CPCU 551 ACTUAL PRACTICE TEXT 200 QUESTIONS
WITH CORRECT ANALYZED ANSWERS TEST BANK
LATEST COMPLETE A+ SOLUTION PASSED
Question 1
ID# 5900769Points: 1
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Question text
Which one of the following statements best describes the Causes of Loss—Special Form?
Select one:
A. The placement of the "burden of proof" rests with the insured as opposed to the insurer.
B. The Special Form is designed to cover any loss that would not be covered by the Basic and Broad
Forms.
C. The Special Form contains exclusions that are covered in the Basic and Broad Forms for certain
hard to insure perils.
D. The Special Form provides coverage for direct physical losses other than those that are specifically
excluded. - CORRECT ANSWER ✔✔ - d
Question 2
ID# 5869629Points: 1
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Question text
Billy owns a baseball souvenir store in Cooperstown, NY. He insured his store under a Building and
Personal Property Coverage Form (BPP) with a $275,000 limit and a $1,500 deductible. A large fire in
the store caused significant damage amounting to $310,000 in covered damages. How much would
Billy's insurer pay under his BPP?
Select one:
A. $273,500
B. $275,000
C. $308,500
D. $310,000 - CORRECT ANSWER ✔✔ - b
Question 3
ID# 5829438Points: 1
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Question text
Which one of the following statements is correct with respect to the Causes of Loss-Basic Form?
Select one:
1|Page
CPCU 551
©®
,A. It excludes loss caused by earth movement, other than by sinkhole collapse.
B. The Water exclusion contains an exception for damage due to the backing up of sewers, drains, or
sumps.
C. It excludes loss caused by power failure only if the damage causing such failure occurs on the
described premises.
D. The War and Military Action exclusion eliminates coverage for loss caused by acts of terrorism,
such as the terrorist attacks of September 11, 2001. - CORRECT ANSWER ✔✔ - a
Question 4
ID# 5868131Points: 1
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Question text
Which one of the statements is correct with respect to the Building and Personal Property Coverage
Form (BPP)?
Select one:
A. Any type of personal property can be insured under the BPP.
B. Some property, such as building foundations below the lowest basement floor, is excluded
because it may not be subject to loss by the perils insured against.
C. The BPP includes satisfactory coverage for physical damage to automobiles owned by the named
insured.
D. The Covered Property section is the only section that must be read in order to determine whether
a specific kind of property is insured. - CORRECT ANSWER ✔✔ - b
Question 5
ID# 5868137Points: 1
Flag Question
Question text
Which one of the following statements is correct with respect to the Building and Personal Property
Coverage Form (BPP) deductible?
Select one:
A. The insurer is not obligated to pay anything to the insured unless the loss exceeds the deductible.
B. If the Coinsurance condition or the Agreed Value optional coverage applies, the amount of the
loss is first reduced by the deductible before applying any penalty imposed by those provisions.
C. If an occurrence involves a loss that affects more than one category of covered property and a
separate limit of insurance applies to each category, losses to all categories are totaled and the
deductible applied to that total amount.
D. Under the ISO Commercial Lines Manual rules, the standard deductible must be at least $2,500. -
CORRECT ANSWER ✔✔ - a
Question 6
ID# 5868135Points: 1
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2|Page
CPCU 551
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,Question text
Which one of the following statements is correct with respect to the Non-Owned Detached Trailers
coverage extension of the Building and Personal Property Coverage Form (BPP)?
Select one:
A. The trailer can be used anywhere in the United States.
B. The coverage applies while the trailer is attached to any motor vehicle or motorized conveyance,
provided it is not in motion.
C. Coverage is available only if the insured has no contractual responsibility for loss or damage to the
trailer.
D. It permits the insured to extend "your business personal property" to include trailers leased to
expand office space or to provide additional storage or work areas. - CORRECT ANSWER ✔✔ - d
Question 7
ID# 5868190Points: 1
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Question text
The Causes of Loss—Broad Form differs from the Causes of Loss—Basic Form in which one of the
following ways?
Select one:
A. The Broad Form covers "risks of direct physical loss" subject to the form's exclusions and
limitations.
B. The Broad Form provides coverage for loss caused by collapse of a building or personal property
resulting from specified perils.
C. The Broad Form adds coverage for flooding, rainfall, sewer backup, and similar causes of water
damage.
D. The Broad Form specifically excludes rupture or bursting of water pipes and leakage of water or
steam from any part of a system or appliance. - CORRECT ANSWER ✔✔ - b
Question 8
ID# 5868189Points: 1
Flag Question
Question text
An exclusion contained in the Causes of Loss—Basic Form eliminates coverage for damage caused by
which one of the following?
Select one:
A. Fire that results from artificially generated electric currents
B. Rupture or bursting of water pipes caused by any covered cause of loss
C. Mechanical breakdown, including rupture or bursting caused by centrifugal force
D. Sprinkler leakage - CORRECT ANSWER ✔✔ - c
Question 9
ID# 5941499Points: 1
3|Page
CPCU 551
©®
, Flag Question
Question text
Which one of the following is an exclusion unique to the Causes of Loss—Special Form?
Select one:
A. Rupture or bursting of water pipes
B. Wear and tear
C. Mudslide or mudflow
D. War - CORRECT ANSWER ✔✔ - b
Question 10
ID# 5941429Points: 1
Flag Question
Question text
"Merchandise, raw materials and in-process or finished goods" is the Building and Personal Property
Coverage Form's (BPP) definition for which one of the following?
Select one:
A. Contents
B. Inventory
C. Stock
D. Business personal property - CORRECT ANSWER ✔✔ - c
Which is correct with respect to the business personal property coverage provided by the (BPP)?
Select one:
A. "Your business personal property" specifically excludes labor, materials, or services furnished by
the insured on the personal property of others.
B. Except for limited off-premises coverage, coverage for business personal property applies only
when the property is located in or on the described building or in the open (or in a vehicle) within
100 feet of the building or structure or within 100 feet of the premises, whichever is greater.
C. The definition of business personal property limits the coverage to furniture, fixtures, machinery
and equipment owned by the insured and used in the insured's business.
D. Leased personal property for which the named insured has a contractual responsibility to procure
coverage is excluded from the BPP, but the coverage can be added by endorsement. - CORRECT
ANSWER ✔✔ - b
Question 12
ID# 5868134Points: 1
Flag Question
Question text
Which one of the following statements is correct with respect to the Newly Acquired or Constructed
Property extension of coverage of the Building and Personal Property Coverage Form (BPP)?
Select one:
4|Page
CPCU 551
©®
WITH CORRECT ANALYZED ANSWERS TEST BANK
LATEST COMPLETE A+ SOLUTION PASSED
Question 1
ID# 5900769Points: 1
Flag Question
Question text
Which one of the following statements best describes the Causes of Loss—Special Form?
Select one:
A. The placement of the "burden of proof" rests with the insured as opposed to the insurer.
B. The Special Form is designed to cover any loss that would not be covered by the Basic and Broad
Forms.
C. The Special Form contains exclusions that are covered in the Basic and Broad Forms for certain
hard to insure perils.
D. The Special Form provides coverage for direct physical losses other than those that are specifically
excluded. - CORRECT ANSWER ✔✔ - d
Question 2
ID# 5869629Points: 1
Flag Question
Question text
Billy owns a baseball souvenir store in Cooperstown, NY. He insured his store under a Building and
Personal Property Coverage Form (BPP) with a $275,000 limit and a $1,500 deductible. A large fire in
the store caused significant damage amounting to $310,000 in covered damages. How much would
Billy's insurer pay under his BPP?
Select one:
A. $273,500
B. $275,000
C. $308,500
D. $310,000 - CORRECT ANSWER ✔✔ - b
Question 3
ID# 5829438Points: 1
Flag Question
Question text
Which one of the following statements is correct with respect to the Causes of Loss-Basic Form?
Select one:
1|Page
CPCU 551
©®
,A. It excludes loss caused by earth movement, other than by sinkhole collapse.
B. The Water exclusion contains an exception for damage due to the backing up of sewers, drains, or
sumps.
C. It excludes loss caused by power failure only if the damage causing such failure occurs on the
described premises.
D. The War and Military Action exclusion eliminates coverage for loss caused by acts of terrorism,
such as the terrorist attacks of September 11, 2001. - CORRECT ANSWER ✔✔ - a
Question 4
ID# 5868131Points: 1
Flag Question
Question text
Which one of the statements is correct with respect to the Building and Personal Property Coverage
Form (BPP)?
Select one:
A. Any type of personal property can be insured under the BPP.
B. Some property, such as building foundations below the lowest basement floor, is excluded
because it may not be subject to loss by the perils insured against.
C. The BPP includes satisfactory coverage for physical damage to automobiles owned by the named
insured.
D. The Covered Property section is the only section that must be read in order to determine whether
a specific kind of property is insured. - CORRECT ANSWER ✔✔ - b
Question 5
ID# 5868137Points: 1
Flag Question
Question text
Which one of the following statements is correct with respect to the Building and Personal Property
Coverage Form (BPP) deductible?
Select one:
A. The insurer is not obligated to pay anything to the insured unless the loss exceeds the deductible.
B. If the Coinsurance condition or the Agreed Value optional coverage applies, the amount of the
loss is first reduced by the deductible before applying any penalty imposed by those provisions.
C. If an occurrence involves a loss that affects more than one category of covered property and a
separate limit of insurance applies to each category, losses to all categories are totaled and the
deductible applied to that total amount.
D. Under the ISO Commercial Lines Manual rules, the standard deductible must be at least $2,500. -
CORRECT ANSWER ✔✔ - a
Question 6
ID# 5868135Points: 1
Flag Question
2|Page
CPCU 551
©®
,Question text
Which one of the following statements is correct with respect to the Non-Owned Detached Trailers
coverage extension of the Building and Personal Property Coverage Form (BPP)?
Select one:
A. The trailer can be used anywhere in the United States.
B. The coverage applies while the trailer is attached to any motor vehicle or motorized conveyance,
provided it is not in motion.
C. Coverage is available only if the insured has no contractual responsibility for loss or damage to the
trailer.
D. It permits the insured to extend "your business personal property" to include trailers leased to
expand office space or to provide additional storage or work areas. - CORRECT ANSWER ✔✔ - d
Question 7
ID# 5868190Points: 1
Flag Question
Question text
The Causes of Loss—Broad Form differs from the Causes of Loss—Basic Form in which one of the
following ways?
Select one:
A. The Broad Form covers "risks of direct physical loss" subject to the form's exclusions and
limitations.
B. The Broad Form provides coverage for loss caused by collapse of a building or personal property
resulting from specified perils.
C. The Broad Form adds coverage for flooding, rainfall, sewer backup, and similar causes of water
damage.
D. The Broad Form specifically excludes rupture or bursting of water pipes and leakage of water or
steam from any part of a system or appliance. - CORRECT ANSWER ✔✔ - b
Question 8
ID# 5868189Points: 1
Flag Question
Question text
An exclusion contained in the Causes of Loss—Basic Form eliminates coverage for damage caused by
which one of the following?
Select one:
A. Fire that results from artificially generated electric currents
B. Rupture or bursting of water pipes caused by any covered cause of loss
C. Mechanical breakdown, including rupture or bursting caused by centrifugal force
D. Sprinkler leakage - CORRECT ANSWER ✔✔ - c
Question 9
ID# 5941499Points: 1
3|Page
CPCU 551
©®
, Flag Question
Question text
Which one of the following is an exclusion unique to the Causes of Loss—Special Form?
Select one:
A. Rupture or bursting of water pipes
B. Wear and tear
C. Mudslide or mudflow
D. War - CORRECT ANSWER ✔✔ - b
Question 10
ID# 5941429Points: 1
Flag Question
Question text
"Merchandise, raw materials and in-process or finished goods" is the Building and Personal Property
Coverage Form's (BPP) definition for which one of the following?
Select one:
A. Contents
B. Inventory
C. Stock
D. Business personal property - CORRECT ANSWER ✔✔ - c
Which is correct with respect to the business personal property coverage provided by the (BPP)?
Select one:
A. "Your business personal property" specifically excludes labor, materials, or services furnished by
the insured on the personal property of others.
B. Except for limited off-premises coverage, coverage for business personal property applies only
when the property is located in or on the described building or in the open (or in a vehicle) within
100 feet of the building or structure or within 100 feet of the premises, whichever is greater.
C. The definition of business personal property limits the coverage to furniture, fixtures, machinery
and equipment owned by the insured and used in the insured's business.
D. Leased personal property for which the named insured has a contractual responsibility to procure
coverage is excluded from the BPP, but the coverage can be added by endorsement. - CORRECT
ANSWER ✔✔ - b
Question 12
ID# 5868134Points: 1
Flag Question
Question text
Which one of the following statements is correct with respect to the Newly Acquired or Constructed
Property extension of coverage of the Building and Personal Property Coverage Form (BPP)?
Select one:
4|Page
CPCU 551
©®
