In property insurance, the term "property in transit" refers to which one of the
following?
A. Property while being moved from one building to another at the insured
location only
B. Mobile equipment while moving under its own power from one work location to
another
C. Owned property while located anywhere other than the insured location
D. Property while being transported by trucks, cars, buses, trains, airplanes, and
ships - ANSWER-D. Property while being transported by trucks, cars, buses,
trains, airplanes, and ships
During a business interruption, some of the organization's expenses, called
continuing expenses, will continue, and other expenses, called noncontinuing
expenses, will not continue. Which one of the following is an example of a
continuing expense?
A. Cost of overnight air shipment of needed repair parts
B. Overtime wages to employees
C. Cost to rent temporary office space
D. Payroll of key employees - ANSWER-D) Payroll of key employees
Telephone Company installs fiber-optic cable using a trenching machine that digs
a trench, buries the cable, fills in the trench, and reseeds, all in one pass. The
trenching machine can install cable in a fifty-home neighborhood in one day. A
day after the trenching machine passes by, a member of the community steps on
the trenched area, sinks in, and breaks his leg. This is an example of a liability
loss exposure arising out of A. Premises.
B. Products.
,C. Professional.
D. Completed operations. - ANSWER-D) Completed operations
Sarah was looking for new furniture for her home and visited a local
woodworker's studio. While she was admiring a bookcase, it accidentally fell over
and injured her leg. From the commercial liability standpoint of the woodworker,
this is an example of A. Products liability.
B. Completed operations liability.
C. Premises and operations liability.
D. Employers liability. - ANSWER-C) Premises and operations liability
Automobile liability exposures can result from A.
Loss of use of an owned automobile.
B. Damage to or destruction of an owned vehicle.
C. Hiring or borrowing an automobile.
D. Workers compensation laws. - ANSWER-C) Hiring or borrowing an automobile.
The management of Maryland Marine Co. (MMC) must ensure that proper
coverage is obtained for work-related injuries. The employee population of MMC
is a mixture of full-time and part-time employees as well as some casual
employees for one-time tasks. Much of MMC's work is done by independent
contractors and temporary employees during peak seasons. Which one of the
following statements about these persons is true?
A. Many states workers compensation statutes exclude casual labor (temporary
employees).
B. Temporary employees are considered employees of MMC rather than
employees of the firm supplying them to MMC.
C. The independent contractors are automatically employees under common law.
,D. Injuries to MMC's full-time ship captains are likely to be covered under state
workers compensation laws. - ANSWER-A. Many states workers compensation
statutes exclude casual labor (temporary employees).
As part of its assessment of its cyber risk, an organization should consider
whether there are any intangible property exposures. Which one of the following
would best be classified as an intangible property loss?
A. There is a fire in the storage area which destroys the backup copy of the office
computer system.
B. Thieves break into the main office and steal several desktop computers.
C. The computer system is hacked and data including credit card numbers are
stolen.
D. Two disgruntled employees use the computer system to transfer office funds
into their own personal bank accounts. - ANSWER-C. The computer system is
hacked and data including credit card numbers are stolen.
The extent of an organization's product of human intelligence that has economic
value refers to which one of the following?
A. Real property
B. Business income
C. Personal property
D. Intellectual property - ANSWER-D) Intellectual property.
For most businesses, which one of the following is the peril that poses the
greatest risk of a large or total property loss?
A. Windstorm
B. Flood
C. Fire
D. Earthquake - ANSWER-C) Fire
, In business income insurance, the expenses that an organization would not have
incurred if the business interruption had not occurred are called A. Excludable
expenses.
B. Extra expenses.
C. Contingent expenses.
D. Continuing expenses. - ANSWER-B) Extra expenses
Pedestrian Wilma was injured as a result of a contractor's negligence when the
contractor failed to adequately warn the public of a hazard when paving a road.
Any resulting liability claim by Wilma against the contractor would be considered
to have arisen from the contractor's
A. Premises and operations liability exposure.
B. Personal liability exposure.
C. Absolute liability exposure.
D. Products and completed operations liability exposure. - ANSWER-A) Premises
and operations liability exposure.
Which one of the following loss exposures exist when a business can be held
legally liable for bodily injury or property damage caused by their repair or
contracting work?
A. Workers' compensation liability
B. Products liability
C. Operations liability
D. Completed operations liability - ANSWER-D) Completed operations liability
Inland marine insurance is insurance that covers
A. Companies that ship goods by commercial vessel on inland waterways.
B. Businesses that own or operate watercraft, or import or export goods. C.
Many different classes of property that typically involve an element of
transportation on land.
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