General Practice Flashcards
7 cards from real P&C practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.
Read the first 7 General Practice flashcards as text
A contractor completes work on a building, and three months later a structural failure injures a tenant. Under a CGL policy, which coverage would respond to this claim?
Answer: Products and completed operations coverage
Products and completed operations coverage applies to bodily injury or property damage arising from work that has been completed or abandoned, making it the appropriate CGL coverage part here.
Which of the following best describes the 'other insurance' provision in a property policy?
Answer: It specifies how payment is shared when two or more policies cover the same loss
The 'other insurance' provision coordinates payment between multiple policies covering the same loss, typically using contribution by equal shares or pro rata methods.
An insurer that operates in a state without being licensed to do so is called a/an:
Answer: Non-admitted insurer
A non-admitted insurer has not received a certificate of authority from the state insurance department to transact business in that state.
Under workers' compensation insurance, which benefit covers the cost of treating a work-related injury?
Answer: Medical benefits
Medical benefits under workers' compensation pay for all reasonable and necessary medical treatment related to a covered work injury or occupational disease.
A building valued at $400,000 is insured for $240,000 under a policy with an 80% coinsurance requirement. If a $100,000 loss occurs, how much will the insurer pay?
Answer: $75,000
The coinsurance formula: (amount carried ÷ amount required) × loss = ($240,000 ÷ $320,000) × $100,000 = 0.75 × $100,000 = $75,000.
Which part of a commercial property policy defines the geographic locations and specific buildings or business personal property that are covered?
Answer: Declarations page
The declarations page identifies the named insured, policy period, covered locations, described property, limits of insurance, and premium — the foundational 'who, what, where, and when' of the policy.
What is the primary purpose of a 'liberalization clause' in an insurance policy?
Answer: Automatically extends broader coverage to existing policies when the insurer broadens its standard forms without additional premium
A liberalization clause provides that if the insurer broadens coverage without charging additional premium, existing policyholders automatically receive the improved coverage.