Maryland Property and Casualty Insurance Practice Test

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• Which entity pays claims and protects policyowners when an insurer fails?
• Which type of claim would be covered by the Maryland Property and Casualty Insurance Guaranty Corporation?
• Which party does not play a role in nonrenewal?
• Who has the authority to inspect bail bond records kept by surety agents?
• A repair facility used after-market parts in the repair of a customer's automobile, and did not notify the customer of this. Which statement is true?
• Which party typically earns a commission on an insurance policy sale?
• Which coverage pays defense costs in liability claims?
• When a surety insurer terminates the appointment of a surety agent, who must be notified immediately?
• What is a premium finance company?
• Binder ceases at the earliest of which events?
• When an insurer in Maryland begins using new rates for the largest corporation, which statements could apply?
• Which program backs flood insurance policies in the United States?
• Which agency regulates P&C in Maryland and handles disciplinary actions?
• In Maryland, to sell flood insurance, a property and casualty insurer must participate in which program?
• J retake earliest March 15.
• Which combination of elements is generally required to form a legally binding insurance contract?
• The Property and Casualty Guaranty Corporation covers claims within what amount range?
• In Maryland dwelling policies, which statement correctly describes DP-1, DP-2, and DP-3?
• An employer may satisfy workers' compensation insurance on their employees by all of the following methods, EXCEPT
• Which statement about a Public Adjuster is correct?
• In Maryland, all vehicle insurance policies must provide coverage for medical, hospital and disability benefits unless waived by whom?
• What is the minimum Maryland auto liability coverage for bodily injury per person, per accident, and property damage?
• All of the following are true of renewal premium obligations EXCEPT
• Surety agents must maintain records of bail bonds; these records must be available for inspection by the Commissioner for at least how long after termination of the surety liability?
• What is the one exception to the rule that forms must be submitted in duplicate?
• Which statement about rebates is true?
• What is an earthquake endorsement on a homeowners policy?
• What is the purpose of a deductible in property insurance?
• In a Maryland homeowners policy, Section B covers which type of property?
• All of the following are EXCLUDED by PIP coverage EXCEPT which scenario?
• In a Maryland homeowners policy, which sections cover the dwelling and other structures?
• Which statement about auto medical benefits in Maryland is true?
• During a sales presentation, a producer intentionally makes a statement that may mislead the applicant. This describes which term?
• If an applicant fails the written insurance licensing examination, how many days must pass before the next allowed examination?
• Public adjusters are compensated by which party?
• Binders can be issued for a period not to exceed
• Which statement about Actual Cash Value (ACV) is true?
• Actual Cash Value reflects depreciation in loss settlements when the policy uses ACV. Which statement is accurate?
• What does the 'other insurance' provision do?
• Which statement best describes a fiduciary duty held by a producer?
• A cancellation notice for a workers' compensation policy must include which item?
• In Maryland, which entity administers the bond requirement for surplus lines brokers?
• Which statement about auto liability coverage is true?
• All of the following would be eligible to apply for coverage in the Maryland Automobile Insurance Fund, EXCEPT:
• In Maryland, which individuals must be licensed to engage in insurance transactions?
• The Property and Casualty Guaranty Corporation pays the full amount of any claim between $100 and $300,000 if the claim occurs within what period after insolvency?
• What role does the Maryland Insurance Administration play in P&C regulation?
• In a DP-3 policy, which statement is true about coverage?
• Name an additional coverage commonly included in homeowners policies for debris removal.
• Failure to disclose the use of aftermarket parts in a repair could be considered what?
• Which of the following is not typically covered under a standard homeowners policy without endorsements?
• Who bears the duty to mitigate damages after a loss?
• Which statement best describes how insurers handle cancellation and nonrenewal notices?
• What term describes the mutual waiver of licensing requirements between states?
• What does 'loss of use' coverage reimburse?
• Which practices are prohibited by unfair claims practices regulations?
• Which authority can legally suspend an insurance license in Maryland?
• In policy terms, what does valuation of personal property consider?
• Which of the following is NOT required for Kristin to become a Maryland insurance producer?
• Fidelity or Crime coverage protects against losses due to what?
• Which statement about transferring continuing education credits to the next reporting period is correct?
• Which of the following would NOT be considered a flood?
• An insurance advisor candidate must post a single security bond to qualify. How much must they post?
• Which of the following would receive a commission from the sale of a policy?
• Which of the following is NOT a required qualification for a business entity under Maryland insurance rules?
• How do misrepresentation and concealment affect policy validity?
• First-party medical payments coverage in auto insurance pays for medical expenses of whom?
• Which action demonstrates a producer attempting to obtain MAIF authority?
• Collision coverage extends to rented passenger vehicles that have been rented for no more than how many days?
• If an insurer charges different premium rate and limits coverage for an applicant based on partial blindness, the insurer may be found guilty of?
• Replacement Cost Value pays for which outcome after a loss?
• What is Additional Living Expenses (ALE) coverage?
• If a policyholder has taken 5 more continuing education credit hours than he will need for this reporting period, how many of these hours can be transferred to the next reporting period?
• Which statement about transferring continuing education credits to the next reporting period is correct?
• Which of the following best describes supplementary payments in liability coverage?
• Circulating deceptive sales material to the public is an example of which Unfair Trade Practice?
• Before a producer can receive authority to place business with MAIF, the following actions are required, EXCEPT which?
• What is the maximum deductible on collision coverage for damage to the insured auto?
• An applicant for an insurance license has failed his written examination. How many days must he wait before we can take another examination?
• When a Maryland insurer changes rates for the largest corporation in the state, which statements could apply?
• Which is a common exclusion in standard homeowners policies?
• Which action would authorize commingling of premiums with the agent's personal funds?
• Which statement correctly describes auto liability versus medical payments (MedPay) coverage?
• The entity that pays covered claims and helps prevent financial losses to claimants and policyowners when an insurance company becomes insolvent is
• Which statement best describes Replacement Cost Value (RCV) in a property policy?
• Surplus lines brokers are required to post a surety bond with which entity?
• Which of the following is an example of a producer being involved in an unfair trade practice of rebating?
• Which party is typically required to file a sworn proof of loss after a covered loss?
• Why might a Fidelity or Crime coverage be included in a P&C exam?
• What happens if an insured materially misrepresents information on an application or claim?
• Insurance companies in Maryland must submit forms to the Insurance Commissioner in duplicate. What is the one exception to this rule?
• What is the license renewal period in this state?
• How often must the Maryland Commissioner examine domestic insurers?
• A Maryland Life/Health licensee specializing in long-term care must complete continuing education of 24 hours every two years, including how many hours of long-term care and how many hours of ethics?
• A repair facility using after-market parts in the repair of a customer’s automobile without notifying the customer has engaged in which of the following?
• Surplus lines brokers must post a surety bond with which entity in Maryland at a minimum amount?
• Public adjusters' fees are typically paid by which party?
• In homeowners or property policies, earthquake endorsements are typically subject to what?
• Which of the following is an example of a producer's fiduciary responsibilities?
• Advertising injury in liability policies typically covers?
• Under Maryland law, charging different rates or limiting coverage based on partial blindness constitutes what?
• When is an appraisal clause used in property loss disputes?
• What does Section II (personal liability) of a homeowners policy cover?
• Public adjusters represent which party in a claim?
• What does medical payments coverage pay for?
• In a property loss claim, what is salvage?
• What is the insurer's duty to defend in liability coverage?
• If private auto insurers will not issue coverage, which program provides auto liability coverage?
• Which statement correctly defines 'competent parties' in an insurance contract?
• The Maryland flood insurance program is administered through which arrangement?
• Which of the following is NOT required for license reinstatement?
• Which of the following would be considered an insurance transaction EXCEPT?
• In a policy with split limits for Employers Liability, the first limit refers to Injury by accident. Which option correctly reflects this statement?
• Willful violations of Maryland insurance laws are considered?
• Which statement correctly defines a proof of loss and its timing?
• PIP coverage in Maryland includes protection for injuries to which group?
• What is coinsurance and how does it affect claim payments when coverage is below the required value?
• What is the purpose of Uninsured/Underinsured Motorist coverage?
• A binder in Maryland will cease to exist in each of the following situations EXCEPT
• Loss assessment coverage in homeowners policies provides coverage for assessments charged by which entity?
• An insurer in Maryland is going to begin using new rates for the largest corporation in Maryland. Which of the following statements apply to this situation?
• Which statement about open-peril coverage is most accurate?
• Under HO-3, personal property coverage is typically on what basis?
• Which action best illustrates a producer's fiduciary duty regarding premiums?
• Which items are typically included under a Scheduled Personal Property Endorsement?
• The Employers Liability maximum for all claims?
• How does Actual Cash Value differ from Replacement Cost Value in a property policy?
• After a client leaves the agent's office, the agent corrects the client's application but fails to inform the client. The client is involved in an accident two weeks later and the insurer uses the corrected form. This is
• Which of the following would be considered false advertising?
• If a dwelling is insured for 60% of its replacement cost, how is the payout calculated?
• What is one key duty an insured must perform after a loss?
• Loss assessment coverage specifically insures assessments charged by a homeowners association for which type of losses?
• Which of the following is NOT a required step when cancelling or nonrenewing lead liability insurance coverage?
• How does a Scheduled Personal Property Endorsement affect coverage for valuables?
• What is the purpose of a Scheduled Personal Property Endorsement?
• Which of the following would be considered illegal inducements EXCEPT?
• If an insurer decides to nonrenew a policy, the insured must be notified by mail at least how many days in advance?
• Which agency issues Maryland insurance producer licenses?
• Public adjusters represent
• Using after-market parts without informing the customer is considered what?
• Define subrogation in the context of property insurance.
• At the time of loss, insurable interest requires which of the following?
• Your property policy will be due for renewal soon. When should you expect to receive notice of renewal premium from your insurer?
• How does the 80% coinsurance rule influence settlement for a dwelling?
• For continuing education, how many hours of ethics are required?
• If a man receives a binder for property insurance today, what is the maximum amount of time that the binder could be effective?
• Upon termination of a surety agent's appointment, which parties must be notified?
• All of the following are true regarding rebates EXCEPT which statement?
• Loss of use coverage may reimburse which of the following types of expenses?
• PIP (personal injury protection) provides coverage for injury to the named insured, resident relatives and
• A binder for property insurance is a temporary coverage document. How long can it remain in force in Maryland?
• What are the two common valuation methods used for property loss settlements?
• Open-peril coverage for the dwelling means which of the following?
• When an insurer desires to cancel or non-renew a property insurance policy, they must give advance written notice of how many days?
• Which of the following describes notice required for property policy cancellation or non-renewal?
• What does a builders risk endorsement cover?
• Which of the following best describes the unfair trade practice of defamation?
• Binders cease at the earliest of which of the following?
• Open endorsement or 'open perils' endorsement expands coverage how?
• Which term best describes mutual waivers of licensing exams between states?
• What term describes the waiver of certain examination requirements when another state would waive those requirements for licensure in Maryland?
• How often does the Maryland Commissioner require domestic insurers to be examined?
• An insurance producer is required to notify the Commissioner of any felony convictions within how many days of the conviction?
• If an individual is unable to purchase auto liability insurance from private insurers, which entity may provide coverage?
• Which statement best describes Section II in a homeowners policy?
• If an insurer nonrenews a property policy because of geographic risk, how many days before the nonrenewal must the Commissioner be notified?
• What is the purpose of a mortgagee clause in a property policy?
• What is the maximum deductible amount for collision coverage on an insured auto?
• In Maryland's Employers Liability with split limits, the first limit shown represents the maximum the insurer will pay for all claims for which of the following?
• In Maryland, how often must producer licenses be renewed?
• In a scenario with multiple employees filing suits for the same cause, the Employers Liability policy provides up to how much aggregate coverage?
• If a licensee intentionally violates the Insurance Code, what is the maximum monetary penalty?
• What is a typical notice period for cancellation by the insurer due to nonpayment or other reasons?
• Which item is NOT required for license reinstatement?
• Who do public adjusters represent?
• Surplus lines brokers are required to post a surety bond in Maryland in an amount of at least how much?
• What endorsements allow you to add an additional insured or mortgagee as a party to the policy?
• Which statement about misrepresentation is correct?
• Actual Cash Value is best described as which of the following?
• A broker requests a hearing with the Commissioner. Within how many days must the hearing be held?
• In auto insurance, what is first-party medical payments coverage?
• What is the main difference between HO-3 and HO-2 policies?
• An insurer or producer may NOT knowingly employ a fiduciary who has been convicted of a felony or crime of moral turpitude within how many years prior to the employment?
• In Maryland, the two-year continuing education requirement for license renewal is 24 hours. Which option lists the correct hours?
• Which situation will NOT cause a binder to cease to exist?
• How many continuing education hours must be completed in a two-year period for Maryland license renewal?
• Which entity pays covered claims and helps prevent financial losses to claimants and policyowners when an insurer becomes insolvent?
• Illegal inducements EXCEPT
• Who must approve rate changes for non-competitive types of insurance?
• Which statement about renewal notices is false?
• What is flood insurance and when is it typically required?