PERSONAL LINES UPDATED SCRIPTED EXAM QUESTIONS
AND SOLUTIONS GUARANTEE A+
✔✔$4,000 - ✔✔T has two Personal Auto policies applying to an auto. The policy
through Company A has a limit of $25,000 per accident for property damage liability.
The policy through Company B has a limit of $50,000 per accident for property damage
liability. How much will Company B have to pay for a covered loss of $6,000 after T
damages someone else's property?
✔✔The policy limit is applied on a per occurrence basis, not per person - ✔✔Under a
Personal Auto policy, all of the following are correct about medical payments coverage,
except:
✔✔Insolvency Protection Limitation - ✔✔If an insurer becomes insolvent within 1 year
after an accident for which it represents the party at fault, the injured party's uninsured
motorist coverage, if any, must cover any unpaid claims resulting from the accident.
✔✔A split-limit policy must provide at least - ✔✔$25,000 for bodily injury per person;
$50,000 for bodily injury to 2 or more persons per accident; $15,000 for property
damage per accident.
✔✔Notice of Cancellation - ✔✔An insurer must give an insured at least 20 days' written
notice of cancellation if the policy is an initial policy that has been in effect 60 days or
more. If the policy has been in effect for less than 60 days or if cancellation is due to
nonpayment of premium, then at least 10 days' advance notice must be given.
If a cancellation notice does not state the reason for cancellation, it must include that
the insurer must state the reason for cancellation within 15 days, upon request.
✔✔per occurrence - ✔✔A _______ deductible applies to hull losses.
✔✔lay-up warranty - ✔✔A _______ applies when the insured boat is in storage, and it
allows for a return of premium
✔✔Mudflow - ✔✔The NFIP defines flood as the inundation of normally-dry land
resulting from overflow of tidal waters, rapid accumulation of surface waters, _______,
and collapse of land along a shoreline due to unusual wave activity.
✔✔Coverage A - ✔✔_______ covers the dwelling on the residence premises, attached
structures, and materials and supplies used to construct or repair the dwelling or other
structures.
✔✔Coverage B - ✔✔____ covers structures separated from the dwelling, not including
those used strictly for business or rented to others as anything other than a private
garage.
, ✔✔Coverage C - ✔✔_______ covers personal property worldwide.
✔✔Coverage D - ✔✔_____ covers indirect losses, such as additional living expenses
and fair rental value.
✔✔Broad Form - ✔✔covers personal property loss or damage specified in the policy
✔✔Special form coverage - ✔✔Type of policy that provides coverage for direct physical
loss subject to a list of exclusions. If a loss is not specifically excluded, coverage
applies.
✔✔special form - ✔✔The _______ (HO-3) offers open perils coverage for the dwelling
and other structures, and named perils coverage for personal property.
✔✔Comprehensive Form - ✔✔The _______ (HO-5) offers open perils coverage for the
dwelling, other structures, and personal property.
✔✔Modified Form - ✔✔The _______ (HO-8) is for older buildings that are otherwise
uninsurable on other Homeowners forms
✔✔Gramm-Leach-Bliley Act (GLBA) - ✔✔A U.S. law that requires banks and financial
institutions to alert customers of their policies and practices in disclosing customer
information.
✔✔Terrorism Risk Insurance Act (TRIA) - ✔✔The terrorism Risk Insurance Act (TRIA)
was first passed in 2002 and has been extended through 2014. The Act created a
Federal Terrorism Insurance Program to administer a system of shared public/private
compensation for insured losses resulting from acts of terrorism in order to protect
consumers and create a transitional period for private insurance markets to stabilize.
The Secretary of the Treasury oversees the program and has the authority to establish
regulations and procedures to implement the program. Commercial policies must cover
the peril of terrorism. The Act does not apply to personal lines policies.
✔✔Fair Credit Reporting Act - ✔✔Act that protects privacy of background information
and ensures that information supplied is accurate.
✔✔Law of Agency - ✔✔The law that governs the relationship between a principal and
his or her agent.
✔✔Voluntary Market - ✔✔Risks insurance companies find acceptable within the
framework of their rates
AND SOLUTIONS GUARANTEE A+
✔✔$4,000 - ✔✔T has two Personal Auto policies applying to an auto. The policy
through Company A has a limit of $25,000 per accident for property damage liability.
The policy through Company B has a limit of $50,000 per accident for property damage
liability. How much will Company B have to pay for a covered loss of $6,000 after T
damages someone else's property?
✔✔The policy limit is applied on a per occurrence basis, not per person - ✔✔Under a
Personal Auto policy, all of the following are correct about medical payments coverage,
except:
✔✔Insolvency Protection Limitation - ✔✔If an insurer becomes insolvent within 1 year
after an accident for which it represents the party at fault, the injured party's uninsured
motorist coverage, if any, must cover any unpaid claims resulting from the accident.
✔✔A split-limit policy must provide at least - ✔✔$25,000 for bodily injury per person;
$50,000 for bodily injury to 2 or more persons per accident; $15,000 for property
damage per accident.
✔✔Notice of Cancellation - ✔✔An insurer must give an insured at least 20 days' written
notice of cancellation if the policy is an initial policy that has been in effect 60 days or
more. If the policy has been in effect for less than 60 days or if cancellation is due to
nonpayment of premium, then at least 10 days' advance notice must be given.
If a cancellation notice does not state the reason for cancellation, it must include that
the insurer must state the reason for cancellation within 15 days, upon request.
✔✔per occurrence - ✔✔A _______ deductible applies to hull losses.
✔✔lay-up warranty - ✔✔A _______ applies when the insured boat is in storage, and it
allows for a return of premium
✔✔Mudflow - ✔✔The NFIP defines flood as the inundation of normally-dry land
resulting from overflow of tidal waters, rapid accumulation of surface waters, _______,
and collapse of land along a shoreline due to unusual wave activity.
✔✔Coverage A - ✔✔_______ covers the dwelling on the residence premises, attached
structures, and materials and supplies used to construct or repair the dwelling or other
structures.
✔✔Coverage B - ✔✔____ covers structures separated from the dwelling, not including
those used strictly for business or rented to others as anything other than a private
garage.
, ✔✔Coverage C - ✔✔_______ covers personal property worldwide.
✔✔Coverage D - ✔✔_____ covers indirect losses, such as additional living expenses
and fair rental value.
✔✔Broad Form - ✔✔covers personal property loss or damage specified in the policy
✔✔Special form coverage - ✔✔Type of policy that provides coverage for direct physical
loss subject to a list of exclusions. If a loss is not specifically excluded, coverage
applies.
✔✔special form - ✔✔The _______ (HO-3) offers open perils coverage for the dwelling
and other structures, and named perils coverage for personal property.
✔✔Comprehensive Form - ✔✔The _______ (HO-5) offers open perils coverage for the
dwelling, other structures, and personal property.
✔✔Modified Form - ✔✔The _______ (HO-8) is for older buildings that are otherwise
uninsurable on other Homeowners forms
✔✔Gramm-Leach-Bliley Act (GLBA) - ✔✔A U.S. law that requires banks and financial
institutions to alert customers of their policies and practices in disclosing customer
information.
✔✔Terrorism Risk Insurance Act (TRIA) - ✔✔The terrorism Risk Insurance Act (TRIA)
was first passed in 2002 and has been extended through 2014. The Act created a
Federal Terrorism Insurance Program to administer a system of shared public/private
compensation for insured losses resulting from acts of terrorism in order to protect
consumers and create a transitional period for private insurance markets to stabilize.
The Secretary of the Treasury oversees the program and has the authority to establish
regulations and procedures to implement the program. Commercial policies must cover
the peril of terrorism. The Act does not apply to personal lines policies.
✔✔Fair Credit Reporting Act - ✔✔Act that protects privacy of background information
and ensures that information supplied is accurate.
✔✔Law of Agency - ✔✔The law that governs the relationship between a principal and
his or her agent.
✔✔Voluntary Market - ✔✔Risks insurance companies find acceptable within the
framework of their rates
