CPCL California Property and Casualty license exam - Set 2 - Part 1

Test your knowledge of technical writing concepts with these practice questions. Each question includes detailed explanations to help you understand the correct answers.

Question 1: Property insurance that pays the named insured for damage to the insured's own property is settling which kind of loss?

A third-party loss

A liability loss

A first-party loss

A consequential loss

Question 2: A homeowner's furniture, clothing, and electronics are best classified as which of the following?

Personal property

Real property

Other structures

Indirect loss

Question 3: Under an open peril, or special form, property policy, which party bears the burden of proving whether a loss is covered?

Insured proves a listed peril

The state insurance department

A neutral appraiser decides

Insurer must prove an exclusion

Question 4: After a covered fire makes a Fresno home uninhabitable, the policy pays the extra cost of temporary lodging and meals. This coverage is best described as which of the following?

A direct loss payment

Additional living expense

Replacement cost coverage

Fair rental value

Question 5: Which phrase in a property policy signals that coverage is written on an open peril, or special form, basis?

Only listed perils are covered

Coverage for specified perils only

All direct loss except exclusions

Fire and lightning only

Question 6: ISO property coverage is written in three named peril tiers. Which tier is the narrowest, covering only causes such as fire, lightning, and internal explosion?

Basic form

Broad form

Special form

Open peril form

Question 7: A Napa earthquake ruptures a gas line, and the resulting fire burns down the home. Under California law and a standard fire policy, how is the fire damage treated?

Excluded as earthquake damage

Covered only with an endorsement

Paid at fifty percent

Covered as fire damage

Question 8: A log rolls out of a fireplace and burns the living room floor. Why is this loss covered, while scorching inside the fireplace would not be?

Friendly fire is always covered

It became a hostile fire

Smoke damage triggers coverage

The deductible was waived

Question 9: A snowbird leaves her furnished San Diego condo for several months while traveling. For insurance purposes, the dwelling is best described as which of the following?

Unoccupied

Vacant

Abandoned

Under construction

Question 10: Which of the following perils is excluded under basic, broad, and special form property coverage alike?

Fire

Windstorm

Flood

Vandalism

Question 11: An insured's roof is destroyed and the policy pays its replacement cost minus a deduction for depreciation. Which valuation method is being used?

Replacement cost

Agreed value

Market value

Actual cash value

Question 12: A property coinsurance clause penalizes an insured who carries less than the required percentage of value. When does this penalty apply?

To every covered loss

Only to partial losses

Only to total losses

Only when the insurer cancels

Question 13: Under which loss settlement method do the insurer and insured fix the property's value before the policy is issued, with that amount paid on a total loss?

Agreed value

Stated value

Actual cash value

Functional replacement cost

Question 14: California requires a replacement cost residential policy to include building code upgrade coverage of at least what share of the dwelling limit, as additional coverage?

Two percent

Five percent

Ten percent

Fifty percent

Question 15: Under a California replacement cost policy, how does the insurer typically pay a covered structural loss?

Full replacement cost immediately

Market value of the home

Only the depreciated amount

Actual cash value first, then holdback

Question 16: Under the popular HO-3 homeowners form, how are the dwelling and personal property each insured?

Both on a named peril basis

Dwelling open peril, contents named

Both on an open peril basis

Dwelling named, contents open peril

Question 17: Which homeowners form is designed for a tenant and provides no Coverage A for the dwelling itself?

HO-4

HO-3

HO-6

HO-8

Question 18: Which homeowners form, often called the comprehensive form, covers both the dwelling and personal property on an open peril basis?

HO-2

HO-4

HO-8

HO-5

Question 19: Which homeowners form is intended for older or historic homes and settles covered losses on an actual cash value basis?

HO-3

HO-5

HO-8

HO-4

Question 20: Which of the following dwellings is generally NOT eligible for a standard homeowners policy?

An owner-occupied single-family home

A working farm dwelling

An owner-occupied two-family home

A condominium unit

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