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TEXAS INSURANCE LICENSE EXAM QUESTIONS
WITH CORRECTANSWERS | LATEST UPDATE
2026/2027 | GRADED A+.
Unless otherwise stated by the policy, property covered by the
Building and Personal Property Coverage Form is valued on
what basis? - correct answer- Actual cash value
Which of the following statements is correct regarding PIP
coverage in Texas? - correct answer- PIP coverage covers
insureds and their guests without regard to fault or to
coordination of benefits
Which of the following statements regarding types of property
loss is incorrect? - correct answer- Direct losses include
additional living expenses
What is the maximum amount supplementary payments
coverage provided by a Business Auto policy will pay for the
cost of bail bonds related to a covered accident? - correct
answer- $2,000
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Under a Business Auto policy, which of the following
statements about towing coverage provided under the policy's
physical damage coverage is correct? - correct answer- Labor
must be performed at the place of disablement to be covered
Under a Commercial General Liability policy, all of the
following statements about the supplemental extended
reporting period are correct, except: - correct answer- The
insurer may cancel the SERP after the insured pays the
premium
Commercial Crime insurance policies are typically able to
cover losses resulting from all of the following, except: -
correct answer- The mysterious disappearance of property
An insured with a Personal Auto policy on their car is using a
non-owned auto to run errands. Under the insured's policy,
liability coverage for use of the non-owned auto is: - correct
answer- Provided on an excess basis
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All of the following are common law defenses against
negligence, except: - correct answer- Statute of limitations
Under Coverage C - Household Personal Property on a Farm
Property policy, coverage is provided for: - correct answer-
Furniture in the dwelling
Which of the following must participate in a Workers'
Compensation Assigned Risk Plan? - correct answer- Insurers
that are authorized to write Workers' Compensation in the
voluntary market
A company that sells mobile equipment has its stock protected
under an Equipment Dealers Floater. Records of the
company's business, including itemized inventories and sales
records, must be retained for at least how long after the policy
ends? - correct answer- 3 years
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Which is true of Coverage C of the Dwelling Policy? - correct
answer- Coverage C provides coverage for the personal
property of a guest
After unintentionally running a red light, L causes an accident
with T. T's sedan is badly damaged, and T's arm is broken. A
few months after the accident, T brings a suit against L,
asking for damages for medical costs incurred for the broken
arm and other injuries sustained in the accident. Under Part A
of L's Personal Auto policy, supplementary payments in
connection with the insurer's defense will: - correct answer-
Be paid in addition to the policy's liability limits
After a building loss, the insured on a Businessowners policy
incurs extra expenses to minimize the suspension of business.
Extra expense coverage is provided during the period of
restoration and for up to: - correct answer- 12 months after the
direct physical loss
J owns a home protected by a property insurance policy. A
severe windstorm creates an opening in the roof that exposes
the upstairs guest suite in J's home and causes rain damage to
the carpet. In order to collect claim payments from the carrier
for the damaged roof and carpet, J is required to: - correct
TEXAS INSURANCE LICENSE EXAM QUESTIONS
WITH CORRECTANSWERS | LATEST UPDATE
2026/2027 | GRADED A+.
Unless otherwise stated by the policy, property covered by the
Building and Personal Property Coverage Form is valued on
what basis? - correct answer- Actual cash value
Which of the following statements is correct regarding PIP
coverage in Texas? - correct answer- PIP coverage covers
insureds and their guests without regard to fault or to
coordination of benefits
Which of the following statements regarding types of property
loss is incorrect? - correct answer- Direct losses include
additional living expenses
What is the maximum amount supplementary payments
coverage provided by a Business Auto policy will pay for the
cost of bail bonds related to a covered accident? - correct
answer- $2,000
,2 | Page
Under a Business Auto policy, which of the following
statements about towing coverage provided under the policy's
physical damage coverage is correct? - correct answer- Labor
must be performed at the place of disablement to be covered
Under a Commercial General Liability policy, all of the
following statements about the supplemental extended
reporting period are correct, except: - correct answer- The
insurer may cancel the SERP after the insured pays the
premium
Commercial Crime insurance policies are typically able to
cover losses resulting from all of the following, except: -
correct answer- The mysterious disappearance of property
An insured with a Personal Auto policy on their car is using a
non-owned auto to run errands. Under the insured's policy,
liability coverage for use of the non-owned auto is: - correct
answer- Provided on an excess basis
,3 | Page
All of the following are common law defenses against
negligence, except: - correct answer- Statute of limitations
Under Coverage C - Household Personal Property on a Farm
Property policy, coverage is provided for: - correct answer-
Furniture in the dwelling
Which of the following must participate in a Workers'
Compensation Assigned Risk Plan? - correct answer- Insurers
that are authorized to write Workers' Compensation in the
voluntary market
A company that sells mobile equipment has its stock protected
under an Equipment Dealers Floater. Records of the
company's business, including itemized inventories and sales
records, must be retained for at least how long after the policy
ends? - correct answer- 3 years
, 4 | Page
Which is true of Coverage C of the Dwelling Policy? - correct
answer- Coverage C provides coverage for the personal
property of a guest
After unintentionally running a red light, L causes an accident
with T. T's sedan is badly damaged, and T's arm is broken. A
few months after the accident, T brings a suit against L,
asking for damages for medical costs incurred for the broken
arm and other injuries sustained in the accident. Under Part A
of L's Personal Auto policy, supplementary payments in
connection with the insurer's defense will: - correct answer-
Be paid in addition to the policy's liability limits
After a building loss, the insured on a Businessowners policy
incurs extra expenses to minimize the suspension of business.
Extra expense coverage is provided during the period of
restoration and for up to: - correct answer- 12 months after the
direct physical loss
J owns a home protected by a property insurance policy. A
severe windstorm creates an opening in the roof that exposes
the upstairs guest suite in J's home and causes rain damage to
the carpet. In order to collect claim payments from the carrier
for the damaged roof and carpet, J is required to: - correct
