Florida 2-20 Agents License Exam 2024-2025 Questions and Correct Verified Answers. Grade A, Exams of Insurance law

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Florida 2-20 Agents License Exam 2024-

Questions and Correct Verified Answers.

Graded A

"Additional Coverage", under a Commercial Property policy include all of the following except: - ANSNewly acquired locations for up to 60 days 10% for a self-storage facility does not apply to personal property that is moved from the residence premises because: - ANSIt's being repaired A _____________ is required in order for an insurer to transact insurance in Florida. - ANSCertificate if Authority A claim under an ISO Commercial Crime Coverage Form is subject to the Valuation —Settlement condition. Which one of the following is true regarding this Valuation—Settlement condition? - ANSDamaged property is valued at replacement cost or the insurer can repair or replace the property A Commercial Package Policy (CPP) premium may be modified by a package modification factor. This factor - ANSIs a discount justified by the greater efficiency in providing a package policy.

A Commercial Package policy may include the following coverage types EXCEPT: - ANSHealth A condominium unit owner would use which form? - ANSHO- A description of the property insured, a list of mortgagees, and the applicable coinsurance percentage(s) are shown on which one of the following documents? - ANSCommercial property declarations A Florida insured has a Personal Auto Policy providing PIP coverage with a $1, deductible. The insured is injured in his vehicle and sustains $15,000 in medical bills. How much will his policy pay under PIP? - ANS$10, A homeowners policy premium is determined by first developing the base premium. The base premium is influenced by certain factors, including which one of the following? - ANSDwelling location A policy with Citizens may be replaced with a policy from an authorized insurer at any time during the policy period with a ________day notice. - ANS

A small business owner concerned about something happening and not being able to work or earn a living for an extended period of time due to an accident should purchase - ANSDisability insurance. A storm causes power lines to break ten miles from the insured's premises. The loss of electrical power causes food in the insured's freezer to thaw and spoil. Coverage for this loss is - ANSExcluded because the power failure occurred off the residence premises. A term used to indicate a partial loss resulting from a sacrifice of cargo to save remaining property (jettison) Each party then shares in the loss in proportion to their total interest in property being transported - ANSGeneral Average A written contract that includes all clauses, riders, endorsements and papers is called: - ANSPolicy ABC, Inc., is a large, national retailer that sells a variety of consumer goods. ABC carries a Commercial Package Policy that includes Insurance Services Office's Commercial Crime Coverage Form (Loss Sustained) with the following insuring agreements: Employee Theft; Forgery or Alteration; Inside the Premises—Theft of Money and Securities; and Inside the Premises—Robbery or Safe Burglary of Other Property. The limit of insurance for each one of these insuring agreements is $100,000 and the deductible per occurrence for each one of these insuring

agreements is $1,000. The policy year is 20X1. During 20X1, two employees, Beth and Jim, in collusion, stole money and merchandise from ABC. Beth and Jim stole money on May 1, 20X1 and August 13, 20X1. They also stole merchandise on January 15, 20X1 and September 29, 20X1. The amount of the money loss totaled $15,000 while the amount of the merchandise loss totaled $110,000. W - ANS$100, Adam and his insurer disagree on the amount of a loss covered by his homeowners policy. Adam wants the insurer to pay $10,000 toward the loss. The insurer's representative feels that the loss should be valued at $5,000. How could the appraisal process resolve this situation? - ANSAdam and the insurer will each select an appraiser, and the two appraisers will submit their differences to an impartial umpire who will reach a resolution. After a loss the insured must do all the following except: - ANSDiscontinue premium payments All "keep-out" and "take-out" plans of Citizens are subject to the ___________ statute. - ANSConsumer Choice All of the following are BI and PD exclusions under the CGL EXCEPT: - ANSExcessive Liability

All of the following are controlled Commercial Inland Marine lines EXCEPT: - ANSAnnual Transit All of the following are coverage extensions found in the Building and Personal Property Coverage form except: - ANSOff premises sign coverage up to $2, All of the following are deductibles for FAJUA Physical Damage Coverage EXCEPT: - ANS$2, All of the following are eligible for a homeowners policy EXCEPT: - ANSOwner- occupants of a 1-6 family dwelling All of the following are eligible for the PAP policy EXCEPT: - ANSCorporations All of the following are exclusions under Garage Insurance Physical Damage coverage EXCEPT: - ANSExpected losses All of the following are Major Medical Insurance exclusions EXCEPT: - ANSCosmetic surgery required by accident

All of the following are not true regarding property coverages under the Businessowners policy EXCEPT: - ANSACV on personal property All of the following are Optional Coverages under the Buisnessowners policy EXCEPT: - ANSCollapse All of the following are penalties under the Florida No-Fault Law EXCEPT: - ANSSR 22 denied All of the following are true of the Supplemental Extended Reporting Period (SERP) under a Claims-made CGL policy except: - ANSThe coverage is automatic and need not be requested by the insured. All of the following can be an insured under the Lawyers Professional Liability policy EXCEPT: - ANSLawyers for their services after termination All of the following coverages are available for FAJUA commercial vehicles over 10,000 lbs EXCEPT: - ANSCollision All of the following fall under the definition of sliding EXCEPT: - ANSGiving the applicant a portion of the commission

All of the following forms will apply to owner-occupants of 1-4 family dwellings EXCEPT: - ANSHO- All of the following Special Limits can be increased EXCEPT: - ANSFirearms from $2,500 to $10, Allen, a sole proprietor, is crossing the street when he is struck by a passing uninsured auto. He sustains $2,500 in medical bills, $3,000 damage to the laptop he was carrying, and $1,000 in lost wages. Allen's business auto policy has $100,000 liability limit and $5,000 medical payments limit. Assuming there is no other coverage, how much will his business auto policy pay? - ANS$2, Alterations or additions made to the building at the expense of an insured who does not own the building and who cannot legally remove them are referred to as

• ANSImprovements and betterments. An animal damaged the interior of an insured's automobile while it was parked with the windows down. Which one of the following types of physical damage coverage under the Business Auto Coverage Form would cover this loss? - ANSComprehensive

An employer that decides to purchase specific excess insurance to cover catastrophic workers compensation losses must pay losses that are which one of the following? - ANSUp to the retention for one occurrence. An example of when a permit bond may be required , would be: - ANSAn athletic event An exclusion contained in the Causes of Loss—Basic Form eliminates coverage for damage caused by which one of the following? - ANSMechanical breakdown, including rupture or bursting caused by centrifugal force An insured covers his owned auto with more than one Personal Auto Policy (PAP), each from a different insurer. In the event of a claim for medical payments coverage, - ANSEach insurer pays its pro rata share based on the proportion that its limit of liability bears to the total of applicable limits. Any insurance wherein payment by the insurer will be paid directly to the insured or names interests is called: - ANSProperty insurance As per Florida law, this includes every person engaged as indemnitor, surety, or contractor in the business of entering into contracts of insurance or of annuity. - ANSinsurer

Basic limits for Hospital Professional Liability are - ANS$250,000/$750, Basic limits for the Hospital Professional Liability form are: - ANS$250,000/$750, Before workers compensation statutes were enacted, what was the remedy for employees with work-related injuries? - ANSThey had to establish that the employer was at fault to recover damages. Bert and Maggie insure their house with an unendorsed HO-3—Special Form (HO-

3. with a Coverage A—Dwelling limit of $300,000, which is the replacement cost of the house. A fire destroys their detached garage. The cost to replace the garage is $35,000. Ignoring any deductible that may apply, how much will Bert and Maggie's insurer pay to replace the detached garage? - ANS$30, Betty's Birdhouses constructs and sells birdhouses. Betty discovered a fungus in the wood used to construct the birdhouses that would kill birds. Betty withdrew her entire stock of birdhouses to avoid any claims from environmental organizations for loss to wildlife. Does Betty's Commercial General Liability (CGL) Coverage Form cover the cost to withdraw the birdhouses and feeders? - ANSNo, because the cost to withdraw Betty's product is excluded

Bilo Manufacturing is weighing whether to lease vehicles for its employees or have them drive their own autos while on company business. Which one of the following exposures is created if Bilo decides in favor of employee-owned autos? - ANSEmployer's Nonownership Liability Bob, an employee of Tank's Trucks, is backing one of Tank's trucks toward the loading dock on the insured premises. Bob accidentally strikes Alice, another employee, while she is directing Bob toward the loading dock. Alice sues Bob for her injuries. Is Bob covered under Tank's Trucks' unendorsed Business Auto Coverage Form for liability coverage? - ANSNo, because fellow employees' suits are excluded. Business Auto policy extends to trailers with a load capacity of: - ANS2,000 lbs of less Business Income and Extra Expense under the Businessowners policy includes all of the following EXCEPT: - ANS$500,000 limit Carl's Cabinets sells and installs cabinets in apartment buildings. After installation but before an apartment is occupied, two of the cabinets are damaged when they fall from the wall as a result of improper installation. Carl's Commercial General

Liability (CGL) Coverage Form excludes coverage for the damage to the cabinets because of which one of the following exclusions? - ANSDamage to Your Work Chuckie's chicken distributor researches the benefits of consuming chicken versus consuming beef. In November 2011, Chuckie's publishes a brochure outlining the potential health hazards of consuming beef and explaining why chicken is a healthier alternative. Chuckie continues to publish and distribute the same brochure for six months. In March 2012, several beef distributors file a suit against Chuckie's for personal and advertising injury. Which one of the following exclusions would apply to this claim under Coverage B of Chuckie's Commercial General Liability Coverage Form (CGL) with a policy period of January 2012 - January 2013? - ANSMaterial published prior to the policy period Citizens homeowners does not include coverage on all the following EXCEPT: - ANSBuilding under construction for named insured Citizens provides commercial coverage for which one of the following? - ANSCondo Associations Coverage for other structures is automatically provided under the HO-3—Special Form (HO-3) policy with a limit that is - ANS10 percent of the Coverage A limit

Crime loss exposures of financial institutions are covered by financial institution bonds. These policies were developed by - ANSThe Surety and Fidelity Association of America (SFAA). Employee Theft includes coverage for the following EXCEPT: - ANSWork loss Entities eligible for financial institution bonds are - ANSNot eligible for the ISO Commercial Crime Forms. Federal workers compensation statutes apply to which one of the following workers? - ANSAn interstate railroad worker Florida Law requires not less than a ________ day notice for cancellation of a health insurance policy. - ANS20 day Florida law requires not less than a _________ day grace period for monthly premium policies. - ANS10 day Florida law states this a contract whereby one undertakes to indemnify another or pay or allow a specified amount or a determinable benefit upon determinable contingencies. - ANSInsurance

Florida Valued Policy Law applies to: - ANSMobile Homes For a DP-2 policy, which is correct? - ANSBuilding and contents are named peril. For a Dwelling Flood policy, which is correct: - ANSPrimary residences are covered at replacement cost on building losses. For Business Income, the period of restoration begins: - ANS72 hours after the date of the direct damage For claims to be considered to have been made on the last day of the policy period under the basic extended reporting period, the claim has to be received and recorded with how many days after the policy expiration? - ANS60 days For commercial auto insurance, a truck, tractor, or trailer is non-zone rated if it is - ANSA light truck operating over any distance. Frank has a Personal Articles Floater with a fine arts schedule covering a painting. Coverage is in the amount of $5,000. A three year old child comes in the house and ruins the painting by marking it up with a black marker. The painting is now

worthless. The company has located the exact same painting for $2,000. What will the policy pay? - ANS$5, From a risk management viewpoint, insurance is used to - ANSTransfer the cost of losses. Garage Insurance only covers rental car if: - ANSThe customer's auto is left for service or repair Garagekeepers Insurance can be written all of the following ways EXCEPT: - ANSSplit limits Health Insurance does not include _________________. - ANSWorkers Compensation HO-8 can be broadened to include off-premises theft losses up to: - ANS$1, Homeowners Insurance is designed to protect all of the following EXCEPT: - ANSlegal liabilities for damages to home

How can a Corporate Officer be exempt from WC coverage? - ANSFile a notice with the Division of Corporations How can partners and sole proprietors elect to be covered for WC? - ANSFile election form with the Division How does Part D-Damage to Your Auto apply to a nonowned auto? - ANSThe Broadest coverage applicable on your covered auto on an excess basis How long do appointments last? - ANS24 months How many days does an agent have to notify the DFS if their contact information changed? - ANS30 days How many days does the Building and Personal Property Coverage form extend coverage for newly acquired buildings or new buildings under construction? - ANS30 days How many days of automatic coverage are provided for an accident to an object at a newly acquired location, subject to the highest limit and deductible as stated in the Declarations for the same type of object? - ANS

How many parties are there in a surety contract? - ANSThree If a loss is covered by recoverable insurance, the Crime policy will be: - ANSExcess If a tenant is injured, would the CGL, Coverage C: Medical Payments pay for the injury? - ANSNo, if the tenant is on the part of the premises the tenant normally occupies If an agent violates any provision of the Unfair Methods of Competition and Unfair or Deceptive Acts statute they could be subject to the following fines: - ANS$5, for each non willful violation and $40,000 for each willfull violation If an insured has failed to cooperate with an insurer in the settlement of a claim, which one of the following policy conditions prevents the insured from suing the insurer if the insured is not satisfied with the insurer's handling of the claim? - ANSLegal Action Against the Insurer If law enforcement officials seize an insured's personal computer to search for files that might be related to a crime, the insured under an HO-3—Special Form (HO-3) may be unsuccessful in claiming a theft loss on the computer due to the - ANSGovernmental Action exclusion.

If the FWCJUA experiences a deficit in either Tier 1 or 2, funding would come from where? - ANSAn assessment for 1 year on all WC policies in the voluntary market If the insured is building a new home, is he eligible for a homeowners policy on the new home while under construction? - ANSYes In a Personal Auto Policy, which of the following statements is incorrect? - ANSThe maximum amount payable under the Supplementary Payments is $ In the liability coverage agreement of the business auto policy, the insurer expresses its three distinct duties. Which one of the following is among these duties? - ANSA duty to pay covered pollution cost In the Liability section of the Businessowners policy, the General Aggregate limit is: - ANSEqual to twice the Liability and Medical Expenses limit Inside the Premises - Theft of Money and Securities covers loss of money and securities resulting from all the following EXCEPT: - ANSFraud

Insurance is not the only risk management transfer technique. When circumstances are appropriate, transfer can be accomplished through - ANSNoninsurance transfer techniques. International Toys (IT) manufactures toys in South Carolina and sells them to stores around the world. A customer in Europe is injured when one of the toys malfunctions and severs the customer's hand. The customer files suit in the United States. If IT is found liable, does its Commercial General Liability (CGL) Coverage Form cover the customer's claim? - ANSYes, because the toys were manufactured in the United States Internet blogger Tom operates a public interest group on the Internet. In posting his opinions, Tom falsely accused the governor of his state of criminal behavior. Tom's Commercial General Liability (CGL) Coverage Form will most likely exclude coverage for any resulting damage based on which one of the following exclusions? - ANSElectronic chatrooms or bulletin boards exclusion James is in the process of forming his own brokerage company which will include several employees. James will be best protected by purchasing which one of the following to cover the crime loss exposures of his company? - ANSFinancial Institution Bond.

Jim and Sue, a young married couple, are under contract to purchase a condominium unit. Which one of the following ISO policy forms is best designed to meet their homeowners insurance needs? - ANSHO-6—Unit-Owners Form Joan has a business auto policy. Which one of the following losses would be covered as auto physical damage? - ANSThe cost to repair vehicle damage that results from hitting a deer Joe has a 1,000 acre farm where he grows corn. To keep in touch with his workers he installs a cellular radio tower. He wants to make sure his farm policy covers the antenna. Where would it be covered on the policy? - ANSSection G Joe has a Personal Auto Policy with Liability of 25/50/25. He hits a car with four (4) occupants from Minnesota, all of whom are hurt. They all sue. The first sues for $20,000; the second sues for $35,000; the third sues for $22,000; the fourth sues for $18,000. The car Joe hit has $8,000 in damage. The company spends $20, on a law firm defense. Ignoring any PIP or Med Pay, what is the total cost to the company for Joe's claim? - ANS$78, Joe has a Personal Auto Policy with one car with liability of 10/20/10, basic PIP, 10/20 UM and no Med Pay. His Florida neighbor has an identical policy on her car. Joe is driving her car, loses control, and hits a tree. Joe is hurt with $15,000 in

medical bills. What is the maximum Joe can collect from UM from all sources from this accident? - ANS$ Joe has a Personal Auto Policy with one car with liability of 10/20/10, basic PIP, 10/20 UM and no Med Pay. His Florida neighbor has an identical policy on her care. Joe is driving her car, loses control; and hits a tree. Joe is hurt with $15, in medical bills. What is the maximum Joe can collect from UM from all sources from this accident? - ANS$ Joe has a Personal Auto Policy with two cars and UM limits of 25/50 stacked. He also has basic PIP and $1,000 Med Pay. He is involved in an accident where a hit and run driver runs into his car. He has $42,000 in medical bills. How much would his UM pay? - ANS$31, Joe has a standard DP-3 on his Florida home with the following coverages: A- $80,000; C-$20,000. Which of the following would be covered, ignoring a deductible: - ANSA $3,000 TV set burns in a fire Joe has Personal Articles Floater covering a musical keyboard he uses for personal use only. While away on vacation in Europe the keyboard is stolen. He had it scheduled for $1,000. To purchase a new keyboard the cost would be $1,250. The company could get the same item at a used musical store for $750. What would the policy pay? - ANS$

Joe is out for an evening cruise on his 100 ft yacht. The fog rolls in and he loses all visability. Then suddenly slams into another boat moored nearby. The damage to the other boat is roughly $20,000. Under what section of Joe's Ocean Marine Policy would there be coverage for the other boat? - ANSRunning Down Clause Joe Motors, which services automobiles, wants to maintain the goodwill of its customers. This is best accomplished by - ANSPurchasing garagekeepers insurance. Joe works for Tastee Burger, Inc. As part if his compensation package, he is supplied with a company car that he gets to take home each night. Joe wants to make sure that the Liability coverage under his own Personal Auto Policy covers him while driving the company car. What should he ask his agent to add to his own policy? - ANSExtended Nonowned Liability coverage Joe's New Cars, Inc. has a Business Auto Policy (BAP). The owner, Joe, owns no car himself since he always drives a company car. If you were the agent, what coverage would you add to the BAP to give Joe liability coverage while he drives a car not owned by the corporation? - ANSOther Car coverage

Keith commutes into the city in his car, and he provides a ride to two co-workers who live near him. Every other week, the co-workers take turns buying the gasoline for Keith's car. Does this activity create a public or livery conveyance situation that would preclude liability coverage under Keith's Personal Auto Policy (PAP)? - ANSNo, because Keith is involved in a share-the-expense car pool. Kenneth, the named insured under a Business Auto Coverage Form with symbol 1 shown for liability coverage, causes an automobile accident while driving a rental car on a business trip. Is Kenneth covered under the liability insuring agreement of his Business Auto Coverage Form for this accident? - ANSYes, because Kenneth, the named insured, is an insured for any auto. Knowingly making false or maliciously critical comments to injure a person is known as: - ANSDefamation Liability coverage for loss exposures arising from a business organization's premises and operations, its products, or its completed work is typically provided by - ANSCommercial general liability insurance. Liability coverage to individuals and families for bodily injury and property damage arising from the insured's personal premises or activities is typically provided by - ANSPersonal liability insurance.

Long Term Care has all f the following types of care EXCEPT: - ANSremedial care Martha drives her auto, which is insured under a Business Auto Coverage Form, outside the state in which it is licensed. The other state requires a $25,000 bodily injury limit for underinsured motorists coverage. Martha's policy does not provide underinsured motorists coverage but does provide a $15,000 liability limit for uninsured motorists coverage. How would Martha's Business Auto Coverage Form respond to a $30,000 underinsured motorists bodily injury claim in the other state? - ANSMartha's policy would provide the $25,000 bodily injury limit required by the other state for underinsured motorists coverage. Mitchell is a highway contractor whose company is covered with a workers compensation policy and an unendorsed business auto policy. Which one of the following losses would be covered by his business auto policy? - ANSAn employee runs over a subcontractor's equipment with an owned auto. Morgan Company is involved in a lawsuit that is covered under its unendorsed Commercial General Liability (CGL) Coverage Form. Which one of the following would be covered under the supplementary payments section of the CGL policy? - ANSPost judgment interest awarded by the judge

Named perils for the Aircraft include all of the following EXCEPT: - ANSExplosion Northern Company (Northern) uses a large forklift in its operations. The forklift is subject to the state compulsory auto insurance law and has a license tag. In the process of moving some items on Northern's premises, the operator loses control of the forklift and runs into a car owned by a customer. Which one of the following statements is true regarding coverage for this loss under Northern's Commercial General Liability (CGL) Coverage Form? - ANSNo coverage applies under the CGL Coverage Form because the forklift is considered to be an 'auto,' and coverage would be provided by a commercial auto policy. Of the different roof types, which one does not receive any type of discount? - ANSGable Omicron Corporation currently does business in Colorado, Nebraska, and Kansas. These states are listed in Item 3.A on the Information Page of Omicron's Workers Compensation and Employers Liability Insurance Policy. The company is hoping to expand its operations into Utah, Arizona, and New Mexico during the next year. Which one of the following statements is correct with respect to workers compensation insurance in the states where Omicron hopes to expand? - ANSOmicron should include Utah, Arizona, and New Mexico in Item 3.C on the Information Page and advise the insurer immediately if the company begins operations in any of those states.

Once license, you have how long to obtain an appointment? - ANS48 months One of the costs of insurance is said to be opportunity costs. This means that if capital and labor were not being used in the insurance business, they could be used elsewhere and making other productive contributions to - ANSSociety One of the main factors used in developing a base premium for a homeowners policy is - ANSThe public protection class. Oscar's custom-built vehicle looks like a sausage sandwich on wheels. He plans to drive it to special events at schools around the country where it will serve as a mobile billboard to promote his product. Oscar is surprised to learn that insurers are reluctant to insure his vehicle because it fails to meet one of the ideal characteristics of an insurable risk. Which characteristic is Oscar's vehicle least likely to meet? - ANSLarge number of similar exposure units Part D-Damage To Your Auto has an additional benefit automatically included called: - ANSTransportation expense Part D-Damage to Your Auto pays claims by - ANSPaying the ACV or cost to repair