Pennsylvania Property and Casualty Licensing
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What typically provides temporary coverage for a specified time
period until an insurance policy is accepted or denied? --- correct
answer ---Binder
What is the threshold for declaring a certified act of terrorism under
the Terrorism Risk Insurance Act (TRIA) and its 2005 extension? ---
correct answer ---$5 million
Exclusions help to keep premiums reasonable and affordable. Which
of the following is not a purpose of exclusions? --- correct answer ---
Reducing coverage to sufficiently earn a profit
What is the difference between a mortgage clause and a loss payable
clause in a property insurance policy covering real property? ---
correct answer ---A loss payable clause usually is not as broad as the
mortgage clause and does not give the loss payee any rights other than
a right to share in a claim settlement
,Tabitha lives in a residential neighborhood where most of the
homeowners have small children. Immediately after purchasing her
home, Tabitha fenced her back yard because it contains an attractive
nuisance. Which of the following structures in Tabitha's back yard
could be the attractive nuisance? --- correct answer ---Swimming Pool
Attractive Nuisance --- correct answer ---A hazardous condition that
can attract and injure children
For how many days may a binder or other contract for temporary
insurance be made? --- correct answer ---Up to 30 days
Donaldson Insurance Company wrote premiums of $100 million last
year and incurred expenses of $40 million in that same time period.
What is this insurer's expense ratio?
A. 25%
B. 40%
C. 75%
,D. 66⅔% --- correct answer ---40%
Expense Ratio --- correct answer ---Calculated by dividing incurred
expenses by written premiums
What type of state plan provides access to basic property insurance to
individuals who might not be able to obtain coverage because their
property is located in high risk areas or there are other high risk
problems? --- correct answer ---FAIR Plan
FAIR plans (Fair Access to Insurance Requirements) --- correct
answer ---This plan addresses the issue of property insurance
availability. This plan makes insurance available to risks that were
previously considered uninsurable because of environmental hazards.
this plan states that no application can be denied simply because of
environmental factors beyond the applicants control.
Master Care Plumbing Supplies has a standard property insurance
policy and operates out of a 100-year-old building. After the building
is almost destroyed by an explosion, the insured is told that he must
rebuild with new electrical wiring, masonry construction, and fire
, walls to comply with current building codes. Although the direct
damage caused by the explosion is covered, what exclusion might
apply to rule out coverage for the reconstruction costs to get the
building up to code? --- correct answer ---Ordinance or Law Exclusion
Ordinance or Law Exclusion --- correct answer ---Eliminates coverage
for the extra expenses, over and above the cost of replacing damaged
property that might be necessary to comply with such ordinances
Which entity protects policyowners and claimants if an insurer cannot
perform its contractual obligations because of insolvency? --- correct
answer ---Pennsylvania Property and Casualty Insurance Guaranty
Association
Sanborn Supplies has a commercial property policy with a causes of
loss broad form. In a hurry to deliver an order, a company driver
strikes a corner of the warehouse, causing substantial damage to it.
Will the company's commercial property policy cover the damage to
the building?
A. Yes. Damage by vehicles is a covered cause of loss under the broad
form commercial property policy.
Comprehensive Exam 2025 Questions with
100% Correct Detailed Verified Answers Get It
Already Graded A+
What typically provides temporary coverage for a specified time
period until an insurance policy is accepted or denied? --- correct
answer ---Binder
What is the threshold for declaring a certified act of terrorism under
the Terrorism Risk Insurance Act (TRIA) and its 2005 extension? ---
correct answer ---$5 million
Exclusions help to keep premiums reasonable and affordable. Which
of the following is not a purpose of exclusions? --- correct answer ---
Reducing coverage to sufficiently earn a profit
What is the difference between a mortgage clause and a loss payable
clause in a property insurance policy covering real property? ---
correct answer ---A loss payable clause usually is not as broad as the
mortgage clause and does not give the loss payee any rights other than
a right to share in a claim settlement
,Tabitha lives in a residential neighborhood where most of the
homeowners have small children. Immediately after purchasing her
home, Tabitha fenced her back yard because it contains an attractive
nuisance. Which of the following structures in Tabitha's back yard
could be the attractive nuisance? --- correct answer ---Swimming Pool
Attractive Nuisance --- correct answer ---A hazardous condition that
can attract and injure children
For how many days may a binder or other contract for temporary
insurance be made? --- correct answer ---Up to 30 days
Donaldson Insurance Company wrote premiums of $100 million last
year and incurred expenses of $40 million in that same time period.
What is this insurer's expense ratio?
A. 25%
B. 40%
C. 75%
,D. 66⅔% --- correct answer ---40%
Expense Ratio --- correct answer ---Calculated by dividing incurred
expenses by written premiums
What type of state plan provides access to basic property insurance to
individuals who might not be able to obtain coverage because their
property is located in high risk areas or there are other high risk
problems? --- correct answer ---FAIR Plan
FAIR plans (Fair Access to Insurance Requirements) --- correct
answer ---This plan addresses the issue of property insurance
availability. This plan makes insurance available to risks that were
previously considered uninsurable because of environmental hazards.
this plan states that no application can be denied simply because of
environmental factors beyond the applicants control.
Master Care Plumbing Supplies has a standard property insurance
policy and operates out of a 100-year-old building. After the building
is almost destroyed by an explosion, the insured is told that he must
rebuild with new electrical wiring, masonry construction, and fire
, walls to comply with current building codes. Although the direct
damage caused by the explosion is covered, what exclusion might
apply to rule out coverage for the reconstruction costs to get the
building up to code? --- correct answer ---Ordinance or Law Exclusion
Ordinance or Law Exclusion --- correct answer ---Eliminates coverage
for the extra expenses, over and above the cost of replacing damaged
property that might be necessary to comply with such ordinances
Which entity protects policyowners and claimants if an insurer cannot
perform its contractual obligations because of insolvency? --- correct
answer ---Pennsylvania Property and Casualty Insurance Guaranty
Association
Sanborn Supplies has a commercial property policy with a causes of
loss broad form. In a hurry to deliver an order, a company driver
strikes a corner of the warehouse, causing substantial damage to it.
Will the company's commercial property policy cover the damage to
the building?
A. Yes. Damage by vehicles is a covered cause of loss under the broad
form commercial property policy.
