Property and Casualty

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  1. Which of the following causes of loss would not be covered under a standard form BOP?

    A. Tornado

    B. Earth movement, power failure and flood

    C. Riot, sprinkler leakage, or sinkhole collapse

    D. Fire or lightning
  2. Under the examinations of books and records condition, the insurance company has the right to examine and audit the insured's book and records related to the policy

    A. During the policy period and for up to 3 years after the termination of the policy

    B. Only during the policy period

    C. During the policy period and for up to 5 years after the termination of the policy

    D. Only after the policy period
  3. Which of the following limits, shown in the declarations of a policy, applies to medical expenses?

    A. Per occurrence

    B. Per injury

    C. Per incident

    D. Per person
  4. Which of the following risks are eligible for coverage under a BOP?

    A. Banks

    B. Automobile dealers

    C. Bars and taverns

    D. Condiminums
  5. An insured is looking over his businessowners policy and wants to know exactly what "coverage territory" and mobile equipment" mean. He can find the definitions of these terms in the 

    A. Commercial coverage policy

    B. Business liability coverage form

    C. Copy of the application

    D. Common policy conditions
  6. Which of the following would be the insured's duty in the event of a loss according to the duties in even of occurrence, claim or suit condition?

    A. Providing specific details regarding the occurrence

    B. Delivering a claim to the insured in person

    C. Initiating the investigation of a claim

    D. Promptly notifying the insurer of a claim by phone
  7. All of the following statements are true regarding fire department service charge under the businessowners policy EXCEPT

    A. This coverage provides an additional $2,500 amount of insurance ($1,000 under '02)

    B. This coverage limit pays in place of the limit of insurance shown in the declarations

    C. This coverage limit is payable in addition to the limit of insurance shown in the declarations

    D. This coverage is not subject to any deductible
  8. Jean owns a craft store. The protective safeguards endorsement of her BOP requires the store to have a functional automatic sprinkler system. A winter storm freezes the pipes to the sprinkler system, causing it to shut down. How many hours does Jean have to restore the system before she must notify her insurer?

    A. 12 hours

    B. 24 hours

    C. 36 hours

    D. 48 hours
  9. Frank's Steaks furnishes meat to steakhouses. An accident on the premises causes the building to lose refrigeration for 32 hours. The state inspectors will not allow the meat in the refrigerating units to be sold for human consumption, and Frank loses $18,500 in disposing of the meat. What coverage under Frank's BOP will cover the loss?

    A. Protective safeguards

    B. Utility service - direct damage

    C. Utility service - time element

    D. Extra expense
  10. A BOP (businesowners policy) is most similar to

    A. Umbrella

    B. Cargo

    C. Homeowners

    D. Auto
  11. Which of the following is an example of a protective safeguard in a businessowners policy?

    A. Errors and omissions insurance

    B. Recordkeeping

    C. Professional liability endorsement

    D. Automatic sprinkler system
  12. Uncle Billy's Burger Bar was forced to close for 10 days in August when the power company's transformer was destroyed by lightning. and Uncle Billy was without electricity. Which of the following endorsements could be added to Billy's businessowners policy that would provide protection against loss of income from such events?

    A. Utility services - time element endorsement

    B. Utility services - direct damage endorsement

    C. Personal injury endorsement

    D. Protective safeguards endorsement
  13. For business income coverage, the waiting period that must occur before the period of restoration may begin is

    A. 30 hours

    B. 15 hours

    C. 45 hours

    D. 72 hours
  14. All of the following coverages are included in the BOP standard form without requesting coverage extensions, EXCEPT

    A. Debris Removal

    B. Outdoor property

    C. Preservation of Property

    D. Fire department service charge
  15. An advertising company has its annual holiday party for employees and customers, after which a customer who had to much to drink is involved in an automobile accident. Occupants of the other car involved in the accident sue the company for serving too much alcohol. Will the company's businessowners policy provide coverage?

    A. Yes, none of the exclusions apply

    B. Yes, employer liability obligates the company to pay

    C. No, accidents outside the company premises are not covered

    D. No, liquor liability is excluded
  16. Which endorsement adds coverage for employee use of automobiles in the insured's business and the insured's use of rented autos if no coverage is provided on a business auto policy?

    A. Hired and nonowned auto liability endorsement

    B. Substitute auto liability endorsement

    C. Newly acquired auto exposure liability endorsement

    D. Additional insured endorsements
  17. The most the insurer will pay for a loss under a business policy is

    A. The limit of insurance after the deductible is paid

    B. The amount of the loss minus the deductible

    C. 80% of the loss

    D. 20% of the loss
  18. The pollutant cleanup and removal coverage in the businessowners policy has a limit of 

    A. $5,000 in any 6 month period

    B. $20,000 in any 6 month period

    C. $10,000 in any 12 month period

    D. $2,500 in any 12 month period
  19. In addition to the common policy conditions, all the following apply to liability coverage EXCEPT

    A. Bankruptcy

    B. Financial responsibility laws

    C. Separation of insured

    D. Conditional lawsuit protection
  20. All of the following coverages are included in the BOP standard form without requesting coverage extensions, EXCEPT

    A. Debris removal

    B. Newly acquired or constructed property

    C. Pollutant cleanup and removal

    D. Civil authority
  21. An endorsement is available for hired and nonowened auto on BOP liability

    A. Only if the insured does not have commercial auto coverage

    B. In addition to commercial auto coverage

    C. Only if the insured has 4 or more employees

    D. Never
  22. Under the additional coverages of a BOP, property removed to protect it from loss will be covered at another location for up to

    A. 45 days

    B. 10 days

    C. 14 days

    D. 30 days
  23. Under a businessowners policy, the inspection and surveys condition specifies all of the following EXCEPT

    A. The insurer does not have the right to inspect the insured's property and operations

    B. The insurer does not make safety inspections of the insured 

    C. The insurer does not guarantee that conditions are safe or healthful

    D. The insurer does not guarantee that the insured is meeting all required safety regulations
  24. A business owners policy is 

    A. A monoline policy

    B. A self-contained complete package policy

    C. A special policy designed for large and small retail operations

    D. Part of a commercial package policy
  25. The liability coverage of the businessowners policy is written on a 

    A. Businessowners liability coverage form

    B. Policyowners liability coverage form

    C. Aggregate liability coverage form

    D. Homeowners liability coverage form
Card Set
Property and Casualty
Business Policy
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