MN PROPERTY & CASUALTY INSURANCE, MN INSURANCE EXAM PROPERTY & CASUALTY QUESTIONS AND ANSW, Exams of Nursing

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CASUALTY QUESTIONS AND ANSWERS UPDATE 2024/2025 ALL ANSWERS

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Declarations - CORRECT ANSWERS Policy includes the identity and address of the name insured, the policy term or period, the amount of insurance or limits of liability, the policy premium, and any applicable deductibles. Will also include either a property description or a schedule of coverage parts, and a list of any endorsements. Conditions - CORRECT ANSWERS Set provisions, rules of conduct, duties and obligations for the parties. A number of common insurance conditions describe such things as the policy period and territory. It also includes the insured's obligation to provide proof of loss, how settlements are handles when other insurance is involved, and the right of each party to cancel the policy. Exclusions - CORRECT ANSWERS May describe property, perils, hazards, or losses arising from specific causes that are not covered by the policy. Limitations - CORRECT ANSWERS May eliminate or reduce coverage, but only under certain circumstances or when specified conditions apply. Abandonment - CORRECT ANSWERS The insured cannot simply abandon the property to the insurance company in exchange for the full-insured value. Salvage - CORRECT ANSWERS If the insurer pays a loss on behalf of the insured, the insurer is entitled to the salvage to reduce the claim Subrogation Clause - CORRECT ANSWERS Used when the insurer has paid a covered claim on the behalf of the insured that is caused by another party. The insurance company is entitled to the insured's right of recovery from the negligent party. This is sometimes called the "Transfer of Right of Recovery Against Other to Us" Vacany - CORRECT ANSWERS The building is void of contents and people. The building is simply not being used. In most cases the insured can purchase Vacancy permit coverage restored for an additional premium. Unoccupancy - CORRECT ANSWERS The premises are void of people. Named Peril - CORRECT ANSWERS This form lists the specific perils to be covered in the policy. Open Peril - CORRECT ANSWERS Does not list the perils but provides broader coverage.

CASUALTY QUESTIONS AND ANSWERS UPDATE 2024/2025 ALL ANSWERS

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Definition of the Insured - CORRECT ANSWERS Those that have insurable interest in the property who would suffer a financial loss if the property were damaged by an insured peril can be considered an insured. In personal insurance, this can include family members without listing their names on the declarations page of the policy. Additional insureds such as a lien holder. Insurable Interest - CORRECT ANSWERS Before a person can obtain an insurance policy, they must have this in the property being insured. A person is deemed to have this in property when he has a lawful, substantial, economic interest in the preservation of the property. The term "person" includes an individual, company, insurer, association, organization, reciprocal, partnership, or any other legal entity. Risk - CORRECT ANSWERS Possibility that a loss might occur and is the reason that people buy insurance. Peril - CORRECT ANSWERS Actual cause of a loss (fire, windstorm, hail) Hazard - CORRECT ANSWERS Any condition that increases the possibility of a loss Moral Hazard - CORRECT ANSWERS A condition of morals or habits that increases the probability of a loss from peril. Morale Hazard - CORRECT ANSWERS Hazard arising out of an insured's indifference to loss because of the existence of insurance. Pure Risk - CORRECT ANSWERS A situation where there is only the possibility of a loss. Example would be catastrophic medical expenses, liability law suit, damage to property by fire. This type of risk is insurable. Speculative Risk - CORRECT ANSWERS A situation where either profit or loss in possible. Example would be betting on a horse race or investing in real estate. This type of risk in not insurable. Static Risk - CORRECT ANSWERS These factors are historical factors that do no frequently fluctuate. They result from "static" or "unchanging" environment. Example would be an area that may only flood every 100 years. This type of risk is insurable.

CASUALTY QUESTIONS AND ANSWERS UPDATE 2024/2025 ALL ANSWERS

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Dynamic Risk - CORRECT ANSWERS This is associated with chance. Example would be a new and fatal virus spontaneously erupting into society. This is not insurable. Waiver - CORRECT ANSWERS Generally defined as the voluntary or intentional relinquishment of a know right. An example would be an insured who fails to report a claim in a timely manner. There are two types; Expressed and Implied. Expressed Waiver - CORRECT ANSWERS Occurs when the insurer the insurer or its representatives purposely gives up known right under the contract. Implied Waiver - CORRECT ANSWERS May result from some kind of neglect on the part of the agent or adjuster. Replacement Cost - CORRECT ANSWERS The current cost to purchase new, the item that was lost, with no deduction or depreciation. The full value will be paid up to the limit of the policy less any deductible. Occurence - CORRECT ANSWERS A sudden and unforeseen event resulting in financial loss. It may also be continuous or repeated exposure to an event that results in financial loss. Insuring Agreement - CORRECT ANSWERS Describes the covered perils, or risks assumed, or nature of coverage, or makes some reference to the contractual agreement between insurer and insured. In package policies each different coverage form includes its own insuring agreement. Negligence - CORRECT ANSWERS Caused by improper product design, improper assembly of the product, failure to inspect or test the product, etc. Single Limit - CORRECT ANSWERS Pays up to one amount as the maximum limit of liability of the insurer with respect to any one accident/occurrence involving either or both bodily injury and property damage. Split Limits - CORRECT ANSWERS Expressed by two figures. There may be a limit representing the max payable for each person injured per occurrence for bodily injury and another limit applicable to the claims of all persons injured in the accident or occurrence.

CASUALTY QUESTIONS AND ANSWERS UPDATE 2024/2025 ALL ANSWERS

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Aggregate Limit - CORRECT ANSWERS Limit stated in the policy representing the total amount for all claims paid during the policy period. Once this limit has been met, the insured is without coverage. Duties of the Insured - CORRECT ANSWERS The insured is required by the policy provisions to report a claim to the company as soon as practical. The insured must also preserve the undamaged property to the best of his/her ability to avoid additional loss. Proof of loss - CORRECT ANSWERS A formal statement made by the insured to the insurance company regarding a loss. The purpose of this is to place before the company sufficient information concerning the loss to enable it to determine its liability under the policy or bond. Actual Cash Value - CORRECT ANSWERS Method for placing value on property as of the time of its loss or damage. It may be determined as replacement cost less depreciation. The market value of an item may be used to help determine this. Replacement Cost - CORRECT ANSWERS Covers property - both building a contents - on the basis of fill replacement cost without deduction for depreciation of any loss sustained, subject to the terms of the co-insurance clause. Appraisal Process - CORRECT ANSWERS In case of losses involving property, it is often nessecary to obtain estimates of the damaged property before payment can be made. This involves all types of property losses such as automobiles, structures, and their contents. Special appraisers or estimators may be required for fine arts, stained glass or other items that require a higher level of expertise. The commissioner examines each insurer every __ years - CORRECT ANSWERS 5 $___ fine per day if a person violates, aides, or abets a written cease and desist order - CORRECT ANSWERS $10, Licensee may request a hearing within __ days of commissioners order after hearing request, the commissioner has ___ to hold the hearing - CORRECT ANSWERS 30 and 30 ___ prelicensing hours per major line of authority - CORRECT ANSWERS 20 hours number of years licensing exam results are valid - CORRECT ANSWERS 3 years

CASUALTY QUESTIONS AND ANSWERS UPDATE 2024/2025 ALL ANSWERS

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$___ per line of authority for an applicaton fee - CORRECT ANSWERS $ ___ credit hours per licensed producer - CORRECT ANSWERS 24 credits how many hours of continuing education must be in ethics? - CORRECT ANSWERS 3 For an earthquake how many hours and how many deductibles - CORRECT ANSWERS 168 hours and only 1 deductible How many years is a license period - CORRECT ANSWERS 2 years a temporary insurance producer license may be issued for up to ___ days - CORRECT ANSWERS 180 days a licensee's time to notify the commissioner of address change is __ days - CORRECT ANSWERS 10 days a license is suspended for any period no less than - CORRECT ANSWERS 3 months how many years can you reapply for a license when your license had been revoked? - CORRECT ANSWERS 2 years when you license is revoked what must you obtain? - CORRECT ANSWERS a performance bond of $20, the insurer must file a notice of appointment within __ days of the first sale by the producer - CORRECT ANSWERS 15 days an insurance company that terminates an appointment must notify the commissioner within ____ days - CORRECT ANSWERS 30

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How many days does the insurance company get to send a written notice to the commissioner about termination to the producer? - CORRECT ANSWERS 15 days After getting the notice of termination, how many days can the producer file written comments concerning the termination with the commissioner? - CORRECT ANSWERS 30 days How much is the penalty for failing to appoint a producer? and up to? - CORRECT ANSWERS $25 up to $ the producer must notify the commissioner of any administrative action take or criminal prosecution against the producer within ___ days - CORRECT ANSWERS 30 days when is the property value determined? - Inland Marine - CORRECT ANSWERS at the time of loss the producer must notify the commissioner within ___ days of any felony or gross misdemeanor conviction, guilty plea, or plea of no contest - CORRECT ANSWERS 10 days a lapsed licensee can reinstate license within ___ months - CORRECT ANSWERS 12 months the penalty for rebating is $___ to $___ per violation - CORRECT ANSWERS $60 - $ a promotional advertising item or gift of $___ or less per year is not a rebate - CORRECT ANSWERS $ How many days does an insurer have to reply to customer claims and inquries? - CORRECT ANSWERS 10 days Policies must be delivered to the insured within __ working days of the producer's receipt from the insurer - CORRECT ANSWERS 30 days financial and complain records must be kept on file for ___ years - CORRECT ANSWERS 6

CASUALTY QUESTIONS AND ANSWERS UPDATE 2024/2025 ALL ANSWERS

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premium refunds must be sent to the insured within ___ days of the producers receipt from the insurer - CORRECT ANSWERS 5 days Policy forms, applications, and advertising must be retained for __ years after the effective date - CORRECT ANSWERS 3 years claim records must be retained for ___ years after the claim is paid or denied - CORRECT ANSWERS 3 years complaint records must be retained for ___ years after the date received - CORRECT ANSWERS 4 years unearned premium refund to be issued within ___ days - CORRECT ANSWERS 30 days Domestic shipments can only be covered by - CORRECT ANSWERS truck, train, air or mail Annual Transit Policy - CORRECT ANSWERS covers all shipments during the year Trip transit - CORRECT ANSWERS Covers a single shipment-one time, one way Motor truck cargo - CORRECT ANSWERS truckers form covers the insureds bailee responsibility (carrying someone elsed stuff) oral binders must be put in writing to the insured within ___ business days - CORRECT ANSWERS 5 what covers the insured own goods in the insureds own trucks - CORRECT ANSWERS owners form the applicant has the right to challenge any erroneous information contains in the consumer report within __ days - CORRECT ANSWERS 30 Bailee Liability - CORRECT ANSWERS - Covers damage to customer's property

• Pays customer

CASUALTY QUESTIONS AND ANSWERS UPDATE 2024/2025 ALL ANSWERS

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Adverse information remains in a credit report for ___ years. - CORRECT ANSWERS 7 years how many years must bankruptcy information remain in the credit report for - CORRECT ANSWERS 10 years Property policy begins at : standard time - CORRECT ANSWERS 12:01AM insured's lawsuits against the insurance company must be initiated within __ years after the loss - CORRECT ANSWERS 2 years the insurance company must give the insured notice of how it will handle the loss within __ days after receipt of proof of loss - CORRECT ANSWERS 30 days once a loss has been settled, payment for the claim must be made within __ business days - CORRECT ANSWERS 5 days how much must a township mutual maintain? - CORRECT ANSWERS minimum of $300, a FAIR plan inspection report is due within __ business days after the inspection - CORRECT ANSWERS 10 days FAIR - if the inspection reveils that the applicant is not eligible, the plan must inform the applicant within __ days of the inception of the policy - CORRECT ANSWERS 59 days FAIR plan policy term is - CORRECT ANSWERS 1 year FAIR - the plan must make an underwriting decision within __ business days of receiving the completed application - CORRECT ANSWERS 5 days Insurance company must give __ days notice of homeowners cancellation - CORRECT ANSWERS 30 days

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FAIR plan cancellations require at least __ days written notice to be insured - CORRECT ANSWERS 15 days a homeowners policy in effect for less than 60 days can be cancelled for any reason with at least ___ days notice of cancellation - CORRECT ANSWERS 20 days insurer must give __ days cancellation notice, if due to nonpayment of premium - CORRECT ANSWERS 20 days for a nonrenewal, notice must be mailed to the insured at least __ days before the effective date - CORRECT ANSWERS 60 days each insurer must retain a record of all non renewals and company initiated cancellations for ___ years - CORRECT ANSWERS 3 First violation for violating MN nonrenewal statutes - CORRECT ANSWERS $ second violation for violating MN nonrenewal statutes - CORRECT ANSWERS $ third violation for violating MN nonrenewal statutes - CORRECT ANSWERS $ the standard underwriting experience period in MN is __ years - CORRECT ANSWERS 3 years $___ for bodily injury to one person in any one accident - CORRECT ANSWERS $30, $___ for bodily injury to two or more persons in any one accident - CORRECT ANSWERS $60, $__ for property damage of others in any one accident - CORRECT ANSWERS $10, For personal injury protection, how much is the minimum per person? - CORRECT ANSWERS $40,

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for reasonable and necessary medical expenses what is the amount? - CORRECT ANSWERS $20, Occurance form - CORRECT ANSWERS coverage triggered by bodily injury or physical damage that occurs during the policy period $___ for income loss, funeral expense, and survivor's loss - CORRECT ANSWERS $20, Income loss benefits provide compensation for % of gross income to a maximum of $_ per week

• CORRECT ANSWERS 85% and $ funeral and burial benefits shall be reasonable expenses not to exceed $___ - CORRECT ANSWERS $5, Rehab treatment must be reported to the insurer within ___ days - CORRECT ANSWERS 60 days a person entitled to basic economic loss benefits must notify the insurer within __ months of the date of accident - CORRECT ANSWERS 6 months survivors economic loss benefits are subject to a maximum of $___ per week - CORRECT ANSWERS $ for underinsured, $___ minimum limit because of the injury or death of one person in any accident - CORRECT ANSWERS $25, non at fault claim may sue the at fault party if medical expenses excees $___ - CORRECT ANSWERS $4, a non at-fault claimant may sue the at-fault party if the disability lasts for __ days - CORRECT ANSWERS 60 days an insurance company must complete the claim investigation within __ days - CORRECT ANSWERS 30 days

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notice of cancellation for car insurance is __ days in advance if the reason is non payment of premium - CORRECT ANSWERS 10 days notice of cancellation for car insurance is __ days in advance if the policy is being cancelled for any other reason - CORRECT ANSWERS 30 days notice of nonrenewal of car insurance is __ days - CORRECT ANSWERS 60 days each insurer must retain a record of all non renewals and company inititaed cancelalltions except those for nonpayment of premium for __ years - CORRECT ANSWERS 3 years Workers comp- no disability benefits are paid for the first __ calendar days after the disability - CORRECT ANSWERS 3 days disability benefits are equal to ___% of the employees gross weekly wage up to a maximum of % of the statewide average weekly wage - CORRECT ANSWERS 66 2/3% and 102% after - CORRECT ANSWERS after a total of $ of permanent total disability benefits have been paid, the amount of benefits paid by the employer are reduced by the amount of any government disability benefits, including SS benefits - CORRECT ANSWERS $25,