CA Property and Casualty Insurance Exam

Questions and Answers

Which of the following is TRUE regarding who qualifies for coverage under the California Fair Access to Insurance Requirements plan?

Any person who qualifies will have the inspection automatically waived if they are a FAIR plan participant.

Any person who qualifies will receive superior coverage to other forms of property insurance.

Any person who is unable to obtain basic property insurance through normal channels. (correct)

Any person who does NOT have an insurable interest in a property can participate in the FAIR plan.

A Special Surplus Line Broker is allowed to place coverage with a non-admitted insurer for all the following EXCEPT:

Interstate commerce involving railroads.

Insurance against perils of navigation for import and exporting of goods.

Transportation involving bridges and tunnels. (correct)

Aircraft insurance.

Which of the following is TRUE regarding the application and renewal of the limited lines automobile insurance agent license?

The fees and process are the same as for a personal lines licensee. (correct)

The limited lines agent is ineligible to become a property or casualty broker-agent.

There are no fees for filing the application or renewal applications for the license.

The agent must pass an examination on the insurance code and products, but not ethics.

Which of the following is TRUE regarding continuing education requirements of an agent or broker?

Any licensee shall satisfactorily complete 24 hours of instruction prior to license renewal. Signup and view all the answers

Which is an ACCURATE statement regarding the List of Approved Surplus Lines Insurers?

Eligible carriers do not need to file documents with the California Department of Insurance. Signup and view all the answers

What 2 different types of areas are served by the California Fair Access to Insurance Responsibilities plan?

Brush fire risk and inner city. Signup and view all the answers

Except in a case where the property is being held as a carrier or depository, what is the insurable interest measured by?

The extent to which the insured would be damnified by loss or injury to the property. Signup and view all the answers

ALL of the following are examples of open policies EXCEPT:

Agreed value. Signup and view all the answers

It is unlawful to do any of the following EXCEPT:

Make or cause to made a knowingly false or fraudulent or material representation for the purpose of encouraging an injured worker to claim benefits. Signup and view all the answers

Study Notes

California Fair Access to Insurance Requirements (FAIR Plan)

Individuals unable to secure basic property insurance through standard channels qualify for coverage.
Coverage does not provide superior benefits compared to alternative property insurance.
Inspection waivers do not automatically apply for FAIR plan participants.

Special Surplus Line Broker Regulations

Special Surplus Line Brokers can place coverage with non-admitted insurers for aircraft insurance and goods import/export but not for transportation involving bridges and tunnels.

Limited Lines Automobile Insurance Agent License

Application and renewal fees for limited lines automobile insurance agent licenses mirror those of personal lines licenses.
No fees are required for applying or renewing limited lines agents, contradicting fee comparison.

Continuing Education Requirements for Agents and Brokers

Licensees must complete 24 hours of instruction for license renewal.
Licensees with at least 10 years of good standing can request exemption from continuing education requirements, focusing on their established reputation.
Continuing education requirements differ based on the type of insurance; life and health agents have more hours than property and casualty agents.

List of Approved Surplus Lines Insurers

Participation in the LASLI (List of Approved Surplus Lines Insurers) is mandatory for eligible non-admitted insurers.
Only approved carriers can be utilized by brokers, aligning rules for both U.S. and non-U.S. domiciled carriers.
Eligible carriers are exempt from filing with the California Department of Insurance.

Areas Served by the FAIR Plan

The California FAIR plan caters to areas with brush fire risks and inner-city locations.

Insurable Interest

Insurable interest is gauged by the extent of financial loss the insured would suffer due to property damage, not by premium size or property value.

Open Policies

Common forms of open policies include market value, actual cash value, and replacement value; agreed value is not classified as such.

Unlawful Acts in Insurance Practices

Assisting in unlawful acts, making false representations for compensation, and fraudulent statements in claims against the insurance code are prohibited. However, misleading representations encouraging injured workers to claim benefits may not be deemed unlawful.

Principal Rating Factors for Automobile Insurance

Details on principal rating factors in determining automobile insurance premiums remain incomplete and unspecified.

Description

Test your knowledge on California's Fair Access to Insurance Requirements plan with this practice exam. The quiz covers who qualifies for coverage, ensuring you understand the key aspects of property insurance in California. Perfect for those preparing for the insurance certification exam.