Ohio Property & Casualty Insurance License, Practice Exams

Several businesses pool their funds to collectively cover one another's losses without buying commercial insurance. This best illustrates risk:

1. Transfer to an insurer
2. Reduction
3. Avoidance
4. Sharing ✓

Why: Risk sharing or pooling spreads the cost of losses among a group of similarly exposed parties.

A PAP insured rents a car on vacation and damages it. Which coverage most directly responds to the damage to the rented car?

1. Part C — Uninsured Motorists, since the rental company carries no liability insurance on its fleet
2. Part D — Coverage for Damage to Your Auto (non-owned auto) ✓
3. Part A — Liability, which pays for damage to any auto in the insured's custody
4. Part B — Medical Payments, applied to the rental damage

Why: Damage to a non-owned auto in the insured's custody, such as a rental, is covered under Part D at the broadest physical damage coverage on the policy.

Section I of a Businessowners Policy provides:

1. Liability coverage
2. Auto coverage
3. Common conditions
4. Property coverage ✓

Why: Section I of the BOP addresses property coverage (building and business personal property), while Section II addresses liability.

Under the PAP, liability coverage for property damage applies to damage to:

1. Property the insured rents, occupies, or has in its care, such as a leased garage
2. Cargo the insured hauls for a fee, up to its invoice value
3. Property of others that the insured is legally liable for damaging ✓
4. The insured's own covered auto after a collision

Why: Part A property damage liability covers damage to others' property the insured is legally responsible for, not the insured's own property.

A loss payable clause in a property policy primarily protects:

1. The state guaranty association, which is reimbursed first out of any loss payment
2. A secured creditor or lender with an interest in covered personal property ✓
3. A bailee holding the property for repair, giving it a direct claim on the proceeds
4. The named insured alone, to the exclusion of any lender

Why: A loss payable clause directs claim payments to a designated party (such as a lender) holding an interest in the covered property.

A defense holding that an injured party who contributed in ANY way to their own injury cannot recover damages is:

1. Last clear chance
2. Contributory negligence ✓
3. Comparative negligence
4. Assumption of risk

Why: Under pure contributory negligence, any fault by the plaintiff—even slight—bars recovery entirely.

Business property on the residence premises is subject to a Coverage C special limit of approximately:

1. $5,000
2. $2,500 ✓
3. $200
4. $1,500

Why: Property used for business while on the residence premises carries a special limit (commonly $2,500) under Coverage C.

After notifying the superintendent of a termination, within how many days must the insurer mail a copy of the notification to the agent at the agent's last known address?

1. Within five days
2. Within thirty days
3. Within forty-five days
4. Within fifteen days ✓

Why: § 3905.21(C)(1) requires the insurer to mail a copy to the agent within fifteen days after notifying the superintendent.

Multiple Peril Crop Insurance (MPCI) typically covers:

1. Liability for injuries to farm visitors and to seasonal workers hired for the harvest
2. Hail damage only, measured per acre
3. A broad range of natural causes of crop loss such as drought, flood, and disease ✓
4. Fire damage to barns and outbuildings only

Why: MPCI is a comprehensive policy covering yield losses from many natural perils including drought, excess moisture, freeze, and disease.

Under ORC §3929.25, before issuing a fire policy on a building the insurer's agent must do what?

1. Photograph the interior and submit the images to the superintendent of insurance
2. Examine the building, make a full description of it, and fix its insurable value ✓
3. Obtain a written appraisal from a licensed appraiser and file it with the state
4. Require the applicant to purchase coverage equal to 100% of replacement cost

Why: §3929.25 requires the insurer to have the building examined by its agent, a full description made, and its insurable value fixed by the agent.

A 'per person' limit in a liability policy applies to:

1. Property damage claims only
2. The deductible per claimant
3. The maximum payable for bodily injury to one individual ✓
4. The total of every claim paid during the policy period, across all occurrences

Why: A per-person limit caps the amount payable for bodily injury sustained by any single individual.

An insured increases jewelry coverage by scheduling items. Scheduled items differ from blanket Coverage C because they:

1. Are excluded from theft coverage unless a burglar alarm is installed
2. Have lower limits than Coverage C provides for the same class of property
3. Require a mortgage clause naming the lender before the schedule takes effect
4. Are individually listed and valued, often with broader perils and no deductible ✓

Why: Scheduled personal property is individually listed and valued, generally insured on a broader open-peril basis, often with no deductible and above Coverage C sublimits.

Pet insurance is generally classified as a form of:

1. Crop insurance, since animals raised for household purposes are treated as agricultural production units
2. Property and casualty inland marine/health-type coverage reimbursing veterinary expenses ✓
3. A surety bond under which the treating veterinarian guarantees recovery and the insurer pays if treatment fails
4. Workers compensation coverage extended to service and working animals

Why: Pet insurance reimburses veterinary expenses for illness or injury and is offered as a specialty personal-lines product.

A stock insurer is owned by its:

1. Stockholders ✓
2. State insurance department
3. Policyholders
4. Board of agents

Why: A stock insurer is owned by stockholders, who supply capital and receive dividends; policyholders are not owners.

Under a Homeowners policy, the 'residence premises' definition primarily refers to:

1. Any dwelling the insured owns, including seasonal and rental homes
2. Any rental property the insured owns and insures separately
3. The dwelling where the insured resides as shown in the declarations ✓
4. Vacant land the insured holds for future construction

Why: Residence premises is the one- to four-family dwelling where the insured resides, as shown in the Declarations, including grounds and related structures.

The maximum amount an insurer will pay for any one accident, regardless of the number of claimants, is the:

1. Per-person limit
2. Aggregate limit
3. Split limit
4. Per-accident limit ✓

Why: A per-accident limit is the most the insurer pays for all damages from one accident combined.

Salvage refers to:

1. The insurer's right to recover and sell damaged property after paying a total loss ✓
2. The unearned portion of the premium returned to the insured when a policy is canceled early
3. The portion of a loss the insured must bear when the coinsurance requirement is not met
4. The dollar amount subtracted from every covered loss before the insurer issues payment

Why: After paying for a loss (often a total loss), the insurer may take title to and sell the damaged property to recoup some payment—this is salvage.

An insured with 50/100/25 split limits injures one person for $80,000. How much does the policy pay for that injured person?

1. $25,000
2. $80,000
3. $100,000
4. $50,000 ✓

Why: The per-person bodily injury limit is $50,000, so the most payable for one injured person is $50,000 regardless of the per-accident limit.

Defining key terms (often in quotation marks or bold) so they have a consistent meaning throughout the contract is the purpose of the:

1. Definitions section ✓
2. Endorsements
3. Exclusions section
4. Declarations

Why: The definitions section clarifies the precise meaning of specific terms used throughout the policy.

The HO-3 (Special Form) covers the dwelling and personal property on what basis, respectively?

1. Named perils on the dwelling; open perils on personal property
2. Open perils on the dwelling; named (broad) perils on personal property ✓
3. Named perils on both
4. Open perils on both

Why: HO-3 insures the dwelling and other structures on an open-perils basis but covers personal property (Coverage C) on a named-perils (broad form) basis.

Tenant's improvements and betterments installed by a lessee are usually insured under:

1. Coverage B — Business Personal Property of the tenant ✓
2. Coverage C — Personal Property of Others, since the landlord holds title to the improvements
3. They are never insurable by the tenant
4. Coverage A — Building, purchased by the tenant

Why: Improvements and betterments made by a tenant (that cannot be legally removed) are covered as the tenant's business personal property under Coverage B.

Under the PAP, the limit of liability for Part A applies:

1. Separately to each claim with no per-accident cap, so every claimant injured in one collision may collect the full stated limit
2. As the most paid regardless of the number of insureds, claims, vehicles, or persons involved (per the limits shown) ✓
3. Per insured separately, so two insureds riding in one auto double the limit available for that accident
4. Doubled when two or more vehicles are listed on the same declarations page

Why: The Part A limit of liability is the most the insurer will pay for one accident regardless of the number of insureds, claims, vehicles, or persons (subject to split/CSL terms).

The CGL 'Other Insurance' condition typically makes the CGL coverage:

1. Primary, but excess over certain other coverages in specified situations ✓
2. Always pro rata with all other collectible insurance, regardless of type
3. Void from inception if other insurance covers the loss
4. Always excess over every other policy the insured carries

Why: The CGL is generally primary but becomes excess in specified situations (e.g., certain additional-insured or fire scenarios) per the Other Insurance condition.

A bailee's customer floater is purchased to:

1. Insure the building the bailee occupies, its permanent fixtures, and the racks and bins that hold customer goods
2. Cover customers' property in the bailee's care regardless of the bailee's legal liability ✓
3. Provide auto liability and cargo coverage on the vehicles the bailee uses to pick up and deliver customer goods
4. Cover the bailee's own machinery, tools, and equipment used in the operation

Why: A bailee's customer policy covers customers' goods in the bailee's possession on a direct-damage basis, often paying regardless of the bailee's legal liability, to preserve goodwill.

A dockworker loading and unloading ships, injured while working on the pier and over navigable waters, is most likely covered by:

1. The Jones Act, since anyone whose work is performed over navigable water qualifies as a seaman
2. FELA, which Congress extended to cover cargo handling at any interstate terminal
3. The Black Lung Benefits Act, for dust in ship holds
4. The Longshore and Harbor Workers' Compensation Act (LHWCA) ✓

Why: The LHWCA provides no-fault workers' compensation benefits to longshore, harbor, and maritime workers (such as those loading/unloading vessels) who are not seamen.

An employee suffers a temporary, totally disabling injury and cannot work at all for several weeks but is expected to fully recover. Which benefit classification applies?

1. Temporary partial disability (TPD)
2. Permanent partial disability (PPD)
3. Temporary total disability (TTD) ✓
4. Permanent total disability (PTD)

Why: Temporary total disability (TTD) applies when the worker is completely unable to work for a limited time but is expected to recover and return to work.

To verify a nonresident applicant's licensure and standing in another state, the superintendent may use which resource first?

1. The producer database maintained by the NAIC or its affiliates ✓
2. The certification records of the appointing insurer
3. Written references from two licensed agents
4. A consumer credit report on the applicant

Why: § 3905.07(B) allows the superintendent to use the NAIC producer database, and only if unavailable to require a certification letter.

Which describes the typical underwriting attitude of a surety toward the principal?

1. The surety expects a predictable frequency of losses and prices the bond to fund them
2. The surety disregards the principal's financial statements and looks instead to the obligee's credit rating, the size of the contract, and the premium it collects for the bond
3. The surety insures the obligee's solvency for the term of the contract
4. The surety underwrites the principal's character, capacity, and capital expecting no loss, similar to a credit decision ✓

Why: Surety underwriting evaluates the principal's character, capacity, and capital like a credit risk, anticipating no loss because the principal must indemnify the surety.

Which statement about strict liability is TRUE?

1. It arises only out of the employer-employee relationship
2. It requires proof the defendant intended the harm
3. Fault need not be proven; liability attaches due to the nature of the activity ✓
4. The plaintiff must still prove the defendant failed to use reasonable care under the circumstances

Why: Strict liability imposes responsibility without requiring proof of negligence, based on the inherently dangerous nature of the activity or product defect.

A bar overserves a patron who then injures a third party in a fight. Which coverage is designed to respond to the bar's liability?

1. Workers compensation, because the bartender was on duty when the fight started
2. Liquor Liability / Dram Shop coverage ✓
3. A surety bond posted with the state liquor control board
4. CGL Coverage A, because the patron's injury is bodily injury on the premises

Why: Because the CGL excludes the liquor business's liability, the bar needs liquor liability/dram shop coverage for injuries connected to serving alcohol.

Actual cash value is generally calculated as:

1. The face amount of the policy
2. Market value plus profit
3. Replacement cost minus depreciation ✓
4. Replacement cost plus appreciation

Why: ACV is typically replacement cost less depreciation, reflecting the property's depreciated value at the time of loss.

Under the NFIP Write-Your-Own (WYO) program:

1. FEMA sells flood policies directly to consumers, with no agent involvement
2. Mortgage lenders issue flood policies to their borrowers at closing
3. Participating private insurers underwrite flood on their own paper, keep the premium, and retain the entire underwriting risk
4. Private insurers sell and service NFIP policies under their own names while the federal government backs the risk ✓

Why: Under the WYO program, participating private insurers issue and service standard NFIP policies in their own names, but the federal government bears the underwriting risk.

A delivery driver uses his personal car to deliver pizzas for a restaurant. Under his unendorsed PAP, a liability claim during a delivery is likely:

1. Subject to the public/livery conveyance exclusion and may be denied ✓
2. Covered under Part D only, because delivery use changes the physical damage rate but never the liability insuring agreement
3. Covered under Part B only, since medical payments carries no business-use restriction on the driver
4. Fully covered, because the restaurant's commercial policy is required by law to sit excess of the driver's pap

Why: Using a vehicle to carry property/persons for a fee (delivery for hire) can trigger the livery/business-use exclusion, so the claim may not be covered without commercial coverage.

A Difference in Conditions (DIC) policy is generally purchased to:

1. Covers only automobile liability arising from vehicles the insured owns, hires, or borrows anywhere in the United States and Canada
2. Replaces the underlying property policy entirely, so the insured may cancel the primary form once the difference in conditions coverage is bound
3. Provides statutory workers compensation benefits in any state the insured has not listed on the information page of its own policy
4. Provide broad, all-risk coverage that fills gaps and covers perils excluded by underlying policies, such as flood and earthquake ✓

Why: DIC coverage supplements an insured's underlying property program by broadening perils and filling coverage gaps, frequently adding flood and earthquake.

Under 'contribution by equal shares,' insurers covering the same loss pay:

1. Only the insurer whose policy was written first, with the others reimbursing it afterward
2. Nothing until the insured has paid a share equal to the deductible
3. Equal amounts until the lowest limit is exhausted, then the rest continue ✓
4. Amounts proportional to each policy's limit of insurance

Why: Each insurer contributes equal amounts until the smallest applicable limit is used up; remaining insurers continue contributing equally.

For a phantom (unidentified) driver to qualify as an 'uninsured motorist' under Ohio law, what is required?

1. Independent corroborative evidence beyond the insured's own testimony that the unidentified driver caused the injury ✓
2. Testimony from at least two eyewitnesses who are unrelated to the insured and were not occupants of the insured's vehicle
3. Actual physical contact between the phantom vehicle and the insured's vehicle, documented by the officer at the scene
4. A police report naming a suspect vehicle

Why: ORC §3937.18(B)(1)(c) requires independent corroborative evidence; the insured's testimony alone is not sufficient unless supported by additional evidence.

'Perils of the sea' in ocean marine refers to:

1. Negligence by the master or crew in navigating the vessel, standing alone
2. Fortuitous accidents or casualties of the sea, such as heavy weather, sinking, and stranding ✓
3. Every cause of loss arising on a voyage, including inherent vice of the cargo and delay in delivery
4. Ordinary wear and tear on hull and rigging from the normal action of wind and waves

Why: Perils of the sea are extraordinary, fortuitous events peculiar to the sea, like storms, stranding, collision, and sinking—not the ordinary action of wind and waves.

Under § 3905.18, an insurer or agent may pay a referral fee to an UNLICENSED person only if the compensation meets what condition?

1. It is split equally with the appointing insurer of record
2. It is a percentage of the first year's premium collected on the referred policy
3. It is paid only after the referred policy is issued and the insurer has collected the first full premium
4. It is a fixed dollar amount per referral and does not depend on whether the person referred buys insurance ✓

Why: § 3905.18(D) permits referral compensation to an unlicensed person only as a fixed dollar amount per referral that does not depend on a purchase.

Authority that is explicitly granted to a producer in the written agency contract is called:

1. Assumed authority
2. Express authority ✓
3. Apparent authority
4. Implied authority

Why: Express authority is the authority specifically granted to the agent in writing through the agency agreement.

The Business Auto physical damage coverage offers which coverage categories?

1. Workers compensation for drivers injured on the job
2. Comprehensive, specified causes of loss, and collision ✓
3. Uninsured motorists coverage written on a per-vehicle basis
4. Liability, medical payments, and garagekeepers legal liability

Why: BACF physical damage can be written as Comprehensive, Specified Causes of Loss (a narrower named-peril option), and Collision.

Which of the following is NOT an element of an ideally insurable risk?

1. The premium must be economically feasible
2. The loss must be due to chance and accidental
3. The loss must be catastrophic to the insurer ✓
4. The loss must be definite and measurable

Why: Insurable losses should NOT be catastrophic to the insurer; insurers avoid risks that could cause simultaneous, ruinous losses across the pool.

A heating contractor ships and installs a new furnace; the equipment is stolen from the job site before acceptance. Best coverage:

1. Installation floater ✓
2. Accounts receivable
3. Ocean marine cargo
4. Jewelers block

Why: An Installation floater covers materials and equipment during transit, storage, and installation until the work is accepted by the owner.

Under comparative negligence (pure form), a plaintiff found 30% at fault for a $100,000 injury recovers:

1. $100,000
2. $30,000
3. $70,000 ✓
4. $0

Why: Pure comparative negligence reduces recovery by the plaintiff's percentage of fault: $100,000 − 30% = $70,000.

A homeowner experiences a sewer backup that floods the basement. Standard Homeowners coverage for this is best obtained through:

1. The earthquake endorsement, which adds earth movement and the water damage that follows
2. Coverage F, medical payments to others
3. A water backup / sump overflow endorsement ✓
4. The base HO-3 form, automatically

Why: Damage from sewer or drain backup is excluded under the base form; a water backup and sump discharge or overflow endorsement is needed.

Under ORC §3937.31, when renewal of an automobile insurance policy is mandatory, the term 'cancellation' is defined to include:

1. Refusal to renew with at least the coverages, insureds, and limits of the preceding period ✓
2. Any increase in premium charged when the policy is renewed for the next term
3. A reduction in the deductible applicable to collision coverage
4. Any mid-term change in the address of the named insured that alters the rating territory of the policy

Why: §3937.31(A) provides that where renewal is mandatory, 'cancellation' includes refusal to renew a policy with at least the coverages, included insureds, and policy limits provided at the end of the next preceding policy period.

Whom must an owner's policy insure besides the named insured, under Ohio's owner's-policy requirements?

1. Only the named insured and a spouse residing in the same household
2. Only the drivers listed by name on the policy's declarations page
3. Only persons operating the vehicle in the course of the insured's business
4. Any person using the covered vehicle with the insured's express or implied permission ✓

Why: ORC §4509.51(B) extends coverage to any person using the vehicle with the express or implied permission of the insured.

Under § 3901.99(B), a person who violates an insurance law for which no penalty is otherwise provided in the Revised Code is subject to what maximum penalty?

1. A fine of not more than five hundred dollars for each day the violation continues
2. A fine of not more than twenty-five thousand dollars, imprisonment of not more than six months, or both ✓
3. A felony of the fifth degree, carrying a definite prison term of six to twelve months
4. A fine of not more than one hundred thousand dollars, imprisonment of not more than one year, or both penalties

Why: Section 3901.99(B) provides that a person who violates an insurance law for which no penalty is otherwise provided shall be fined not more than twenty-five thousand dollars, imprisoned not more than six months, or both.

When death results from a compensable Ohio injury and there are wholly dependent persons, ORC 4123.59 pays weekly benefits at what rate of the average weekly wage?

1. 66 2/3% ✓
2. 72%
3. 100%
4. 50%

Why: ORC 4123.59(B) provides that wholly dependent persons receive 66 2/3% of the average weekly wage, subject to statutory maximum and minimum tied to the SAWW.

An experience modification factor (mod) below 1.00 (e.g., 0.85) indicates that an employer:

1. Has worse-than-average loss experience and pays a debit (surcharge)
2. Has better-than-average loss experience and receives a credit (discount) ✓
3. Is exempt from audit
4. Must purchase coverage from the assigned-risk pool

Why: A mod below 1.00 is a credit mod, reflecting better-than-expected losses and reducing premium; a mod above 1.00 is a debit mod that increases premium.

Symbol 1 in the Business Auto Coverage Form means:

1. Any auto ✓
2. Non-owned autos only
3. Owned autos only
4. Hired autos only

Why: Symbol 1 represents "Any Auto" and provides the broadest scope; it is most commonly used for liability coverage.

A deductible in a property policy is the portion of a loss that:

1. The insurer pays first, then bills the insured
2. Is recovered from salvage sale proceeds
3. The insured retains/pays before the insurer pays ✓
4. Is added to the annual premium at renewal

Why: A deductible is the amount the insured must absorb on a covered loss before insurance benefits apply.

Pure risk differs from speculative risk in that pure risk involves:

1. Only the chance of loss or no loss ✓
2. Voluntary participation for reward
3. Guaranteed profit
4. Both loss and gain possibilities

Why: Pure risk presents only the possibility of loss or no loss, with no opportunity for gain, making it the only insurable type of risk.

Under ORC §3955.08, in any one year the Ohio Insurance Guaranty Association may assess a member insurer on any account no more than what percentage of its net direct written premiums for the preceding calendar year?

1. One and one-half percent ✓
2. Two percent
3. Five percent
4. One-half of one percent

Why: §3955.08(A)(3) provides each member insurer may be assessed in any year on any account no more than one and one-half per cent of its net direct written premiums for the preceding calendar year on the kinds of insurance in that account.

The Ohio license examination is designed to test an applicant's knowledge of which of the following?

1. The internal underwriting manuals and rate filings of each appointing insurer
2. Only the mathematics of premium computation, loss reserving, and commission accounting for each line of authority sought
3. Federal income tax law and federal securities regulation, which the superintendent administers jointly with FINRA
4. The lines of authority, the duties and responsibilities of an agent, and the insurance laws of this state ✓

Why: § 3905.04(A) states the examination tests the lines of authority, the agent's duties and responsibilities, and the insurance laws of this state.

A civilian working for a U.S. defense contractor on a military base overseas is injured. Which act most likely provides workers' compensation coverage?

1. The Jones Act
2. FECA
3. FELA
4. The Defense Base Act ✓

Why: The Defense Base Act extends LHWCA-style workers' compensation benefits to civilian employees of U.S. government contractors working on overseas military bases and similar locations.

Under ORC §3955.05, which of the following is NOT covered by the Ohio Insurance Guaranty Association?

1. Homeowners property coverage
2. Fire and allied lines coverage
3. Other liability insurance
4. Ocean marine insurance ✓

Why: §3955.05(E) excludes ocean marine insurance from the act; property/casualty lines such as fire, homeowners, and liability are covered.

Under § 3905.06, the 'life' line of authority is described as insurance coverage on human lives that may also include which benefits?

1. Coverage against direct physical loss to or damage of real property and of the personal property kept inside it
2. Title defect protection for real estate purchasers
3. Coverage for the insured's legal liability to third parties for bodily injury and property damage they sustain
4. Benefits of endowment and annuities, and may include death or dismemberment by accident and disability income ✓

Why: § 3905.06(B)(1) describes 'life' as coverage on human lives including endowment and annuity benefits and may include accidental death/dismemberment and disability income.

A building worth $800,000 has 80% coinsurance. The insured carries $700,000. A $100,000 loss occurs. After applying coinsurance, how much is paid (before deductible)?

1. $70,000
2. $80,000
3. $87,500
4. $100,000 ✓

Why: Required = 80% x $800,000 = $640,000. The insured carries $700,000, which exceeds the requirement, so no penalty applies and the full $100,000 is paid.

Under § 3901.21(P), the prohibition on pattern settlements does NOT prevent an insurer from doing what?

1. Imputing liability to a claimant without conducting any investigation of the particular occurrence, based only on the general claim type
2. Applying one predetermined settlement formula to every similar occurrence without reviewing the facts developed by the insurer's investigation
3. Routinely assigning a fixed share of liability to every claimant involved in a rear-end collision, whatever the adjuster actually finds
4. Applying formulas or guidelines to the facts and circumstances disclosed by the insurer's investigation of the particular occurrence ✓

Why: Section 3901.21(P) states that nothing in the division prohibits an insurer from determining a claimant's liability by applying formulas or guidelines to the facts and circumstances disclosed by the insurer's investigation of the particular occurrence.

A self-insuring employer in Ohio must generally provide the administrator with what security?

1. An irrevocable letter of credit, drawn on an Ohio bank, equal to one full year of the employer's payroll
2. A surety bond issued under ORC 4123.351 sufficient to secure payment of compensation and expenses ✓
3. A cash deposit with the bureau equal to ten percent of the employer's gross revenue for the prior year
4. No security at all once the employer has operated in Ohio for two years

Why: ORC 4123.35(D) requires the administrator to obtain a surety bond from self-insuring employers, issued under ORC 4123.351, sufficient to secure payment of compensation to injured or killed employees.

Which perils does the Broad Causes of Loss form ADD beyond the Basic form?

1. Earthquake and flood, which the Basic form omits from its list of covered causes
2. War and nuclear hazard, added back once the Broad form endorsement is attached
3. Wear and tear from ordinary use
4. Falling objects; weight of snow, ice, or sleet; and water damage ✓

Why: The Broad form adds falling objects; weight of snow, ice, or sleet; water damage; and includes a limited collapse provision.

A statement that is guaranteed to be true and becomes part of the contract is a:

1. Concealment
2. Representation
3. Warranty ✓
4. Waiver

Why: A warranty is a statement that is guaranteed true and becomes part of the policy; its breach can void coverage.

Under ORC §3955.01, the maximum the Ohio Insurance Guaranty Association will pay on any one covered claim (other than unearned premium) is:

1. The full policy limit with no statutory cap
2. $100,000
3. $300,000 ✓
4. $500,000

Why: §3955.01(D)(2)(b) excludes from 'covered claim' any amount in excess of $300,000 on any claim.

Under ORC §3955.01, the Ohio Insurance Guaranty Association's cap on any UNEARNED PREMIUM claim is:

1. $1,000
2. $300,000
3. $10,000 ✓
4. $25,000

Why: §3955.01(D)(2)(a) excludes from covered claim any amount in excess of $10,000 on any unearned premium claim.

Under a valued policy, the amount paid in the event of a total loss is:

1. The replacement cost of the property at the time of the loss
2. The amount stated (agreed) in the policy regardless of actual value ✓
3. The salvage value of whatever remains after the loss has occurred
4. The actual cash value at the time of loss, being replacement cost less depreciation

Why: A valued policy pays the agreed-upon amount stated in the policy upon total loss, common for fine art and antiques.

Most Professional Liability/E&O and D&O policies are written on what kind of trigger?

1. Claims-made ✓
2. Named perils
3. Open peril
4. Occurrence

Why: Professional and management liability lines are typically claims-made, with a retroactive date and ERP options.

Under the ISO Commercial General Liability Coverage Form, which coverage part responds to bodily injury and property damage liability arising out of the insured's premises and operations?

1. Supplementary Payments
2. Coverage B
3. Coverage C
4. Coverage A ✓

Why: Coverage A insures bodily injury and property damage liability. Coverage B is personal and advertising injury; Coverage C is medical payments.

Under TRIA, the federal government's share of insured terrorism losses applies only after the insurer pays:

1. The full amount of every certified loss, with federal reimbursement available only to reinsurers
2. Nothing, since federal sharing begins at the first dollar
3. A flat $1,000 retention for each certified event
4. An insurer deductible based on a percentage of its prior-year premiums ✓

Why: Under TRIA, each insurer retains a deductible (a percentage of its prior-year direct earned premium) before the federal government shares in the remaining certified losses.

The Fair Credit Reporting Act (FCRA) primarily regulates:

1. The collection, use, and disclosure of consumer report information ✓
2. How FEMA sets and subsidizes flood premiums inside mapped Special Flood Hazard Areas
3. Federal premium subsidies paid to crop insurers under the Federal Crop Insurance Act
4. The federal reinsurance backstop for certified acts of terrorism

Why: The FCRA governs how consumer reporting agencies collect, share, and use consumer credit and report information, and the rights of consumers regarding that information.

Under § 3901.211(B)(7), an unlicensed bank employee who refers a customer to a licensed agent may be compensated for the referral only if:

1. The employee also explains the specific terms, conditions, and premium of the policy to the customer before handing off the referral
2. The customer actually purchases the product, in which case the referral fee may be paid out of the first year's premium collected
3. The referral fee equals ten percent of the first-year premium on any policy the customer buys
4. The compensation is a fixed dollar amount per referral that does not depend on whether the customer purchases the product ✓

Why: Section 3901.211(B)(7) permits an unlicensed person to make a referral (without discussing specific terms) and be compensated only by a fixed dollar amount per referral that does not depend on whether the customer purchases the insurance product.

Defense costs under the standard CGL are:

1. Paid in addition to the limits as a Supplementary Payment ✓
2. Paid within the limits of insurance, reducing them
3. Never covered
4. Subject to a separate aggregate only

Why: Under the standard CGL, defense costs are paid in addition to the limits as part of Supplementary Payments (unlike many specialty 'defense-within-limits' policies).

Which CGL limit is the most that will be paid for the sum of all damages because of bodily injury and property damage arising out of any one occurrence?

1. Each Occurrence Limit ✓
2. Products-Completed Operations Aggregate
3. Personal and Advertising Injury Limit
4. General Aggregate Limit

Why: The Each Occurrence Limit caps total BI and PD damages (plus medical payments) for a single occurrence.

Under the Dwelling Policy, Coverage A applies to which of the following?

1. Detached garages and sheds
2. Household personal property
3. The dwelling itself ✓
4. Loss of rental income

Why: Coverage A is the Dwelling coverage, insuring the described residence structure. Other structures are Coverage B, personal property is Coverage C.

What is the financial-responsibility reinstatement fee for a FIRST violation of driving without proof of coverage under ORC §4509.101?

1. $300
2. $40 ✓
3. $100
4. $160

Why: ORC §4509.101(A)(5)(a) sets the reinstatement fee at $40 for a first violation.

Under the Business Auto Coverage Form, the covered "auto" definition generally includes:

1. Mobile equipment such as forklifts kept entirely on the insured's premises
2. Company aircraft and watercraft used to carry employees
3. Railcars operated on a private siding
4. Land motor vehicles, trailers, and semitrailers designed for use on public roads ✓

Why: A covered auto is a land motor vehicle, trailer, or semitrailer designed for travel on public roads, including attached machinery, but not most mobile equipment.

A resident agent's license is not renewed by its renewal date or its late renewal date. What happens under § 3905.06?

1. The license automatically is suspended for nonrenewal on the first day of the second month following the renewal date ✓
2. Nothing happens, because a resident agent license issued in this state stays in force until it is surrendered or revoked
3. The license converts to a temporary license good for one hundred eighty days while the agent completes continuing education
4. The license remains valid until the superintendent issues an order of revocation after notice and an opportunity for hearing

Why: § 3905.06(E) provides automatic suspension for nonrenewal on the first day of the second month following the renewal date.

Most workers' compensation laws impose a 'waiting period' before income (indemnity) benefits begin. The purpose is to:

1. Give the employer time to contest compensability
2. Delay medical benefits until a doctor files a report
3. Let the state audit the employer's payroll records
4. Avoid paying wage benefits for very short, minor absences ✓

Why: The waiting period (commonly a few days) means no wage-loss benefits are paid for minor, brief absences; medical benefits, however, usually begin immediately.