PA Property and Casualty Questions and Answers (Latest Update 2024), Exams of Nursing

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Answers (Latest Update 2024)

All of the following are requirements to be licensed in PA except: -Complete a four-week long pre-licensing course -Pass the appropriate exam -Apply for a license with the insurance department and pay the appropriate fee -Have your fingerprints taken and submitted - Correct Answer ✅Complete a four-week long pre-licensing course All of the following statements are correct except: -An applicant has up to one year to be licensed after successfully passing the exam -The fee for the PA Property-casualty license is $55 for two years -An Insurance Agency does not need to be licensed if they are a corporation -You must be at least 18 years of age to be licensed - Correct Answer ✅An Insurance Agency does not need to be licensed if they are a corporation Which statement is false?

Answers (Latest Update 2024)

-A resident producer must both live and work in Pennsylvania -The maximum limit for a temporary license is 180 days -An insurance company's license is called a certificate of authority -A producer must be licensed to sell, solicit, or negotiate contracts of insurance - Correct Answer ✅A resident producer must both live and work in Pennsylvania Which time period is incorrect? -30 days to report a change of address -30 days to report a criminal conduct of being charged -60 days to reinstate a lapsed license retroactively -Four years to complete 24 hours of continuing education - Correct Answer ✅Four years to complete 24 hours of continuing education Possible insurance department penalties for insurance law violations include all of the following except: -Fines -Revoking a license

Answers (Latest Update 2024)

-Increased requirement of CE hours -Issuance of an order to cease and desist - Correct Answer ✅Increased requirement of CE hours All of the following are general duties and powers of the insurance commissioner except: -Prosecute the individual in a court of law -Collect fees -Investigate complaints -Regulate rates - Correct Answer ✅Prosecute the individual in a court of law Rate regulatory law requires rates to be all of the following except: -Not excessive -Equal for all policy holders -Adequate -Not unfairly discriminatory - Correct Answer ✅Equal for all policy holders

Answers (Latest Update 2024)

Which statement is false? -The insurance commissioner is appointed by the governor -All rates must be filed and approved before they can be used -Maximum jail term for an insurance violation is six months -Illegal inducement is doing business with unlicensed persons

• Correct Answer ✅Illegal inducement is doing business with unlicensed persons Which activity would be a prohibited practice under the unfair claims practices law? -Failing to act promptly on a communication dealing with a claim -Reporting the claim to the insurance company online -Denying payment of a claim that is not covered by the policy -Assigning an adjuster to investigate the claim before payment - Correct Answer ✅Failing to act promptly on a communication dealing with a claim Which activity would not be a prohibited practice under the Unfair Trade Practice Law?

Answers (Latest Update 2024)

-Intentionally misrepresenting coverage terms in the policy -Forging a client's signature on an application -Not remembering your clients birthday -Committing a felony - Correct Answer ✅Not remembering your clients birthday Misrepresentation call be all of the following except: -Twisting -Sharing part of your own commission with a client -Misrepresenting benefits, terms or conditions -Misrepresenting in advertisements - Correct Answer ✅Sharing part of your own commission with a client All of the following are Unfair Trade Practices activities except: -Comingling of funds -Rebating -Defamation -Boycott, coercion, or intimidation - Correct Answer ✅Comingling of funds

Answers (Latest Update 2024)

The Fair Credit Reporting Act requires all of the following except: -Notification of a credit investigation at time of application -A copy of the report sent to the client -The name and address of the credit reporting agency given to the client -Notice must be in writing - Correct Answer ✅A copy of the report sent to the client The Gramm-Leach-Bliley Act requires all of the following except: -Annual privacy notification given to all customers -Customers given the option to opt out of sharing info to others -Insurers must protect the security of financial information -An annual report must be sent to the federal government - Correct Answer ✅An annual report must be sent to the federal government

Answers (Latest Update 2024)

Which statement is false concerning the Federal Terrorism Risk Insurance Act (TRIA)? -It applies to all lines of insurance, both personal and commercial -The premium must be shown to the client with the opportunity to reject coverage -It provides coverage for acts of terrorism -The federal government shares in payment of covered losses with insurance industry - Correct Answer ✅It applies to all lines of insurance, both personal and commercial Before federal funds are made available under TRIA the following must certify an act of terrorism -The president & congress -Secretary of the Treasury and Secretary of Homeland Security -The attorney general and congress -The FBI - Correct Answer ✅Secretary of the Treasury and Secretary of Homeland Security The Motor Carrier act of 1980 was passed to deal with:

Answers (Latest Update 2024)

-Unlicensed trucks traveling interstate -Uninsured cargo traveling interstate -Transporting hazardous cargo causing pollution accidents -Unlicensed drivers of motor vehicles - Correct Answer ✅Transporting hazardous cargo causing pollution accidents Under the motor carrier act of 1980 the minimum limit of liability required when transporting hazardous cargo is: -$500, -$750, -$1,000, -$5,000,000 - Correct Answer ✅$750, All of the following statements are correct concerning the MCS-90 endorsement except: -It is not insurance protection -It guarantees clean-up of a pollution spill -It responds like a surety bond -The insured will not have to pay back costs even if they do not have pollution insurance coverage for the spill - Correct

Answers (Latest Update 2024)

Answer ✅The insured will not have to pay back costs even if they do not have pollution insurance coverage for the spill The Telephone Consumer Protection Act requires all of the following except: -The law does not apply to fax communications -Telemarketers must maintain a do not call list -No phone calls can take place before 8:00 A.M. or after 9: P.M. -Prohibits artificial voice or recording - Correct Answer ✅The law does not apply to fax communications The application fee for a resident producer is ___ and the non- resident producer is ___? -$25, $ -$55, $ -$75, $ -$65, $165 - Correct Answer ✅$55, $

Answers (Latest Update 2024)

Which person is not exempt from taking the appropriate exam: -CPCU for Property-Casualty -CISR for Property-Casualty -CLU for Life-Health -CIC for Property-Casualty - Correct Answer ✅CISR for Property-Casualty All of the following procedures would be required if a licensed producer is representing a client in the procurement of insurance with a company with whom he is not licensed as an authorized agent except: -A written agreement with the client -A disclosure of any fees to be charges to the client -No fee charged for filling out an application -All insurance quotes must be with a company rated A+ or better - Correct Answer ✅All insurance quotes must be with a company rated A+ or better A consent agreement:

Answers (Latest Update 2024)

-Is an agreement to settle an insurance claim -Is a written agreement in which an accused personal does not admit or deny the charges but consents to payment of civil liability -Is the finances agreement to get married -Is an agreement between an insurance company and a prospective agent - Correct Answer ✅Is a written agreement in which an accused personal does not admit or deny the charges but consents to payment of civil liability Commingling is defined as: -Mixing two different agency's loss ratios together for reporting purposes -Involves not keeping all insurance premiums separate from the agencies operating account -Inviting underwriters and agents to an annual meeting -Mixing claims payments of attorney expense with loss payments - Correct Answer ✅Involves not keeping all insurance premiums separate from the agencies operating account

Answers (Latest Update 2024)

The definition of boycott, coercion, or intimidation involves all except: -Charging a client a higher premium that his class rate would dictate -Refusing to have business dealings with a person -Using the threat of force to buy insurance -Intimidation of a client in the business of insurance - Correct Answer ✅Charging a client a higher premium that his class rate would dictate Which activity would not be rebating? -Returning a part of your commission to your client -Giving any new client a special 25% discount for buying a policy this month -The agency owner paying his insurance agency employees a year-end bonus for hitting their production goals -Giving all your relatives a discount on their insurance policies - Correct Answer ✅The agency owner paying his insurance agency employees a year-end bonus for hitting their production goals

Answers (Latest Update 2024)

The agency termination law requires all except: -Written notification of at least 90 days prior to the termination date -A rehabilitation period of one year if the reason of termination is adverse experience -A rehabilitation period of four years if the reason of termination is loss ratio -No protection if the agent has been appointed with the company for less than four years - Correct Answer ✅A rehabilitation period of four years if the reason of termination is loss ratio Which dollar amount is incorrect? -$1,000 fine for insurance law violation which the person did not know was a violation -$12.50 appointment fee for an insurance company to register an agent with the insurance department -$15,000 the maximum fine for violation of an insurance law -$165 the fee for reinstating a lapsed renewal license - Correct Answer ✅$15,000 the maximum fine for violation of an insurance law

Answers (Latest Update 2024)

If a licensee desires to do business under an assumed or fictitious name in PA the must register the name with: -Department of State -Insurance Department -Department of Transportation -Department of Industry and Labor - Correct Answer ✅Department of State Risk can be defined as all of the following except: -Uncertainty of Loss -Frequency of Loss -The person or property that it the subject of insurance -A peril that we think may cause a loss - Correct Answer ✅Frequency of Loss Which term is not a risk management term? -Avoidance -Retention

Answers (Latest Update 2024)

-Transfer -Open Perils - Correct Answer ✅Open Perils Loss frequency can be described as: -The number of losses within a given time period -The dollar amount of losses -Anything that increases the chance of loss -The event that causes damage or destruction to property - Correct Answer ✅The number of losses within a given time period All are elements of insurable risk except: -Definite loss -Accidental loss -Retention -Not catastrophic - Correct Answer ✅Retention The law of large numbers: -Can identify who will suffer the loss

Answers (Latest Update 2024)

-Can tell you when the loss will happen -Will tell you what the losses will be for any one insured -Will predict total losses for an extended period of time given sufficient exposures - Correct Answer ✅Will predict total losses for an extended period of time given sufficient exposures All of the following are classifications of the various types of insurance company organizations except: -Associated insurance company -Stock insurance company -Mutual insurance company -Reciprocal insurance company - Correct Answer ✅Associated insurance company Which insurance company would be domiciled and located with PA? -Alien insurance company -Domestic insurance company -Consolidated insurance company

Answers (Latest Update 2024)

-Foreign insurance company - Correct Answer ✅Domestic insurance company Which document would be the best example to express authority given to an insurance agent? -Their E&O policy with their carrier -Their agency contract with their principal insurance company -Their buy/sell agreement with the partners in the firm -Their agency manual - Correct Answer ✅Their agency contract with their principal insurance company The definition of insurance includes all except: -It is a legal contract -It involved a transfer of risk -It involves a pooling of funds to pay for claims -It guarantees that all losses will be paid - Correct Answer ✅It guarantees that all losses will be paid Elements of a legal contract include: -An offer and a willing acceptance of the offer

Answers (Latest Update 2024)

-Competent parties -Consideration -All of the above - Correct Answer ✅All of the above Statements made at time of application that are correct and true to the best of the insured's knowledge are: -Representations -Concealments -Warranties -Fraud - Correct Answer ✅Representations Material misrepresentation: -Is a valid reason for cancellation of an insurance contract -Requires that the contract would not have been written if the truth were known -Requires that there be an intentional misstatement of facts -All of the above - Correct Answer ✅All of the above All statements about insurance contracts are true except:

Answers (Latest Update 2024)

-Require all representations to be absolutely correct and true -Are contracts of utmost good faith -Are legal contracts -Must have legal purpose - Correct Answer ✅Require all representations to be absolutely correct and true Hazard can be defined as: -The person or peril that is the subject of insurance -Anything that increases the chance of loss -The uncertainty of loss -A cause of loss - Correct Answer ✅Anything that increases the chance of loss Which item is a peril or cause of loss -Fire -Liability -Sharing -Indemnify - Correct Answer ✅Fire

Answers (Latest Update 2024)

Which statement about insurable insurance is incorrect? -Insurable interest must exist at time of loss for property insurance -More than one entity might have insurable interest in one event -Insurable interest is the financial interest in the person or property insured -Insurable interest must exist at time of application but not at time of loss for property - Correct Answer ✅Insurable interest must exist at time of application but not at time of loss for property Which of the following is not a step in the underwriting process -Gathering information -Paying covered claims -Determining rates -Determining coverage - Correct Answer ✅Paying covered claims

Answers (Latest Update 2024)

Which rates consider the characteristics of a particular risk that can either increase or decrease a premium? -Judgement rates -Merit rates -Retrospective rates -Class rates - Correct Answer ✅Merit rates A newspaper stored next to a fireplace would be an example of: -Physical hazard -Morale hazard -Moral hazard -Road hazard - Correct Answer ✅Physical hazard Employees not wearing their hard hats on the job because they don't like their boss would be an example of which hazard? -Physical -Morale -Moral

Answers (Latest Update 2024)

-Consequential - Correct Answer ✅Morale All of the following are perils except: -Fire -Subrogation -Windstorm -Hail - Correct Answer ✅Subrogation Open perils insurance contracts: -Have less exclusions than a named perils contract -Are often indicated in a contract by the terms "special" or "comprehensive" -Cover fewer losses than named perils -Are often indicated in a contract by the terms "basic" or "broad" - Correct Answer ✅Are often indicated in a contract by the terms "special" or "comprehensive" All of the following perils are typically covered under a "basic" perils contract except: -Riot and civil commotion

Answers (Latest Update 2024)

-Lightning -Smoke -War - Correct Answer ✅War For a consequential or indirect loss to be covered: -The governor must declare the territory to be a disaster area -There must first be a covered direct loss -The insurance adjuster must pay the direct loss in full -The policy holder must fill out a second proof of loss - Correct Answer ✅There must first be a covered direct loss Construction of a specified thickness of masonry exterior walls and a specified fire-resistive rating for structural framing of not less than two hours is what type of construction? -Frame -Joisted masonry -Non Combustive -Fire resistive - Correct Answer ✅Fire resistive

Answers (Latest Update 2024)

The definition of actual cash value is -Functional replacement cost less than depreciation -The actual value of all building materials less labor -Replacement cost less depreciation -The price a willing buyer and seller agree upon - Correct Answer ✅Replacement cost less depreciation The valuation method that guarantees a policyholder that the scheduled limit of insurance listed for the item will be the claim payment in the event of a total loss is: -Valued policy -Market value -Actual cash value -Coinsurance - Correct Answer ✅Valued Policy The valuation of replacement cost with materials that are more commonly used and are functionally equivalent is: -Replacement cost -Actual cash value -Functional replacement cost

Answers (Latest Update 2024)

-Market value - Correct Answer ✅Functional replacement cost All of the following are parts of the insurance policy except: -Conditions -Assignments -Exclusions -Declarations - Correct Answer ✅Assignments The part of the insurance contract which contains all of the rights and duties of the insurance company and the insured is: -Conditions -Endorsements -Declarations -Exclusions - Correct Answer ✅Conditions A certificate of insurance: -Is a snapshot of the policies and limits as of their effective date