1. Which endorsement adds coverage for employee use of automobiles in the
insured's business and the insured's use of rented autos if no coverage is
provided on a business auto policy?
a) Hired and nonowned auto liability
b) Substitute auto liability
c) Newly acquired auto exposure liability
d) Additional insured: a) Hired and nonowned auto liability
2. An insured is driving her car through a residential area when she loses control
and crashes into a neighbor's front porch. The neighbor, who was sitting on
the porch, is injured. The insured's liability policy has a limit of $500,000. This
amount applies to the total of damages for any bodily injury and property
damage resulting from one accident. Which type of limit of liability does the
insured have?
a) Combined single
b) Split
c) Aggregate
d) Per occurrence: a) Combined single
3. All of the following statements describe the concept of strict liability EXCEPT
a) It is applied in product liability cases.
,b) It is imposed on defendants engaged in haẓardous activities.
c) Claimants may need to provide proof that a product defect caused an injury.
d) It is imposed regardless of fault.: b) It is imposed on defendants engaged in haẓardous activities.
4. Which of the following would be considered a cause for flood conditions
covered by the National Flood Insurance Program?
a) Sewer backup
b) Mudflow
c) Snow
d) Landslides: b) Mudflow
5. , as defined by the National Flood Insurance Program, is a general and
temporary condition of partial or complete inundation of two or more acres
of normally dry land area or of two or more properties from overflow of
inland or
,tidal waters, unusual and rapid accumulation or runoff of surface waters from
any source, or mudflow.: A flood
6. is commonly applied in product liability cases. The business is then liable
for defective products, regardless of fault or negligence.: Strict liability
7. is a single dollar limit of liability applying to the total of damages for
bodily injury and property damage combined resulting from one accident or
occurrence.: Combined single
8. arising out of the use or maintenance of a hired or nonowned auto.
This typically refers to employees' use of their personal autos for business
purposes.: Coverage is provided for liability
9. Which of the following may be covered by electronic data processing cover-
age form under an inland marine policy?
a) Computer hardware that is specifically scheduled.
b) Extra expense the insured incurs to continue the business following a loss.
c) Data processing media, including magnetic tapes or paper tapes, punch
cards and discs
d) All of these are covered.: d) All of these are covered.
10. The policy conditions define
a) The excluded perils.
b) The amount of coverage.
c) How parties to the contract must act following a loss.
d) The basic underwriting information.: c) How parties to the contract must act following a loss.
, 11. of a policy structure. define what each party to the policy is required
to do contractually in the event of a loss.: Conditions is an essential part
12. The type of insurance used to cover goods for one specific trip is called
a) Commercial property.
b) Bailee policy.
c) Motor truck cargo policy.
d) Trip transit.: d) Trip transit.
13. cover a single shipment of goods for a specific trip.: Trip transit policies
14. A situation in which a person can only lose or have no change represents
a) Speculative risk.
insured's business and the insured's use of rented autos if no coverage is
provided on a business auto policy?
a) Hired and nonowned auto liability
b) Substitute auto liability
c) Newly acquired auto exposure liability
d) Additional insured: a) Hired and nonowned auto liability
2. An insured is driving her car through a residential area when she loses control
and crashes into a neighbor's front porch. The neighbor, who was sitting on
the porch, is injured. The insured's liability policy has a limit of $500,000. This
amount applies to the total of damages for any bodily injury and property
damage resulting from one accident. Which type of limit of liability does the
insured have?
a) Combined single
b) Split
c) Aggregate
d) Per occurrence: a) Combined single
3. All of the following statements describe the concept of strict liability EXCEPT
a) It is applied in product liability cases.
,b) It is imposed on defendants engaged in haẓardous activities.
c) Claimants may need to provide proof that a product defect caused an injury.
d) It is imposed regardless of fault.: b) It is imposed on defendants engaged in haẓardous activities.
4. Which of the following would be considered a cause for flood conditions
covered by the National Flood Insurance Program?
a) Sewer backup
b) Mudflow
c) Snow
d) Landslides: b) Mudflow
5. , as defined by the National Flood Insurance Program, is a general and
temporary condition of partial or complete inundation of two or more acres
of normally dry land area or of two or more properties from overflow of
inland or
,tidal waters, unusual and rapid accumulation or runoff of surface waters from
any source, or mudflow.: A flood
6. is commonly applied in product liability cases. The business is then liable
for defective products, regardless of fault or negligence.: Strict liability
7. is a single dollar limit of liability applying to the total of damages for
bodily injury and property damage combined resulting from one accident or
occurrence.: Combined single
8. arising out of the use or maintenance of a hired or nonowned auto.
This typically refers to employees' use of their personal autos for business
purposes.: Coverage is provided for liability
9. Which of the following may be covered by electronic data processing cover-
age form under an inland marine policy?
a) Computer hardware that is specifically scheduled.
b) Extra expense the insured incurs to continue the business following a loss.
c) Data processing media, including magnetic tapes or paper tapes, punch
cards and discs
d) All of these are covered.: d) All of these are covered.
10. The policy conditions define
a) The excluded perils.
b) The amount of coverage.
c) How parties to the contract must act following a loss.
d) The basic underwriting information.: c) How parties to the contract must act following a loss.
, 11. of a policy structure. define what each party to the policy is required
to do contractually in the event of a loss.: Conditions is an essential part
12. The type of insurance used to cover goods for one specific trip is called
a) Commercial property.
b) Bailee policy.
c) Motor truck cargo policy.
d) Trip transit.: d) Trip transit.
13. cover a single shipment of goods for a specific trip.: Trip transit policies
14. A situation in which a person can only lose or have no change represents
a) Speculative risk.
