Property & Casualty Practice Exam:
Personal Lines UPDATED ACTUAL Exam
Questions and CORRECT Answers
Coverage under a comprehensive PL Policy or Homeowners Section II extends:
A) To the premises described and to the personal activites of the insured on or off of the
premises
B) Only to the premises described in the policy
C) Only to the personal activities of the insured
D) To the premises described and to all personal and business activities of the insured on or off
the described premises - CORRECT ANSWER -A
Which property is excluded under an HO3 policy?
A) Firearms
B) Jewelry
C) Securities
D) Guard dog - CORRECT ANSWER -D
Which is an additional benefit that is included in a DP2 that is not included in a DP1?
A) Debris Removal
B) Lawns, tree, shrubs
C) Reasonable repairs
D) Fire dept. services - CORRECT ANSWER -B
What additional coverage does a DP2 have compared to a DP1?
A) Debris Removal
B) Improvements, alterations, and additons
C) Personal liability
,D) Additional living expenses - CORRECT ANSWER -D
Which of the following collapse losses would be covered under an HO3?
A) Defective workmanship completed 2 years ago
B) Known insect damage
C) Weight of contents
D) Earth movement from a volcanic eruption - CORRECT ANSWER -C
Mary has an HO3 policy with replacement cost coverage on the insured buildings. The cost of
replacement on the dwelling is $100,000, and the other structure (a garage) is $20,000. To be
certain of replacement cost coverage on a partial loss to either structure, she must carry a
minimum of
A) $100,000 on the dwelling; $10,000 on the garage
B) $100,000 on the dwelling; $20,000 on the garage
C) $80,000 on the dwelling; $8,000 on the garage
D) $80,000 on the dwelling; $16,000 on the garage - CORRECT ANSWER -D
The ordinance or law limitation in a Homeowner's policy may cause a gap in coverage in which
of the following situations?
A) The insured's home is damaged by fire and must be rebuilt to meet present building codes.
The additional cost of complying with the codes is 50%.
B) A community ordinance requires dog to be on a leash. The insured's dog, running free in a
park, bites a child.
C) The insured has a business occupancy that is permitted by homeowner's rule and does not
affect his coverage. However, community laws prohibit the occupancy unless certain approvals
are obtained and fees are paid. The insured has not obtained approvals nor paid fees prior to
windstorm damage to home.
D) A law requires all swimming pools on a residential property to be fenced and to have self-
closing gates. The insured's fate is not self-closing, and the neighbor's child goes through the gate
and is severely injured when he falls into the - CORRECT ANSWER -A
, Which of the following loss exposures is not covered by Section II of Ron's Homeowner's
policy?
A) Ron's use of riding a lawnmower while he is mowing his lawn
B) Ron's registered/licensed personal auto while used on his own property which includes 10
acres of undeveloped land
C) Ron's use of a motorized golf cart, while playing golf on a golf course
D) Ron's activities while rebuilding a car for fun in his garage at home. The car does not have an
engine. - CORRECT ANSWER -B
What is one way in which the HO2, HO4, and HO6 are similar?
A) Perils insured against under coverage C
B) The limits provided for under coverage C
C) Perils insured against under coverage A
D) The limits for under coverage B - CORRECT ANSWER -A
Which homeowners form is best for use on a brand- new single family dwelling?
A) HO4
B) HO5
C) HO8
D) HO6 - CORRECT ANSWER -B
Which of the following is a reason why someone would not purchase a Dwelling Policy instead
of an HO3?
A) Broader coverage is desired
B) Home is being leased to a tenant
C) Personal liability is not desired
D) Dwelling odes not meet all the standards for a Homeowner's policy, but meets dwelling
requirements - CORRECT ANSWER -A
The watercraft endorsement on a homeowners policy extends coverage for:
Personal Lines UPDATED ACTUAL Exam
Questions and CORRECT Answers
Coverage under a comprehensive PL Policy or Homeowners Section II extends:
A) To the premises described and to the personal activites of the insured on or off of the
premises
B) Only to the premises described in the policy
C) Only to the personal activities of the insured
D) To the premises described and to all personal and business activities of the insured on or off
the described premises - CORRECT ANSWER -A
Which property is excluded under an HO3 policy?
A) Firearms
B) Jewelry
C) Securities
D) Guard dog - CORRECT ANSWER -D
Which is an additional benefit that is included in a DP2 that is not included in a DP1?
A) Debris Removal
B) Lawns, tree, shrubs
C) Reasonable repairs
D) Fire dept. services - CORRECT ANSWER -B
What additional coverage does a DP2 have compared to a DP1?
A) Debris Removal
B) Improvements, alterations, and additons
C) Personal liability
,D) Additional living expenses - CORRECT ANSWER -D
Which of the following collapse losses would be covered under an HO3?
A) Defective workmanship completed 2 years ago
B) Known insect damage
C) Weight of contents
D) Earth movement from a volcanic eruption - CORRECT ANSWER -C
Mary has an HO3 policy with replacement cost coverage on the insured buildings. The cost of
replacement on the dwelling is $100,000, and the other structure (a garage) is $20,000. To be
certain of replacement cost coverage on a partial loss to either structure, she must carry a
minimum of
A) $100,000 on the dwelling; $10,000 on the garage
B) $100,000 on the dwelling; $20,000 on the garage
C) $80,000 on the dwelling; $8,000 on the garage
D) $80,000 on the dwelling; $16,000 on the garage - CORRECT ANSWER -D
The ordinance or law limitation in a Homeowner's policy may cause a gap in coverage in which
of the following situations?
A) The insured's home is damaged by fire and must be rebuilt to meet present building codes.
The additional cost of complying with the codes is 50%.
B) A community ordinance requires dog to be on a leash. The insured's dog, running free in a
park, bites a child.
C) The insured has a business occupancy that is permitted by homeowner's rule and does not
affect his coverage. However, community laws prohibit the occupancy unless certain approvals
are obtained and fees are paid. The insured has not obtained approvals nor paid fees prior to
windstorm damage to home.
D) A law requires all swimming pools on a residential property to be fenced and to have self-
closing gates. The insured's fate is not self-closing, and the neighbor's child goes through the gate
and is severely injured when he falls into the - CORRECT ANSWER -A
, Which of the following loss exposures is not covered by Section II of Ron's Homeowner's
policy?
A) Ron's use of riding a lawnmower while he is mowing his lawn
B) Ron's registered/licensed personal auto while used on his own property which includes 10
acres of undeveloped land
C) Ron's use of a motorized golf cart, while playing golf on a golf course
D) Ron's activities while rebuilding a car for fun in his garage at home. The car does not have an
engine. - CORRECT ANSWER -B
What is one way in which the HO2, HO4, and HO6 are similar?
A) Perils insured against under coverage C
B) The limits provided for under coverage C
C) Perils insured against under coverage A
D) The limits for under coverage B - CORRECT ANSWER -A
Which homeowners form is best for use on a brand- new single family dwelling?
A) HO4
B) HO5
C) HO8
D) HO6 - CORRECT ANSWER -B
Which of the following is a reason why someone would not purchase a Dwelling Policy instead
of an HO3?
A) Broader coverage is desired
B) Home is being leased to a tenant
C) Personal liability is not desired
D) Dwelling odes not meet all the standards for a Homeowner's policy, but meets dwelling
requirements - CORRECT ANSWER -A
The watercraft endorsement on a homeowners policy extends coverage for:
