NJ PSI PROPERTY AND CASUALTY STUDY GUIDE
2025/2026 ANSWERS AND QUESTIONS GRADED A+
✔✔Non-renewal and cancellation notices must be sent no later than ___ days to the
insured. - ✔✔120
✔✔A policy may be cancelled at any time for any reason by the insurer if the policy was
in effect for less than _____ days. - ✔✔60
✔✔All commerical policies issued must follow the provisions of what act that protects
the public from the adverse effects of excessive inadequate rates? - ✔✔Commercial
insurance deregulation act
✔✔In order to apply for coverage with the NJ Underwriting Association, all must be
fulfilled EXCEPT:
a. attach evidence of their failure to obtain coverage
b. authorize a licensed producer to apply for coverage
c. prove proof of property's condition
d. provide evidence there are no unpaid uncontested premiums due from the applicant -
✔✔c. prove proof of the property's condition
✔✔How often must a property insurer pay a surcharge to the NJ insurance
Development fund for placing business with the NJIUA? - ✔✔Semi-annually
✔✔Insurers that participate in WYO write and service their policies on a no-risk basis
with a plan specific to which administration? - ✔✔Federal Insurance Administration
✔✔Insureds have a right to cancel their policy at any time and any unearned premium
must be refunded. There is a cancellation penalty that will be applied called... - ✔✔A
short rate
✔✔What is the penalty for failing to comply with a subpoena? - ✔✔$5,000
✔✔3 partners are going to open an insurance company. How many of them must be
licensed? - ✔✔At least 1
✔✔Within how many days must an insurer notify the commissioner of a cancelled
agency contract? - ✔✔15 days
✔✔Who would probably not complete continuing education hours? - ✔✔Nonresident
producer
,✔✔A certificate of license status report can be issued for a producer. What is the max
time a report can contain background disciplinary information on a producer? - ✔✔4
years
✔✔When an insurance producer negotiates an insurance contract on behalf of a client
he is acting as a... - ✔✔broker
✔✔What is the fine for unintentionally violating an insurance law? - ✔✔$1,000
✔✔How many days prior to a hearing must a producer be given written notice about a
disciplinary hearing? - ✔✔10 days
✔✔Within what time must agents remit their premium to their insurer? - ✔✔5 business
days
✔✔Last year, John's license lapsed. When can he apply for a late renewal? - ✔✔Within
1 year of its expiration
✔✔How does a producer cancel their license? - ✔✔Return the license to the Dept. of
Insurance & cancel the license
✔✔When a producer acts as a broker, the producer negotiates a contract on behalf of
which of the following? - ✔✔Client
✔✔2 years ago, Sam had his producer's license revoked. How long will he need to wait
before his reinstatement request can take place? - ✔✔3 years
✔✔Which of the following is a responsibility of the commissioner:
a. adopt insurance rules
b. appoint producers
c. provide insurance rates
d. provide insurance quotes - ✔✔a. adopt insurance rules
✔✔An insurer gave funds to one of their producers to return to an insured. When must
the producer give the money back? - ✔✔5 business days
✔✔Next year, Larry's insurance license will need to be renewed. How many days prior
must he submit his application to the Dept? - ✔✔10 days
✔✔When reinsurance is purchased on a certain policy, what kind of insurance does this
describe? - ✔✔Faculatative
, ✔✔Ray, a licensed producer, was killed in a motorcycle accident. If his partner asks
another producer to continue his business transaction, how long can his temporary
agreement last? - ✔✔180 days
✔✔Which is a correct statement regarding the Special Form Dwelling policy?
a. Coverage A & C are on an all risk basis
b. Coverage A& C are for broad form perils
c. Coverage A is for all risk perils & Coverage C is for broad form perils
d. Coverage A is for all risk perils & Coverage C is for basic perils - ✔✔c. Coverage A is
for all risk perils & Coverage C is for broad form perils
✔✔What is the aggregate amount of Coverage C for the loss of property on the
premises used for business purposes? - ✔✔$2500
✔✔How may an insured waive their rights of recovery against another person? - ✔✔By
signing a sworn statement
✔✔What is not an optional coverage in a BOP? - ✔✔Worker's comp
✔✔John has several buildings, each at a different location & with a certain amount of
insurance on each property. What kind of coverage does John have on his buildings? -
✔✔blanket
✔✔What policy covers claims related expenses incurred by an insured to protect their
damaged property from further loss? - ✔✔Additional coverage
✔✔What clause establishes a procedure to determine a property loss when it cannot be
agreed upon by insured & insurer? - ✔✔Arbitration
✔✔What rates are based on similar characteristics of other rates? - ✔✔Manual
✔✔Contracts that are prepared and submitted on a take it or leave it basis are classified
as... - ✔✔Contracts of adhesion
✔✔When would it be possible for a nonresident NJ producer to be exempt from
completing continuing education hours? - ✔✔The producer has satisfied the CE hours
in their home state & they are the same CE requirements as NJ
✔✔Jan just passed her producer license exam. When may she begin soliciting
insurance? - ✔✔After she obtains a temporary work order
✔✔An authorized insurer will most likely be represented by this term regarding
insurance? - ✔✔Admitted
2025/2026 ANSWERS AND QUESTIONS GRADED A+
✔✔Non-renewal and cancellation notices must be sent no later than ___ days to the
insured. - ✔✔120
✔✔A policy may be cancelled at any time for any reason by the insurer if the policy was
in effect for less than _____ days. - ✔✔60
✔✔All commerical policies issued must follow the provisions of what act that protects
the public from the adverse effects of excessive inadequate rates? - ✔✔Commercial
insurance deregulation act
✔✔In order to apply for coverage with the NJ Underwriting Association, all must be
fulfilled EXCEPT:
a. attach evidence of their failure to obtain coverage
b. authorize a licensed producer to apply for coverage
c. prove proof of property's condition
d. provide evidence there are no unpaid uncontested premiums due from the applicant -
✔✔c. prove proof of the property's condition
✔✔How often must a property insurer pay a surcharge to the NJ insurance
Development fund for placing business with the NJIUA? - ✔✔Semi-annually
✔✔Insurers that participate in WYO write and service their policies on a no-risk basis
with a plan specific to which administration? - ✔✔Federal Insurance Administration
✔✔Insureds have a right to cancel their policy at any time and any unearned premium
must be refunded. There is a cancellation penalty that will be applied called... - ✔✔A
short rate
✔✔What is the penalty for failing to comply with a subpoena? - ✔✔$5,000
✔✔3 partners are going to open an insurance company. How many of them must be
licensed? - ✔✔At least 1
✔✔Within how many days must an insurer notify the commissioner of a cancelled
agency contract? - ✔✔15 days
✔✔Who would probably not complete continuing education hours? - ✔✔Nonresident
producer
,✔✔A certificate of license status report can be issued for a producer. What is the max
time a report can contain background disciplinary information on a producer? - ✔✔4
years
✔✔When an insurance producer negotiates an insurance contract on behalf of a client
he is acting as a... - ✔✔broker
✔✔What is the fine for unintentionally violating an insurance law? - ✔✔$1,000
✔✔How many days prior to a hearing must a producer be given written notice about a
disciplinary hearing? - ✔✔10 days
✔✔Within what time must agents remit their premium to their insurer? - ✔✔5 business
days
✔✔Last year, John's license lapsed. When can he apply for a late renewal? - ✔✔Within
1 year of its expiration
✔✔How does a producer cancel their license? - ✔✔Return the license to the Dept. of
Insurance & cancel the license
✔✔When a producer acts as a broker, the producer negotiates a contract on behalf of
which of the following? - ✔✔Client
✔✔2 years ago, Sam had his producer's license revoked. How long will he need to wait
before his reinstatement request can take place? - ✔✔3 years
✔✔Which of the following is a responsibility of the commissioner:
a. adopt insurance rules
b. appoint producers
c. provide insurance rates
d. provide insurance quotes - ✔✔a. adopt insurance rules
✔✔An insurer gave funds to one of their producers to return to an insured. When must
the producer give the money back? - ✔✔5 business days
✔✔Next year, Larry's insurance license will need to be renewed. How many days prior
must he submit his application to the Dept? - ✔✔10 days
✔✔When reinsurance is purchased on a certain policy, what kind of insurance does this
describe? - ✔✔Faculatative
, ✔✔Ray, a licensed producer, was killed in a motorcycle accident. If his partner asks
another producer to continue his business transaction, how long can his temporary
agreement last? - ✔✔180 days
✔✔Which is a correct statement regarding the Special Form Dwelling policy?
a. Coverage A & C are on an all risk basis
b. Coverage A& C are for broad form perils
c. Coverage A is for all risk perils & Coverage C is for broad form perils
d. Coverage A is for all risk perils & Coverage C is for basic perils - ✔✔c. Coverage A is
for all risk perils & Coverage C is for broad form perils
✔✔What is the aggregate amount of Coverage C for the loss of property on the
premises used for business purposes? - ✔✔$2500
✔✔How may an insured waive their rights of recovery against another person? - ✔✔By
signing a sworn statement
✔✔What is not an optional coverage in a BOP? - ✔✔Worker's comp
✔✔John has several buildings, each at a different location & with a certain amount of
insurance on each property. What kind of coverage does John have on his buildings? -
✔✔blanket
✔✔What policy covers claims related expenses incurred by an insured to protect their
damaged property from further loss? - ✔✔Additional coverage
✔✔What clause establishes a procedure to determine a property loss when it cannot be
agreed upon by insured & insurer? - ✔✔Arbitration
✔✔What rates are based on similar characteristics of other rates? - ✔✔Manual
✔✔Contracts that are prepared and submitted on a take it or leave it basis are classified
as... - ✔✔Contracts of adhesion
✔✔When would it be possible for a nonresident NJ producer to be exempt from
completing continuing education hours? - ✔✔The producer has satisfied the CE hours
in their home state & they are the same CE requirements as NJ
✔✔Jan just passed her producer license exam. When may she begin soliciting
insurance? - ✔✔After she obtains a temporary work order
✔✔An authorized insurer will most likely be represented by this term regarding
insurance? - ✔✔Admitted
