AINS 103 Chapter 4 Exam with verified detailed answers

AINS 103 Chapter 4 Exam with verified ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




detailed answers ||\\|//||




What format do most insurers use for commercial auto coverage? - correct answer✔✔Due
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to auto insurance needs and legal requirements, coverage needs can vary, which is why
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most insurers use a flexible, modular format.
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Business Auto Coverage Form (BACF): - correct answer✔✔Provides auto liability ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




insurance and includes optional coverage for physical damage to autos. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




BACF Liability Coverage: - correct answer✔✔The insurer agrees to pay damages for bodily
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injury or property damage the insured is liable for that is caused by an accident involving a
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covered auto. Exclusions, policy limits and other conditions may apply.
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BACF Physical Damage Coverage: - correct answer✔✔Coverage is optional, but is often
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required if a business is financing or leasing its autos. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




The BACF allows a business to select from three basic physical damage coverages: - correct
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answer✔✔-Collision
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-Comprehensive

-Specified Causes of Loss ||\\|//|| ||\\|//|| ||\\|//||




Collision Coverage: - correct answer✔✔Insures direct and accidental loss of or damage to a ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




covered auto caused by its collision with another object or is overturned.
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,Comprehensive Coverage: - correct answer✔✔Open perils coverage, which insures direct ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




and accidental loss of or damage to a covered auto by any peril EXCEPT collision,
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overturn, or one specifically excluded. Overlaps with Specified Causes of Loss Coverage. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




Specified Causes of Loss Coverage: - correct answer✔✔Covers direct and accidental loss ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




caused by fire, lightning, explosion, theft, windstorm, hail, earthquake, flood, mischief,
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vandalism, or loss resulting from the sinking, burning, collision, or derailment of a ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




conveyance transporting the covered auto. Overlaps with Comprehensive Coverage. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




Important Endorsements: - correct answer✔✔Coverages for medical payments, personal ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




injury protection (PIP), uninsured motorists (UM), and underinsured motorists (UIM) are
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commonly added by endorsements to commercial auto coverage forms. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




Auto Medical Payments Coverage: - correct answer✔✔Pays small bodily injury claims
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resulting from an auto accident, regardless of fault. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




(Personal Injury Protection (PIP) Coverage: - correct answer✔✔May be legally required by ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




state law. It pays benefits, regardless of fault, for medical expense, income loss, and other
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expenses resulting from an accident. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




Uninsured/Underinsured Motorist (UM/UIM) Coverage: - correct answer✔✔Pays for ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




injuries caused by another motorist who is uninsured/underinsured and unable to pay as a
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result.
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Jane is an Electrician who drives her employer covered auto, a van, to a customer's house.
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While parked, the van leaked coolant on the customers driveway. Does the BACF provide
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coverage for the pollution cleanup? - correct answer✔✔Yes. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




What three basic physical damage coverages does the BACF offer to businesses? - correct
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answer✔✔-Collision

, -Comprehensive

-Specified Causes of Loss ||\\|//|| ||\\|//|| ||\\|//||




Which example would qualify as an uninsured motorist pursuant to an uninsured motorist
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UM endorsement on a business auto policy? - correct answer✔✔A hit-and-run driver.
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The Morlyn Corporation has a Business Auto Coverage Form (BACF) that provides liability
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coverage for any auto. In addition to the named insured, who/what would also be an
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insured under Morlyn's BACF when driving a covered auto? - correct answer✔✔An ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




employee driving a vehicle leased by Morlyn for business purposes. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




Coverage will apply under the liability insuring agreement of the Business Auto Coverage ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




Form (BACF) for bodily injury or property damage due to: - correct answer✔✔Caused by
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an accident. ||\\|//||




Which is an example of a loss covered by Employers Liability Insurance? - correct
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answer✔✔An injured employee sues a third party who, in turn, sues the injured person's ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




employer for negligence that resulted in the injury. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




Umbrella liability insurance MAY cover: - correct answer✔✔Some claims that are not ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




covered by underlying liability insurance. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||




In equipment breakdown insurance, an example of a piece of mechanical equipment is a: -
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correct answer✔✔Turbine. ||\\|//||




Policies for the crime loss exposure for financial institutions are called "bonds" because: -
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correct answer✔✔Employee dishonesty, a key coverage, was traditionally called a "fidelity
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bond."