Download NY Insurance Property and Casualty Practice Test Questions with Correct Answers and more Exams Insurance law in PDF only on Docsity!
PSI ONLINE EXAMINATION NY INSURANCE PROPERTY AND CASUALTY PRACTICE TEST
QUESTIONS WITH CORRECT ANSWERS
"c. premises and operations - CORRECT ANSWER Which of the following business liability
exposure does a slip and fall loss fall under? a. indirect and contingent b. medical expenses c. premises and operations d. retail hazards"
"b. indirect loss - CORRECT ANSWER Which of the following defines a loss which is
consequential and comes as a result of an original loss? a. direct loss b. indirect loss c. partial loss d. total loss"
"b. company has the option to repair to pre-loss condition - CORRECT ANSWER Which of the
following situations under dwelling policy conditions describe how the insurance company will settle a loss? a. pay the full value of a pair of earrings when only one is lost b. company has the option to repair to pre-loss condition c. if loss is covered by other insurance the other insurance pays full loss d. property is replaced by company at full replacement value at loss"
"c. insuring your friend's automobile - CORRECT ANSWER All of the following are examples of
insurable interest except? a. insuring your home b. insuring expensive jewelry c. insuring your friend's automobile d. insuring business property you own"
"c. loss due to crime - CORRECT ANSWER Which of the following would be covered by a
commercial package policy? a. small to medium sized businesses b. ocean marine c. loss due to crime d. injury to worker on the job"
"d. warranties - CORRECT ANSWER Which of the following are defined as a part of the policy
and can void the policy if they are breached, whether the breach was intentional or unintentional? a. material facts b. representations c. waivers d. warranties"
"d. rental reimbursement until claim is settled by insurance - CORRECT ANSWER An insured
has transportation expenses coverage under part D of the personal auto policy when involved in a collision. Coverage provides which of the following? a. immediate coverage for total theft of the covered auto b. towing for the covered vehicle from the crash site c. rental reimbursement until a new auto is purchased d. rental reimbursement until claim is settled by insurance"
"b. $2,500 - CORRECT ANSWER Homeowner form HO-2 provides coverage for loss of
appliances, carpeting, and other household furnishings for a maximum of how much? a. $1, b. $2, c. $3, d. $5,000"
"b. declarations - CORRECT ANSWER Which part of the commercial general liability designates
who is an insured? a. conditions b. declarations c. definitions d. insuring agreement"
"a. disability - CORRECT ANSWER Underwriters are permitted to use all of the following when
underwriting an application for insurance EXCEPT? a. disability b. inspection services c. credit reports d. claim history"
"d. other persons or organizations for their liability from an accident involving an auto or trailer
used by the insured but owned by that person or organization - CORRECT ANSWER All of the
following would be considered an insured person under Part A of a personal automobile policy EXCEPT a. other persons or organizations that use the car to the extent that they share liability with the insured person b. anyone using the insured's car with the insured's permission or the reasonable belief that they are entitled to do so c. the named insured and members of the insured's family for the ownership, maintenance and use of any auto or trailer d. other persons or organizations for their liability from an accident involving an auto or trailer used by the insured but owned by that person or organization"
"a. indemnity - CORRECT ANSWER which of the following characteristics of an insurance
contract expresses the principle that the policyholder is returned to the approximate financial condition as before the loss? a. indemnity b. risk transfer c. insurance d. risk reduction"
"Forgery and Alteration - CORRECT ANSWER A bank customer's identity was compromised
and the thieves made numerous purchased from a retailer by signing the customer's checks. When the bank refused to make payment for the goods, the retailer brought suit against the bank. Which coverage indemnified the bank for liability in the suit?"
"a. the responsibilities and obligations of insured and insurer - CORRECT ANSWER which of
the following best describes the policy conditions? a. the responsibilities and obligations of insured and insurer b. who is insured, location, risk and what is insured c. the meanings of terms used in the policy d. the losses for which the insured is NOT covered"
"The BOP prepackages a group of coverages desirable to small businesses - CORRECT ANSWER
How does the BOP differ from the CPP?"
"a. cost of bail bonds - CORRECT ANSWER Under the commercial general liability which one of
the following is covered under supplementary payments?
a. cost of bail bonds b. defense costs for the plaintiff c. court costs taxed against a third party d. loss of earnings expense of over $250 a day"
"b. they do not reduce the policy limit - CORRECT ANSWER Which of the following is correct
for amounts paid as supplementary payments covered in the personal auto policy Part A liability? a. they are subject to the deductible b. they do not reduce the policy limit c. They are included in the policy limit d. they cannot be paid to the insured"
"morale hazard - CORRECT ANSWER Which type of hazard is an example of a person who
increases the chance of loss through carelessness or by irresponsible actions?"
"a. carpet cleaning after a water main break - CORRECT ANSWER Which of the following
would trigger coverage under business income form with extra expense coverage? a. carpet cleaning after a water main break b. Employee pay after a building structure is damaged c. building inspectors feeds after a loss d. unit rent when tenant is liable"
"d. cost of damages - CORRECT ANSWER All of the following are used to establish negligence
EXCEPT?
a. proximate cause b. legal duty owed c. breach of legal duty owed d. cost of damages"
"$20,000 - CORRECT ANSWER The insured carries underinsured motorists coverage limits of
250/500/250 on his automobile policy and his vehicle is struck by an at fault motorist who insures with the State minimum for liability of 20/40/10. If the insured brings suit for bodily injury damages to himself of $500,000, how much will he recover from at fault driver's policy?"
"b. HO-5 - CORRECT ANSWER Which of the following Homeowners form provides the most
comprehensive coverage? a HO- b. HO-
"imported goods - CORRECT ANSWER According to the Nationwide Definition of marine
insurance, which category is an eligible marine risk?"
"c. 20% - CORRECT ANSWER Which of the following limits of insurance on the dwelling are
available and apply to coverage D-Fair rental value? a. 10% b. 15% c. 20% d. 25%"
"loss from collision damage - CORRECT ANSWER Which exposure is unique to mobile homes?"
"Nonrenewal - CORRECT ANSWER When the policy term ends and either the insured or the
insurance company wants to discontinue coverage which provision is applied?"
"to state which perils are insured against - CORRECT ANSWER What is the purpose of the
causes of loss form that lists specific exclusions?"
"c. per occurrence - CORRECT ANSWER For the commercial general liability coverages of
bodily injury, property damage and medical payments, which of the following limits of insurance apply if the aggregate limit is NOT met? a. bodily injury b. medical payments c. per occurrence d. property damage"
"b. driving neighbor's auto - CORRECT ANSWER The insured has a commercial auto policy with
a drive other car broadened coverage liability for named individuals (DOC) endorsement. In which of the following would the named individual be covered? a. racing company car b. driving neighbor's auto c. any vehicle owned by insured d. family member driving company vehicle"
"b. insurable interest in the property - CORRECT ANSWER Which of the following gives a
mortgagee rights at the time of loss? a. money to lend for restoration b. insurable interest in the property
c. may file a proof of loss for insured d. may pay the premium for insured"
"d. surety bond - CORRECT ANSWER The state highway department is rebuilding a roadway
and the general contractor winning the bid will be required to purchase a bond guaranteeing the work will be completed according to specifications and on time. Which of the following types of bonds will the general contractor need to purchase? a. contract bond b. fidelity bond c. indemnity bond d. surety bond"
"d. labor costs performed at the shop are limited to $25 - CORRECT ANSWER All of the
following are correct for towing and labor costs coverage on the personal auto policy EXCEPT? a. settlement is by reimbursement b. coverage is available by endorsement c. towing and labor are combined per occurrence d. labor costs performed at the shop are limited to $25"
"d. carpeting that is permanently installed inside the building - CORRECT ANSWER The
property coverage of a BOP includes which of the following? a. motor vehicles b. outdoor fencing c. outdoor signs that are not attached to the building d. carpeting that is permanently installed inside the building"
"The broadest coverage available extends from the insured's policy - CORRECT ANSWER If the
insured has a loss with a private passenger nonowned temporary substitute vehicle how will the loss be treated by the insured's own policy for physical damage?"
"b. occurrence form - CORRECT ANSWER Which of the following forms trigger coverage for a
loss under the commercial general liability policy if a loss happens during the policy period? a. claims made form b. occurrence form c. period certain form d. static form"
"b. robbery - CORRECT ANSWER Which of the following types of crimes best describe the
unlawful act of taking property from the care and custody of another person while threatening to cause bodily harm?
"d. on the date construction starts above the lowest basement floor if there is a basement -
CORRECT ANSWER When does the coverage begin for a builders risk form?
a. the date the policy premium is paid b. on the date any construction begins c. on the date construction starts above the highest basement floor if there is a basement d. on the date construction starts above the lowest basement floor if there is a basement"
"a. temporary permanent - CORRECT ANSWER The following are all types of disability
categories under workers' compensation insurance except? a. temporary permanent b. permanent total c. permanent partial d. temporary total"
"c. the applicant is seeking a transaction greater than $150,000 - CORRECT ANSWER The fair
credit reporting act permits consumer reporting agencies to include applicant information about bankruptcies MORE than 10 years old under which of the following circumstances? a. The applicant has been convicted of a felony or fraud b. the applicant is a public or political figure c. the applicant is seeking a transaction greater than $150, d. the applicant is employed in the financial industry"
"d. damage by ice to outdoor radio and television antennas and aerials - CORRECT ANSWER
Which of the following is EXCLUDED as a covered loss under the DP-3 coverage? a. freezing of pipes when water is shut off during a vacancy b. vandalism in a house vacant for 30 days c. sudden seepage from an air conditioning system d. damage by ice to outdoor radio and television antennas and aerials"
"a. the fall - CORRECT ANSWER A woman slips on icy steps and breaks her leg. Which of the
following is the peril in this situation? a. the fall b. the icy steps c. the broken leg d. the season of the year"
"d. residual market insurance - CORRECT ANSWER Federal crop insurance is a type of
insurance sometimes called which one of the following? a. voluntary private insurance b. special broadened forms insurance c. national association coverage insurance
d. residual market insurance"
"c. builder's floater form - CORRECT ANSWER All of the following are the most commonly used
personal inland marine forms EXCEPT? a. personal property form b. personal articles form c. builder's floater form d. personal effects form"
"a. unknowingly inflicting injury that violates the rights of another - CORRECT ANSWER
Liability arising out of any of the following is excluded from the personal and advertising injury liability coverage EXCEPT? a. unknowingly inflicting injury that violates the rights of another b. oral or written publication of material that the insured knows is false c. criminal acts committed by or at the direction of the insured d. failure of goods or products to conform with advertised quality"
"d. negligence - CORRECT ANSWER Absolute liability can be imposed by law and exist in the
absence of which of the following? a. third party liability b. hazardous operations c. products liability d. negligence"
"c. the customer's car is covered for any physical damage while in the custody of the insured -
CORRECT ANSWER An insured operates a auto repair shop and has a garage coverage form
with garage keepers insurance when an employee on a test drive with a customer's car is involved in a crash. How will the customer's car be covered by the insured's policy? a. all coverage is excluded under the garagekeepers insurance for the nonowned car b. the insured's policy is excess to the employee's policy and covers any physical damage c. the customer's car is covered for any physical damage while in the custody of the insured d. physical damage coverage is specifically excluded for off premise occurrences."
"$100,000 - CORRECT ANSWER An insured with split liability limits of 100/300/100 is at fault
in an automobile accident and the other vehicle sustains $6,500 in property damages as well as two occupants have bodily injury and are claiming $150,000 each. What is the most insurance will pay to each occupant?"
"c. owned autos only - CORRECT ANSWER When an insured selects symbol 2 on the
automobile declarations, indicating coverage for any auto titled to the insured, which of the following automobile types will be covered? a. any auto
"c. replacement cost less depreciation - CORRECT ANSWER Which one of the following
valuations methods best describes how a loss will be settled when the policy provides for actual cash value settlement? a. depreciation plus replacement cost b. cost to repair if less than policy limit c. replacement cost less depreciation d. the lesser of insurable interest"
"d. subrogation - CORRECT ANSWER Which of the following terms refers to the transfer of the
insured's right of recovery against others to his insurance company? a. abandonment b. legal release c. loss transfer d. subrogation"
"c. riot or civil commotion - CORRECT ANSWER which of the following would be covered perils
under the DP-1 Basic policy form? a. falling objects b. freezing of plumbing c. riot or civil commotion d. weight of ice or snow"
"b. the United States Congress - CORRECT ANSWER Which of the following created the
National Flood Insurance program? a. An association of mortgage banks b. the United States Congress c. governors of flood prone states d. a consortium of insurance companies"
"d. a volunteer worker - CORRECT ANSWER Which of the following persons is covered for
accidental injury on the insured's premises under the commercial general liability medical payments? a. a tenant of the premises b. an employee of the insured c. person injured in warfare d. a volunteer worker"
"c. freezing or road damage - CORRECT ANSWER All of the perils are specifically listed in the
policy as being other than collision losses EXCEPT a. fire b. windstorm c. freezing or road damage
d. malicious mischief or vandalism"
"a. not driving a car to prevent getting in an accident - CORRECT ANSWER Which of the
following is an example of risk avoidance? a. not driving a car to prevent getting in an accident b. providing comprehensive training on how to drive a car c. making sure a car has airbags before purchasing it d. purchasing a large amount of automobile insurance"
