California property and casualty exam, Pool Questions & Answers. Verified. Rated A

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California property and casualty exam, Pool Questions & Answers. Verified. Rated A The process where by a mutul insurer becomes a stock company is called - ✔✔Demutalization The process where... by a stock company a mutal insurer is called - ✔✔Mutalization The provision in a property policy which states that the insured has been paid up to their insurable interest is - ✔✔Valuation clause The part of the policy that states the amout of coverage the insured property policy period is - ✔✔Declaration Part of the policy that establishes limits upon the insurer and the insured with the insuance policy - ✔✔Conditions Which are the characterics of negligence - ✔✔Duty,breach,proximate cause, damages Which of the following is not a federal program - ✔✔Worker' compensation Absolute risk(liability) is imposed - ✔✔When there is negligence whether proven or not X is in an accident with Y. X suffers $5000 of damage but it is determined that X is 60% responsible for the accident. How much would X receive under CONTRIBUTORY negligence rules? - ✔✔$0 what is the main purpose of tort law - ✔✔to determine financial responsibillty for damage what of the following is not considered an intentional tort? - ✔✔Auto accident Which of the following statements is true regarding compensatory damages? - ✔✔There is usually no direct correlation between the amount of general and special damages awarded to the victim The insurer decides not to renewan insured's personal auto policy. How much notice must the insurer provide to the insured - ✔✔30 days an insured's loss reserve for a claim isan estimate of the amount insurer will pay for present and future loss, which of the following is an example of loss prevention - ✔✔a homeowner decides not to install a pool in the backyard which of the following describes the act of making a false entry in any book statement of report of any insurer with the intent to device any examiner lawfully appointed to examine the insured's - ✔✔an unfair practice a person can base his/her claim for liability on the basis of all of the following EXCEPT - ✔✔breach of liability the term "assignment"refers to - ✔✔the transfer of the insured's interest in a policy to another party the term "subrogation" refers to - ✔✔the insured's right to recover payment from a responsible 3rd party insur's right to recover the payment of the claim after they paid the insured for their property losses a negligent 3rd party is know as, - ✔✔subrogation an insurance deductible is - ✔✔the amount of covered expense that the insured pays before the insurer pays, all of the following are requirements for a notice by mail to an insured by insurer except - ✔✔notice must be sent with return receipt required which of the following is considered special damages - ✔✔Compensation for time away from work Which advisory organization(s) develop forms for the standard market? - ✔✔Insurane service office and American association of insurances Which of the following would be considered special dmamges? - ✔✔Lost wages What do the initials S.tA.R.R reperesent? - ✔✔Methods of risk mamagement All of the following would be considered benfits of insurance except - ✔✔Retention of loss by the insured What gives an insured party the right to seek compensation if it is proven that another person with negligence contributed to the injury - ✔✔Tort law What of the following is NOT one the three main types of insurance losses - ✔✔Financial loss Under a special cause of loss form if a landslide is caused by an unnatural flow of water due to improper grading, the loss is, - ✔✔Excluded under the concurrent causation An open peril policy protects agaginst the loss from - ✔✔Any peril, other than those specifically excluded What factor supportd the principle of indemnity? - ✔✔Insurable interest All of the following are characteristics of an ideally insurable loss exposure"except" - ✔✔Losses that are catastrophic The amount to replace property with " like property of the same quality and construction" is the properties - ✔✔Replacement value All of the following are considered intentional torts - ✔✔except, Assult What is the difference between per accident limit in a split limit policy and single limits - ✔✔There is no difference The intentional relinquishment of known right is - ✔✔Waivier Which type of loss is a business retirement or disability of key employee, exposed to death retirement or disability of key employee, - ✔✔Personnel loss exposure The amount to replace an insured's damaged property - ✔✔less depreciation, is know as the, Actual cash value The commercial property conditions included a condition called " liberalization". The effect of this condition is - ✔✔To automatically apply broader coverage to the commercial property coverage part if a policy form revision would broaden coverage without an addition premium In a commercial lines program policycommon policy condition do not include which of the following as a condition?, - ✔✔Perils insured A possibility of financially loss resulting from the ownership of property is know as - ✔✔insurable interest laura is driving her own car on behalf of her employer laura's negligent operation of her car injures a member of public. The employer may be held liable because of what is called., - ✔✔Vicarious liability Type of exposure can be best defined as a condition or situation where the exposure to financial loss is presented to a business owner by the injury - ✔✔disability, death, sickness, of valuable employee, Personnel loss exposure Which of the following is also know as a human loss exposure - ✔✔Personal loss exposure Which of the following best characterize a speculative risk? - ✔✔A situation that offers the possibility for a loss or gain In the state of CA no rate will remain in effect if it is considered to be any of the following, EXCEPT, - ✔✔Impartial What course of action does a party to a contract have if the other party is found to be breach of that contract - ✔✔Damage for breach, reasonable attorney fee and cost Which part of the insurance contract summarize the major promises of the insurer - ✔✔Insuring agreement Under tort law a corporation can be subject to a claim for legal liability on the basis, - ✔✔Absolute liability Risk management technique that eliminates a loss exposure and reduces the chance of loss to zero is - ✔✔Avoidance A situation is which there only the possibility of loss or no loss is considered a - ✔✔Pure risk A reduction in value of property that results immediately from damage to the property is know as - ✔✔Direct loss Items that are paid on replacement cost is defined as the - ✔✔Amount to replace the damage property without a deduction for depreciation A wrongful act other than a crime or breach of contrat is law - ✔✔Tort law The amount to replace property with like property of the same quality and construction is the - ✔✔Replacement cost Whatis the process whereby insurers decides which customers to insure and what coverage to offer - ✔✔Underwriting The amount paid for damaged propertywhich is equal to the price for which it could have been sold is called - ✔✔Market value A policy may not be transferred to another without - ✔✔Written consent of the insured An insured's loss reserve for a claim is - ✔✔An estimate or the amount that the insurer will pay What is the type of loss exposre that would include land and property attached to it - ✔✔Liability loss exposure What type of policy protect against loss from any peril except those that are specifally excluded - ✔✔Allrisk or open peril Who is considered the first party to an insurance contract - ✔✔The insured A written provision that modifies the provisions of the original contracts is know as - ✔✔An endrorsment In a commericial property the insurance claim is deniend because of the insured action's. the mortgage holder will in most cases., - ✔✔Still have right to receive the full amount of the loss a payment Named insured on a commercial insurance policy is "sam stone and dan Sullivan DBA S&S bar and grill" if the insurer cancels the policy, they are required to mail or deliver written notice to - ✔✔Only san stone Which type of exposure can be best be defined as a condition or situation for any exposure or finanicial loss is presented to an individual or family by such cause as injurydisability, death or sickness - ✔✔Personal loss exposure What is the primary reason for co-insurance clauses in property polices - ✔✔to encourage insurd's to purchase coverages near the value of the property the state laws that regulate insurer practice regarding underwriting sales, rate-making, and claims handling are called, - ✔✔market conduct regulation a common fourmula that is used to establish cash value is - ✔✔ACV=replacement cost minus depreciation The possibility of financial loss resulting from the ownership of property is know as - ✔✔Insurable interest Which of the following types of loss would result in a claim for monertary damages due to injury to another or damage to another's property - ✔✔Liability loss Which of the following coverage's is a property insurance coverage. - ✔✔Other collision exclusive agents - ✔✔generally represent only one insurer in an unendorsed claims-made general liability policyhow long does an insured have to report a claim which occurred during the policy perio - ✔✔60 days To determine the fact actual cash value of commercial bulding for coinsurance purposes uses - ✔✔Fair market value What causes is commony used to require's purchase insurance close to the value of the property - ✔✔Coinsurance clause A distinct feature of the alternative funding method know as self-funding is - ✔✔The benefits are tailored to the group Actual cash value is defined as the - ✔✔The amount to replace damage property minus depreciation Which of the following would be know as the process whereby an insurer determine appropriate changes for its policies - ✔✔Rate-making All of the following would be considered benefits of insurance EXCEPT - ✔✔Retention of the loss by the insured What is the formula for actual cash value (ACV) in determinig loss values - ✔✔Replacement cost less depreciation Which of the followingwould be classified as a property insurance coverage - ✔✔Other-than-collision coverage Which of the following is the reason that an insured should not be making any kind of profit as the result of an insurance claim/loss being paidbut rather, the payment should restore the insured to the financial status that existed prior to the loss with no chance of any type of profit., - ✔✔Basic principle of insurance What is the effect of "concurrent causation" exclusion under the "cause of loss-broad form in a commercial property policy? - ✔✔If there is a loss resulting from two or more perils that occur at the same time to cause a loss then is no coverage is any of the perils are excluded What will the mortgage holder do in the event that an insurer does not pay claim as the result of the actions of the insured - ✔✔Receive full payment for the loss, if the required premium has been paid What exactly does a policy know as "open peril" protect against - ✔✔Perils not specially named as exclusions in the policy What does a "pure risk" consist of ? - ✔✔The chance of loss only The term "proximate clause " is best defined by which of the following? - ✔✔A negligent act that causes bodily injury or property damge that follows a sequence of uninterrupted, but related chains of events Why would an employer be held legally liab;e for the negligent operation by employee who is driving a vehicle on belhalf of the employer and cause an injury to a pedestrian - ✔✔The principle of vicarious liability How would a "peril" best be defined? - ✔✔Reason for the loss event that leads up to loss Which of the following combinations of characteristics should be considered when making a an insurance recommendation to a propective insured that has just purchased a new office building? - ✔✔The structure that is exposed a loss, the perils that may occur, consequently causing a loss possible financial impact of loss What type of insurance company is owned by individuals that are stockholder in the company; and share in the profits of the company? - ✔✔Stock insurance companies All of the following explain the characterics that are unique to insurance contracts EXCEPT - ✔✔There is an equal exchange of amounts or values within the contract With regards to insurance applicability the word "risk" can be best defined as which of the following? - ✔✔The uncertainty associated with a loss occurring All of the following insurance company are private insurers; EXCEPT - ✔✔Fraternal insurance company What would be the reason(s) for $100 deductible versus a $1000 deductible - ✔✔Neither of these apply An indivual who loves next to nuclear power plant is exposed to which of the following types of hazard - ✔✔Physical Which of these is defined as "exclusive agent' - ✔✔Sells for one insurance company and only that company's products. The concept of "pure risk" involves the possibitly of chance of which of the following? - ✔✔A loss only An employee is operating their own car for their employer. The individual injures a person in a area as result of negligent drivng. The reson why the employer would be held liable is because of which of the following? - ✔✔Vicarious liability Which of the following coverages' does an open peril policy provide? - ✔✔Perils other than those specifically named as being excluded "risk" is one of the most important terms in the insurance industry. How is it defined - ✔✔the uncertainty of a loss what would be the result of a lower(250) deductible vs. the selection of a higher deductible ($1000) - ✔✔greater number of smaller claims sent to the insurer of the following which is true characteristic about insurance - ✔✔it is considered a method of transferring risk the amount paid for property damage which is equal to price for which it could have sold is - ✔✔market value which of the following is the best definition of an insurer's loss reserve - ✔✔the approximate dollar amount of an insurer's liability of at least one (or more)open claims for any type of risk exposure to be considered an ideally insurable riskwhich of the following characteristics does not have to exist , there is very little - ✔✔if any chance a loss happening during the policy period during the application process for a personal auto policy. the applicant says that he has not had any tickets or accidents. The insurance company accepts the risk and issues the policy. Shortyly after. the insured's vehicle is stolen resulting in the insurer paying the loss and canceling the policy. This despite the fact that they found out that the insured had received several traffic tickets that he neglected to mention. What is the reason for the course of action of the insurer - ✔✔the traffic tickets that were not disclosed were not material. This is why the policy was not recinded and the claim was paid under California insurance code marketing department is responsible for all of the following; except - ✔✔bulk mailing A representation as to the past - ✔✔present or future is an ,verified promise When must insurance records for insurance agents and insurance broker be made available to the insurance commissioner? - ✔✔all times When may a representation be withdrawn? - ✔✔only before the insurance is in effect RW and associates is an agency which represents BLG insuaracne corporation. RW and associates may leave the name BLG insurance corporation in its advetertisments by clearly stating the relationship between the two business in any of the following ways ; EXCEPT - ✔✔RW And Associates underwriting for Blg insurance Corporation Which of the following describes an insurer who has enough financial resources only to provide for all its liabilities and for all reinsurance of all outstanding risk? - ✔✔insolvent Represention as to the future is considered which of the following - ✔✔promise An insurer that has a certificate of authority in California is - ✔✔amitted The execution of a policy involes which of the following? - ✔✔signing a covering note The negotiation of a policy involes which of the following - ✔✔sending the propect an email suggesting that they buy a certain type of policy An applicant of insurance does not reveal information that the insurer would rely upon to issue the policy this is/an - ✔✔consealment The method that the California DOI uses to approve or disapprove rate filing for various types of insurance such as homeowners and automobile is know as? - ✔✔prior approval method An organization will cease too exsit as an entity eliglble to hold a liceense for all of the following reasons EXCEPT - ✔✔termination of key employee All of the following are areas that market regulation cover EXCEPT - ✔✔Employee training Which of the following statement is true regading insurer with admitted status in California? - ✔✔they may not use race color, religion, or national origin as condition to use higher rate All of the following are requirements for a notice by mail to an insured by an insurer EXCEPT - ✔✔notice must be sent with return receipt reuired What is one the main factors that the insuruce commissioner uses while detereming whether a rate excessive or unfairly discriminatory? - ✔✔wheter the rate mathematically reflects the insurance company's investment income An agent who divert/comingles premium dollars for the agents's own use is guilty of - ✔✔theft Every admitted insurer in the state of California is required to maintain a unit or division to investigate which of the following? - ✔✔possible fraudulent claims made by insured's What will happen when an agent's appointment to an insurance company is terminated and the agent has no other appointment with any other insurance company? - ✔✔The agent's permanent license becomes inactive The CA insurance code requires property insurance polices specify all of the following EXCEPT - ✔✔the insured address What steps need to taken to terminate a licensee's license that is in the possession of an employer? - ✔✔the licensee needs to give written notice of intent to the insurance [Show More]

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