Maryland Property and Casualty Insurance Practice Test

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