1
WA Property and Casualty Questions with
Answers (100% Correct Answers)
Which of the following would modify the original insurance contract by either
adding or removing coverage? Answer: Endorsements
An insured carries a property policy on her home in the amount of $250,000. A
bank is shown as the mortgagor in the policy. Last month the insured made her
final mortgage payment, but did not remove the bank from the policy. In the
event of a covered loss to her home, how much will the bank receive? Answer:
Nothing
Which part of an insurance policy covers claims-related expenses, reasonable
expenses incurred by an insured to protect damaged property from further loss,
or defense expenses? Answer: Additional coverage
Which of the following would not be classified as personal property for
insurance purposes? Answer: A house
An insured's home is mortgaged by the local bank. He is required to carry
insurance on the home showing the bank as the mortgagee. Which of the
following is true if the home is damaged by a covered peril? Answer: Losses
will be paid to the mortgagee and mortgagor as their interest appears
Duties of the insurer found in property policy conditions include all of the
following except Answer: Notify the insured in the event of financial difficulty
If a liability policy had split limits of 50/100/30, what is the maximum amount
that would be payable in the event of an injury to a single person? Answer:
$50,000
A policy that insures all property at multiple locations for a single amount is
referred to as Answer: Blanket
,2
What will happen if a house covered by a standard mortgage clause is a total
loss? Answer: The insurer pays the mortgagee according to the mortgagee's
interest in the property
Which method of loss valuation is contrary to the basic concept of indemnity?
Answer: Replacement cost
All of the following are conditions commonly found in the insurance policy
except Answer: Insuring agreement
Losses caused by continuous or repeated exposure to conditions resulting in
injury to persons or damage to property that is neither intended nor expected is
the definition of which of the following terms? Answer: Occurrence
In which of the following types of property valuation will the policy pay the full
value as specified on the policy schedule, regardless of the insured property's
appreciation or depreciation? Answer: Agreed value
Insurable interest in the property covered by the policy must be proven Answer:
At the time of loss
With regard to fire insurance premiums, structures with which of the following
type of construction would most likely have the most favorable premium rate
for the peril of fire? Answer: Fire resistive
In property insurance, actual cash value is defined as which of the following?
Answer: Replacement cost at the time of the loss, minus depreciation
A type of policy that is used to provide a specific amount of replacement cost
for a given risk after an insured property has been destroyed is called a Answer:
Valued policy
In property and Casualty insurance, what is the term for the amount of a loss
that the insured must cover out of pocket, and the insurer will only pay for the
additional amount of the loss above this limit? Answer: Deductible
,3
The past of a property policy that shows the amount of insurance, premium,
and policy term is the Answer: Declarations
All of the following are considered parts of the policy structure except Answer:
Provisions
All of the following are found in the declarations section of a policy except the
Answer: Exclusions
All of the following statements concerning coinsurance are true except Answer:
The coinsurance formula will also be applied to the total losses
The policy conditions define Answer: How parties to the contract must act
following a loss
A dwelling property policy can be purchased to insure properties solely used for
residential purposes in the following situations: Answer: Up to 5 roomers or
boarders, up to 4 residential units. Properties in the course of construction.
Owner occupied tenant occupied or both. Mobile homes on the basic form
only, if they contain no more than one apartment and are located at a
permanent location listed in the policy. Seasonal dwellings unoccupied for
three or more months during a 12 month period. Not designed as a farm
property.
Business occupancies can be accommodated as long as they are: Answer:
Incidental, are conducted by the insured on the dwelling premises, and if there
are no more than 2 persons working at any time
Permissible incidental occupancies include: Answer: Small service operations
where sales of merchandise are not the primary function. Ex: Barber and
beauty shops
The three coverage forms applicable to the dwelling property policy define the
coverages: Answer: Perils or causes of loss insured against, other coverages,
exclusions and conditions
, 4
Dwelling property: Agreement Answer: Insuring agreement states that the
insurer will provide the coverage described in the policy in return for the
premium paid and compliance with all applicable policy provisions
Dwelling property: Definitions Answer: Limited in nature
Dwelling property: Deductible Answer: Applies to all covered losses unless
noted otherwise in the policy form
Dwelling property: Coverages including other coverages Answer: define direct
and indirect property coverages and additional coverages included in the
premium charge
Dwelling property: Perils insured against Answer: Vary by form and is a key
differentiator in form selection
Dwelling property: General exclusions Answer: perils not covered in all forms
Dwelling property: conditions Answer: Specify when coverage will apply
Dwelling program: Basic Answer: Form number: DP 00 01 or DP1 Peril Type:
Named peril. Most limited coverage. There is no minimum amount of
insurance required
Dwelling program: Broad Answer: Form number: DP 00 02 or DP2 Peril Type:
Named Peril
Dwelling program: Special Answer: Form number: DP 00 03 or DP3 Peril
Type: Open and named peril
Basic insures against: Answer: Fire or lightning and internal explosion,
windstorm or hail, explosion, riot or civil commotion, aircraft, vehicles, smoke,
volcanic eruption (WHARVES; W.C.SHAVER), vandalism or malicious
mischief
Included in basic form: Answer: Fire, lightning, internal explosion
WA Property and Casualty Questions with
Answers (100% Correct Answers)
Which of the following would modify the original insurance contract by either
adding or removing coverage? Answer: Endorsements
An insured carries a property policy on her home in the amount of $250,000. A
bank is shown as the mortgagor in the policy. Last month the insured made her
final mortgage payment, but did not remove the bank from the policy. In the
event of a covered loss to her home, how much will the bank receive? Answer:
Nothing
Which part of an insurance policy covers claims-related expenses, reasonable
expenses incurred by an insured to protect damaged property from further loss,
or defense expenses? Answer: Additional coverage
Which of the following would not be classified as personal property for
insurance purposes? Answer: A house
An insured's home is mortgaged by the local bank. He is required to carry
insurance on the home showing the bank as the mortgagee. Which of the
following is true if the home is damaged by a covered peril? Answer: Losses
will be paid to the mortgagee and mortgagor as their interest appears
Duties of the insurer found in property policy conditions include all of the
following except Answer: Notify the insured in the event of financial difficulty
If a liability policy had split limits of 50/100/30, what is the maximum amount
that would be payable in the event of an injury to a single person? Answer:
$50,000
A policy that insures all property at multiple locations for a single amount is
referred to as Answer: Blanket
,2
What will happen if a house covered by a standard mortgage clause is a total
loss? Answer: The insurer pays the mortgagee according to the mortgagee's
interest in the property
Which method of loss valuation is contrary to the basic concept of indemnity?
Answer: Replacement cost
All of the following are conditions commonly found in the insurance policy
except Answer: Insuring agreement
Losses caused by continuous or repeated exposure to conditions resulting in
injury to persons or damage to property that is neither intended nor expected is
the definition of which of the following terms? Answer: Occurrence
In which of the following types of property valuation will the policy pay the full
value as specified on the policy schedule, regardless of the insured property's
appreciation or depreciation? Answer: Agreed value
Insurable interest in the property covered by the policy must be proven Answer:
At the time of loss
With regard to fire insurance premiums, structures with which of the following
type of construction would most likely have the most favorable premium rate
for the peril of fire? Answer: Fire resistive
In property insurance, actual cash value is defined as which of the following?
Answer: Replacement cost at the time of the loss, minus depreciation
A type of policy that is used to provide a specific amount of replacement cost
for a given risk after an insured property has been destroyed is called a Answer:
Valued policy
In property and Casualty insurance, what is the term for the amount of a loss
that the insured must cover out of pocket, and the insurer will only pay for the
additional amount of the loss above this limit? Answer: Deductible
,3
The past of a property policy that shows the amount of insurance, premium,
and policy term is the Answer: Declarations
All of the following are considered parts of the policy structure except Answer:
Provisions
All of the following are found in the declarations section of a policy except the
Answer: Exclusions
All of the following statements concerning coinsurance are true except Answer:
The coinsurance formula will also be applied to the total losses
The policy conditions define Answer: How parties to the contract must act
following a loss
A dwelling property policy can be purchased to insure properties solely used for
residential purposes in the following situations: Answer: Up to 5 roomers or
boarders, up to 4 residential units. Properties in the course of construction.
Owner occupied tenant occupied or both. Mobile homes on the basic form
only, if they contain no more than one apartment and are located at a
permanent location listed in the policy. Seasonal dwellings unoccupied for
three or more months during a 12 month period. Not designed as a farm
property.
Business occupancies can be accommodated as long as they are: Answer:
Incidental, are conducted by the insured on the dwelling premises, and if there
are no more than 2 persons working at any time
Permissible incidental occupancies include: Answer: Small service operations
where sales of merchandise are not the primary function. Ex: Barber and
beauty shops
The three coverage forms applicable to the dwelling property policy define the
coverages: Answer: Perils or causes of loss insured against, other coverages,
exclusions and conditions
, 4
Dwelling property: Agreement Answer: Insuring agreement states that the
insurer will provide the coverage described in the policy in return for the
premium paid and compliance with all applicable policy provisions
Dwelling property: Definitions Answer: Limited in nature
Dwelling property: Deductible Answer: Applies to all covered losses unless
noted otherwise in the policy form
Dwelling property: Coverages including other coverages Answer: define direct
and indirect property coverages and additional coverages included in the
premium charge
Dwelling property: Perils insured against Answer: Vary by form and is a key
differentiator in form selection
Dwelling property: General exclusions Answer: perils not covered in all forms
Dwelling property: conditions Answer: Specify when coverage will apply
Dwelling program: Basic Answer: Form number: DP 00 01 or DP1 Peril Type:
Named peril. Most limited coverage. There is no minimum amount of
insurance required
Dwelling program: Broad Answer: Form number: DP 00 02 or DP2 Peril Type:
Named Peril
Dwelling program: Special Answer: Form number: DP 00 03 or DP3 Peril
Type: Open and named peril
Basic insures against: Answer: Fire or lightning and internal explosion,
windstorm or hail, explosion, riot or civil commotion, aircraft, vehicles, smoke,
volcanic eruption (WHARVES; W.C.SHAVER), vandalism or malicious
mischief
Included in basic form: Answer: Fire, lightning, internal explosion
