EXAM FX, VA PROPERTY &
CASUALTY INSURANCE EXAM
QUESTIONS & VERIFIED ANSWERS
PASSED ALREADY GRADED A+
The members of a limited liability company are insureds under a businessowners policy (BOP) if
- correct answer ✔✔The limited liability company is designated as the named insured.
An endorsement added to a businessowners policy that provides coverage for direct damage
caused by utility service disruption stemming from a covered peril is called - correct answer
✔✔Utility Services - Direct Damage.
Which of the following would be the insured's duty in the event of a loss according to the duties
in event of occurrence, claim, or suit condition? - correct answer ✔✔Providing specific details
regarding an occurrence
Which common policy condition prohibits the insured from changing the rights or duties as
defined under the policy to any other person or entity without the written consent of the
insurance company? - correct answer ✔✔Transfer of rights and duties under the policy
A company has a businessowners policy on a building with an estimated replacement cost of
$300,000. The company carries $150,000 of insurance. If a loss occurs, how much will the
insured company be paid? - correct answer ✔✔The coinsurance formula would apply
The businessowners policy liability coverage will pay for necessary medical expenses of others
incurred within what maximum time period? - correct answer ✔✔1 year
,The most the insurer will pay for a loss under a businessowners policy is - correct answer
✔✔The limit of insurance after the deductible is paid.
Which of the following is NOT settled on an actual cash value basis while covered under the
business property coverage form? - correct answer ✔✔Valuable papers and records
Which endorsement adds coverage for employee use of automobiles in the insured's business
and the insured's use of rented autos if no coverage is provided on a business auto policy? -
correct answer ✔✔Hired and nonowned auto liability
Which of the following is an example of a protective safeguard in a businessowners policy? -
correct answer ✔✔Automatic sprinkler system
A BOP (businessowners policy) is most similar to - correct answer ✔✔Homeowners.
Jean owns a craft store. The protective safeguards endorsement of her BOP requires the store to
have a functional automatic sprinkler system. A winter storm freezes the pipes to the sprinkler
system, causing the system to shut down. How many hours does Jean have to restore the
system before she must notify her insurer? - correct answer ✔✔48 hours
Frank's Steaks furnishes meat to steakhouses. An accident on the premises causes the building
to lose refrigeration for 32 hours. The state inspectors will not allow the meat in the
refrigerating units to be sold for human consumption, and Frank loses $18,500 in disposing of
the meat. What coverage under Frank's BOP policy will cover the loss? - correct answer
✔✔Utility service - direct damage
Which of the following is eligible for a businessowners policy? - correct answer ✔✔A 6-story
office building with less than 100,000 square feet total area
In business income additional coverage in a businessowners policy (BOP), the waiting period
that must occur before the period of restoration may begin is - correct answer ✔✔72 hours.
,Under the additional coverages of a businessowners policy, property removed to protect it from
loss will be covered at another location for up to - correct answer ✔✔30 days.
All of the following statements are true regarding employee dishonesty optional coverage under
the businessowners policy (BOP) EXCEPT - correct answer ✔✔It provides coverage for all
employees, even those employees who were terminated in the past 90 days.
Under a businessowners policy, the inspections and surveys condition specifies all of the
following EXCEPT - correct answer ✔✔The insurer does not have the right to inspect the
insured's property and operations.
When is a hired and nonowned auto liability endorsement available in a businessowners policy
(BOP)? - correct answer ✔✔Only if the insured does not have commercial auto coverage
In addition to the common policy conditions, all of the following conditions apply to liability
coverage EXCEPT - correct answer ✔✔Employers liability.
The liability coverage of the businessowners policy is written on a - correct answer
✔✔Businessowners liability coverage form.
All of the following would be covered under the medical expense coverage of a businessowners
policy EXCEPT - correct answer ✔✔Mental health counseling.
A businessowners policy is - correct answer ✔✔A self-contained prepackaged policy.
Which of the following is defined as a covered cause of loss in businessowners property
coverage? - correct answer ✔✔Leakage from fire-extinguishing equipment
, What is the limit for the forgery or alteration coverage in the businessowners policy? - correct
answer ✔✔$2,500
Which of the following is NOT an optional coverage available in a businessowners policy? -
correct answer ✔✔Workers compensation
The pollutant cleanup and removal coverage in the businessowners policy has a limit of - correct
answer ✔✔$10,000 in any 12-month period.
Which of the following limits, shown in the declarations of a policy, applies to medical
expenses? - correct answer ✔✔Per person
The inspections and surveys condition in a businessowners policy - correct answer ✔✔Allows
the insurer the right to inspect the insured's premises.
According to businessowners policy Section I, which of the following is NOT a condition to be
met for the terms of the policy to apply to mortgageholders? - correct answer ✔✔The
mortgageholder must petition the state department of insurance for named status.
An advertising company has its annual holiday party for employees and customers, after which
a customer who had too much to drink is involved in an automobile accident. Occupants of the
other car involved in the accident sue the company for serving the customer too much alcohol.
Will the company's businessowners policy provide coverage? - correct answer ✔✔Yes, none of
the exclusions will apply.
Under businessowners policy Section I, if an insurer wants to cancel a policy for any reason
except nonpayment of premium, how many days before the effective cancellation date must the
insurer notify the mortgageholder? - correct answer ✔✔30 days
CASUALTY INSURANCE EXAM
QUESTIONS & VERIFIED ANSWERS
PASSED ALREADY GRADED A+
The members of a limited liability company are insureds under a businessowners policy (BOP) if
- correct answer ✔✔The limited liability company is designated as the named insured.
An endorsement added to a businessowners policy that provides coverage for direct damage
caused by utility service disruption stemming from a covered peril is called - correct answer
✔✔Utility Services - Direct Damage.
Which of the following would be the insured's duty in the event of a loss according to the duties
in event of occurrence, claim, or suit condition? - correct answer ✔✔Providing specific details
regarding an occurrence
Which common policy condition prohibits the insured from changing the rights or duties as
defined under the policy to any other person or entity without the written consent of the
insurance company? - correct answer ✔✔Transfer of rights and duties under the policy
A company has a businessowners policy on a building with an estimated replacement cost of
$300,000. The company carries $150,000 of insurance. If a loss occurs, how much will the
insured company be paid? - correct answer ✔✔The coinsurance formula would apply
The businessowners policy liability coverage will pay for necessary medical expenses of others
incurred within what maximum time period? - correct answer ✔✔1 year
,The most the insurer will pay for a loss under a businessowners policy is - correct answer
✔✔The limit of insurance after the deductible is paid.
Which of the following is NOT settled on an actual cash value basis while covered under the
business property coverage form? - correct answer ✔✔Valuable papers and records
Which endorsement adds coverage for employee use of automobiles in the insured's business
and the insured's use of rented autos if no coverage is provided on a business auto policy? -
correct answer ✔✔Hired and nonowned auto liability
Which of the following is an example of a protective safeguard in a businessowners policy? -
correct answer ✔✔Automatic sprinkler system
A BOP (businessowners policy) is most similar to - correct answer ✔✔Homeowners.
Jean owns a craft store. The protective safeguards endorsement of her BOP requires the store to
have a functional automatic sprinkler system. A winter storm freezes the pipes to the sprinkler
system, causing the system to shut down. How many hours does Jean have to restore the
system before she must notify her insurer? - correct answer ✔✔48 hours
Frank's Steaks furnishes meat to steakhouses. An accident on the premises causes the building
to lose refrigeration for 32 hours. The state inspectors will not allow the meat in the
refrigerating units to be sold for human consumption, and Frank loses $18,500 in disposing of
the meat. What coverage under Frank's BOP policy will cover the loss? - correct answer
✔✔Utility service - direct damage
Which of the following is eligible for a businessowners policy? - correct answer ✔✔A 6-story
office building with less than 100,000 square feet total area
In business income additional coverage in a businessowners policy (BOP), the waiting period
that must occur before the period of restoration may begin is - correct answer ✔✔72 hours.
,Under the additional coverages of a businessowners policy, property removed to protect it from
loss will be covered at another location for up to - correct answer ✔✔30 days.
All of the following statements are true regarding employee dishonesty optional coverage under
the businessowners policy (BOP) EXCEPT - correct answer ✔✔It provides coverage for all
employees, even those employees who were terminated in the past 90 days.
Under a businessowners policy, the inspections and surveys condition specifies all of the
following EXCEPT - correct answer ✔✔The insurer does not have the right to inspect the
insured's property and operations.
When is a hired and nonowned auto liability endorsement available in a businessowners policy
(BOP)? - correct answer ✔✔Only if the insured does not have commercial auto coverage
In addition to the common policy conditions, all of the following conditions apply to liability
coverage EXCEPT - correct answer ✔✔Employers liability.
The liability coverage of the businessowners policy is written on a - correct answer
✔✔Businessowners liability coverage form.
All of the following would be covered under the medical expense coverage of a businessowners
policy EXCEPT - correct answer ✔✔Mental health counseling.
A businessowners policy is - correct answer ✔✔A self-contained prepackaged policy.
Which of the following is defined as a covered cause of loss in businessowners property
coverage? - correct answer ✔✔Leakage from fire-extinguishing equipment
, What is the limit for the forgery or alteration coverage in the businessowners policy? - correct
answer ✔✔$2,500
Which of the following is NOT an optional coverage available in a businessowners policy? -
correct answer ✔✔Workers compensation
The pollutant cleanup and removal coverage in the businessowners policy has a limit of - correct
answer ✔✔$10,000 in any 12-month period.
Which of the following limits, shown in the declarations of a policy, applies to medical
expenses? - correct answer ✔✔Per person
The inspections and surveys condition in a businessowners policy - correct answer ✔✔Allows
the insurer the right to inspect the insured's premises.
According to businessowners policy Section I, which of the following is NOT a condition to be
met for the terms of the policy to apply to mortgageholders? - correct answer ✔✔The
mortgageholder must petition the state department of insurance for named status.
An advertising company has its annual holiday party for employees and customers, after which
a customer who had too much to drink is involved in an automobile accident. Occupants of the
other car involved in the accident sue the company for serving the customer too much alcohol.
Will the company's businessowners policy provide coverage? - correct answer ✔✔Yes, none of
the exclusions will apply.
Under businessowners policy Section I, if an insurer wants to cancel a policy for any reason
except nonpayment of premium, how many days before the effective cancellation date must the
insurer notify the mortgageholder? - correct answer ✔✔30 days
