State Farm Insurance License Exam
Questions And Answers | Verified
Abandonment Condition CORRECT ANSWERS A condition often contained in property
insurance policies that states that the insured cannot abandon damaged property to the
insurer and demand to be reimbursed for its full value.
Accident CORRECT ANSWERS A loss that occurs at a specific time and place
Actual Cash Value (ACV) CORRECT ANSWERS Today's replacement cost minus
depreciation. Depreciation from wear and tear, or obsolescence.
admitted insurer; authorized insurer CORRECT ANSWERS Company that meets a
state insurance department's standards and is allowed to do business in that state.
Adverse Selection CORRECT ANSWERS the tendency of insureds with a greater than
average chance of loss to purchase insurance
Annual Transit Policy CORRECT ANSWERS Nonfiled commercial inland marine
transportation form that insures a property owner's incoming or outgoing shipments of
goods during a year
Appraisal Clause CORRECT ANSWERS A survey of property to determine the
insurable value of the property or the value of the loss sustained.
Appraisal Condition CORRECT ANSWERS Policy condition that outlines a procedure
for when the insured and insurer disagree on the amount of a loss
Assignment CORRECT ANSWERS The legal transfer of one's interest in an insurance
policy to another person.
Aviation Hull Insurance CORRECT ANSWERS Provides coverage for physical damage
to an aircraft.
Bailee's Customers Policy CORRECT ANSWERS Nonfiled commercial inland marine
form obtained by a bailee to cover loss or damage to customers' property in the bailee's
custody without regard to liability.
Appurtenant Structures CORRECT ANSWERS Buildings of lesser value that are on the
same premises as the main building insured under a property policy; they are usually
covered by the policy.
, Assignment Condition CORRECT ANSWERS Condition in insurance policies that
specifies that the policy cannot be transferred to another unless the company consents
to the transfer in writing.
Bailee CORRECT ANSWERS A person or organization that has temporary possession
of someone else's personal property.
Basic Perils in Homeowners Policy CORRECT ANSWERS There are 14 perils. Fire,
lightening, riot, explosion, vehicles, volcanic eruption, civil commotion, smoke, hail,
aircraft, windstorm, vandalism, malicious mischief, theft.
Basic Property Policy Structure (DICEE) CORRECT ANSWERS D - Declarations
I - Insuring agreement
C - Conditions
E - Exclusions
E - Endorsements
Blanket Insurance CORRECT ANSWERS Type of insurance policy that covers more
than one item of property at a single location or one or more items of property at
multiple locations
Builders Risk Coverage Form CORRECT ANSWERS Commercial property coverage
forms that covers commercial, residential, or farm buildings that are under construction
or during remodeling.
Cargo Insurance CORRECT ANSWERS Type of ocean marine insurance that covers
goods while they are in transit over water.
Binder CORRECT ANSWERS Oral or written statement that provides immediate
insurance protection for a specified period; designed to provide temporary coverage
until a policy is issued or denied.
BOP CORRECT ANSWERS Package policy designed to provide broad property and
liability coverage for small businesses; eligibility requirements are stricter than the CPP.
Business Income Policy CORRECT ANSWERS Pays for loss of income that the insured
sustains due to a direct physical loss from a covered peril that forces the insured to
suspend operations until the property can be repaired, rebuilt, or replaced with
reasonable speed; available with or without extra expense coverage.
Causes of Loss Form CORRECT ANSWERS Separate form used with the commercial
property coverage part of the commercial package policy that lists covered perils and
exclusions. Several different versions provide increasingly broader coverage from basic
to broad to special.
Questions And Answers | Verified
Abandonment Condition CORRECT ANSWERS A condition often contained in property
insurance policies that states that the insured cannot abandon damaged property to the
insurer and demand to be reimbursed for its full value.
Accident CORRECT ANSWERS A loss that occurs at a specific time and place
Actual Cash Value (ACV) CORRECT ANSWERS Today's replacement cost minus
depreciation. Depreciation from wear and tear, or obsolescence.
admitted insurer; authorized insurer CORRECT ANSWERS Company that meets a
state insurance department's standards and is allowed to do business in that state.
Adverse Selection CORRECT ANSWERS the tendency of insureds with a greater than
average chance of loss to purchase insurance
Annual Transit Policy CORRECT ANSWERS Nonfiled commercial inland marine
transportation form that insures a property owner's incoming or outgoing shipments of
goods during a year
Appraisal Clause CORRECT ANSWERS A survey of property to determine the
insurable value of the property or the value of the loss sustained.
Appraisal Condition CORRECT ANSWERS Policy condition that outlines a procedure
for when the insured and insurer disagree on the amount of a loss
Assignment CORRECT ANSWERS The legal transfer of one's interest in an insurance
policy to another person.
Aviation Hull Insurance CORRECT ANSWERS Provides coverage for physical damage
to an aircraft.
Bailee's Customers Policy CORRECT ANSWERS Nonfiled commercial inland marine
form obtained by a bailee to cover loss or damage to customers' property in the bailee's
custody without regard to liability.
Appurtenant Structures CORRECT ANSWERS Buildings of lesser value that are on the
same premises as the main building insured under a property policy; they are usually
covered by the policy.
, Assignment Condition CORRECT ANSWERS Condition in insurance policies that
specifies that the policy cannot be transferred to another unless the company consents
to the transfer in writing.
Bailee CORRECT ANSWERS A person or organization that has temporary possession
of someone else's personal property.
Basic Perils in Homeowners Policy CORRECT ANSWERS There are 14 perils. Fire,
lightening, riot, explosion, vehicles, volcanic eruption, civil commotion, smoke, hail,
aircraft, windstorm, vandalism, malicious mischief, theft.
Basic Property Policy Structure (DICEE) CORRECT ANSWERS D - Declarations
I - Insuring agreement
C - Conditions
E - Exclusions
E - Endorsements
Blanket Insurance CORRECT ANSWERS Type of insurance policy that covers more
than one item of property at a single location or one or more items of property at
multiple locations
Builders Risk Coverage Form CORRECT ANSWERS Commercial property coverage
forms that covers commercial, residential, or farm buildings that are under construction
or during remodeling.
Cargo Insurance CORRECT ANSWERS Type of ocean marine insurance that covers
goods while they are in transit over water.
Binder CORRECT ANSWERS Oral or written statement that provides immediate
insurance protection for a specified period; designed to provide temporary coverage
until a policy is issued or denied.
BOP CORRECT ANSWERS Package policy designed to provide broad property and
liability coverage for small businesses; eligibility requirements are stricter than the CPP.
Business Income Policy CORRECT ANSWERS Pays for loss of income that the insured
sustains due to a direct physical loss from a covered peril that forces the insured to
suspend operations until the property can be repaired, rebuilt, or replaced with
reasonable speed; available with or without extra expense coverage.
Causes of Loss Form CORRECT ANSWERS Separate form used with the commercial
property coverage part of the commercial package policy that lists covered perils and
exclusions. Several different versions provide increasingly broader coverage from basic
to broad to special.
