NJ Property & Casualty Insurance Exam II Copy

Benson Pharmaceutical Company decides not to manufacture a new drug after determining that it has serious potential side effects. This is an example of which risk management method?

Trailer Interchange coverage is included in which of the following forms?

Which of the following would be covered under the building coverage of the Building and Personal Property coverage form?

Deirdre has a complete 12-piece tea service valued at $20,000. In an explosion covered by her insurance policy, most of the tea service comes through intact, but one of the tea cups is broken beyond repair. The cup by itself would be valued at $400, but the value of Deirdre’s tea service without the broken cup is $17,000. How much will Deirdre’s insurance company pay for the broken cup?

Who is responsible for licensing insurance agents?

Ann’s auto was damaged when it was struck by another car whose driver ran a stop sign. Which part of Ann’s Personal Auto policy will cover the damage to her car?

An action that, in a natural and continuous sequence, produces a loss is the

Under the additional coverages of the Businessowners property coverage, property removed to protect it from loss will be covered at another location for up to how many days?

What is the largest office building risk that might be eligible for a BOP?

A business that wants coverage for its liability for employment-related acts can obtain it by purchasing which of the following?

Which of the following coverages are included in an unendorsed Garage coverage form?

Which of the following is not excluded under commercial general liability coverage for bodily injury and property damage liability?

Under an insurance contract, the uncertainty of events can lead to unequal financial results for the two parties. This means that insurance is what kind of contract?

Which of the following losses could be covered under the Theatrical Property coverage form?

Which of the following is not one of the common law defenses against an employer’s liability?

Which of the following is covered under the Builders Risk coverage form?

Which one of the following answer choices lists all of the parties to a Surety bond?

Under the 1989 dwelling policy forms, if coverage for vandalism and malicious mischief is attached to a policy, it will be suspended whenever the building has been vacant for more than how many days?

Under a homeowners policy, in addition to any payments for damages awarded against an insured, the insurance company will reimburse the insured for reasonable expenses incurred at the company’s request, including loss of earnings of up to how many days?

Tom Baxter has an automobile insured by a personal auto policy. He trades in his car and purchases a new private passenger auto as a replacement vehicle. If he does not notify the insurance company, the liability coverage for his replacement vehicle will apply automatically for how long?

The law of large numbers

Renata’s home is demolished in a fire that started when a neighbor misdirected the fireworks he set off to celebrate the Fourth of July. Renata’s insurance company pays her for the damage, and then files suit against the neighbor to recover the amount it paid for the loss. This is an example of the application of what policy condition?

LaTonya purchases a house from John. She borrows $75,000 from First City Bank that, along with her $25,000 down payment, equals the $100,000 purchase price of the home. Who has an insurable interest in this home? Choose all that apply

What is the purpose of a retroactive date in the claims-made form?

Which of the following is not true about difference in conditions (DIC) insurance?

What type of property is protected under Computer Fraud coverage?

Which of the following business liability exposures are either excluded altogether from the CGL or covered only in certain circumstances? Select all that apply.

Commercial insureds who need more Liability coverage than provided by a certain policy or want coverage for losses excluded by a certain policy should purchase which of the following?

If an insurer decides to not renew the CGL policy, how many days notice of nonrenewal must be provided to the first named insured?

The most common definition of actual cash value (ACV) in the property insurance field is which of the following?

Agent Blondell is offering a free television to every applicant who agrees to buy insurance through his agency. In most states, this is an illegal practice known as

George accidentally hits Elaine’s car with his car. The accident causes $3,000 of damage to Elaine’s car, plus Elaine is injured and her medical bills come to $1,000. George’s car also sustains $500 damage in the accident, but George isn’t hurt. What will George’s auto liability coverage pay for?

Under the 1989 dwelling policy forms, if coverage for vandalism and malicious mischief is attached to a policy, it will be suspended whenever the building has been vacant for more than how many days?

Failure to use the care that is required to protect others from the unreasonable chance of harm is called what?

Which of these losses would be covered under the Camera and Musical Instrument Dealers coverage form?

Which of the following would be covered under the building coverage of the Building and Personal Property coverage form?

The Johnsons’ home is covered by a Special Dwelling policy. When a fire damages the home, the family is forced to stay at a motel for a month while repairs are made. What coverage might reimburse them for these expenses?

National flood insurance is available for which of the following?

Loss caused by sprinkler leakage is covered under which Commercial Property Causes of Loss forms?

For how long after the date of a direct physical loss will the insurance company pay for extra expenses under the extra expense additional coverage?

A breakdown of equipment covered under the Equipment Breakdown Protection coverage form results in the simultaneous breakdown of three other pieces of covered equipment. According to the form, how many “breakdowns” occurred in this loss?

Highpoint Industries has an automatic sprinkler system installed in its office building. This is an example of which risk management method?

Which of the following are usually excluded under Coverage A of the Commercial General Liability policy? Select all that apply.

A homeowners policy has been in force 30 days, and the company discovers that the insured has misrepresented certain material facts. The insurer wants to cancel the policy. Under what circumstances may it do so?

Which of the following autos owned by the named insured could be covered under a Personal Auto policy?

Which of the following individuals have Liability coverage under Mr. Stump’s Personal Auto policy?

What is the maximum amount of coverage that can be purchased for a single-family home under the emergency Flood insurance program?

A nonexclusive agent

Adequate coverage for large, powerful boats is provided by which of the following?

If coverage for personal liability and medical payments is attached to a dwelling policy, what basic limit of coverage applies to medical payments unless a higher amount is purchased?

Trailer Interchange coverage is included in which of the following forms?

Which of these items of personal property would be covered under a Dwelling policy when Coverage C is written?

How do deductibles apply in the Equipment Breakdown Protection coverage form?

Under the Appraisal condition, the insured and the insurance company each chooses an appraiser. If the appraisers do not agree, the dispute is submitted to a third individual agreed upon jointly by the insured and the insurance company. That third party is called the

Which of the following classes of personal property are subject to special sublimits of coverage under a homeowners policy?

Which of these statements concerning Medical Payments to Others coverage are correct?

In legal terms, the actions by one party might have the effect of giving up a known right. When this occurs, the party has created which of the following?

The insured knows that it might take several months for his damaged turbine to be fully repaired, so he authorizes $500 for temporary repairs so that production can resume. This expenditure would be covered under which coverage in the Equipment Breakdown Protection coverage form?

Which of the following coverages are included in an unendorsed Garage coverage form?

Which of the following losses would not be excluded under a Basic Dwelling policy form?

Under a CPP, how many days advance notice is required if the insurance company is cancelling the contract for nonpayment of premium?

The Additional Coverage for collapse is included in which homeowners form(s)?

What is meant by the term “adverse selection”?

Which of the following is not true about insurance binders?

Which of these statements regarding Difference in Conditions insurance are correct?

A device that is used to minimize small nuisance claims and that helps to keep insurance premiums down is called what?

Three policies, totaling $300,000 in coverage, apply to an $80,000 loss. Policy A’s limit of insurance is $100,000, policy B’s limit is $50,000, and policy C’s limit is $150,000. Use the pro rata method to determine how much policy C would pay for this loss.

Which of the following are true about the 60-day basic extended reporting period? Select all that apply.

Under the NCCI workers compensation and employers liability policy form, the basic, or minimum, limit for employers liability coverage is how much per accident?

If the insurance company requests a proof of loss on a Commercial Inland Marine claim, the insured must submit it within how many days?

Which of the following losses would be excluded under the Building and Personal Property coverage form if the insured building had been vacant for more than 60 days before the loss occurred?

Under the supplementary payments provided by general liability coverage, when a vehicle to which the bodily injury insurance applies is involved in an accident and bail bonds are required, the insurer will pay up to what amount?

Trailer Interchange coverage is included in which of the following forms?

The insured knows that it might take several months for his damaged turbine to be fully repaired, so he authorizes $500 for temporary repairs so that production can resume. This expenditure would be covered under which coverage in the Equipment Breakdown Protection coverage form?

Vanessa’s Liability coverage has split limits of 100/300/50. How much coverage does Vanessa have for property damage liability?

Which of the following is not one of the common law defenses against an employer’s liability?

Most liability claims are based on negligence that results in injury or damage. An act of negligence is considered to be a tort. What does the term “tort” mean?

Which of the following is not true about difference in conditions (DIC) insurance?

The purpose of FAIR Plans (Fair Access to Insurance Requirements) is to do what?

Which of the following statements apply to Professional Liability policies?

Which of the following perils are covered in the Causes of LossBasic form

All of the following reduce the CGL’s General Aggregate Limit except which of the following?

Which part of an insurance policy sets the rules of conduct, duties, and obligations of the insured and insurer under the terms of the contract?

What type of property is protected under Computer Fraud coverage?

Benson Pharmaceutical Company decides not to manufacture a new drug after determining that it has serious potential side effects. This is an example of which risk management method?

Liability that an insured incurs because of the actions of others, such as employees, is called what?

Which Causes of Loss form provides open peril coverage?

Which one of the following is not required in a CGL coverage part?

A heavy snowfall causes the roof over Amaya’s living room to collapse. The insurance company asks her to move her belongings out of the living room to protect them from further damage and put a tarp over the roof until it can be repaired. It also asks her to complete a proof of loss form listing the items that were damaged. This is an example of the application of what policy condition?

Which one of the following coverages is not included in the BOP?

What is the largest office building risk that might be eligible for a BOP?

Which type of insurance professional does not actually sell insurance coverages, but sells advice about insurance coverages?

Can states require insurance companies to use certain forms or rates in connection with certain types of insurance?

The tread on Alan’s automobile tires is very thin. This is an example of what type of hazard?

Failure to use the care that is required to protect others from the unreasonable chance of harm is called what?

Which of the following are contained in the Common Policy Declarations?