FUNDAMENTALS OF INSURANCE (Business)
LEVEL 1 PRACTICE EXAM 2 QUESTIONS
AND ANSWERS
When the insurer has made the decision to change the policy in any way that
provides less protection for the insured, they will prepare two copies of the
endorsement. One copy must be signed by the insured and returned to the
insurance company. This signed copy will help the insurer to prove, in the
event of a later dispute, that the insured was aware of the change in
coverage and had agreed to it.
Correct Answer -True.
Many insurance policies have pre-printed endorsements included in their
policies. If the endorsement is applicable to the insured, the Declarations
page of their policy will identify the endorsement and indicate that it applies
to the insured's policy.
Correct Answer -True.
A rider is used primarily to insure mobile property that moves from one
location to another. It is different from a floater that is used solely to insure
waterborne property.
Correct Answer -False.
All insurance policies contain conditions. A condition essentially tells the
insured what they should and should not do. When the insured breaches a
condition, coverage can be denied when the breach of condition is directly
related to the cause of the loss.
Correct Answer -True.
, An exclusion in an insurance policy refers to losses that are not insured by
them. However, there are many property insurance policies that have np
exclusions at all.
Correct Answer -False.
Exclusions can be "bought out" of property and other insurance policies.
This is true for all exclusions, including war and loss or damage from
terrorism.
Correct Answer -False.
Where no Loss Payee has been named on the policy and the claim has been
paid in full to the insured, the insurance company could still be responsible
to compensate the Loss Payee.
Correct Answer -False.
Most insurance companies will provide automatic renewals for all their
insurance policies.
Correct Answer -False.
The insurance company may make the decision not to renew certain
policies. That information will be provided to the brokerage well in advance
of the policy expiry date.
Correct Answer -True.
Regardless of the number of names on the policy, there are other people
who will also qualify as insureds under that policy. These other people will
LEVEL 1 PRACTICE EXAM 2 QUESTIONS
AND ANSWERS
When the insurer has made the decision to change the policy in any way that
provides less protection for the insured, they will prepare two copies of the
endorsement. One copy must be signed by the insured and returned to the
insurance company. This signed copy will help the insurer to prove, in the
event of a later dispute, that the insured was aware of the change in
coverage and had agreed to it.
Correct Answer -True.
Many insurance policies have pre-printed endorsements included in their
policies. If the endorsement is applicable to the insured, the Declarations
page of their policy will identify the endorsement and indicate that it applies
to the insured's policy.
Correct Answer -True.
A rider is used primarily to insure mobile property that moves from one
location to another. It is different from a floater that is used solely to insure
waterborne property.
Correct Answer -False.
All insurance policies contain conditions. A condition essentially tells the
insured what they should and should not do. When the insured breaches a
condition, coverage can be denied when the breach of condition is directly
related to the cause of the loss.
Correct Answer -True.
, An exclusion in an insurance policy refers to losses that are not insured by
them. However, there are many property insurance policies that have np
exclusions at all.
Correct Answer -False.
Exclusions can be "bought out" of property and other insurance policies.
This is true for all exclusions, including war and loss or damage from
terrorism.
Correct Answer -False.
Where no Loss Payee has been named on the policy and the claim has been
paid in full to the insured, the insurance company could still be responsible
to compensate the Loss Payee.
Correct Answer -False.
Most insurance companies will provide automatic renewals for all their
insurance policies.
Correct Answer -False.
The insurance company may make the decision not to renew certain
policies. That information will be provided to the brokerage well in advance
of the policy expiry date.
Correct Answer -True.
Regardless of the number of names on the policy, there are other people
who will also qualify as insureds under that policy. These other people will
