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Insurance Knowledge Quiz

Test your expertise in insurance with our comprehensive quiz designed for both aspiring professionals and seasoned experts. Challenge yourself with 50 thought-provoking questions covering various aspects of insurance policies, liability, and risk management.

Are you ready to enhance your understanding? Here’s what you can expect:

50 diverse questions
Multiple choice format
Instant scoring and feedback

50 Questions12 MinutesCreated by LearningScout425

Under the Homeowners HO-2 Policy, all of the following are covered EXCEPT:

Dwelling

Contents

Personal liability

Farm outbuildings

Under a Homeowners Policy, the insured location includes all of the following EXCEPT:

A cemetery plot

A secondary location used by the insured for a business

Vacant land on which the insured plans to build a house

A motel room in which the insured is residing temporarily

All of the following are included in the Liability section of the Businessowners Policy EXCEPT:

Declarations

Common policy conditions

Applicable endorsements

Causes of loss forms

Monetary damages awarded to an injured party must be based on all of the following elements EXCEPT:

Damages as the proximate result

Negligence

Available insurance

A legal duty owed

Who would be covered under the medical payments section of the Commercial General Liability Policy, if injured on the insured's premises?

A tenant of the named insured

The named insured

A customer of the named insured

An individual by the named insured

Which is an exclusion under Part Two of the Workers Compensation and Employers Liability Policy?

Care and loss of service

Consequential injury to a spouse of the injured worker

Actions brought against the insured in a capacity other than as an employer

Injury occurring to an employee who is permanently assigned to work outside of the State

Under a Homeowners Policy, the definition of an insured includes which one of the following?

An uncle who resides with the insured

A guest of the insured

A relative of the insured, visiting for the day

The insured's neighbor who comes to borrow an appliance

A social organization which is licensed to issue insurance ONLY to its members is an example of which type of insurer?

Fraternal

Mutual

Reciprocal

Stock

Endorsements to change the terms of a Businessowners Policy must be approved by the:

Insured

Insurer

Producer or agent

Claim adjuster

The liability section of the Garage Coverage Form includes all of the following EXCEPT:

Premises and operations liability

Products and completed operations liability

Automobile liability

Contractual liability

A group-owned insurer whose primary activity consists of assuming and spreading the liability risks of its members is the definition of:

Reinsurer

Risk retention group

Insurance purchasing group

Pure off-shore captive

An insurance contract drafted by the company and offered to the prospective insured for acceptance or rejection without negotiation is called a:

Personal contract

Unilateral contract

Contract of subrogation

Contract of adhesion

Which one of the following is usually true about Commercial Umbrella Liability Policies?

They are NOT standardized within the industry.

They limit protection to no more than $1,000,000 in coverage.

They are endorsements to general liability policies.

They are considered primary policies.

All of the following are common law defenses for negligent liability EXCEPT:

Contributory negligence

Intervening cause

Strict liabiltiy

Assumption of risk

A Basic Form Dwelling Policy provides:

Coverage on a named peril basis

Liability coverage for damage caused by the insured

Additional living expenses

Recovery on a replacement cost basis

Damages reduced in proportion to the amount of negligence that the insured party contributed to the injury is called:

Comparative negligence

Contributory negligence

Absolute negligence

General negligence

The Business Auto Coverage Form covers losses from all of the following under comprehensive coverage EXCEPT:

Fire

Vandlism

Theft

Freezing

An unendorsed liability insurance policy provides coverage for:

Criminal actions

Unintentional torts

Intentional torts

Moral obligations

The Homeowners Policy covers:

A detached garage used for a bike repair show

Lumber on the insured premises to be used to build a porch onto the dwelling

Summer home owned by the insured but not listed in the declarations

Lawnmowers used off premises in the insured's landscaping business

Which one of the following is a major section of a liability insurance policy?

Property covered

Perils

Loss payment

Conditions

Which one of the following is covered under the Liability Coverage of the Liability Coverage of the Business Auto Coverage Form?

Workers compensation

Expected injury

Pollution

Explosion

Changing conditions for an insurance policy currently in force required:

Authorization by a court

A mutual agreement of producer or agent and insurer

An endorsement or rider attached to policy

A notarized authorization by the Department of Insurance

Under the other structures coverage of the Broad Form Dwelling Policy, all of the following are true EXCEPT:

It provides a 10% extension of coverage.

It provides coverage for a tool shed.

It does not provide an additional amount of insurance.

It covers a private garage rented for storage of a car.

Under a Businessowners Coverage form, if an insured violates a policy condition, the insurer may:

A) Deny coverage for loss at the involved locations

B) Discontinue coverage without notice at all insured locations

C) Provide coverage at the involved location, subject to an additional premium

D) Provide coverage at the involved location for 10 days and then cancel the policy

Under the Commercial Package Policy (CPP), the Commercial Inland Marine Declarations Form contains information about which one of the following:

Loss payment

Conditions

Policy period

Other insurance

The National Flood Insurance Program (NFIP) is an example of a form of insurance regulated by the:

State government

Federal government

Property Insurance carriers

State Corporation Commission

All of the following are true about the limit of insurance in an unendorsed property insurance policy EXCEPT:

A) It can be increased by attaching an endorsement

B) The insured can expect additional limits automatically upon purchasing a second property

C) The insurer will normally not pay more than the stated limit

D) There are special limits of insurance on some types of property

The risk of financial loss that an individual faces illustrates the principle of:

Indemnity

Limit of recovery

Subrogation

Insurable interest

Theft is the taking of another's property:

While threatening bodily harm

While inflicting injury upon the owner

After forcible entry into the premises

Without the owner's consent

The Businessowners Policy covers loss of income:

Up to 10% of the policy limits

Up to 25% of the policy limits

Within 12 months following direct physical loss

Within 3 months following direct physical loss

A Federal Flood Insurance Policy covers which of the following?

Power tools stored in an attached garage

Furniture in a basement family room

Patio furniture on an open deck

Recreational vehicles parked in the driveway

Actual cash value (ACV) is generally accepted to mean:

Original purchase price of the property

Market value at the time of the loss

Cost to replace at the time of loss, plus appreciation

Cost to replace at the time of loss, less depreciation

In the Causes of Loss -- Basic Form of the Commercial Property Policy, the explosion coverage includes damage from:

Rupture of a pressure relief device

Sonic boom of an aircraft

Bursting of a building due to water expansion of its contents

Airborne volcanic blast

Which of the following is NOT used in determining the amount an insured can receive under the Personal Property Replacement Coverage Endorsement to a Homeowners Policy?

Full cost of repair at the time of loss

Depreciated market value

The Coverage C amount

Special limits stated in the policy

An insurer typically will grant its producers or agents the authority to:

Waive policy exclusions

Reject insurance ricks

Modify policy conditions

Select applicants

Which one of the following is eligible property for a Dwelling Policy?

A 4 family dwelling

A 6 family dwelling

A single family dwelling with the 3rd floor rented to 5 boarders.

A 2 family dwelling with the ground floor rented for a beauty parlor.

The Coverage A limit for a dwelling under construction is the:

ACV on date of completion

ACV at specified periods during construction

Average value during the period of construction

Replacement cost on the date of completion

The Employers Liability Insurance coverage which accompanies a Workers Compensation policy covers:

Punitive damages

Damages arising out of discrimination in hiring

Damages under the doctrine of dual capacity

Expenses of medical treatments for occupational diseases

A driver of a vehicle failed to stop for a red light and hit a light pole but did not hit a nearby vehicle. Which element of negligence is missing for legal action to be taken by the driver of the nearby vehicle?

Legal duty

Failure to meet the standard of care

Proximate cause

Actual damage

When an insurer unknowingly accepts two large cash payments from an illegal drug dealer to insure the drug operation and its employees, there is generally:

No contract

A quasi-contract

A contract of adhesion

An unenforceable contract

Medical payments to others under the Homeowners Policy will cover an accident that injures a:

Residence employee during the course of employment

Child living at home

Trespasser

Dependent child at college

A store employee discovers a large shortage while taking product inventory. Under an unendorsed Businessowners Policy, the loss:

Could be covered by an off-premises endorsement

Is covered if the store takes reasonable security precautions

Is covered under the additional coverages of the additional coverages section of the policy

Is excluded under the limitations section of the policy

To recover for a loss under the Standard Fire Policy, when must an insurable interest exist?

Only at the inception of the policy

At the time of loss

For at least six months before the loss

An insurable interest need not exist

All of the following may be covered by basic builders risk insurance EXCEPT:

An occupied building

Foundation of a building under construction

A building under construction

Building materials not yet part of the building

47) Under the Farm Policy, losses which qualify for payment on a replacement cost basis is limited to the actual cash value until:

The final loss report is submitted to the insurance company

A loss statement has been signed by the insured

The total damages exceed 80% of the limit of insurance

The actual repairs or replacement are completed

48) A licensed producer or agent may receive commission compensation for all of the following services EXCEPT:

Negotiation of any insurance contract

Procurement of an insurance contract

Acting as a consultant to provide insurance advice

Adjustment of claims arising from insurance contracts

If Policy A states that it will pay after payment by other applicable policies, Policy A is:

Excess

Primary

Pro rata

Reinsurance

If an insured with a Dwelling Policy has other coverage, which is true?

The proceeds are divided between the mortgagee and mortgagor according to their interest in the property

The proceeds are divided among all who have an insruable interest at the time of loss

Losses are payable in the same proportion that this insurance bears to the total amount of fire insurance

The amount of premium earned is prorated to the length of time the policy has been in force

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