WPCI Washington Property and Casualty Insurance Exam - Set 5 - Part 3

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

Question 41: A business wants high limit protection against catastrophic liability losses that sit above its everyday coverages, and its insurer requires it to carry commercial auto liability and a general liability policy first. Which policy provides this catastrophic, high limit business liability coverage above the underlying policies?

Commercial umbrella liability

Commercial property coverage

Difference in conditions coverage

Workers compensation coverage

Question 42: A personal umbrella insured lets her required underlying auto liability policy lapse, then has a large loss. The umbrella insurer explains that because the insured warranted to keep underlying limits in force, the umbrella pays only what it would have paid above those limits. What must the insured now cover?

Nothing, the umbrella drops down

Only the umbrella deductible

The entire loss alone

The gap equal to underlying limits

Question 43: A homeowner buys a personal umbrella that adds liability limits above her auto and homeowners policies and can also act as primary for certain losses those underlying policies exclude. Personal umbrella limits generally begin at what minimum amount?

One hundred thousand dollars

Five hundred thousand dollars

One million dollars

Ten million dollars

Question 44: When an umbrella covers a loss that the underlying policy excludes, the insured must pay a selected amount out of pocket before the umbrella responds, functioning much like a deductible for that gap loss. What is this insured retained amount called?

A coinsurance penalty

A self insured retention

An aggregate limit

A franchise deductible

Question 45: An insured compares two options. A pure excess policy only adds limits above the underlying and follows its form, while the other can both sit excess and drop down to cover a gap the underlying excludes. Which option both adds limits and drops down for excluded losses?

A pure excess liability policy

A difference in conditions policy

A followed form excess policy

An umbrella liability policy

Question 46: A commercial umbrella insured suffers a personal injury loss that its underlying general liability policy excludes but the umbrella covers. After the insured pays the retention, the umbrella pays the loss as if it were primary. This behavior of the umbrella is best described as what?

Dropping down to cover a gap

Following form as excess

Applying a coinsurance penalty

Reducing the aggregate limit

Question 47: A Bellingham homeowner completes a flood insurance application and pays the initial premium today. Under the National Flood Insurance Program, coverage does not take effect immediately but only after a standard waiting period tied to completing all obligations. How long is that standard waiting period?

Ten days

Fifteen days

Sixty days

Thirty days

Question 48: A Vancouver homeowner buys flood insurance from a private insurer that issues the policy in its own name under an arrangement with the federal government, adjusting claims as a fiscal agent. The homeowner believes this is private flood coverage. How is this write your own policy correctly characterized?

Private flood insurance, not federal

Still a National Flood Insurance Program policy

A difference in conditions policy

An excess flood policy above NFIP

Question 49: On a mobile home policy, several coverage amounts differ from the standard homeowners percentages. In particular, the personal property coverage is set at a lower share of the dwelling coverage than the homeowners fifty percent. What share of the dwelling coverage applies to personal property?

Forty percent

Fifty percent

Thirty percent

Twenty percent

Question 50: A homeowner adds an earthquake endorsement, and the producer notes that a single deductible applies to a series of quakes if the shocks occur close together in time. Within how many hours must aftershocks fall to be treated as one event under a single deductible?

Twenty-four hours

Forty-eight hours

Seventy-two hours

Ninety-six hours

Congratulations!

You have completed all 5 question sets. Good job!

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