Property & Casualty Flashcards

Johanna purchased a National Flood Insurance Policy 10 days after her community entered an emergency program. When her coverage be effective?

12:01 am the day after the application and premium payment are mailed.

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Which statements regarding insurable risks is not correct?
A. Insurance cannot be mandatory
B. The insurable risk needs to be statistically predictable
C. An insurable risk must involve a loss that is definite as to time, cause, place, and amount.
D. Insureds cannot be randomly selected

D. Insureds cannot be randomly selected

Getting insurance must not be mandatory, selecting insureds randomly will help the insurer to have a fair proportion of good risks to poor risks. All other statements are true.

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Producer A is prosecuted for a crime. He must notify the director within what time frame after the initial pretrial hearing date?

No later than 30 days

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The personal injury liability endorsement to a HO policy to all the following EXCEPT:
A. Slander
B. Invasion of privacy
C. False Arrest
D. A third party breaks a leg when the insured knocks him down

D. A third party breaks a leg when the insured knocks him down

The broken leg is covered by personal liability coverage.

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In the event of a claim under a commercial general liability policy, the insured has all of the following duties to the insurer EXCEPT:
A. Furnishing the insurer with copies of any demands, notices, or other legal papers received in connection with a claim or suit
B. Assisting the insurer upon request in the enforcement of any right against any person or organization that may be liable to the insured
C. Submitting to a medical exam when requested
D. Providing prompt written notice of any claim or suit actually filed against the insured

C. Submitting to a medical exam when requested

Under medical payments, the insured third party has to submit to an exam upon request, not the insured.

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Adverse selection is a concept best described as:

Risks with higher probability of loss seeking insurance more often than other risks.