Insurance Policies and Coverage Flashcards
7 cards from real CCA practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 Insurance Policies and Coverage flashcards as text
A 'manuscript policy' in commercial insurance refers to:
Answer: A custom-drafted policy negotiated specifically for a particular insured's unique exposures
A manuscript policy is individually negotiated and drafted to address the specific, often complex or unusual, coverage needs of a large commercial insured rather than using standard ISO forms.
Under a personal auto policy (PAP), the 'uninsured motorist' (UM) coverage pays for the insured's damages when:
Answer: The at-fault driver has no liability insurance or flees the scene (hit-and-run)
UM coverage steps in to compensate the insured for bodily injury (and sometimes property damage) caused by a driver who carries no liability insurance or cannot be identified.
Which of the following best describes 'inland marine' insurance?
Answer: Coverage for property in transit over land or property with unique mobility or communication functions
Inland marine insurance covers moveable property, property in transit by land, and specialized property (cameras, fine arts, contractor's equipment) that does not fit standard property forms.
A 'cancellation' provision in a property policy typically requires the insurer to give the insured how many days' notice for mid-term cancellation due to nonpayment of premium?
Answer: 10 days
Most states and standard policy forms require a minimum of 10 days' notice for cancellation due to nonpayment of premium, while other cancellation reasons typically require 30 days' notice.
An 'occurrence' under a CGL policy is best defined as:
Answer: An accident, including continuous or repeated exposure to conditions, that results in bodily injury or property damage
The CGL policy defines 'occurrence' broadly to include not just sudden accidents but also ongoing exposure to harmful conditions, ensuring long-tail claims (like pollution or asbestos) can be covered.
The 'declarations page' of an insurance policy is important to adjusters because it:
Answer: Identifies the named insured, policy period, covered property/risks, limits, and premium
The declarations page is the policy's summary sheet, providing the key identifying and quantifying information an adjuster needs to confirm coverage at the outset of a claim.
A 'liberalization clause' in an insurance policy provides that if the insurer broadens coverage without additional premium during the policy period:
Answer: The broader coverage automatically applies to existing policies in force
The liberalization clause ensures policyholders automatically benefit from mid-term coverage improvements the insurer makes to its standard forms without needing to endorse or renegotiate each policy.