AU 62 Exam Questions with Correct Answers
Which one of the following statements about owners and contractors protective liability
coverage is true?
It covers the property owner for damage arising from the contractor's operations.
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?
A Railroad Protective Liability Coverage Form purchased by the contractor
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?
The subcontractor maintains adequate separate insurance coverage
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?
Martin should base the classification on the intended use of the final product.
Which one of the following is one of the five classifications the Commercial Lines
Manual (CLM) uses to refine the general liability classification process?
Contracting or servicing
,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?
Money charged for rentals is part of gross sales
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:
Sales Tax
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?
Overtime, holiday, and vacation pay.
All of the following correctly describe underwriting considerations when evaluating the
extent of an insured's liability exposure to the public, EXCEPT:
The presence of heavy traffic automatically means that the premises has an excessive
exposure.
Which one of the following is an underwriting consideration when evaluating the extent
of an insured's liability exposure to the public?
Differences in exposure between two premises may be the result of location, type of business,
and time in business.
, Most of the claims covered by liability insurance are based on
Tort Law
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
statute
Liability imposed by certain statutes, such as workers compensation laws, is an example
of
Strict Liability
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?
Intentional tort
Certain doctrines in tort law allow a court to infer negligence without direct evidence.
This doctrine is based on the conclusion that the accident would not have happened if
the action or event causing the injury was under the defendant's exclusive control, and
the accident ordinarily would not have happened if the defendant exercised appropriate
care. Courts will often apply the doctrine of
Res ipsa loquitur.
Which one of the following statements about owners and contractors protective liability
coverage is true?
It covers the property owner for damage arising from the contractor's operations.
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?
A Railroad Protective Liability Coverage Form purchased by the contractor
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?
The subcontractor maintains adequate separate insurance coverage
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?
Martin should base the classification on the intended use of the final product.
Which one of the following is one of the five classifications the Commercial Lines
Manual (CLM) uses to refine the general liability classification process?
Contracting or servicing
,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?
Money charged for rentals is part of gross sales
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:
Sales Tax
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?
Overtime, holiday, and vacation pay.
All of the following correctly describe underwriting considerations when evaluating the
extent of an insured's liability exposure to the public, EXCEPT:
The presence of heavy traffic automatically means that the premises has an excessive
exposure.
Which one of the following is an underwriting consideration when evaluating the extent
of an insured's liability exposure to the public?
Differences in exposure between two premises may be the result of location, type of business,
and time in business.
, Most of the claims covered by liability insurance are based on
Tort Law
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
statute
Liability imposed by certain statutes, such as workers compensation laws, is an example
of
Strict Liability
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?
Intentional tort
Certain doctrines in tort law allow a court to infer negligence without direct evidence.
This doctrine is based on the conclusion that the accident would not have happened if
the action or event causing the injury was under the defendant's exclusive control, and
the accident ordinarily would not have happened if the defendant exercised appropriate
care. Courts will often apply the doctrine of
Res ipsa loquitur.
