Insurance MCQ

Which statement is false regarding the National Flood Insurance Program (NFIP)? a. It provides coverage for direct and indirect loss to covered property as the result of flooding b. Coverage includes the increased cost of compliance with flood plain management ordinances c. The Emergency Program applies after a community has agreed to, but has not yet completed, the process to adopt flood control measures d. The Regular Program allows coverage on a single family dwelling up to $250,000 Answer: a. It provides coverage for direct and indirect loss to covered property as the result of flooding

All of the following statements regarding flood insurance are true, except: a. Communities in the earliest stage of participation in the NFIP are in the Emergency Program b. The policy applies a deductible only to loss of contents c. Coverage is available from participating private insurers and directly from the NFIP d. Protection is provided to property that is on normally dry land Answer: b. The policy applies a deductible only to loss of contents

What coverage is not included under the Boatowners Policy? a. Hull b. Property Coverage c. Medical Payments d. Personal Property Coverage Answer: d. Personal Property Coverage

What coverage is not included under the Yacht policy? a. Personal Injury Coverage b. Protection and Indemnity c. Personal Property coverage d. Towing Answer: a. Personal Injury Coverage

The Personal Articles Floater is used to do which of the following? a. Provide replacement cost coverage on personal property b. Insure individual personal property on a scheduled basis c. Replace Coverage B of the Homeowners Policy d. Insure personal property on a blanket basis Answer: b. Insure individual personal property on a scheduled basis

All of the following types of property may be covered by a Personal Articles Floater, except: a. Stamps b. Buildings c. Jewelry d. Golf equipment Answer: b. Buildings

The intent of insuring under the Personal Effects Floater is: a. To insure hard-to-value property like fine art or heirlooms b. To provide coverage for property kept at the home c. To provide coverage worldwide for travelers d. To insure personal property on a scheduled basis Answer: c. To provide coverage worldwide for travelers

Under a Mobile Home policy, if the mobile home is insured under Coverage A for $70,000, how much coverage would ordinarily apply to personal property under Coverage C? a. $35,000 b. $42,000 c. $30,000 d. $28,000 Answer: d. $28,000

A Mobile Home Insurance Policy is most similar to: a. A Travel Trailer policy b. An Auto policy c. A Homeowners Policy d. A Tenants policy Answer: c. A Homeowners Policy

Fine arts and antiques are classes of property insured on a: a. Market value basis b. Valued basis c. Actual cash basis d. Replacement cost basis Answer: b. Valued basis

Which of the following is not true about the FAIR plan? a. FAIR means Fair Access to Insurance Requirements b. It provides property coverage to both residential and farm dwellings c. It provides basic property coverage to those who have been rejected in the standard market d. Agents cannot bind FAIR plan coverage Answer: b. It provides property coverage to both residential and farm dwellings

Umbrella policies provide coverage on which basis? a. Excess b. Aggregate c. Primary d. Open perils Answer: a. Excess

If property under a Personal Floater risk is insured at a $5,000 valued basis, how much would the insured receive if the item is a total loss, the actual cash value is $4,000, and an auction is selling the same item for $3,500? a. $3,500 b. $4,000 c. $4,000 less the deductible d. $5,000 Answer: d. $5,000

All of the following are true of the Personal Jewelry Floater, except: a. It has a 60-day automatic coverage for newly acquired items b. It has a Pair and Sets Clause c. Appraisal is usually mandatory d. It can be written on a valued basis Answer: a. It has a 60-day automatic coverage for newly acquired items

The National Flood Policy defines all of the following as floods, except: a. Leakage of underground water systems b. Overflow of inland or tidal waters c. Mudflow caused by accumulation of water d. Unusual and rapid accumulation or runoff of surface water Answer: a. Leakage of underground water systems

A flood damages a home that is in a community in early stages of participation in NFIP, but are not yet considered a participating community. What is the maximum a resident may receive for damages to personal property? a. Coverage C on the homeowners policy b. Nothing since they are not participating yet c. $10,000 d. $100,000 Answer: c. $10,000

The Personal Articles Floater is similar to which of the following endorsements? a. The Special Personal Property Endorsement b. The Guaranteed Replacement Cost Endorsement c. The Scheduled Personal Property Endorsement d. The Personal Property - Replacement Cost Endorsement Answer: c. The Scheduled Personal Property Endorsement

Which Statement is true regarding a Difference In Conditions Policy? a. There is no standard form b. There is always a coinsurance clause c. The standard deductible is $250 d. There is a pro rata clause Answer: a. There is no standard form

Which of the following is covered by Crop Hail insurance? a. Non-visible crops b. Failure to harvest a mature crop c. Non owned property (shared crop) d. Damage caused by freezing, drought, insects and disease Answer: d. Damage caused by freezing, drought, insects and disease

How is Mobile Home insurance written? a. By writing a separate Mobile Homeowners Policy only b. By adding a Mobile Home Endorsement to a Homeowners Policy only c. Either by writing a separate Mobile Homeowners Policy or by adding an endorsement to a Homeowners Policy d. Mobile homes cannot be covered Answer: c. Either by writing a separate Mobile Homeowners Policy or by adding an endorsement to a Homeowners Policy