Utah Property & Casualty Producer's Practice Exam Latest Updated

Under a Businessowners Policy, the policy's terms can be amended or waived only by endorsement issued by - Answer the insurer and made a part of the policy. All of the following are Valuable Papers and Records EXCEPT A. manuscripts, records, or abstracts. B. inscribed, printed, or written documents. C. books, deeds, drawings, films, maps, or mortgages. D. money or securities. - Answer money or securities. Paula and Peter Jones are both insureds on their Homeowners insurance policy which has a $3,000 limit on Coverage F - Medical Payments to Others. They and two visitors named Victor and Valerie are injured when a car smashes into the home. The medical expenses are as follows: Paula $3,000; Peter $7,000; Victor $6,000; Valerie $4,000. How much will the Homeowners policy pay under Coverage F - Medical Payments to Others? - Answer $6,000 Tammy has an insurance producer license. Unless it is renewed, when does her insurance license expire? - Answer On the last day of the licensee's birth month, every two years Kenneth is negligent for causing a car accident when he runs into a car driven by Suzanne. Which of the following losses will be paid by Physical Damage coverage on Kenneth's Personal Automobile Policy? - Answer $15,000 damage to Kenneth's car What are the Commercial Automobile Policy (CAP) coverage forms that can be sold to commercial entities? - Answer Business Auto, Business Auto Physical Damage, Garage, Truckers, Motor Carriers Mario has a personal auto insurance policy with a bodily injury per person limit of $100,000. Mario is negligent for causing a car accident that results in Luciana having $120,000 in medical expenses. Additionally, the insurer incurred $30,000 of defense costs to settle the claim. What is the total amount the insurer will have to pay for everything related to this claim? - Answer $130,000 What is another term for disability income? - Answer Loss of wages Part One: Workers Compensation pays for all of the following EXCEPT A. failing to comply with health or safety regulations or any violation of Workers' Compensation law. B. defense costs for any claim, proceeding, or suit against the insured. C. premiums for bonds, litigation costs, and interest on a judgment. D. benefits required by state Workers' Compensation laws. - Answer failing to comply with health or safety regulations or any violation of Workers' Compensation law. Phillip Producer accepted an insurance payment from a customer, and then with that money he purchased groceries for his family. This is best described as what? - Answer Commingling Under the Businessowners Policy, the Utility Services - Time Element endorsement could pay for - Answer loss of the insured's income due to loss of power, water, or communication services. Under Business Liability coverage of the Businessowners Policy, loss or damage to which type of property is covered? - Answer Property of others Ernie's Hardware Store was force to pay $100,000 after Ernie was kidnapped at gunpoint and threatened. Which Crime endorsement can pay for this loss? - Answer Extortion Commercial Entities Chris took his Ford to the shop to get new tires and have the brakes fixed. Which method of handling risk is this? - Answer Risk reduction The Homeowners Scheduled Personal Property endorsement can be purchased to provide a sufficient amount of insurance - Answer for specifically described items or for certain categories (or classes) of personal property. Seven days ago Jackson traded in his old car and purchased a 2016 Ford Explorer. He has not yet informed the insurer of his purchase. What Liability coverage does Jackson have on his 2016 Ford Explorer? - Answer The broadest coverage now provided for any vehicle shown in the declarations. Which of the following individuals is eligible to purchase a Homeowners policy? - Answer Randall, who owns a duplex; he lives in one unit and rents out the other. If the insured is negligent for a loss that is not covered by the underlying insurance--but is covered by the Umbrella policy--the insurer will require the insured to pay an amount called - Answer a self-insured retention (SIR) before the Umbrella policy will pay. The main purpose of the coinsurance rule found in property insurance policies is to encourage the insured to - Answer carry an adequate amount of insurance on their property. An investigative consumer report may not be ordered unless the consumer being investigated is notified in writing, not later than - Answer three (3) days after the date on which the report was first requested. Under an Ocean Marine Insurance policy, Protection & Indemnity (P&I) Coverage - Answer is liability insurance that pays if the insured ship owner is negligent for causing bodily injury or property damage to a third party. Regarding Inland Marine Transportation coverage, the business who is sending the goods is the - Answer Shipper. Which of the following statements about the law of agency is true? - Answer Market conduct is a code of ethics for insurance professionals. What term describes the point in time when the insured first became aware that a loss covered by the policy occurred? - Answer Discover Louis, David, and Greg are all named insureds on a commercial insurance policy, in that order. Who is responsible for paying the policy's premiums and has the authority to change or cancel the policy? - Answer Louis, because he is listed first on the policy. Which of the following would NOT be covered by building coverage of the building and business personal property coverage form? - Answer materials and supplies one mile from the described premises Regarding subrogation, once an insured has been indemnified, the insured - Answer loses the right to seek damages from a negligent third party. Business Liability coverage under the Businessowners policy pays for all these EXCEPT A. when the insured is responsible for causing Bodily Injury to a third party. B. when the insured is responsible for causing Property Damage to a third party. C. when the insured is responsible for causing Personal and Advertising Injury to a third party. D. when the insured is responsible for causing Property Damage to the insured's own property. - Answer when the insured is responsible for causing Property Damage to the insured's own property. Which type of reinsurance is it when the originating insurer agrees in advance to cede (transfer) many risks to a reinsurer —and the reinsurer agrees in advance to assume (take) the risks. - Answer Treaty reinsurance Coverage E - Scheduled Farm Personal Property - Answer has a separate limit of insurance for each specific type of property. A licensee shall keep at the principal place of business address registered under, separate and distinct books and records of the transactions consummated under the Utah license. The books and records shall be available to the commissioner for inspection upon reasonable notice during business hours for a period of time after the date of transaction for at least how long? - Answer the current calendar year plus three years Which of the following is NOT covered by Coverage C of Lamar's Homeowners policy? A. Lamar's clothes that he takes on a backpacking trip in Europe B. Lamar's cousin Linda's luggage while Linda is visiting Lamar's house C. Lamar's pet dog Lassie D. Lamar's electric powered wheelchair that assists his daughter with a disability at his home - Answer Lamar's pet dog Lassie Samuel is a trucker. He often pulls trailers that are owned by others. Which of the following provides coverage for Samuel's legal liability if he were in an accident that caused damage to a non-owned trailer he was using to haul a load? - Answer Trailer Interchange Absolute liability (also known as strict liability) is a legal doctrine which means that someone is held responsible for injury or damage to another - Answer without negligence having to be proved. Which condition states that the premium is estimated at the beginning of the policy period, and the final premium is determined at the end of the policy period? - Answer Premium Audit Margaret owns multiple restaurant buildings at separate locations. Her insurance policy covers all the buildings with one limit of insurance. This type of coverage is called - Answer blanket. A person may only accept commission compensation or other compensation for an insurance transaction, if that person is what? - Answer Licensed to act as an insurance producer Which of the following statements is FALSE about the use of aftermarket crash parts? A. Unless the consumer is given notice in writing prior to installation, a repair facility or installer may not use non-OEM aftermarket parts to repair a vehicle. B. Nonoriginal equipment manufacturer (non-OEM) means a manufacturer of replacement parts for a different manufacturer's equipment. C. Unless the insured is given notice in writing, an insurer may not specify the use of non-OEM aftermarket crash parts in the repair of an insured's motor vehicle. The notice required shall identify non-OEM parts as not made for or by the vehicle manufacturer. D. Federal law prohibits any or all use of aftermarket crash parts to replace any of the nonmechanical sheet metal or plastic parts that generally constitute the exterior of a motor vehicle, including inner and outer panels. - Answer Federal law prohibits any or all use of aftermarket crash parts to replace any of the nonmechanical sheet metal or plastic parts that generally constitute the exterior of a motor vehicle, including inner and outer panels. Which type of insurance can pay a claim if a lawyer is held responsible for a wrongful act that causes someone to be harmed? - Answer Legal Malpractice Which of the following changes is LEAST likely to result in an auto policy premium change? A. Changing the loss payee or lienholder B. Adding a young driver C. Changing the address that the vehicle is garaged at D. Changing the use of the vehicle - Answer Changing the loss payee or lienholder Which of the following Homeowner policy forms provides automatic Replacement Cost Coverage for Personal Property? A. HO-2 B. HO-3 C. None D. HO-5 - Answer None Which of the following is NOT covered under Coverage A - Dwelling of a dwelling policy? A. the dwelling on the described location shown in the declarations B. materials and supplies located on or next to the described location used to construct, alter or repair the dwelling C. building equipment and outdoor equipment used for the service of and located on the described location D. land - Answer land Which federal law applies to seamen that spend a significant amount of time (usually defined as 30% or more of their time) onboard a vessel? - Answer The Jones Act The terms of the policy may not be changed or waived except by - Answer endorsement issued by the insurer. Which of the following is NOT an example of utmost good faith? A. Wilbur concealed important information on the insurance application. B. After a thorough investigation, the Wonderful World Insurance Company pays a claim to William for wind damage to his home. C. After being involved in a car accident, Wally cooperates fully with the insurance company. D. Wendy provides honest answers to all the questions on a renter's policy application. - Answer Wilbur concealed important information on the insurance application.