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Personal Lines exam study session
1. indirect loss: An additional loss that results from a direct loss of property is called a/an
2. It provides errors and omissions coverage for an agency: Which of the following statements is NOT true
regarding a personal umbrella liability policy?
3. Renewal dates: What type of information would be found in a policy's insuring agreement?
4. Per occurrence: An insured has a liability policy that sets the amount for all claims that arise from a single incident at
$50,000. Which type of limit of liability does this insured's policy have?
5. Owned or leased by the resident of the mobile home: The mobilehome en- dorsement alters the homeowners
policy to cover a mobilehome and other struc- tures on land
6. warranty: Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance
contract?
7. Mechanical breakdown: Which of the following is a common exclusion found in Part D: Coverage for Damage to
Your Auto of a PAP?
8. market value: The insured's house is located one mile from the county's new landfill and across the road from the
entrance of a rock quarry. It would cost $150,000 to rebuild the house is something happened to it, but when the insured tried to sell it, the best offer he received was $80,000. The insurance company will insure the house for only $80,000. What method of valuation is used to insure this property?
9. Each policy will pay $25,000 of the loss: An insured has four separate but identical policies written by different
insurers to cover her $100,000 building. Each policy is written for $100,000, and each has the pro rata liability other insurance clause. In the event of a total loss to the building, what would each insurer pay?
10. declarations: Which of the following is a mandatory part of an insurance policy that varies with each individual
policy?
11. Insuring agreement: All of the following are conditions commonly found in the insurance policy EXCEPT
12. Burglary: The crime of forced entry into the premises of another by a person or persons with felonious intent is
defined as
13. dwelling policy form: Residential structures, including individual condominium units, and their contents are
insured by what part of the National Flood Insurance Program?
14. transportation/permission to move endorsement: An insured covered under a Mobile Homeowners Policy wants
to move the location of the covered mobile home. Which of the following must the insured obtain from the insurer?
15. Consideration: 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?
16. Insured: Who is responsible for filling out a notice of claim form?
17. occurrence: Losses caused by continuous or repeated exposure to conditions resulting in injury to persons or
damage to property that is neither intended nor expected is the definition of which of the following terms?
18. other than collision coverage: Rental reimbursement is only available if the policy includes which coverage?
19. How parties to the contact must act following a loss: The policy conditions define
20. other insurance: What insurance policy provision defines how the policy will respond if there is more than one
insurance policy written on the same risk?
21. uninsured motorist coverage: In the personal auto policy, owned trailers being towed by an insured auto are
automatically covered for
31. Specific definitions as to their meaning as used in the policy: words or terms that appear in an insurance policy in
bold face print include
32. pay dividends to the policy owner: A participating insurance policy may do which of the following?
33. Property and Casualty Insurance Guaranty Association: Which of the fol- lowing was created to pay benefits
due to insured's after their insurance companies have been declared insolvent?
34. First named insured: Which of the following would be named on the declara- tions page of a property or
liability policy?
35. consideration: Something of value exchanged between the insurer and the insured is considered an
36. The coinsurance formula will also be applied to total losses.: All of the following statements concerning
coinsurance are true EXCEPT
37. stated amount: when the amount of insurance written in a property policy is not subject to any coinsurance
provision and that amount is paid in the event of a covered loss, the coverage is said to be written as
38. full replacement of property as its current cost, new and without reduction for depreciation: replacement cost
is defined as
39. $500: 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
40. Insuring Agreement: The part of the insurance contact that described the covered perils and the nature of
coverage of the contractual agreement between the insurer and the insured is called the
41. to pre-establish the amount of coverage available for property items that are difficult to value: Which of the
following best expresses the purpose of a stated value contract?
42. conditions: because an insurance policy is a legal contract, it must conform to the state laws governing
contracts which require all of the following elements EXCEPT
43. replacement cost: which method of loss valuation is contrary to the basic concept of indemnity
44. liability coverage: which of the following personal auto coverage's would pay for the insured's travel expenses and
loss of earnings while involved in the settlement process of a covered loss?
45. accident insurance, because it pays medical expenses regardless of fault-
: in a personal auto policy, the medical payments coverage is similar to
46. 2 years: with in how many years of loss may an insured bring a lawsuit against an insurer, according to the
dwelling policy?
47. occurrence: losses caused by continuous or repeated exposure to conditions resulting in injury to persons or
damage to property that is neither intended nor expected is the definition of which of the following terms
48. renewal dates: what type of information would be found in a policy's insuring agreement
49. uninsured motorist coverage: in the personal auto policy, owned trailers being towed by an insured auto are
automatically
50. the amount of coverage on the dwelling: The amount an insurer will pay under Coverage D (Loss of Use) depends
on
51. the insured is injured while exiting a friend's mobile home: the medical payments coverage in a personal auto
policy will pay reasonable medical expenses for all of the following EXCEPT
52. other than collision coverage: rental reimbursement is only available if the policy includes which coverage
53. this loss is not covered: an insured is driving her auto and strikes a large pothole, causing a flat tire. Which
coverage of the insured's personal auto policy will pay for the repair?
60. Certificate of authority: What must an insurer obtain in order to transact insurance within a given state?
61. Assigned risk auto plan Joint
underwriting association FAIR plan: What is considered a residual market?
62. State property and casualty guaranty association: A mechanism for assist- ing the policyholders of bankrupt
insurers?
63. It is issued to group insurance participants.: Which of the following is NOT true regarding a Certificate of
Authority?
64. liability insurance: Adam is injured in a car accident caused by John. What kind of insurance would cover John's
obligation to pay for Adam's injuries?
65. any change in business name: An individual licensed as an agent must notify the Texas Department of Insurance,
on a monthly basis, of all of the following EXCEPT
66. The lesser of the above amounts: Under the Texas Property and Casualty Insurance Guaranty Association, what is
the maximum amount that a claimant may recover from an occurrence under a policy issued by an insolvent insurer?
67. Draft insurance laws: The commissioner has full power and authority to do all of the following EXCEPT
68. misrepresentation: During a sales presentation a produce intentionally makes a statement which may mislead the
insurance applicant. This describes
69. The hearing must be held within 10 days of receiving a request, unless both parties agree to a later date.: An
agent receives an Emergency Cease and Desist Order for chronically misrepresenting his insurance policies. The agent knows that he did not commit the violations stated in the Emergency Cease and Desist Order. He wants to contest the
charges in a court hearing. Which of the following is true?
70. a licensed life insurance agent: which of the following individuals could legally receive commissions from the
sale of a life insurance policy?
71. specific definitions as to their meaning as used in the policy: Words or terms that appear in an insurance
policy in bold face print include
72. controlled business: when an individual obtains an insurance license for the primary purpose of writing insurance
on him- or herself, or for members of his or her immediate family, or business, this is called?
