Question 1

The advisability of rain insurance depends on the promoter's estimate of

Accepted Answer

A)  the size of the crowd, 
B)  the effect of rain on the crowd, 
C)  the time of day of the event. 
A)  the size of the crowd, 
B)  the effect of rain on the crowd, 
C)  the time of day of the event. B

Question 2

A reporting form is one in which the insured reports to the insurer each loss as it occurs.

Accepted Answer

A) True 
 B)False  False

Question 3

A consequential loss contract is usually written as an endorsement to a direct peril contract.

Accepted Answer

A) True 
 B)False  True

Question 4

Use and occupancy insurance in the boiler and machinery contract is most similar to

Accepted Answer

A)  business income insurance, 
B)  expenses-to-reduce-loss insurance, 
C)  extra-expense insurance, 
D)  profits and commissions insurance, 
E)  none of these. 
A)  business income insurance, 
B)  expenses-to-reduce-loss insurance, 
C)  extra-expense insurance, 
D)  profits and commissions insurance, 
E)  none of these.

Question 5

There would be no recovery under a business income policy unless it could be demonstrated that the firm would have earned a profit during the period of interruption by an insured peril.

Accepted Answer

A) True 
 B)False

Question 6

Temperature damage insurance is important for the owner of a greenhouse.

Accepted Answer

A) True 
 B)False

Question 7

Rain insurance can be written on a valued basis as well as on a contract of indemnity.

Accepted Answer

A) True 
 B)False

Question 8

The limit of liability in a boiler and machinery policy applies to each coverage division on an independent basis.

Accepted Answer

A) True 
 B)False

Question 9

Accounts receivable insurance covers the loss stemming from lenient credit policies.

Accepted Answer

A) True 
 B)False

Question 10

Match the descriptions with their terms:
-________________ is the BPP option that covers fire, lightning, explosions, windstorm and hail, smoke, riot or civil commotion, vandalism, sprinkler linkage, sinkhole collapse, and volcanic action.

Accepted Answer

A)  agreed amount clause 
B)  Basic form 
C)  Boiler and machinery insurance 
D)  broad form 
E)  Business income
F) consequential damage endorsement
G) consequential losses
H) Contracts without time element
I) extended-period-of-indemnity endorsement
J) maximum period of indemnity
K) scheduled coverage
L) special form
M) Time-element contracts 
A)  agreed amount clause 
B)  Basic form 
C)  Boiler and machinery insurance 
D)  broad form 
E)  Business income
F) consequential damage endorsement
G) consequential losses
H) Contracts without time element
I) extended-period-of-indemnity endorsement
J) maximum period of indemnity
K) scheduled coverage
L) special form
M) Time-element contracts

Question 11

Actual total loss occurs when the property is completely destroyed.

Accepted Answer

A) True 
 B)False

Question 12

In boiler and machinery insurance, the portion of premium used for inspection services is approximately

Accepted Answer

A)  1/8, 
B)  1/4, 
C)  3/8. 
A)  1/8, 
B)  1/4, 
C)  3/8.

Question 13

The business owner's program has a mandatory

Accepted Answer

A)  80 percent coinsurance clause, 
B)  0 percent coinsurance clause, 
C)  90 percent coinsurance clause. 
A)  80 percent coinsurance clause, 
B)  0 percent coinsurance clause, 
C)  90 percent coinsurance clause.

Question 14

Match the descriptions with their terms:
-When property at two or more locations is specifically listed in an insurance contract, it is called _________________.

Accepted Answer

A)  agreed amount clause 
B)  Basic form 
C)  Boiler and machinery insurance 
D)  broad form 
E)  Business income
F) consequential damage endorsement
G) consequential losses
H) Contracts without time element
I) extended-period-of-indemnity endorsement
J) maximum period of indemnity
K) scheduled coverage
L) special form
M) Time-element contracts 
A)  agreed amount clause 
B)  Basic form 
C)  Boiler and machinery insurance 
D)  broad form 
E)  Business income
F) consequential damage endorsement
G) consequential losses
H) Contracts without time element
I) extended-period-of-indemnity endorsement
J) maximum period of indemnity
K) scheduled coverage
L) special form
M) Time-element contracts

Question 15

Match the descriptions with their terms:
-A/An _________________ is an endorsement that substitutes a dollar amount for the coinsurance percentage with respect to insurance to value provisions in a property insurance contract.

Accepted Answer

A)  agreed amount clause 
B)  Basic form 
C)  Boiler and machinery insurance 
D)  broad form 
E)  Business income
F) consequential damage endorsement
G) consequential losses
H) Contracts without time element
I) extended-period-of-indemnity endorsement
J) maximum period of indemnity
K) scheduled coverage
L) special form
M) Time-element contracts 
A)  agreed amount clause 
B)  Basic form 
C)  Boiler and machinery insurance 
D)  broad form 
E)  Business income
F) consequential damage endorsement
G) consequential losses
H) Contracts without time element
I) extended-period-of-indemnity endorsement
J) maximum period of indemnity
K) scheduled coverage
L) special form
M) Time-element contracts

Question 16

Seasonal variations do not generally affect business income insurance recoveries.

Accepted Answer

A) True 
 B)False

Question 17

Extra expense covers loss incurred during the time that a piece of machinery has been put out of commission by a described accident.

Accepted Answer

A) True 
 B)False

Question 18

Leasehold interest insurance covers loss of rental income to a landlord when its property is damaged by a covered loss.

Accepted Answer

A) True 
 B)False

Question 19

A strike on the premises during reconstruction will extend the indemnity period of a business interruption policy.

Accepted Answer

A) True 
 B)False

Question 20

Match the descriptions with their terms:
-_________________ measure an indirect loss in terms of so many dollars per unit of time that passes until the subject matter can be restored.

Accepted Answer

A)  agreed amount clause 
B)  Basic form 
C)  Boiler and machinery insurance 
D)  broad form 
E)  Business income
F) consequential damage endorsement
G) consequential losses
H) Contracts without time element
I) extended-period-of-indemnity endorsement
J) maximum period of indemnity
K) scheduled coverage
L) special form
M) Time-element contracts 
A)  agreed amount clause 
B)  Basic form 
C)  Boiler and machinery insurance 
D)  broad form 
E)  Business income
F) consequential damage endorsement
G) consequential losses
H) Contracts without time element
I) extended-period-of-indemnity endorsement
J) maximum period of indemnity
K) scheduled coverage
L) special form
M) Time-element contracts

Exam 9: Risk Management and Commercial Propertypart I

The advisability of rain insurance depends on the promoter's estimate of

A reporting form is one in which the insured reports to the insurer each loss as it occurs.

A consequential loss contract is usually written as an endorsement to a direct peril contract.

Use and occupancy insurance in the boiler and machinery contract is most similar to

There would be no recovery under a business income policy unless it could be demonstrated that the firm would have earned a profit during the period of interruption by an insured peril.

Temperature damage insurance is important for the owner of a greenhouse.

Rain insurance can be written on a valued basis as well as on a contract of indemnity.

The limit of liability in a boiler and machinery policy applies to each coverage division on an independent basis.

Accounts receivable insurance covers the loss stemming from lenient credit policies.

Match the descriptions with their terms: -________________ is the BPP option that covers fire, lightning, explosions, windstorm and hail, smoke, riot or civil commotion, vandalism, sprinkler linkage, sinkhole collapse, and volcanic action.

Actual total loss occurs when the property is completely destroyed.

In boiler and machinery insurance, the portion of premium used for inspection services is approximately

The business owner's program has a mandatory

Match the descriptions with their terms: -When property at two or more locations is specifically listed in an insurance contract, it is called _________________.

Match the descriptions with their terms: -A/An _________________ is an endorsement that substitutes a dollar amount for the coinsurance percentage with respect to insurance to value provisions in a property insurance contract.

Seasonal variations do not generally affect business income insurance recoveries.

Extra expense covers loss incurred during the time that a piece of machinery has been put out of commission by a described accident.

Leasehold interest insurance covers loss of rental income to a landlord when its property is damaged by a covered loss.

A strike on the premises during reconstruction will extend the indemnity period of a business interruption policy.

Match the descriptions with their terms: -_________________ measure an indirect loss in terms of so many dollars per unit of time that passes until the subject matter can be restored.

Introduction to Risk

Risk Identification and Evaluation

Property and Liability Loss Exposures

Life, Health, and Loss of Income Exposures

Risk Management Techniques: Noninsurance Methods

Insurance As a Risk Management Technique: Principles

Insurance As a Risk Management Technique: Policy Provisions

Selecting and Implementing Risk Management Techniques

Risk Management and Commercial Propertypart II

Risk Management and Commercial Liability Risk

Workers Compensation and Alternative Risk Financing

Risk Management for Auto Ownerspart I

Risk Management for Auto Ownerspart II

Risk Management for Homeowners

Loss of Life

Loss of Health

Retirement Planning and Annuities

Employee Benefits: Life and Health Benefits

Employee Benefits: Retirement Plans

Financial and Estate Planning

Risk Management and the Insurance Industry

Functions and Organization of Insurers

Government Regulation of Risk Management and Insurance

Filters