NJ PROPERTY CASUALTY INSURANCE EXAM
SET Questions and Answers
1. Why was the commercial Insurance Deregulation Act Created?
ANS To protect the public from the adverse effects of excessive, inadequate, & unfair
discriminatory rates & marketing practices
2. Which policies issued must follow the provisions of the
Commercial Insurance Deregulation Act?
ANS Commercial policies
3. When must rate amendments & policy forms be filed with the
commission- er?
ANS 30 days before
4. What losses are excluded from flood insurance?
ANS -Landslides
-Sewer backup
-Windblown Rain
-Snow
-Sleet
5. Who administers the NFIP?
, ANS Federal Insurance Administration (FIA)
6. What does the NFIP stand for?
ANS National Flood Insurance Program
7. Why was the National Flood insurance Program constructed?
ANS to fill in gaps of flood coverage by the private sector
8. What are the 3 NFIP requirements for coverage?
ANS -community land management & flood control programs must reduce flood losses in
the future
-Flood insurance required in specific flood prone areas as a condition for receiving loans through/ backed
by the federal government
-Property owners that fail to purchase flood insurance within 1 year after it is available will not be eligible for full
disaster relief funding. It will be reduced by an amount of insurance that could have been purchased
9. What is the NFIP max coverage for a single family?
ANS Building $250K, Contents $100K
10. What is the NFIP max coverage for other residential?
ANS Building $250K, Contents $100K
11. What is the NFIP max coverage for small business?
ANS Building $500K, Contents $500K
,12. What is the NFIP max coverage for Other Non-Residential?
ANS Building $500k, Contents
$500K
13. What is the NFIP subsidized rate for a single family?
ANS Building $35K, Contents $10K
14. What is the NFIP subsidized rate for Other Residential?
ANS Building $100K, Contents
$100K
15. What is the NFIP subsidized rate for small businesses?
ANS Building $100K, Contents $100K
16. What is the NFIP subsidized rate for other non-residential?
ANS Building $100K, Contents
$100K
17. What is the wait period before flood insurance can be
effective?
ANS 30 days, no binders issued
, 18. What are the exceptions to the 30 day NFIP wait period?
ANS -1st 30 days after coverage, community enters standard or emergency program,
coverage will begin at 12:01 am the date after application and premium were mailed
-When an existing policy was assigned to a property purchaser
-At 12:01 am on the 5th day after an endorsement request & premium has been mailed for existing policy
19. What was the Supreme Court's decision regarding the Paul v.
Virginia case?-
ANS insurance was NOT interstate commerce and could not be regulated by the federal govt.
20. Who heard the Paul v. Virginia case?
ANS Supreme Court
21. Who heard the US v Southeastern Underwriting Association case?
ANS Supreme Court
22. What was the decision in the US v Southeastern Underwriting
Association Case?
ANS Insurance is interstate commerce and should be subject to federal regulations (currently in
effect today)
23. What is the McCarran-Ferguson Act?
SET Questions and Answers
1. Why was the commercial Insurance Deregulation Act Created?
ANS To protect the public from the adverse effects of excessive, inadequate, & unfair
discriminatory rates & marketing practices
2. Which policies issued must follow the provisions of the
Commercial Insurance Deregulation Act?
ANS Commercial policies
3. When must rate amendments & policy forms be filed with the
commission- er?
ANS 30 days before
4. What losses are excluded from flood insurance?
ANS -Landslides
-Sewer backup
-Windblown Rain
-Snow
-Sleet
5. Who administers the NFIP?
, ANS Federal Insurance Administration (FIA)
6. What does the NFIP stand for?
ANS National Flood Insurance Program
7. Why was the National Flood insurance Program constructed?
ANS to fill in gaps of flood coverage by the private sector
8. What are the 3 NFIP requirements for coverage?
ANS -community land management & flood control programs must reduce flood losses in
the future
-Flood insurance required in specific flood prone areas as a condition for receiving loans through/ backed
by the federal government
-Property owners that fail to purchase flood insurance within 1 year after it is available will not be eligible for full
disaster relief funding. It will be reduced by an amount of insurance that could have been purchased
9. What is the NFIP max coverage for a single family?
ANS Building $250K, Contents $100K
10. What is the NFIP max coverage for other residential?
ANS Building $250K, Contents $100K
11. What is the NFIP max coverage for small business?
ANS Building $500K, Contents $500K
,12. What is the NFIP max coverage for Other Non-Residential?
ANS Building $500k, Contents
$500K
13. What is the NFIP subsidized rate for a single family?
ANS Building $35K, Contents $10K
14. What is the NFIP subsidized rate for Other Residential?
ANS Building $100K, Contents
$100K
15. What is the NFIP subsidized rate for small businesses?
ANS Building $100K, Contents $100K
16. What is the NFIP subsidized rate for other non-residential?
ANS Building $100K, Contents
$100K
17. What is the wait period before flood insurance can be
effective?
ANS 30 days, no binders issued
, 18. What are the exceptions to the 30 day NFIP wait period?
ANS -1st 30 days after coverage, community enters standard or emergency program,
coverage will begin at 12:01 am the date after application and premium were mailed
-When an existing policy was assigned to a property purchaser
-At 12:01 am on the 5th day after an endorsement request & premium has been mailed for existing policy
19. What was the Supreme Court's decision regarding the Paul v.
Virginia case?-
ANS insurance was NOT interstate commerce and could not be regulated by the federal govt.
20. Who heard the Paul v. Virginia case?
ANS Supreme Court
21. Who heard the US v Southeastern Underwriting Association case?
ANS Supreme Court
22. What was the decision in the US v Southeastern Underwriting
Association Case?
ANS Insurance is interstate commerce and should be subject to federal regulations (currently in
effect today)
23. What is the McCarran-Ferguson Act?
