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texas exam
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1

transpertation expenses

20 per day up to $600 is available. Coverage begins 48 hours after a theft loss and 24 hours for any other covered loss

2

If the insured trades vehicles, the newly acquired vehicle

automatically covered. Liability coverage is continuous until the end of the policy period. To continue physical damage coverage certain restrictions and limitations apply.

3

A deductible usually applies to which of the following automobile policy coverages

Physical Damage

4

special damages

involve expenses where the costs are known or can easily be determined.

5

Symbol 1-5

physical and liability

6

symbol 6-19

liability no physical

7

Collision

collison with an object or vehical or when a car is overturned

8

comphrensive

any loss other than collision or overturn

9

specified auto-

fire lighting explosion theft windstorm hail equake flood mischief. not glass breakage.

10

maximum payable for auto electronic equipment permanently installed

1,000

11

provided worldwide for insureds for a period of

30 days

12

covered pollution costs

any expenses from govermnet ordedr to test the pollutants from a car. does not ccover normal operative mechanics of car like exhaust.

13

The supplementary payments under the personal auto policy:

Will pay the insured up to $200 per day for loss of earnings due to testifying at a trial concerning an accident caused by the insured is correct

14

bailment

The owner’s property is temporarily in the possession of another and will ultimately revert back to the owner

15

Used clothing would be covered on

replacement cost basis.

16

How many days does the insured have to file for proof of loss under a homeowner policy issued in Texas?

91 days is correct.

17

Which is not covered under the HO forms

earthquake

18

Under an HO-3 form, what coverage is provided for watercraft lost due to theft

1,500 under special limits

19

A standard ISO homeowner policy is best described as

Package policy that provides property and liability insurance

20

Homeowner policies provide liability coverage for which of the following?

Property Damage and Bodily Injury is correct.

21

HO automatically coveres

lawn mowers.

22

Friendly fire

damage from a fire that was in its specfied location

23

unfriendly

It has left its place of containment.

24

What does the "identity fraud expense" endorsement to a homeowner policy cover?

Covers expenses up to $15,000. This includes attorney fees to cover defense costs..

25

Are employers required to have workers comp in texas?

Employers may elect to provide workers compensation insurance but are not required to do so. If they do not, they may be sued by employees for work-related injuries and occupational diseases.

26

A first party claimant is the entity that receives the benefit of an insurance policy that specifically covers their property. A first party claimant can be all of the following

an individual, corporation, association, partnership, or other legal entity.

27

The Foreign Coverage Endorsement should be added to the company's workers compensation policy. However, this endorsement applies for a period of no longer than

90 days

28

How long after being notified of an injury does an insurance carrier or self-insured employer have to contest the compensability of a workers' compensation claim?

Within 60 days

29

Subsequent Injury Fund

provide an incentive for employers to hire employees who have already suffered a work-related injury.

30

What is the minimum weekly income benefit payable under the Texas workers compensation law?

15% of the state average weekly wage is correct.

31

maximum medical improvement

Two years from the date income benefits begin to accrue.

32

The required unmodified workers compensation premium is

500,000.

33

Longshore harbor act-

martime workers who are disabled from injuries sustained on the navigable waters of the US, loading, or unloading a vessel

34

The Jones Act-AKA mercahnt marine act of 1920

allows for martime workers to sue employers for negligence that results from negligence of employer.

35

black lung benfefits act

cocompensation to coal miners

36

Federal employees comp act FECA

federal and postal workers protection

37

federal employers liability act

appllies to railroads

38

The premium charged for a standard Workers Compensation policy is based primarily on a company's:

payroll

39

Like physical damage coverage on an auto policy, the watercraft and yacht policies provide for the adjusting of physical damage losses to covered property on

an actual cash value basis.

40

For equipment breakdown policy, what is not covered

structures supporting the equipment that breaks

41

severability of insurance

insurance applies separately to each insured. However, if more than one insured is involved in the same loss the limits are not increased.

42

personal articles floater fine arts.

are reimbursed for their full value, regardless if the value of the item depreciates over time

43

Marine-oil haulers are only required to carry

$1,000,000, look for key word here is "excess oil" and when followed up with "explosives" makes this freight hazardous requiring the $5,000,000 limit.

44

aircraft policy
Commercial flights, passenger is covered

the second they step on the plane, not before or after.

45

Marketing distribution systems.

The selling of insurance products through the use of captive agents, independent agents, or insurance company employees in a call center are examples of

46

The penalty for a violation

may not exceed $25,000 unless a greater or lesser penalty is specified in another insurance law in the state.

47

Under the dwelling insurance program, an endorsement may be attached to the policy to cover dwellings during the course of construction. The insurance company must be advised when construction is completed, and within

within 60 days after the insured takes occupancy of the dwelling.

48

Which of the following most accurately describes the "debris removal" clause?

It covers the cleanup costs associated with a covered property loss

49

Which of the following dwelling forms provides broad perils coverage for personal property?

DP-2 and DP-3 only is correct.

50

The DP Forms have a blank limitation of the Coverage C amount when personal property is OFF the premises.

10%

51

Commercial liability also known as

business liability

52

What is excluded under Commercial liability

automobile dealerships

53

Commercial liability coverage A

bodily injuiry and property damage

54

Commercial liability coverage B

personal injury and advertising liability. wronful arrest, wronful eviction. invasion of privacy.

55

Coverage C

medical payments. covers anything within one year of the accident regardless who was at fault.

56

occurance form

when injury happens durring policy period

57

claims made form

when claim is reported

58

Basic extended reporting is provided

free of charge for up to 60 days after the policy expires

59

supplimental extended reporting

up 200% of the original premium extends this for an unlimited duration

60

laser beam endorsent

allows insurer to exluded specific accidents from coverage.

61

products and completed operations

company selling manufactured goods needs products. construction company needs completed operations. excludes engineers architechs and surveyors.

62

Endorsement CG 2407-

covers injuries now on the premises. used by restaurants that serve food.

63

bail bonds amount covered

250

64

contingent liability refers to

work of independent contractors

65

The maximum limit an insurer must offer for Personal Injury Protection

2,500

66

Personal Injury Protection does not cover

pain and suffer"

67

Personal Injury Protection covers injuries up to

3 years after.

68

Which of the following time periods is ordinary payroll coverage limited to in case of a business income loss under the BOP?

60 days is correct.

69

jewelers block policy what is excluded

if the insured wears their products and it is damaged or stolen, it will not be covered.

70

ABC Office Temps and Clean-Rite Dry Cleaning are both located in a strip mall and share a common party wall. Fire begins in the dry cleaners and damages the party wall. Clean-Rite decides to go out of business. How will the BOP policy of ABC Office Temps respond regarding the party wall?

ABC’s policy will repair the party wall and subrogate against Clean-Rite is correct.

71

red tags

Coverage is suspended until repairs are made

72

Standard deductible for equipment breakdown

500

73

The BOP has limitations on the square footage in regard to eligible risks. What is the maximum square footage a building can contain and still be eligible for the policy?

35,000 square feet.

74

insurance company can cancel the policy if the risk is blank vacant

69%

75

What is required in order for seasonal increase coverage to apply under the BOP

-the limit of insurance must be at least equal 100% of the average personal property values for the previous 12 months.

76

What are the unique features of the Businessowners policy form?

The property coverage is open peril with no coinsurance requirement.

77

In the Building and Personal Property Coverage form, under Loss Conditions, the Vacancy Clause states that when the policy is issued to the owner or general lessee of a building, such building is vacant unless at least

31% filled

78

An Installation Floater

provides property coverages for work performed until accepted by the owner.

79

Hull coverage

damage to or loss of the ship itself. Written on a valued basis.

80

Sue and labor clause

- in the event of a loss, crew must immediately take all possible steps to minimize any further loss.

81

Jettison

voluntary act of destruction where cargo is thrown overboard in order to save the ship or the crew.

82

For ocean- insurance is terminated the second

any change of ownership occurs.

83

Adventure clause

protects against hazards to a vessel while a loss at sea.

84

Lay up endorsement

covers a watercraft at a reduced premium when a boat is in storage.

85

Break bulk

loose cargo stowed on the ship.

86

Cocontainerization

shipping based on large cargo carrying containers that can be moved to trucks without rehandling of contents.

87

Bulk shipments-

shipments not packaged, loaded directly into the ship. Example, coal, scrap, ore, iron. Rice.

88

Warehouse to warehouse clause

covers cargo while in transit over water. Coverage applies until reaching destination warehouse.

89

Demurrage

covers any costs incurred from delay in unloading a vessel.

90

Freight insurance

covers loss of income/ shippers feesfrom shipping of cargo if the cargo is lost, does not cover the cargo itself.

91

Inchmaree clause

An ocean marine insurance provision adding coverage for damage directly resulting from the bursting of boilers, breakage of shafts, other mechanical failures, latent defects in the ship's equipment or machinery, and faults or errors in the navigation or management of the ship.

92

General average

all share loss

93

Particular average

only one party takes the loss.

94

In ocean marine- must make claim within

180 days of accident or it is not covered.

95

Inherent vice-

means the potential of the property to self destruct.

96

Ivel clause

to provide excess hull and collision liability coverage.

97

A conventional cargo ship is used to transport

break-bulk cargo or bulk cargo.

98

The hull physical damage deductible applies to which of the following losses?

Collision is correct

99

The boat is in transit and if physical damage should occur to the boat

watercraft policy will cover

100

Barratry

The crew of a ship is guilty of fraud with the intention of reaping gains at the expense of the owner.

101

Personal article floater:

The personal inland marine coverage form which provides open peril insurance for specific classes of personal property on an itemized and scheduled

102

Commercial inland marine Key characteristic is

the fact that is it involves transport by land.

103

Controlled standardized form

uniform use

104

Non controlled

written by individual companies

105

Annual transit policy

- this is a non controlled form for the protection of frequent shipper goods.

106

Trip transit policy-

this is a non controlled form to protect single shipments on specified property.

107

Motor truck cargo policy

non controlled and covers materials while in transit via truck.

108

Free on board FOB shipping point-

-means the title to the property in transit transfers to the buyer the moment it leaves the shipper.

109

Free on board destination point

means the title to the property remains with the shipper until it arrives and is accepted by the buyer.

110

Contractor’s equipment coverage form

a non controlled form that insures various types of construction equipment.

111

Commercial articles coverage form

non controlled form used to insure interests of the owner of commercial cameras, instruments and related equipment

112

Equipment dealers form

covers open perils for dealers in mobile agricultural and construction equipment.

113

Jewerly block coverage- must take inventory every

12 months.

114

What commercial inland marine form covers loss due to damage of records

accounts receivable

115

Valuable papers and records covers

deeds, drawings, maps, books files and mortgages

116

What is the ideal form of protection for the frequent shipper of goods

annual transit policy

117

Installation floater

covers work installed and delivered but not yet accepted or paid for.

118

Bailee policy-

protects insured from loss or damage to customers property, like a cleaners.

119

What is the only coverage territory approved for Equipment dealers policy-

US Puerto Rico and Canada.

120

Garagekeepers specified causes of loss does not specify

physical damage, such as windstorm

121

The term "average" in ocean marine insurance refers to

loss or damage.

122

legal liablity garage

customor must prove the garage was at fault.

123

primary liablity garage

covered without proof of negligence.

124

if a vehical is driven 50 miles from the workshop

it is no longer covered.

125

accident

continuous and repeated expoisure to the same conditions

126

garagekeepers exludes almost all the following except

stereo system permanently installed in car (almost always on the exam)

127

Which sections of an insurance policy states who may be considered an insured in addition to the named insured?

definitions page.

128

A company's promise to pay for damage caused by or resulting from a covered cause of loss would be found in which of the following sections of a Commercial Property Policy?

Insuring Agreement is correct.

129

A company's promise to pay for damage caused by or resulting from a covered cause of loss would be found in which of the following sections

Insuring Agreement

130

Insurable Interest

Lawful economic interest in the preservation of the subject of insurance, free from loss or destruction or monetary impairment is the definition of

131

Which of the following is the type of report indicating the initial results of the investigation of a claim

field report.

132

Signing someone else's name or falsifying documents is considered

forgery

133

The insured owns a home with a swimming pool. The pool is not fenced. If a child were to drown in the pool, which of the following liability doctrines would most likely apply?

Attractive Nuisance .

134

Since the insurance company drafts the insurance contract and it is not negotiable, if it is found to be ambiguous the courts will interpret the contract against the party that prepared it. This is an example of

contract of adhesion

135

Estoppel

the principle that precludes a person from asserting something contrary to what is implied by a previous action or statement of that person or by a previous pertinent judicial determination.

136

An initial premium charged the insured under a reporting form type of policy is called the

deposit premium

137

Terrorism risk 2015 act: what is excluded

Automobiles

138

Terrorism risk 2015 act what is the only thing covered in case of war

Workers compensation coverage

139

Under the Terrorism Risk Insurance Reauthorization Act of 2015, the Secretary of the Treasury is charged with certifying that an act of terrorism has occurred and that it would be covered under the Act. However, before certification is complete the Secretary of the Treasury must consult with

The Secretary of Homeland Security

140

In liability insurance the term "occurrence" means:

Continuous or repeated exposure to the same conditions. is correct.

141

Bail bonds

court or litigation bond, which are sometimes called financial guarantee bonds

142

loss sustained form

coverage while the policy is in force and for up to one year after the policy expires

143

discovery form

while the policy is in force and 60 days after the policy has expired.

144

fidelity bonds-

bond for employee theft and forgery.

145

surety bond

gaurantees that at certain acts will occur.

146

public bonds-

bonds to protect public entitites

147

replevin bond

guarantees that if proprty is determined to belong to the other party it will be returned.

148

robery bond

protects against criminal acts from theft.

149

to be defined as burgalery, there has to be

signs of visable forced entry

150

messenger

someone who has control of insured property outstide of the premises of the work place

151

three types of limits for commerical umbrella

per occurrence, personal injury and aggregate limit.

152

Must acknowledge within

15 days of claim

153

a dwelling vacant for more than blank is not covered

60 days

154

An emergency license in Texas is effective for a period not to exceed

90 days.

155

A licensee must maintain records of evidence of each continuing education course completed for a period of

four years

156

Under Homeowners insurance, "Medical Payments to Others" coverage will cover necessary medical expenses incurred within:

3 years

157

An employer in Texas whose workers compensation coverage is terminated or cancelled must notify each employee that the coverage has been terminated or cancelled not later than

15 days after the coverage is terminated or cancelled.

158

Medical payments coverage under a BOP applies to expenses incurred by non-insureds for bodily injury and reported to the insurer within

1 year

159

Death benefits

paid to spouse and children at 66 2/3% of workers wages subject to weekly maximum and minimum.

160

must respond to an inquiry in writing not later than the after the date the inquiry was first received.

10th day

161

anything over 500K

must be electronically transfered

162

Must examine a carrier once every

five years

163

Must renew every blank on the adjusters birthday suspended or revoked

two years

164

what is the renewal fee

50 dollars

165

what is the emergency licence fee

20 dollars

166

how many hours of continuing education for each reporting period

24 hours

167

how many hours of education must be in ethics

2 hours

168

how many days must education be finished before renewal

30 days

169

if you are continually licenced for blank you no longer have to renew your license.

20 years

170

penalties for criminalty of an adjuster-

500 fine, six months in jail, or both.

171

if insured is notified insurerer will pay, payment must be made no later than

the fifth business day of said notice.

172

settlment offers must be responded to within

10th day

173

Standard form #24

commonly used financial institution bond used by banks and various financial oriented agencies. The other bonds are fidelity and surety bonds and are used to either guarantee performance of a task or that dishonest acts will not happen. The financial institution bonds are similar to the crime insurance policies used by businesses.

174

The employer is required to report to their insurance carrier the fact that an employee is absent from work as a result of a work-related incident more than

1 day

175

Commercial Glass Coverage is suspended if, at the time of loss, the building has been vacant for more than:

60 consecutive days. is correct.

176

Under workers compensation in Texas, income benefits may not be paid for an injury unless the injury results in disability that lasts longer than what period of time?

1 week

177

Preservation of Property" coverage when property is removed from the premises to protect it from a covered cause of loss. The coverage will apply at other locations for up to:

30 days

178

Premium costs for Workers Compensation insurance are paid by

employers only

179

The personal inland marine coverage form which provides open peril insurance for specific classes of personal property on an itemized and scheduled basis is called a:

Personal article floater. is correct.

180

A commercial umbrella policy would, in most cases, provide which of the following coverages?

Excess coverage over an insured auto liability claim is correct.

181

Ruth has been in an auto accident caused by a third party. Her vehicle is totaled and she has injuries and loss of wages. The adjuster states that he does not want to pay for anything until she agrees to the damage to repair her vehicle and her special damages. This is considered:

An unfair claims settlement practices act. is correct.

182

When an insured is fulfilling the duty of proving a loss by taking an inventory of the damaged property, who pays the expenses incurred by the insured?

The insured.

183

Even when extended coverage perils are added to a DP-1, not all of these perils are as broad as they are under the DP-2. The extended coverage perils which are broader under the DP-2 are:

Explosion, smoke and vehicles. .

184

An insured is covered under an HO-3 form. If the insured hits his own house and also damages the garage and the attached fence with his vehicle, what coverage would apply?

All of the items are covered under the HO-3 if the insured damages his own property with his vehicle. This is also true of the HO-5 form. These two forms provide open peril coverage and do not exclude this kind of loss.

185

Oliver Dogwood was in an auto accident which destroyed his car. While investigating the accident, Adjuster Doright found that Mr. Dogwood paid $1,000 for the vehicle. After checking with others he found the same vehicle with an asking price of $1,700, a retail price of $2,150 and a dealer price of $1,750. What amount will Mr. Dogwood receive?

2,150 is correct. always pay the retail price

186

The insured carries an auto policy and a personal umbrella policy. In case of a loss, how would the policies respond to pay a covered claim?

The personal auto policy would be the primary and would pay up to the policy limits, then the umbrella policy would be excess to pay up to its policy limits.

187

Property with no occupants or contents is considered to be _____ whereas property with no occupants but with contents is considered:

Vacant/Unoccupied is correct.

188

Subject to all other reasons for the termination of income benefits, what is the maximum length of time a disabled employee can receive income benefits in Texas?

: 401 weeks.

189

The insured carries a yacht policy and is pulling a water skier. The skier is a family member and is injured. What coverage might apply to this accident?

Medical payments coverage.

190

That branch of the law which defines rights and duties is referred to as:

Substantive Law..

191

How is property covered under an unendorsed BOP form

Coverage is written on an open peril basis

192

Under the Texas financial responsibility law, what is the minimum limit of liability that must be carried by the insured in an accident involving more than one injured party?

60,000

193

A dwelling insured under an HO-3 form has been vacant for 61 consecutive days. The dwelling has been vandalized. The vandals decide to set fire to the dwelling to conceal any evidence of their presence. The insurer will:

The insurer will deny the loss because the fire loss is as a result of the vandals setting fire to the dwelling. All of the damage is considered vandalism. Since the dwelling has been vacant for longer than the 60-day limit, coverage would not apply to any vandalism damages. Note: In New York the provisions that restrict coverage for vacant dwellings, the allowed vacancy period is reduced from 60 days to 30 days.

194

Which of the following would be covered under the "other than collision" coverage of a personal auto policy?

Lightning

195

Mr. Robin is retired and lives in an older home in Maine. He has an old floor furnace to heat his home that is in need of repair and he forgets to have it checked. In the winter he stays in Florida for a month with his daughter. While Mr. Robin is away the furnace malfunctions and all his water pipes freeze and burst causing massive water damage. The furnace is also destroyed. He has a broad form homeowner policy, which includes water damage from a heating or plumbing system. What will the adjuster do?

Pay for all damage except the furnace.

196

After suffering a work-related injury, how soon must the employee (or someone acting on their behalf) notify the employer of the injury?

30 days. is correct

197

Fidelity bonds which apply coverage to an employee or employees acting in collusion with others are called:

Commercial blanket bonds.

198

QUESTION:
Which of the following best demonstrates the meaning of "contract of adhesion?"

Since the insurance company formulates the policy language, the courts usually will resolve any ambiguities in the insured's favor

199

In claims adjusting, which of the following is not considered an unfair claims act?

Failing or refusing to separate the damaged from the undamaged property in order to properly evaluate the loss and damages owed the insured..

200

A damage award against a manufacturer of a defective automobile over and above the award for pain and suffering and special damages would be considered what kind of damages?

Punitive Damages

201

An item is covered on a personal articles floater. Under which of the following circumstances would the item be covered?

Breakage

202

A ship has negligently collided with another ship and caused severe damage. What coverage would apply to cover this claim?

: Hull insurance with the "running down clause"..

203

A deductible usually applies to which of the following automobile policy coverages

Physical Damage is correct.

204

What commercial auto policy form would be used to cover a company that transports their own property and property of others?

: The motor carrier form.

205

Dwelling forms may be used to insure residential structures which:

Contain no more than 4 occupancy units. .

206

John Smith has just made his last car payment which concludes his contract. The finance company, for reasons not immediately apparent, has the car repossessed. If Mr. Smith brings a suit, the court will allow Mr. Smith to retake possession of the car pending the court’s final ruling as to ownership if Mr. Smith provides the court a:

Replevin bond..

207

In order for a principal-agent relationship to exist there must be a:

: A contractual agreement..

208

Which commercial property form provides the broadest coverage

Special form is correct.

209

All of the following are excluded under the Commercial Building and Personal Property Form, EXCEPT:

Furniture and fixtures. .

210

Coverage for earthquakes and volcanic eruptions may be attached to Commercial Property Insurance. When the Earthquake Causes of Loss Form is attached, a series of earthquakes or volcanic eruptions will be treated as a single event whenever the series of shocks or eruptions occurs within a:

. 1 week 7 days

211

In which of the following situations should an adjuster consider obtaining a non-waiver agreement?

: In dealing with a potential coverage dispute.

212

The form used to report the insured’s actual and estimated business income under an Equipment Breakdown policy is called:

Business income—Report of Values .

213

direct" question by an adjuster addressed to an interviewee?

A "direct" question seeks specific pieces of information. Claim representatives use direct questions to elicit information, clarify an interviewee's statements and help reduce the likelihood that he or she will change their statement later. The other answers are considered "open ended" questions which call for an explanation or elaboration.

214

One of the purposes of the coinsurance clause is to:

Encourage insureds to insure property for most if not all of its value

215

What coverage under the BOP automatically applies if a customer slips and falls on the named insured's premises, regardless of legal liability?

Medical expense coverage is correct.

216

Which of the following can bind an insurance coverage by oral or written agreement?

Property and casualty producer is correct.

217

The insured has a one family dwelling with a detached garage. The dwelling is insured for $200,000. How much coverage applies to the garage?

20,000. The policy provides for 10% of the dwelling limit. Therefore, the garage is insured for $20,000 for the same perils that apply to the dwelling.

218

Your car is damaged in an auto accident. While it is being repaired, the body shop loans you a replacement. From a coverage standpoint this replacement vehicle is known as:

: A temporary substitute. is correct

219

Personal Injury Protection provided by auto liability coverage does not cover

A pedestrian .Personal Injury Protection (PIP) does not cover a pedestrian struck by the insured in an auto accident. Auto bodily injury coverage would provide coverage.

220

If a large employer has a current Workers Compensation policy with an experience modification factor above 1.00, which of the following is the most accurate statement?

The employer has had a worse-than-expected claims experience during the last few years. is correct.

221

An alien insurance company is

insurance company not in the US

222

A company that repairs customers' aircraft may need _______to cover the accidental damage to the customers' property.

Hangarkeeper’s Legal Liability.

223

What feature is common to most property insured under a commercial inland marine policy?

Usually in transit.

224

Loss of rental income on an apartment building caused by an insured peril is best described as:

: A consequential loss.Consequential losses include time element losses. This coverage provides loss of income incurred by a business that is caused by a direct loss from an insured peril.

225

What is the limit that will be paid for the fire department service charge in the BOP form

2,500

226

The doctrine of reasonable expectations is based primarily on

Contract Law.

227

What is the name of the fund in Texas that provides a portion of lifetime income benefits to a worker who has sustained a second work-related injury

Subsequent Injury Fund

228

An insured who had a $500,000 primary liability policy purchased a $1 million Umbrella liability policy with a $2,000 self-insured retention limit. Later, the insured allowed the required underlying primary policy with a limit of $100,000 to expire. A week after that, the insured became liable for a $100,000 loss that is not excluded by the provisions of either the primary policy or the Umbrella policy. How will this loss likely be settled?

The correct answer is: The insured will pay the full $100,000 loss..

229

What type of automobile coverage might a person need if he or she does not own a vehicle?

A named non-owner auto policy.

230

If an employee is eligible to receive impairment income benefits, what is payment based on?

70-% of the employee’s average weekly wage

231

A civil wrong, considered to be a violation of another's natural right, not covered by a specific contract or law, is called a:

Tort

232

An insurance agent represents the interest of:

The insurance company. .

233

Under the dwelling policy, what is the purpose of adding the EC (extended coverage) endorsement?

It adds additional perils to the coverage. .

234

If a person is found guilty of violating USC Section 1033 regarding Federal Fraud and False Statements, the Attorney General may do which of the following?

Assess a civil penalty in the amount the person received or offered for the prohibited conduct or $5,000 whichever is greater..

235

Which of the following is true regarding debris removal under the dwelling forms?

Coverage is included in the dwelling and contents coverage.

236

Under the Terrorism Risk Insurance Program Reauthorization Act of 2015, the maximum limit for the Act for total claims paid under the Act by either private insurers or the government is still limited to:

100 billion .

237

Which of the following allows the insured to increase their contents coverage amount for specified periods of time when inventory may be higher than usual?

Peak Season Endorsement.

238

The insured’s have a homeowner policy with a $5,000 loss deductible. The husband has purchased some expensive camera equipment to take on a cruise for recording their trip. Also special scuba gear and sportswear have been purchased for both. They are concerned about fire and theft. What coverage would you recommend?

Personal effects form

239

A policyholder would expect to find which of the following information in the insuring agreement section of an auto policy?

: The promise of the insurance company to pay on the behalf of the insured

240

What is the time limit for a person to file a claim for death benefits after an employee's death?

No later than the first anniversary after the death of the employee

241

An insurance broker is a person who represents:

An insured or prospective insured

242

The insured has a primary liability policy with a limit of $300,000 per occurrence and a $1 million umbrella liability policy with a $10,000 self-insured retention limit. The insured became liable for $800,000 in damages that are excluded by the underlying policy, but not by the umbrella policy. How would this case likely be settled?

The insured would pay $10,000, and the umbrella policy would pay $790,000. is correct.

243

Prior to commencing subrogation, the insurer should

The insurer should obtain a signed subrogation agreement, trust agreement or loan receipt from the insured.

244

If the claim is not denied, an insurance carrier must initiate compensation under the laws promptly. Not later than the ___ day after the date on which an insurance carrier receives written notice of an injury, the insurance carrier must begin payment of the benefits.

: 15th is correct.

245

In case of a loss, how many days notice does the insured have after notification of a claim to submit the claim to the underwriters of the ocean marine coverage?

180 days.

246

A vehicle rolled over exiting the interstate. The insured carries collision coverage with a $1,000 deductible and other than collision coverage with a $500 deductible. The damage to the vehicle is $2,000. What amount is the insurer responsible to pay?

1,000.A vehicle that rolls over and sustains damage is considered to be a collision claim versus an other than collision claim. The damage to the vehicle is $2,000 and the deductible is $1,000. Therefore, the insurer is liable for $1,000.

247

Ocean marine coverage for losses to the insured vessel caused by bursting boilers, latent defects in the vessel and negligence of the master or crew members are addressed by which of the following?

The Inchmaree clause.

248

All forms and endorsements must be filed _____ before the date of use in Texas.

: 60 days.

249

In terms of fidelity bonds, what does “name scheduled” refer to?

The bond covers only those persons listed by name on the bond’s schedule..

250

Under business income coverage, what coverage continues payment of income after the period of restoration is complete?

Extended Business Income.

251

Which of the following sections of an insurance policy states who may be considered an insured in addition to the named insured?

Definitions

252

Under Homeowners insurance, "Medical Payments to Others" coverage will cover necessary medical expenses incurred within:

: 3 years of the accident causing the injury

253

When may an insured sue their insurance company?

: Not until the insured has complied with all policy provisions and within the time limit specified in the state laws.

254

The mandatory recoupment of the federal share through policyholder surcharges under Terrorism Risk Insurance Program Reauthorization Act of 2015 was increased from 133% to:

140% is correct.

255

If an insurance company covered an excluded claim it may have to continue paying other such claims because of:

Estoppel

256

Which of the following coverages may be added by endorsement to an Equipment Breakdown Policy?

Business Income

257

Mr. Adams is having his brakes repaired at the garage. The mechanic test drives the vehicle and hits a tree. What coverage would respond to protect the garage for repairs to Mr. Adam’s vehicle?

Garage Keepers Legal liability .Garage Keepers Legal liability coverage protects the garage for damages to a customer’s vehicle. This includes theft, fire collision and a few other perils.

258

What coverage is provided under the BOP for a steam boiler explosion

Steam boiler explosion is excluded under the BOP.

259

On the way to Europe, heavy seas place a cargo ship in danger of sinking. The crew decides that if they dispose of the heavy equipment they are hauling the ship won’t sink. They toss overboard 10 tractors owned by John Deere. The cartons of cotton balls owned by Eli Cotton are safe as is the whipped marshmallow cream being shipped for Kraft Foods. When they get to Europe, Eli and Kraft are asked to share in the loss that John Deere sustained. This is an example of:

General Average Clause.

260

Which of the following types of property may be insured under a furriers block policy

Stocks of furs owned by the insured furrier.

261

An unendorsed Homeowner Policy provides no coverage for liability arising out of business related exposures, other than for permitted incidental occupancies. The ______Endorsement provides liability coverage for a business conducted away from or on the residence premises.

Home Business Pursuits

262

The maximum seating capacity and total floor space for a fine dining restaurant covered under a BOP is?

150 seats with 7,500 total square feet.

263

In insurance terms, the phrase "severability of insurance"

: The insurance applies separately to each insured. .

264

Watercraft coved boats

50 HP or less

25 feet or less

sailing 26 ft or less

reported 45 days after acquisition

265

What is insurance

Insurance is a social device for spreading the chance of financial loss among a large number of people.

266

Transacting insurance:

includes soliciting insurance, collecting premiums and handling claims

267

Law of Large Numbers

is a statistical concept that relates to probability. It is one of the factors insurance companies use to determine rates.

268

Intervening cause

an independent action that breaks the chain of causation and sets in motion a new chain of events.

269

McCarren-Ferguson Act:

passed by congress in 1945 and states that regulation of insurance companies should remain at the statel level.

270

Reciprocal insurance exchange:

associations that agree to share risk equally among its members. Lloyds is an example.

271

Fraternal Benefit Society

incorporated by society or order, without capital stock, that is operated on the lodge system and conducted solely for the benefit of its members and their beneficiaries, and not for profit. Mostly write life and health insurance.

272

Rebating

occurs if the buyer of an insurance policy receives any part of the agent’s commission or anything of significant value as an inducement to purchase the original policy.

273

Twisting

: is the unethical act of persuading a policy owner to drop a policy solely for the purpose of selling another policy without regard to the possible disadvantage to the policy owner.

274

EC perils

windstorm, civil common, smoke, hail, aircraft, vehicles, volcanic eruption, explosion and riot. WC SHAVVER

275

Broad perils

burglary damage, ice and snow weight, glass breakage, accidental discharge of water or steam, falling objects, freezing pipes, electrical damage, collapse and tearing apart/cracking/burning. BIG AFFECT

276

What amount, if any, is paid for burial expenses under the Texas workers compensation law?

up to $10,000.

277

All of the following types of signs can be covered by the Sign Coverage Form, except

Signs carved in stone or brick.

278

Which of the following homeowner forms does not provide full coverage on the dwelling - Coverage A

HO-4

279

Which of the following may cancel a Commercial Package Policy

The first named insured.

280

What is the most important advantage to an employer under the self-insured Texas workers compensation plan?

Save premium

281

A common carrier has signed a contract to deliver goods of the seller. The goods are to be shipped "Free on Board Destination". When does the responsibility of the seller end?

Not until the goods are delivered to the buyer in accordance with the contract terms..

282

The "last clear chance doctrine" addresses:

Avoidance of the occurrence on the part of the plaintiff..

283

The Homeowners policy provides a special limit for Damage to Property of Others in the Section II (liability) Additional Coverages of:

$1,000..

284

The limit of a bond is known as its:

Penalty

285

Risk is best defined as

An uncertainty of loss.

286

Reporting forms

require insureds to periodically report values of autos the insured holds for sale, and premiums are charged accordingly.

287

In which part of an insurance contract would you expect to find a description of the duties and obligations of the insured?

Conditions

288

Under a personal auto policy, what is Coverage D

Coverage for Damage to Your Auto.

289

An aleatory contract is most accurately described by which of the following

It is a contract in which the performance of one party is contingent upon the occurrence of a fortuitous (accidental) event.

290

When an insurer cancels a dwelling policy for non-payment of premium, it must give the insured advance notice of at least:

10 days. .

291

The workers compensation law of the State of Texas is administered and operated by what body?

Division of Workers Compensation.

292

What endorsement may be used on the dwelling policy to keep values current with the replacement cost of the buildings?

The Automatic Increase Endorsement

293

Which of the following would NOT be found in the conditions section of a homeowner insurance policy?

Insurance premium

294

The insured is moving to a new location. Coverage for contents provided under a Homeowner Policy would be:

The insured is moving to a new location. Coverage for contents provided under a Homeowner Policy would be:

295

Transportation expenses in a personal auto policy apply to what type of loss?

Indirect loss

296

Who is the principal in a bid bond?

The Contractor

297

When someone dies without a will they are said to have died:

Intestate

298

An adjuster's report that contains all the facts, evidence and disposition of the claim and is considered to be the final report is known as the:

Full Report

299

If a named insured obtains "newly acquired property" such as a new outboard motor after their Personal Watercraft policy period begins, that property is covered under the policy for a maximum of ____ days after the date it came into the insured's possession.

14

300

A person who has been previously convicted of operating a motor vehicle in violation of the motor vehicle liability requirement may be subject to a maximum fine of up to:

$1,000