1 | Page
CALIFORNIA COMMERCIAL INSURANCE 2025
UPDATED ACTUAL EXAM WITH CORRECT
SOLUTIONS.
What is a Modular Policy? - correct answer- A modular policy is
a policy consisting of several different documents, none of
which by itself forms a complete contract.
What is a Commercial Package Policy (CPP)? - correct
answer- A Commercial Package Policy is a modular policy that
combines different forms and more than one line of coverage.
What must a CPP policy consist of? - correct answer- A
Declaration Page (stating premium charges and coverage
limits)
A Policy Conditions (six conditions that apply to the entire
contract)
Two or more Coverage Modules/Parts
What is the purpose of an Interline form? - correct answer- An
Interline form is used to eliminate redundancy and minimize the
number of pages.
,2 | Page
EXAMPLE: A CPP policy only contains one Declarations page
listing all of the separate coverages. In this case the
Declaration page would be considered an interline form.
What is a Monoline form? - correct answer- A Monoline form
only contains one 1 coverage part.
(A single coverage policy)
In a Commercial policy, who can cancel, request changes, is
responsible for premium, and will be the only person named on
a refund of premium? - correct answer- The first named
insured.
NOTE: This may be an individual or a company.
What are the 6 common conditions in a Commercial policy? -
correct answer- Cancellation, Changes, Inspections and
Surveys, Premiums,
How many days does the Insurer have to provide written notice
to the Insured before cancellation of their policy? - correct
answer- 10 days prior to the date of cancellation for
nonpayment of premium.
, 3 | Page
30 days prior to the date of cancellation for any other allowable
reason.
NOTE: The insure must be able to prove it has mails the
cancellation notice to the address on file, although no proof of
delivery of this notice is required.
When can an insurer cancel a policy? - correct answer- An
insurer can cancel a policy at anytime but only under certain
conditions.
When can Examination of Books and Records be completed? -
correct answer- At anytime during the policy period and for up
to three years after the policy ends/expires. This is done to
verify that the insure has collected the appropriate premium.
What is the Inspections and Surveys condition? - correct
answer- The insurer has the right but is not obligated to inspect
the property and make recommendations. This is done for
insurability and rating only. It does not warrant the place safe or
in compliance.
What is the Premium condition? - correct answer- The Premium
condition states that the first named insured is responsible to
CALIFORNIA COMMERCIAL INSURANCE 2025
UPDATED ACTUAL EXAM WITH CORRECT
SOLUTIONS.
What is a Modular Policy? - correct answer- A modular policy is
a policy consisting of several different documents, none of
which by itself forms a complete contract.
What is a Commercial Package Policy (CPP)? - correct
answer- A Commercial Package Policy is a modular policy that
combines different forms and more than one line of coverage.
What must a CPP policy consist of? - correct answer- A
Declaration Page (stating premium charges and coverage
limits)
A Policy Conditions (six conditions that apply to the entire
contract)
Two or more Coverage Modules/Parts
What is the purpose of an Interline form? - correct answer- An
Interline form is used to eliminate redundancy and minimize the
number of pages.
,2 | Page
EXAMPLE: A CPP policy only contains one Declarations page
listing all of the separate coverages. In this case the
Declaration page would be considered an interline form.
What is a Monoline form? - correct answer- A Monoline form
only contains one 1 coverage part.
(A single coverage policy)
In a Commercial policy, who can cancel, request changes, is
responsible for premium, and will be the only person named on
a refund of premium? - correct answer- The first named
insured.
NOTE: This may be an individual or a company.
What are the 6 common conditions in a Commercial policy? -
correct answer- Cancellation, Changes, Inspections and
Surveys, Premiums,
How many days does the Insurer have to provide written notice
to the Insured before cancellation of their policy? - correct
answer- 10 days prior to the date of cancellation for
nonpayment of premium.
, 3 | Page
30 days prior to the date of cancellation for any other allowable
reason.
NOTE: The insure must be able to prove it has mails the
cancellation notice to the address on file, although no proof of
delivery of this notice is required.
When can an insurer cancel a policy? - correct answer- An
insurer can cancel a policy at anytime but only under certain
conditions.
When can Examination of Books and Records be completed? -
correct answer- At anytime during the policy period and for up
to three years after the policy ends/expires. This is done to
verify that the insure has collected the appropriate premium.
What is the Inspections and Surveys condition? - correct
answer- The insurer has the right but is not obligated to inspect
the property and make recommendations. This is done for
insurability and rating only. It does not warrant the place safe or
in compliance.
What is the Premium condition? - correct answer- The Premium
condition states that the first named insured is responsible to
