AU 62 Exam 2025 Questions and
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.
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 1
,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
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 2
, 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 is an action causing harm that would most likely result in
the application of the res ipsa loquitur doctrine? - ✔✔A roll of tar paper falls off a
building at night and hits someone.
In terms of landowners' duties to people on their property, which one of the following
is the best definition of a licensee? - ✔✔A person with express or implied permission to
enter onto the land for his or her own purpose, generally owed no duty of safety
FridgeCo, an appliance retailer, owned a storefront. The public sidewalk was damaged.
A customer intent on purchasing a mini-frig got into an argument with the owner. The
owner asked the customer to leave. The customer angrily stormed out and tripped on
the broken sidewalk sustaining a fractured ankle. Which one of the following most
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 3
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.
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 1
,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
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 2
, 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 is an action causing harm that would most likely result in
the application of the res ipsa loquitur doctrine? - ✔✔A roll of tar paper falls off a
building at night and hits someone.
In terms of landowners' duties to people on their property, which one of the following
is the best definition of a licensee? - ✔✔A person with express or implied permission to
enter onto the land for his or her own purpose, generally owed no duty of safety
FridgeCo, an appliance retailer, owned a storefront. The public sidewalk was damaged.
A customer intent on purchasing a mini-frig got into an argument with the owner. The
owner asked the customer to leave. The customer angrily stormed out and tripped on
the broken sidewalk sustaining a fractured ankle. Which one of the following most
COPYRIGHT © 2025 BY OLIVIA WEST, ALL RIGHTS RESERVED 3
