Comprehensive Reviewer Part 1
Commercial Vehicle Insurance Mastery Quiz
Test your knowledge of commercial vehicle insurance with this comprehensive 92-question quiz. Designed for insurance professionals and enthusiasts alike, this quiz covers key concepts, terms, and provisions relevant to commercial vehicle insurance.
- Understand the intricacies of Commerical Motor Vehicle Liability Insurance.
- Learn about the various policies and their coverage.
- Prepare for certification or simply enhance your knowledge.
Under a Commercial Vehicle Comprehensive Policy, the company shall be liable to pay for, among others,
A. Damage caused by overloading or strain
B. Damage to tires
C. Consequential losses, depreciation, wear and tear, mechanical breakdown, failures and breakage
D. Damage whilst in transit (including the process of loading and unloading incidental to such transit) by road, rail, inland waterway, lift or elevator
Under the “No-fault” provisions of the CMVLI, in case of disagreement as to the extent of claim,
A. Payment is suspended
B. Indemnity must be made not exceeding P15,000
C. Indemnity must be made not exceeding P5,000
D. None of the above
The territorial definitions of the commercial vehicle insurance comprehensive policy issued in the Philippines limits protection in
A. The United States, its territories and possessions
B. The Philippines and Japan
C. The Philippines
D. Both A & C
Which of the following is not important when rating for Motorcar Insurance?
A. The geographical location in which the vehicle is principally garaged
B. Age of the automobile
C. Age of the driver
D. Use of the automobile
Which of the following situations is not covered by the comprehensive portion of the motorcar insurance policy?
A. Falling object denting a car’s top
B. Broken windshield
C. Frozen radiator
D. Stolen car
The “No-fault” provision of the CMVLI refers to payment of claim for death or bodily injury to any passenger
A. Conditioned that the fault or negligence of any kind is proven by the aggrieved party
B. Provided that the person making the claim is not also negligent
C. Without need of proving fault or negligence of any kind
D. None of the above
In Compulsory Motor Vehicle Liability Insurance, action or suit for recovery of damage due to loss or injury must be brought through cases, with the Commissioner, or the courts with the competent jurisdiction, within
A. One year from the date of the accident
B. Six months from the date of the accident
C. Ninety days from the date of the accident
D. One month from the date of the accident
A Commercial Vehicle Comprehensive Policy usually covers which among the following:
A. Use for hauling and carrying of logs
B. Use for hire and reward
C. Use in connection with the insured’s business
D. None of the above
Even if the insured drives recklessly and against the speed limit, as a general rule
A. The motorcar policy is suspended
B. The motorcar policy is not liable for bodily injury or death of pedestrians
C. The motorcar policy is liable for bodily injury, death of a third party
D. None of the above
One in whose name a motor vehicle is registered with the Land Transportation Commission as the actual, legal owner thereof is called an/a
A. Motor vehicle owner
B. Land transportation operator
C. Automobile pilot
D. None of the above
Under the “No-fault” provision of the CMVLI, in the event of liability for death or bodily injury on one hand, and liability for damage to property on the other hand
A. The former has priority for settlement over the latter
B. The latter has priority for settlement over the former
C. Both will equally share
D. None of the above
A passenger, under the LTO Insurance
A. Is a fare paying passenger being transported and conveyed by a motor vehicle
B. Need not necessarily be a fare paying passenger
C. Combination of A and B
D. None of the above
A “No-Fault” claim can be made
A. Involving more than one motor vehicle in case more than one vehicle in the accident
B. Involving only one motor vehicle even if more than one vehicle in the accident
C. Combination of A & B
D. None of the above
For the purpose of CMVLI, a third party is
A. Private car messenger
B. Any person other than a commercial vehicle passenger
C. Combination of A & B
D. None of the above
A pedestrian run over and injured by an insured vehicle should:
A. File a claim directly against the owner of the insured vehicle
B. File a claim directly against the Motor Pool
C. File a claim directly against the Insurance Company
D. Combination of all the choices
The main benefit under the loss or damage cover of the Motor Car Policy on the car insured is:
A. If there is a collision, the policy would be liable for damage to another person’s car or property
B. If the insured car meets an accident, the insurer will pay for the repairs (less the amount of deductible)
C. Combination of A & B
D. None of the above
An insured carries a family Automobile Policy that affords protection to Bodily Injury and Property Damage Liability. He runs into the rear wall of a neighbour’s garage. Coverage would be afforded for:
A. Damage to the garage
B. Damage to the Insured’s automobile
C. Bodily injury to a passenger
D. Both B and C
Under the Automobile Liability Insurance policy, the costs which the insurance company may incur in defending any suit brought against the Insured
A. Shall be paid in addition to the applicable limits of liability
B. Shall be deducted to the applicable limits of liability
C. Shall be borne by the Insured
D. May be covered by endorsement
A comprehensive motor car policy is
A. Liable for passenger claims
B. Liable for accidental death or bodily injury and property damage.
C. Not as comprehensive as it may seem
D. None of the above
Under LTO Insurance, one of the requirements is
A. Horse power
B. Displacement capacity
C. Number of passenger capacity
D. Unladen weight
Protection and Indemnity Clubs are:
A. International night clubs
B. Marine insurance clubs in the Philippines such as the Manila Marine Association
C. Associations of shipowners who are liable for certain marine losses
D. None of the above
What information would an insurance company need from a shipowner applying for Hull Insurance?
I. Name of the vessel
II. Value to be insured
III. Required conditions of Insurance
IV. Trades to be engaged in
V. Recent survey report
A. I, III & IV
B. II, IV & V
C. I, IV & V
D. All of the above
A vessel was insured for one year. Suppose during the same year, the vessel will undertake 12 voyages. When must the ship be seaworthy?
A. At the commencement of the risk
B. At the beginning and at the end of the voyage
C. At the commencement of each of the 12 voyages
D. At the end of the voyage
In case of partial loss of ship or its equipment, the old materials cannot be sold to help pay for the new materials.
True
False
Joel insured his ship for 100,000. The vessel was damaged to such an extent as to reduce its value by more than three-fourths. The insured gave notice of abandonment, but the insurer refused to accept the abandonment. What can Joel recover from the insurer?
A. The Insured can recover double the amount of loss
B. The Insured cannot recover anything
C. The Insured can recover a partial loss
D. The Insured can recover a constructive total loss
In Marine Insurance, this is known as the fraudulent act of the master or mariner against the shipowner’s interest:
A. Peril of the Sea
B. Barratry
C. Jettison
D. Risk
A Canadian Steamer with a defective compass was navigating a Canadian water in a fog. Eventually, it became stranded on an island and was abandoned. Is the insurer of the vessel liable?
A. Yes, because there was no improper deviation from the agreed voyage
B. No, because the vessel was not seaworthy
C. No, because the vessel was engaging in an illegal venture
D. No, because there was abandonment
Three-fourths value clause provides that the limit of liability of the company is three-fourths of the total loss sustained.
True
False
Loss or damage due to civil war, revolution, rebellion, insurrection, or civil strike are covered by the
A. Institute Classification Clause “B”
B. Institute War Clause
C. Institute Classification Clause “A”
D. None of the above
An actual loss in a standard marine cargo insurance may be caused by any of the following except:
A. Damage to the thing insured which renders it valueless to the owner for the purpose for which he held it
B. Irretrievable loss of the thing insured by sinking or being broken up
C. Total destruction of the thing insured
D. Stranding of the vessel
A cargo of rice is insured under ICC “B”. During the voyage, seawater entered the compartment where the cargo was stored through a defective drainpipe and damaged the rice. Will the insurer be liable?
A. Yes, because entry of seawater is covered under ICC “B”
B. No, because the defect in the pipe, was a result of the lack of necessary repairs
C. The insurer should pay the claim out of the goodness of his heart
D. None of the above
In Marine Cargo Insurance, a policy which is a continuous contract covering automatically all shipments to and from stated parts of the world is called
A. Marine cargo note
B. Special marine policy
C. Marine open policy
D. None of the above
The bill of lading in a Marine Cargo Insurance Policy is
A. The receipt of the shipowner for the goods shipped on board his vessel, and states the terms and conditions on which they are to be carried
B. The draft or order drawn by the seller on the buyer, requiring the latter to pay the stated sum on sight, to the person named on his order
C. An indication that the goods are fully insured against loss or damage against marine perils with approved underwriters
D. None of the above
Patrick insured his cargo to be delivered from Manila to Brazil. The cargo was loaded and the vessel left the port of Manila. While the vessel was docking in the port of Brazil, Patrick surrendered the policy and asked for a cancellation. Would he be entitled to a refund?
A. Yes, because the cargo was not damaged
B. No, the risk was already exposed to perils and the entire voyage
C. Yes, the customer always gets what he wants
D. None of the above
Under a marine policy, the falsity of the statement of the time when the vessel will sail, the nature of the cargo to be shipped, the amount of the profit will not void the policy.
A. True
B. False
C. True, in the absence of fraud
D. False, because these are not mere statements of expectation
The Institutes Cargo Clause With Average (WA) – as the name implies:
A. Pays total loss only
B. Pays partial loss, as a general rule
C. Pays all risk, losses
D. None of the above
Losses or damages due to heavy weather are covered by:
A. Institute Cargo Clause (FPA)
B. Institute Cargo Clause (WA)
C. Freight Insurance
D. None of the above
In the Philippines, the period of cover available to the Insured under the Transit Clause (Incorporating the Warehouse Clause) is:
A. 60 days from midnight of the day of discharge from vessel at port of destination
B. 15 days from midnight of the day of discharge from the vessel at port of destination
C. There is no limit
D. None of the above
As a general rule, the Institute Cargo Clause – Free of Particular Average
A. Pays all losses
B. Pays particular loss only
C. Pays total loss only
D. None of the above
After a Constructive Total Loss, the Insured declares the relinquishment to the insurer of his interest in the subject matter insured. This act is called
A. Insurable interest
B. Deviation
C. Abandonment
D. None of the above
Any proper deviation under taken by the master or owner of the ship for the purpose of saving life does not affect the insurance.
True
False
The fundamental principles of Marine Insurance include the following except:
A. Insurable interest
B. Profits
C. Indemnity
D. Utmost Good Faith
Which among the following is not a requirement for General Average?
A. Intentional
B. Preserve from peril
C. Sacrifice
D. None of the above
In Marine Insurance, the warranty that the vessel will not engage in illegal ventures must be expressed in the contract.
True
False
“Average”, in marine parlance, means:
A. The score attained by a shipowner specifying the median of a ship’s several voyages
B. The points achieved by an Insured for preventing or minimising laws
C. Loss or damage
D. None of the choices
Abandonment, in Marine Insurance, is:
A. The act of the Insured by which, after a constructive total loss, decline the relinquishment to the insurer of his right to the thing insured
B. The act of the Insured by which, after a constructive total loss he relinquishes his right to the thing insured
C. The act by which the owner waives all the benefits derived from the chartering of his ship or its employment for the carriage of goods by sea
D. All of the above
Fortuitous accidents or casualties of the seas, and for which certain marine policies may be liable in the event of loss due thereto are known as:
A. Perils of the marine insurance
B. Perils of the sea
C. Perils of sea urchins
D. None of the above
War risks in Marine Insurance include:
A. Act of enemy agent in blowing up a vessel
B. Loss by explosion caused by a drifting mine in territories of war
C. Loss due to collision with an enemy submarine
D. All of the above
Which of the following statements in Marine Insurance on “abandonment” is false?
A. It is an act of the Insured by which, after a constructive total loss, he declares the relinquishment to the insurer of his interest in the thing insured
B. It can be partial or conditional
C. It is equivalent to a transfer by the Insured of his interest in the thing insured
D. It can be sustained only upon cause specified in the notice of abandonment
A deviation is proper in Marine Insurance under the following circumstances, except
A. When caused by circumstances over which neither the master or the owner of the ship has any control
B. When necessary to avoid
C. When the master of the ship would like to visit a friend he has not seen for quite some time
D. For the purpose of relieving another vessel in distress
“Perils of the seas” include every cause of loss to the shipowner.
True
False
Perils of the ship as distinguished from perils of the sea include the following except
A. Losses or damages resulting from the natural and inevitable action of the sea
B. Losses or damages that could not be foreseen and not attribute to the fault of anybody
C. Losses or damages resulting from ordinary wear and tear of a ship
D. Losses or damages due to the negligent failure of the ship’s owner to provide the vessel with proper equipment to convey the cargo under ordinary conditions
In connection with the Ocean Marine Contract, the assured must have an interest in the subject matter insured at the time of loss, though he need not have an interest while the insurance is in effect.
True
False
In Fire Insurance, the company is required to pay the Assured cash for all legitimate losses.
True
False
As defined, the term Fire Insurance
A. Is an agreement whereby the insurer, in return for the premium undertakes to indemnify the Insured for direct “loss” or damage to the latter’s property by fire or lighting
B. Shall include insurance against loss by fire, lighting, windstorm, tornado or earthquake and other allied risks when such risks are covered by extension to fire insurance policies or under separate policies
C. All of the above
D. None of the above
Gloria gets Fire Insurance from PISC to cover her house. Mike the electrician, accidentally starts a fire and Gloria’s house burns down. PISC pays Gloria. Can Gloria also collect from Mike?
A. Yes
B. No, Mike has already escaped to another country
C. No, because her right to sue must be assigned to the Insurance company (to the extent of its payment for the loss)
D. None of the above
If an insured property becomes vacant for a period of more than 30 days,
A. The insurance coverage continue.
B. The insurance ceases to attach.
C. The insurance is liable to pay additional premium.
D. The insurance company may not charge additional premium.
Rates of premium applied to buildings are affected by the following factors, except
A. Occupancy of the building
B. Type of construction
C. Actual cash value of building
D. Location of the property
The insurable interest in a property covered by a Fire policy may not be transferred to the new owner.
True
False
Which of the following is covered under the Standard Fire Policy?
A. Loss to a subterranean fire
B. Loss due to spontaneous combustion
C. Loss due to volcanic eruption
D. Loss due to lightning
Which factor(s) in a building construction affect the fire rating?
A. Inner walls and materials used
B. Materials used in both inner and exterior walls
C. Exterior walls and materials used
D. None of the above
An alteration in the use or condition of a thing insured in violation of the provisions of the Fire Insurance Policy but without increasing the risk, entitles the insurer to rescind the contract.
True
False
The open policy clause in the fire policy
A. Is similar to a cover note
B. Is the same marine cargo open policy
C. Requires that in the event of loss, the amount of loss shall be subject to adjustment, limiting the liability of the Insurer to the actual loss of the Insured
D. None of the above
A fire policy takes effect
A. When it specifies the commencement date.
B. When it specifies the beginning time.
C. When it specifies both the commencement date and the beginning time.
D. None of the above
The insurance company is not liable for a loss that occurs after the described building or premises is unoccupied for a period of 30 consecutive days.
True
False
Under the Standard Fire Policy, the insurance company has right to,
A. Take all the damage property and pay the Insured for his loss.
B. Repair the damaged property.
C. Take part of the damaged property and pay the Insured for his loss.
D. All of the above
Under the average clause of the Fire Policy, the Insured
A. Is not bound to insure the property at its sound value
B. Shall be paid the full value of his loss
C. Shall be considered a self-insurer of the uninsured portion if the policy is underinsured
D. None of the above
Insurable value in Fire Insurance is the expense it would be to the Insured, at the time of the commencement of the fire, to replace the thing lost, or to bring it back to the condition it was in
True
False
The premium paid for a Fire Insurance Policy is supposed to cover
A. Services rendered by the insurer
B. Risk assumed by the insurer
C. Both risks assumed and services rendered by the insurer
D. None of the above
Does the Standard Fire Policy cover
I. Smoke damage from a hostile fire in a neighbouring building
II. Breakage of the valuable vase while being removed from the premises to save it from fire damage
III. Water damage caused by firemen in extinguishing a hostile fire in another building
IV. Theft of a typewriter from the building during a fire
A. All are covered
B. All are covered except I & II
C. All are covered except II & IV
D. All covered except IV
Earthquake - Fire as an extraneous peril covers the Insured against loss
A. Due to tremors of an earthquake
B. By fire which ensues after an earthquake
C. By both fire and earthquake whichever occurs first
D. None of the above
The typhoon and flood endorsement to the Philippine Standard Fire Policy covers among others:
A. Loss by windstorm and/or the common street flood
B. Loss by typhoon damaging the building externally and/or loss due to the rising of navigable waters in the case of flood
C. It is enough that there exists a typhoon and/or flood
D. None of the above
In Fire Insurance, policyholders are not allowed to turn over their damaged property to the insurance company.
True
False
Under the Standard Fire Policy, the insurance company has the right to take part of the damaged property and pay the insured for his loss.
True
False
The Philippine Standard Fire Policy covers basically
A. Fire only
B. Fire and lightning
C. Fire and other extraneous perils
D. None of the above
With respect to a Standard Fire Policy, the term “vacancy” means
A. Unfurnished and not lived in
B. Furnished but not lived in
C. Lived but not furnished
D. None of the above
According to the terms of the “loss clause” (which is contained in the coverage from attached to a fire policy), must an Insured request for the reinstatement of his insurance after a loss has occurred?
A. Yes, if the loss exceeds 5%
B. Not until the premises have been restored
C. No, the insurance company will reinstate the coverage automatically
D. No, the coverage is not reduced by the occurrence (for payment of loss)
A clause in the Property Damage Fire Form states that the insurance contract will not be prejudiced by the act or neglect of a person other than the Insured if the act or neglect is not within the control of the Insured. This clause known as the
A. Automatic sprinkler clause
B. Control of property clause
C. Work and material clause
D. Liberation clause
A provision in the Standard Fire Policy that states that the Assured must declare all other insurance covering the property.
A. Average clause
B. Control of property clause
C. Other insurance clause
D. Waiver clause
The “other insurance” clause in the fire insurance policy provides that
A. In case of loss, the amount to payable shall be shared by several insurance companies
B. The insured at his election may be allowed to buy any other insurance or additional insurance in the same property
C. No other insurance on the aside from the granted shall be allowed without the insurer’s consent by written endorsement
D. None of the above
Written evidence of provisional insurance contracts which are to be issued only when regular fire policies cannot be granted for certain valid reason.
A. Insurance Contract
B. Cover Notes
C. Surety Bond
D. Over-insurance
Insurance effected in property either in one or several companies to an amount which separately or in aggregate exceeds the actual cash value of the insured’s in the property.
A. Particular Average
B. Co-Insurance
C. Over Insurance
D. Injunction Bond
Form of coverage which primarily concerned with the protection of goods in transit and the means of transportation.
A. Over-insurance
B. Double Insurance
C. Insurance Contract
D. Marine Insurance
Indicated that the title will pass from the shippers to the consignee at the specified point in transit.
A. Marine Insurance
B. Free on Board (F.O.B.)
C. Loss of voyage
D. Insurance Contract
Exists when the same risk is insured by several insurers separately in respect to the same subject and interest.
A. Co-Insurance
B. Double Insurance
C. Over-insurance
D. Insurance Contract
Bond to prevent an individual from committing a specified act that will injure him such as selling a business.
A. Surety Bond
B. Replevin Bond
C. Particular Average
D. Injunction Bond
Agreement among three parties whereby a surety company guarantees of goods in transit and the means of
A. Surety Bond
B. Injunction Bond
C. Replevin Bond
D. Free on Board (F.O.B.)
Statement by the insured, the truth of which becomes a condition of the validity of the policy.
A. Physical Hazard
B. Warranty
C. Loss of voyage
D. Good Faith
Term used in marine insurance which means partial loss.
A. Particular Average
B. Partial Damage
C. Partial Doom
D. Not total loss
A provision which specifies that the insurance company will pay only a part of a loss and requires policy holder to pay the balance himself.
A. Co-Insurance
B. Over-insurance
C. Double Insurance
D. Semi-Insurance
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