EXAMFX: PROPERTY & CASUALTY NEWEST EXAM ACTUAL EXAM 2025 QUESTIONS & CORRECT ANSWERS, Exams of Nursing

Download EXAMFX: PROPERTY & CASUALTY NEWEST EXAM ACTUAL EXAM 2025 QUESTIONS & CORRECT ANSWERS and more Exams Nursing in PDF only on Docsity! EXAMFX: PROPERTY & CASUALTY NEWEST EXAM ACTUAL EXAM QUESTIONS AND DETAILED CORRECT ANSWERS | VERIFIED An ocean marine loss that occurs through the voluntary sacrifice of a part of the vessel or cargo to save the ship, crew, or other cargo is known as? A: Particular average B: Inchmaree clause C: Protection and indemnity D: General average Correct Answer D If a claim under a commercial property policy is disputed, what is the maximum time period an insured may bring legal action against an insurer? A: 2 years from a loss B: 6 years From a Loss C: 5 years from the initial application D: 10 years from the initial application Correct Answer C A company has a business owners policy on a building with an estimated replacement cost of $300,000. The company carries $150,000 of insurance. If a loss occurs, how much will the insured company be paid? A: Up to $300,000 for the loss B: Up to $150,000 for the loss C: The coinsurance formula would apply D: Nothing because the company failed to carry the required insurance amount Correct Answer C The law of large numbers is best defined as a large numbers of people with similar exposures to loss resulting in actual losses being? A: Less predictable B: Smaller C: Larger D: More Predictable Correct Answer D The basic dwelling (DP-1) provides all of the following coverages without endorsement EXCEPT? A: Additional Living Expenses B: Fair Rental Value C: Dwelling D: Other structures Correct Answer A Which of the following dwelling policies insures a structure on an actual cash value basis? A: DP-1 B: DP-2 C: DP-3 D: DP-6 Correct Answer A B: 40% of the replacement cost C: 60% of the replacement cost D: 80% of the replacement cost Correct Answer D A homeowner lives in a 150-year-old adobe building that is on the National Register of Historic Places. The homeowner has a HO-8 coverage. If a fire destroys part of the roof, which of the following describes the insurer's responsibility? A: Replacement of the roof to the condition prior to the fire B: Full roof replacement to current code specifications C: Partial roof replacement to current code specifications D: None Correct Answer B Which of the following could be covered on a basic dwelling policy form if purchased? A: Hail damage to a dwelling's outside antenna B: Smoke damage from fireplace use C: Damage from broken water pipes D: Damage from vandalism to a property that has been vacant for 45 days Correct Answer B Which of the following limitations does a homeowners policy place on a home-run business? A: An additional premium is charged based on the income of a home-run business B: There can be no more than 2 people working at any one time C: The business is limited to $10,000 in retail sales D: The home business may operate only between the hours of 7am and 6pm local time Correct Answer A The Commissioner of Insurance is? A: Elected by authorized insurers B: Elected by the people of North Carolina C: Appointed by the governor D: Appointed by the Attorney General Correct Answer C Which of the following is covered under a dwelling policy? A: Structures used for commercial manufacturing B: Fire caused by an earthquake C: freezing of plumbing systems D: Flood or surface water Correct Answer B Denying insurance coverage on the basis of a person's marital status is? A: Allowed with the insurance commissioners approval B: Allowed under state law C: Considered unfair discrimination D: Considered a category D felony Correct Answer C Which of the following is not consider a rebate? a. Offering a client a multi-policy discount b. Returning part of your premium to your client c. Any inducement to buy that is not stated in the policy d. Giving clients who buy policies from you $100 gift cards Correct Answer A Which of the following would NOT be covered under a dwelling property policy? A: Residence occupied by both an owner and a tenant B: Residences undergoing construction C: A farm used to raise and sell cattle D: A vacation rental that is unoccupied for 3 or more months a year Correct Answer C To be eligible for coverage under a BOP, an office building cannot exceed how much in square footage? A: 3,00 B: 50,000 C: 100,000 D: 300,000 Correct Answer C After receiving proof of loss from an insured, an insurer must notify the insured of its intent to repair or replace damaged or lost property within? A: 10 days B: 20 Days C: 30 days D: 60 days Correct Answer D Which of the following entities is eligible for a business owners policy? How are premiums handled on a prepackage business owners policy? A: Property premiums are set at a fixed rate, while liability premiums increase over time B: There is one premium for property and liability coverage C: Only property coverage requires premium payments D: Premiums may very between property and liability coverage Correct Answer B All of the following actions are prohibited in the sale of life insurance EXCEPT? A: Sharing commissions from the sale of a life policy with another life agent B: Paying anything of value to the insured that is not specified in the contract C: Offering shares of stock in the insurer as an inducement to buy insurance D: Giving a special advantage as an inducement to buy insurance Correct Answer A A basic dwelling policy automatically provides coverage against fire, lightening, and ? A: Windstorm B: Internal Explosion C: Riot D: Smoke Correct Answer B A sudden, unplanned and unexpected event, not under the control of the insured, resulting in injury or damage that is neither expected nor intended is known as ? A: Peril B: Loss Valuation C: Liability D: Accident Correct Answer D Which of the following business owners policy (BOP) endorsements provides coverage for the inability to collect monies due from customers as the result of a covered cause of loss? A: Valuable papers and records B: Accounts receivable C: Money and security D: Extortion Correct Answer B An insured loses $2,500 worth of precious stones in a burglary. How much will the insured's homeowners policy cover? A: Nothing B: $1,250 C: $1,500 D: $2,500 Correct Answer C Which of the following is an advantage of a businessowners policy? A: It offers lower rates to bars and grills B: It combines property and liability coverage in a single package C: It is a monoline policy D: It splits premiums, allowing an insured more flexibility regarding coverage Correct Answer D Which of the following types of insurance would be covered by the North Carolina Post-Assessment Insurance Guaranty Association? A: Automobile policies B: Life Insurance C: Mortgage insurance D: Surety bonds Correct Answer A If a licensee is convicted in any court for any offense, other than a traffic violation, the licensee must notify the Commissioner within how many days of the conviction date? A: 10 days B: 15 days C: 30 days D: 31 days Correct Answer A How soon after a direct physical loss would the period of restoration begin under the extra expense coverage form of a CPP? A: Immediately A: The amount of the loss minus the deductible B: 80% of the loss C: 20% of the loss D: The limit of insurance after the deductible is paid Correct Answer D An individuals construction company leaves mobile equipment and construction machinery on the job site until the project is completed. What could this individual use to insure it? A: Bailee's customers form B: Builders Risk form C: General property form D: Contractors equipment floater Correct Answer D The appraisal clause of the standard fire policy allows for the process of setting disputes over the ACV of the property or the property or the amount of loss. When disputes arise, each party (insurer and the insured) must select an impartial appraisal within? A: 20 days B: 30 days C: 45 days D: 10 days Correct Answer A All of the following help determine flood insurance rates EXCEPT? A: zone classifications B: Simple flood definitions C: Pre-FIRM rates D: Post-FIRM rates Correct Answer B All of the following are exclusions that apply in all three types of Dwelling Policies EXCEPT? A: Earth movement B: Fire or lightening C: Government action D: water damage Correct Answer B All of the following are other coverages under the dwelling policy EXCEPT? A: Improvements, altercations, and additions B: Earth Movement C: Other structures D: Debris removal Correct Answer B Maps that indicate which areas in the community are subject to serve flooding are called? A: Flood Susceptibility Maps B: Topographical Representations C: Flood Hazard Boundary Maps D: Flood Insurance Rate Maps Correct Answer C An agent in Ohio wants to become an agent in North Carolina. The Commissioner will waive certain examination requirements, provides that Ohio would waive these same requirements if a North Carolina agent sought licensure in Ohio. What term does this describe? A: Rebating B: Indemnity C: Reciprocity D: Residency Correct Answer C All of the following are duties of the insured following a loss in a standard fire policy EXCEPT? A: Submit a signed proof of loss within 30 days B: Furnish a complete, detailed inventory including values C: Notify the insurer in writing immediately following the loss D: Protect the property from further damage Correct Answer A Which of the following other coverages is NOT included in the basic form dwelling policy? A: Breakage of glass B: Removal Coverage C: Personal property temporarily away from the insured premises D: Tenant's improvements, altercations, and additions Correct Answer A Replacement cost coverage is provided in both the broad and special form dwelling policies when? A: Property at risk must be owner occupied B: Risk must be insurable C: The applicant must have made an unsuccessful effort to obtain coverage in the normal market D: Risk must be located in a specific area Correct Answer A An agent who offers a cash reward to a prospect for buying a policy is guilty of? A: Rebating B: Coercoin C: Twisting D: Controlled business Correct Answer A Statements made by an applicant for an insurance policy that are the best of the applicants knowledge are referred to as? A: Indemnity B: Warranties C: Representations D: Material Information Correct Answer C From the date of the loss, how many years does an insured have to file a lawsuit against a homeowners insurer? A: 1 year B: 2 year C: 3 year D: 5 year Correct Answer A In homeowners policies, indirect losses are covered by? A: Coverage A B: Coverage B C: Coverage C D: Coverage D Correct Answer D Under businessowners policy Section I, if an insurer wants to cancel a policy for any reason except no payment or premium, how many days before the expiration date must the insurer notify the mortgageholder? A: 30 days B: 90 days C: 20 days D: 40 days Correct Answer A The perils covered by the beach area property plan include all of the following EXCEPT? A: Fire B: Flood C: Lightening Correct Answer B All of the following are grounds for license suspension revocation or refusal EXCEPT? A: Having committed any insurance unfair trade practice B: Making an untrue statement on the license application C: Sharing commissions with another agent D: Failure to pay child support Correct Answer C A home insured on an HO-3 policy was completely destroyed in a fire. The house was worth $300,000. The limit of the policy is $250,000. The policy will pay for the total loss & debris removal is? A: $250,000 B: $250,000 plus an additional 5% C: $300,000 D: $300,000 minus 5% Correct Answer B Section I of a homeowners policy would cover which of the following? A: Liability B: Personal Property C: Loss of income D: Personal Injury Correct Answer B In homeowners policy, coverage for a loss by theft of firearms is? A: 10% of Coverage C, up to $5,000 B: 10% of Coverage C, up to $10,000 C: 25% of Coverage C, up to $10,000 D: $25,000 Correct Answer B D: Under all circumstances Correct Answer B Under which of the following circumstances would a loss be covered under an HO-2 policy form? A: Rain enters a house through an open door, warping the wooden floors B: An insured drives a car into a wooden plat fence on the insureds property C: A house that has been vacant for 65 days is damaged when a water heater bursts D: A hail storm pokes a hole in a roof and a bedroom has hail damage Correct Answer D Which of the following types of property would be covered in homeowners coverage form? A: Landlords furnishings in an on-premises apartment B: Structers used for business purposes C: Structured rented to others who are not tenants of the dwelling D: Animals, birds, or fish Correct Answer A Which of the following coverages in the dwelling policy is for indirect losses? A: Personal Property B: Dwelling C: Additional Living Expenses D: Other Structures Correct Answer C Which of the following commercial forms would cover costs associated with a temporary worksite while damaged to an office building are being repaired? A: Builders risk B: Business Income C: Legal Liability D: Extra Expense Correct Answer B Events or conditions that increase the chances of an insured loss occurring are referred to as? A: Risks B: Perils C: Hazards D: Exposures Correct Answer C Insurance is the transfer of risk of ? A: Loss B: Risk C: Hazards Correct Answer A An insurance agent who embezzles a client's monies is guilty of? A: A Felony B: A misdemeanor C: Fraud D: Perjury Correct Answer A Which of the following refers to the upper limit a liability policy will pay out for all claims that arise from a single accident? A: Split limits B: Per Person C: Per occurrence D: Combined single limits Correct Answer C An insurance broker represents? A: The beneficiaries B: Other agents C: The insurer D: The insured Correct Answer D In which of the following situations would a property be considered unoccupied? A: A new apartment building has been insured, but no dwellers have moved in yet? B: A building has been condemned and emptied of all property C: The insured went on vacation for a month while the house remained empty D: The insured moved out and removed all the furniture from the house 3 months ago Correct Answer C All of the following practices would be prohibited EXCEPT? How many years from the cancellation or nonrenewal of a commercial property policy may an insurer audit the books or records of the insured? A: 1 year B: 3 years C: 5 years D: Indefinitely Correct Answer B Which of the following homeowners forms would be best for a person renting half of a duplex? A: Unit-owners for (HO-6) B: Broad form (HO-2) C: Special form (HO-3) D: Contents broad form (HO-4) Correct Answer D A couple has just purchased a condominium. Which of the following policies would they use to insure their dwelling? A: HO-2 B: HO-4 C: HO-5 D: HO-6 Correct Answer D An insured has a homeowners policy and repairs her to be a member of the homeowners association in her neighborhood. The association's community house has burned down and the insured has been assessed $1,200 for her community share of the rebuilding cost. How much of the assessment will the homeowners policy pay? A: None B: $500 C: $1,000 D: $1,200 Correct Answer C Which of the following causes of loss is covered under a commercial property basic form? A: Nuclear hazard B: Dry rot C: Volcanic eruption D: Earth movement Correct Answer C In a liability policy with split limits of 20/40/10, what is the maximum amount payable for bodily injury to two or more people per occurrence? A: $10,000 B: $20,000 C: $40,000 D: $70,000 Correct Answer C When may an insurer charge a rate different from the one promulgated by the North Carolina Rate Bureau? A: Only if it is a rate increase B: Only if it is a rate decrease C: Only when the insurer files the proposed deviation with the Commissioner and the Bureau D: At any time Correct Answer C Commercial property policies written together into a single contract are referred to as? A: Combined policies B: General liability policies C: Package policies D: Monoline policies Correct Answer C Who would participate in a Write Your Own (WYO) flood insurance program? A: Business requiring National Flood Insurance policies B: Private Insurers that wish to write and service National Flood Insurance policies on a no risk-bearing basis C: Lloyd's associations D: Government insurance companies that write and service National Flood Insurance policies Correct Answer B If an insured covered under a Mobile Homeowners Policy moves the mobile home to protect it from a covered peril, the policy will pay up to? A: $350 B: $500 C: $750 D: $1,000 Correct Answer B All of the following are options of the insurer in the loss settlement of a standard fire policy EXCEPT? Removal coverage under a standard fire policy remains in effect for? A: 5 days B: 10 days C: 30 days D: 15 days Correct Answer A All of the following are losses NOT covered under the standard fire policy EXCEPT? A: Acts of war B: Theft C: Fire D: Insured's neglect Correct Answer C Which of the following would provide coverage for loss of income when an insured rental dwelling is rendered uninhabitable because of a covered loss? A: Coverage C B: Coverage D C: Coverage A D: Coverage B Correct Answer B (Coverage D provides fair rental value coverage when insured rental dwellings suffer a loss covered by Coverage A, B, or C) How does the mobilehome endorsement affect the other coverage of law or ordinance in a homeowners policy? A: It removes coverage B: It broadens the coverage C: It limits the coverage D: It has no effect on this coverage Correct Answer A (The mobilehome endorsement makes the other coverage of law or ordinance inapplicable to the policy) All of the following are other coverages included in both the broad and special form dwelling policy EXCEPT? A: Theft of personal property B: Collapse C: Breakage of glass D: Lawns, trees, shrubs, and plants Correct Answer A (theft of personal property can only be included by endorsement) Which of the following would be considered a cause for flood conditions covered by the National Flood Insurance Program? A: Mudflow B: Snow C: Landslides D: Sewer backup Correct Answer A The mobilehome endorsement alters the homeowners policy to cover a mobilehome and other structures on land ? A: Owned or leased by the resident of the mobilehome B: Owned or leased by a landlord who does not reside on the premises C: Owned by a landlord who does not use the mobilehome located on it D: Leased by the owner of the land Correct Answer A Which of the following statements is true concerning the special form dwelling policy? A: Coverage A is for all-risk perils, and Coverage C is for basic perils only B: Coverage A is for all-risk perils, and Coverage C is for the broad form perils C: Both Coverage A and Coverage C are provided on an all-risk basis D: Both Coverage A and Coverage C are provided for the broad form perils Correct Answer B (Because the all-risk coverage applies to property insured under Coverages A and B only) A Commercial Package Policy (CPP) allows the insured to select the coverage needed and customize the policy to meet the needs of the insured's business. In a CPP, the business owner may select from all of the following types of coverage EXCEPT? A: Crime Coverage B: Boiler and machinery coverage C: General liability coverage D: Workers compensation coverage Correct Answer D A: Completed value form B: Scheduled form C: Reporting form D: Specific value form Correct Answer A In equipment breakdown coverage, all accidents would be considered a single accident if they occur? A: At the same location within a 48-hour period B: At a single location at the same time and from the same cause C: At all insured locations at the same time and from the same cause D: At the same location within a 24-hour period Correct Answer B An individual's construction company leaves mobile equipment and construction machinery on the job site until the project is completed. What could this individual use to insure it? A: Builders risk form B: General property form C: Contractors equipment floater D: Bailee's customers form Correct Answer C The common policy conditions is a modular part combined with other parts to create the contract. The common policy condition section contains provisions that are applicable to all lines of coverage that may be included in the policy. Which of the following provisions would be found in the common policy conditions section of the policy? A: The first named insured may cancel the policy at any time by giving written notice to the insurer B: Prior to the insurer making inspections, surveys, and reports relating to the insurance, approval from the insured must be obtained C: Requests for any changes in the policy from the insured may be made by the second named insured D: The insurer is granted the right to audit books and records of the insured relating to the policy for a period of up to 5 years after the end of the policy Correct Answer A (Only the first named insure may make requests for any changes in the policy) Business personal property coverage form covers all of the following EXCEPT? A: Machinery that is not permanently installed B: Stock C: Automobiles held for sale D: Furniture and fixtures Correct Answer C (Automobiles held for sale are among the exclusions in the BPP Form. The rest are covered types of property) In addition to the common policy conditions, all of the following conditions apply to liability coverage EXCEPT? A: Employers liability B: Separation of insured C: Legal action against insurer D: Bankruptcy Correct Answer A (Employers liability is an exclusion) A Policyholder has an equipment breakdown policy with a $200,000 limit. If a boiler explosion causes $100,000 damage to the boiler itself, $50,000 damage to the insured's building, and $30,000 of expediting expenses, how much will the insured collect under the policy? A: $200,000 B: $ 100,000 C: $175,000 D: $180,000 Correct Answer C A commercial property special form covers property in transit up to? A: Full replacement cost B: $5,000 C: ACV D: $500 Correct Answer B (This extension of coverage may be added to the special form. It is additional insurance (in addition to the coverage limit) and coinsurance does not apply) Which of the following endorsements under a Boiler and Machinery policy is used for calculating the amount to be paid on a lost business claim after a direct loss? A: Refrigeration Interruption Coverage Adverse selection is a concept best described as? A: Underwriting slanting the odds in favor of the company B: Poor choices of applicants to be covered C: Only offering coverage to good risks D: Risks with higher probability of loss seeking insurance more than other risks Correct Answer D An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. Which of the following insurance principles has the insurer violated? A: Consideration B: Good faith C: Representation D: Adhesion Correct Answer A What type of information would be found in a policy's insuring agreement? A: Insurer's address B: Renewal dates C: Location of premises D: Policy limits Correct Answer B What do individuals use to transfer their risk of loss to a larger group? A: Insurable interest B: Exposure C: Indemnity D: Insurance Correct Answer D All of the following are factors in the determining of actual cash value EXCEPT? A: Type and quality of property B: Age of the property C: Replacement cost D: Insurance premium paid Correct Answer D Which of the following would be covered under personal injury liability? A: Death B: Slander C: A broken arm D: A concussion Correct Answer B The part of a property that shows the amount of insurance, premium, and policy term is the ? A: Endorsements B: Declarations C: Insuring clause D: Conditions Correct Answer B A man is working on the roof of his house, and his neighbor is watching from the ground. when roof shingles are thrown off the roof, they hit the neighbor in the face, injuring his eye. Which best classifies the homeowner's legal liability? A: Personal injury B: Bodily Injury C: Contributory negligence D: Property damage Correct Answer B A businessowners policy is? A: Part of a commercial package policy B: A monoline policy C: A self-contained prepackaged policy D: A special policy designed for large retail operations Correct Answer C The Commissioner reports any violations of insurance laws and regulations to the? A: Governor B: NAIC C: Attorney General D: Guaranty Association Correct Answer C All are true of the additional coverages of a homeowners policy EXCEPT? A: It will pay up to 10% of the policy's dwelling limit for increased building cost because building codes have changed between the time the house was built and the covered loss occurred B: It will pay up to $5000 for grave markers away from the residence premises caused by a Coverage C peril