AU 62 Exam | Questions and Answers with Verified
Solutions | Latest 2026 Update
Q: Which one of the following statements about owners and contractors protective
liability coverage is
true?
Answer:
It covers the property owner for damage arising from the contractor's operations.
Q: A contractor was hired by a railroad to work on a bridge adjacent to railroad tracks.
Which one of the
following types of insurance coverage would best respond to claims against the
railroad arising out of
the contractor's work?
Answer:
A Railroad Protective Liability Coverage Form purchased by the contractor
Q: Best Builders is a commercial building contractor. The company often hires
subcontractors to perform
certain activities on a job. According to the Commercial Lines Manual (CLM), the
work performed by
subcontractors should be separately classified under Contractors - subcontracted
work (91583) only if
which one of the following is true?
Answer:
The subcontractor maintains adequate separate insurance coverage
,Q: Martin, a commercial lines underwriter, is reviewing the general liability application
for Shelton
Manufacturing. The company processes recyclable plastic into a variety of products.
Which one of the
following guidelines should Martin follow when classifying Shelton
Manufacturing's operations?
Answer:
Martin
should base the classification on the intended use of the final product.
Q: Which one of the following is one of the five classifications the Commercial Lines
Manual (CLM) uses to
refine the general liability classification process?
Answer:
Contracting or servicing
Q: The ISO Commercial Lines Manual's definition of the premium base "gross sales" is
the gross amount of
money charged by the named insured, by the concessionaires of the named insured,
or by others
trading the insured's name for various specifically named sources of funds collected.
Which one of the
following is one of those sources of funds?
Answer:
Money charged for rentals is part of gross sales
,Q: The ISO Commercial Lines Manual's definition of the premium base "gross sales" is
the gross amount of
money charged by the named insured, by the concessionaires of the named insured,
or by others
trading the insured's name for all of the following, EXCEPT:
Answer:
Sales Tax
Q: For general liability insurance purposes, in addition to salaries and wages, the ISO
Commercial Lines
Manual's definition of "payroll" includes which one of the following?
Answer:
Overtime, holiday, and vacation
pay.
Q: All of the following correctly describe underwriting considerations when evaluating
the extent of an
insured's liability exposure to the public, EXCEPT:
Answer:
The presence of heavy traffic automatically means
that the premises has an excessive exposure.
Q: Which one of the following is an underwriting consideration when evaluating the
extent of an insured's
liability exposure to the public?
Answer:
Differences in exposure between two premises may be the result of
location, type of business, and time in business.
, Q: Most of the claims covered by liability insurance are based on
Answer:
Tort Law
Q: A mining company has a partial ceiling collapse in one of its mines. Investigators
discover that the
company neglected maintenance of their safety systems which resulted in serious
injury to several of
their employees during the mine's ceiling collapse. The legal liability imposed on
the company for the
injury to its employees is based on
Answer:
statute
Q: Liability imposed by certain statutes, such as workers compensation laws, is an
example of
Answer:
Strict
Liability
Q: A farmer is angry that the neighbor's children ride all-terrain vehicles (ATVs) across
the farmer's fields.
The farmer sets a fire behind the storage shed for the ATVs in order to destroy the
ATVs. A child is in the
shed when it burns and is injured. A court decides the farmer is liable for the child's
injury based on
which one of the following?
Answer:
Intentional tort
Solutions | Latest 2026 Update
Q: Which one of the following statements about owners and contractors protective
liability coverage is
true?
Answer:
It covers the property owner for damage arising from the contractor's operations.
Q: A contractor was hired by a railroad to work on a bridge adjacent to railroad tracks.
Which one of the
following types of insurance coverage would best respond to claims against the
railroad arising out of
the contractor's work?
Answer:
A Railroad Protective Liability Coverage Form purchased by the contractor
Q: Best Builders is a commercial building contractor. The company often hires
subcontractors to perform
certain activities on a job. According to the Commercial Lines Manual (CLM), the
work performed by
subcontractors should be separately classified under Contractors - subcontracted
work (91583) only if
which one of the following is true?
Answer:
The subcontractor maintains adequate separate insurance coverage
,Q: Martin, a commercial lines underwriter, is reviewing the general liability application
for Shelton
Manufacturing. The company processes recyclable plastic into a variety of products.
Which one of the
following guidelines should Martin follow when classifying Shelton
Manufacturing's operations?
Answer:
Martin
should base the classification on the intended use of the final product.
Q: Which one of the following is one of the five classifications the Commercial Lines
Manual (CLM) uses to
refine the general liability classification process?
Answer:
Contracting or servicing
Q: The ISO Commercial Lines Manual's definition of the premium base "gross sales" is
the gross amount of
money charged by the named insured, by the concessionaires of the named insured,
or by others
trading the insured's name for various specifically named sources of funds collected.
Which one of the
following is one of those sources of funds?
Answer:
Money charged for rentals is part of gross sales
,Q: The ISO Commercial Lines Manual's definition of the premium base "gross sales" is
the gross amount of
money charged by the named insured, by the concessionaires of the named insured,
or by others
trading the insured's name for all of the following, EXCEPT:
Answer:
Sales Tax
Q: For general liability insurance purposes, in addition to salaries and wages, the ISO
Commercial Lines
Manual's definition of "payroll" includes which one of the following?
Answer:
Overtime, holiday, and vacation
pay.
Q: All of the following correctly describe underwriting considerations when evaluating
the extent of an
insured's liability exposure to the public, EXCEPT:
Answer:
The presence of heavy traffic automatically means
that the premises has an excessive exposure.
Q: Which one of the following is an underwriting consideration when evaluating the
extent of an insured's
liability exposure to the public?
Answer:
Differences in exposure between two premises may be the result of
location, type of business, and time in business.
, Q: Most of the claims covered by liability insurance are based on
Answer:
Tort Law
Q: A mining company has a partial ceiling collapse in one of its mines. Investigators
discover that the
company neglected maintenance of their safety systems which resulted in serious
injury to several of
their employees during the mine's ceiling collapse. The legal liability imposed on
the company for the
injury to its employees is based on
Answer:
statute
Q: Liability imposed by certain statutes, such as workers compensation laws, is an
example of
Answer:
Strict
Liability
Q: A farmer is angry that the neighbor's children ride all-terrain vehicles (ATVs) across
the farmer's fields.
The farmer sets a fire behind the storage shed for the ATVs in order to destroy the
ATVs. A child is in the
shed when it burns and is injured. A court decides the farmer is liable for the child's
injury based on
which one of the following?
Answer:
Intentional tort
