays without regards to fault
and Coverage F Med Pay to Others?
All of the following are considered an c.) a stranger who takes the car without permission
insured under the liability part of a
personal auto insurance policy
EXCEPT:
a.) a neighbor who borrows the
vehicle for a trip
b.) a relative with an out of state
drivers license
c.) a stranger who takes the car
without permission
d.) a nonresident relative who has no
insurance
Minimum limits of Auto liability Uninsured Motorist
coverage in State A are 30/60/25.
How would a person driving with
limits of 25/50/10 be classified?
