NC Casualty Questions with
Accurate Answers
$15,000 correct answer To become a broker in NC requires a bond of what
amount?
$5,000 correct answer If a person is found guilty of a violation for which an
insurance license may be suspended or revoked, the Commissioner may order the
payment of restitution to any person harmed by the violation and payment of up
to what amount?
10 days advance notice for nonpayment of premium, 30 days notice for other
reasons correct answer When an insurer cancels a Commercial Package policy, it
must give the insured
15 correct answer When insurance rates come under the jurisdiction of North
Carolina Rate Bureau and an insurer wishes to change those rates, the insured
must be given written notice of this change at least how many days in advance?
30 days correct answer If an agent's appointment or license is cancelled by an
insurer, the insurer must give written notice to the Commissioner within
45 days prior to the effective date correct answer The liberalization clause of a
Businessowner's policy automatically applies favorable expansions of coverage,
for which a premium is not charged, if the changes are made during the policy
period or within what time period?
80% correct answer Minimum amount of insurance required to avoid coinsurance
,A financial guarantee of your performance of a specific action correct answer
Surety Bond
A rating system should be designed to provide a fair match between what two
levels?
A. Level of profits and level of contingencies
B. Level of the premium and level of loss costs
C. Level of the premium and level of the exposure to loss
D. Level of the class rating and level of the individual rating correct answer C.
Level of the premium and level of the exposure to loss
A. $20 per day with a maximum of $600 correct answer Transportation expenses
cover up to
A. $20 per day with a maximum of $600
B. $25 per day with a maximum of $750
C. $30 per day with a maximum of $900
D. $40 per day with a maximum of $1,200
A. $300,000 correct answer What is the maximum amount that the North
Carolina Insurance Guaranty Association will pay on a covered claim?
A. $300,000
B. $500,000
C. $750,000
D. $1 million
,A. 30 days correct answer Compensation for an employee's injury will be allowed
only if the employer knew about the injury or was notified of it within how many
days after the accident occurred?
A. 30 days
B. 60 days
C. 90 days
D. 120 days
A. A motor vehicle insured by an insolvent liability insurer correct answer Which
of the following is included in the term uninsured motor vehicle?
A. A motor vehicle insured by an insolvent liability insurer
B. A motor vehicle owned by the named insured
C. A motor vehicle owned or operated by a self insurer
D. A motor vehicle owned by the United States or Canada
A. A rate is the price of insurance for each unit of exposure. A premium is a
periodic payment for insurance coverage correct answer How does an insurance
rate differ from an insurance premium?
A. A rate is the price of insurance for each unit of exposure. A premium is a
periodic payment for insurance coverage.
B. There is essentially no difference between them.
C. A rate is the final calculation of what the cost of insurance will be.
D. Premiums include loss costs and expenses, but rates do not.
A. A vehicle that has an auto insurance policy with minimum liability limits correct
answer Which of the following vehicles is not an 'uninsured motor vehicle' at the
, time of an accident under Part C'Uninsured Motorists Coverage on a personal
auto policy?
A. A vehicle that has an auto insurance policy with minimum liability limits
B. A hit-and-run vehicle
C. A vehicle for which no auto insurance liability policy is in place
D. A vehicle with an applicable liability policy but the insurer denies coverage
A. Agreed value correct answer Robin has a valuable porcelain collection she
wants to insure. It's difficult to assess the collection's value because some items
were purchased through dealers and at auctions and their costs reflect actual
value. Other items were purchased online, at flea markets, or at garage sales at
significantly reduced prices, but have values greater than their costs. Robin and
her insurer have worked out a schedule listing the value of each insured item.
What valuation method have they used?
A. Agreed value
B. Stated amount
C. Market value
D. Replacement cost
A. Aleatory contracts involve an exchange of equal amounts. correct answer
Susan is studying insurance and comes across the term 'aleatory contract.' She
asks her professor what the term means and he tells her that
A. Aleatory contracts involve an exchange of equal amounts.
B. Aleatory contracts involve an exchange of unequal amounts.
C. Insurance contracts are not aleatory.
D. Aleatory contracts are commutative.
Accurate Answers
$15,000 correct answer To become a broker in NC requires a bond of what
amount?
$5,000 correct answer If a person is found guilty of a violation for which an
insurance license may be suspended or revoked, the Commissioner may order the
payment of restitution to any person harmed by the violation and payment of up
to what amount?
10 days advance notice for nonpayment of premium, 30 days notice for other
reasons correct answer When an insurer cancels a Commercial Package policy, it
must give the insured
15 correct answer When insurance rates come under the jurisdiction of North
Carolina Rate Bureau and an insurer wishes to change those rates, the insured
must be given written notice of this change at least how many days in advance?
30 days correct answer If an agent's appointment or license is cancelled by an
insurer, the insurer must give written notice to the Commissioner within
45 days prior to the effective date correct answer The liberalization clause of a
Businessowner's policy automatically applies favorable expansions of coverage,
for which a premium is not charged, if the changes are made during the policy
period or within what time period?
80% correct answer Minimum amount of insurance required to avoid coinsurance
,A financial guarantee of your performance of a specific action correct answer
Surety Bond
A rating system should be designed to provide a fair match between what two
levels?
A. Level of profits and level of contingencies
B. Level of the premium and level of loss costs
C. Level of the premium and level of the exposure to loss
D. Level of the class rating and level of the individual rating correct answer C.
Level of the premium and level of the exposure to loss
A. $20 per day with a maximum of $600 correct answer Transportation expenses
cover up to
A. $20 per day with a maximum of $600
B. $25 per day with a maximum of $750
C. $30 per day with a maximum of $900
D. $40 per day with a maximum of $1,200
A. $300,000 correct answer What is the maximum amount that the North
Carolina Insurance Guaranty Association will pay on a covered claim?
A. $300,000
B. $500,000
C. $750,000
D. $1 million
,A. 30 days correct answer Compensation for an employee's injury will be allowed
only if the employer knew about the injury or was notified of it within how many
days after the accident occurred?
A. 30 days
B. 60 days
C. 90 days
D. 120 days
A. A motor vehicle insured by an insolvent liability insurer correct answer Which
of the following is included in the term uninsured motor vehicle?
A. A motor vehicle insured by an insolvent liability insurer
B. A motor vehicle owned by the named insured
C. A motor vehicle owned or operated by a self insurer
D. A motor vehicle owned by the United States or Canada
A. A rate is the price of insurance for each unit of exposure. A premium is a
periodic payment for insurance coverage correct answer How does an insurance
rate differ from an insurance premium?
A. A rate is the price of insurance for each unit of exposure. A premium is a
periodic payment for insurance coverage.
B. There is essentially no difference between them.
C. A rate is the final calculation of what the cost of insurance will be.
D. Premiums include loss costs and expenses, but rates do not.
A. A vehicle that has an auto insurance policy with minimum liability limits correct
answer Which of the following vehicles is not an 'uninsured motor vehicle' at the
, time of an accident under Part C'Uninsured Motorists Coverage on a personal
auto policy?
A. A vehicle that has an auto insurance policy with minimum liability limits
B. A hit-and-run vehicle
C. A vehicle for which no auto insurance liability policy is in place
D. A vehicle with an applicable liability policy but the insurer denies coverage
A. Agreed value correct answer Robin has a valuable porcelain collection she
wants to insure. It's difficult to assess the collection's value because some items
were purchased through dealers and at auctions and their costs reflect actual
value. Other items were purchased online, at flea markets, or at garage sales at
significantly reduced prices, but have values greater than their costs. Robin and
her insurer have worked out a schedule listing the value of each insured item.
What valuation method have they used?
A. Agreed value
B. Stated amount
C. Market value
D. Replacement cost
A. Aleatory contracts involve an exchange of equal amounts. correct answer
Susan is studying insurance and comes across the term 'aleatory contract.' She
asks her professor what the term means and he tells her that
A. Aleatory contracts involve an exchange of equal amounts.
B. Aleatory contracts involve an exchange of unequal amounts.
C. Insurance contracts are not aleatory.
D. Aleatory contracts are commutative.
