Pearson VUE: Property Insurance
Practice Exam Questions and Answers
S is purchasing a Commercial Property policy to cover a
commercial building with a replacement cost of $100,000.
The policy includes an 80 percent Coinsurance clause. To
avoid a coinsurance penalty in the event of a partial loss, S
should purchase a policy with minimum limits of AT LEAST
which of the following amounts?
A. $100,000
B. $90,000
C. $80,000
D. $20,000 - Correct Answer ✅C
The MAXIMUM amount a policy will pay in the event of a loss
is called the:
A. coinsurance amount
,Pearson VUE: Property Insurance
Practice Exam Questions and Answers
B. deductible
C. limit of liability
D. pro rata return - Correct Answer ✅C
The National Flood Insurance Program provides coverage for
losses caused by all of the following occurrences EXCEPT:
A. mudslides
B. runoff from heavy rain
C. overflow of tidal waters
D. water-main breakage - Correct Answer ✅D
Special Form or Open Perils coverage:
,Pearson VUE: Property Insurance
Practice Exam Questions and Answers
A. Provides coverage against the named perils
B. Provides coverage against scheduled risks
C. Is limited by the named exclusions
D. Includes no exclusions - Correct Answer ✅C
Which of the following businesses would be eligible for a
Businessowners policy?
A. Auto body shop
B. Theater
C. Branch bank
D. Barber shop - Correct Answer ✅D
, Pearson VUE: Property Insurance
Practice Exam Questions and Answers
During a tornado, a barn is destroyed when a section of its
wall is blown down, knocking over a lantern, which sets the
barn on fire. The proximate cause of loss is the:
A. fire
B. collapse of the wall
C. tornado
D. smoke - Correct Answer ✅C
A fire in an insured's restaurant burns the kitchen walls and
causes smoke damage to the entire interior. Water used to
extinguish the fire causes extensive damage to floors and
furnishings. The water damage is best described as:
A. a time element loss
B. a consequential loss
Practice Exam Questions and Answers
S is purchasing a Commercial Property policy to cover a
commercial building with a replacement cost of $100,000.
The policy includes an 80 percent Coinsurance clause. To
avoid a coinsurance penalty in the event of a partial loss, S
should purchase a policy with minimum limits of AT LEAST
which of the following amounts?
A. $100,000
B. $90,000
C. $80,000
D. $20,000 - Correct Answer ✅C
The MAXIMUM amount a policy will pay in the event of a loss
is called the:
A. coinsurance amount
,Pearson VUE: Property Insurance
Practice Exam Questions and Answers
B. deductible
C. limit of liability
D. pro rata return - Correct Answer ✅C
The National Flood Insurance Program provides coverage for
losses caused by all of the following occurrences EXCEPT:
A. mudslides
B. runoff from heavy rain
C. overflow of tidal waters
D. water-main breakage - Correct Answer ✅D
Special Form or Open Perils coverage:
,Pearson VUE: Property Insurance
Practice Exam Questions and Answers
A. Provides coverage against the named perils
B. Provides coverage against scheduled risks
C. Is limited by the named exclusions
D. Includes no exclusions - Correct Answer ✅C
Which of the following businesses would be eligible for a
Businessowners policy?
A. Auto body shop
B. Theater
C. Branch bank
D. Barber shop - Correct Answer ✅D
, Pearson VUE: Property Insurance
Practice Exam Questions and Answers
During a tornado, a barn is destroyed when a section of its
wall is blown down, knocking over a lantern, which sets the
barn on fire. The proximate cause of loss is the:
A. fire
B. collapse of the wall
C. tornado
D. smoke - Correct Answer ✅C
A fire in an insured's restaurant burns the kitchen walls and
causes smoke damage to the entire interior. Water used to
extinguish the fire causes extensive damage to floors and
furnishings. The water damage is best described as:
A. a time element loss
B. a consequential loss
