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Property and Casualty Insurance Exam – Georgia Questions and Answers
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Property and Casualty Insurance Exam – Georgia Questions and Answers
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Property and Casualty Insurance Exam –Georgia Questions and Answers
participating policies Correct Ans-In some states, insurance companies or state workers
compensation funds are allowed to write participating policies (also referred to as safety
groups). This means the insured is eligible for dividends (partial premium refund) if the
experience during the policy term falls within guidelines established by the insurer at the
inception of the policy term. Dividends are not guaranteed. To be eligible for participation, the
insured must meet the associated underwriting requirements for participation.
retrospective rating Correct Ans-Retrospective rating is a method of establishing a premium
on large commercial accounts. The final premium is based on the insured's actual loss
experience during the policy term. It is subject to a minimum and maximum premium, with the
final premium determined by a formula. Under this plan, the current year's premium is based
on the current year's losses, although the premium adjustments may take months or years
beyond the end of the current year. The rating formula has numerous variations, and is
guaranteed in the insurance contract.
Crime Policy Correct Ans-1, commercial entities
2. government entities
For each section the insured can select a form that has different coverage triggers, discovery
form or a loss sustained form. These trigger differences have some similarities to the general
liability form - occurrence and claims-made.
,Employee theft coverage Correct Ans-pays for loss of or damage to money, securities, and
other property resulting from theft or forgery committed by an employee, either acting alone or
in collusion with others
Theft - inside the premises - theft of money and securities Correct Ans-Inside the premises -
theft of money and securities provides coverage for loss of money and securities from inside a
premise or a banking premise resulting directly from theft, disappearance, or destruction.
Coverage also applies to damage to the premises or its exterior, and loss or damage to a locked
safe, vault, cash register, cash drawer, or cash box located inside the premises resulting from
actual or attempted theft.
Robbery - inside the premises - robbery or safe burglary of other property Correct Ans-Inside
the premises - robbery or safe burglary of other property
provides coverage for loss or damage to other property inside the premises resulting from an
actual or attempted robbery of a custodian, or from a safe or vault inside the premise. In
addition, certain property is specifically defined as not covered, including motor vehicles,
trailers, and equipment and accessories. A special limit of $5,000 per occurrence applies to loss
or damage to precious metals, precious and semiprecious stones, pearls, furs, manuscripts,
drawings or records.
Forgery or alteration Correct Ans-insures against the forgery or alteration of checks, drafts,
promissory notes, and similar items regarding the payment of a sum of money that are made or
drawn by the insured or someone acting on behalf of the insured
Mysterious Disappearance Correct Ans-A disappearance of property that cannot be
explained as to the location, time or the manner of property loss.
,Bonds Correct Ans-There are generally 3 parties to a bond: principal, obligee, and surety.
Principal or obligor Correct Ans-Principal or obligor is the person who promises to fulfill the
obligation and who purchases the bond
Obligee or insured Correct Ans-The person to whom the promise has been made and to
whom the bond is payable in the event the principal defaults on its obligation.
Guarantor or surety Correct Ans-The surety or bonding company provides the financial
backing for the guarantee, known as a bond penalty. If the principal, or obligor, defaults on its
obligation, the surety will pay the amount specified in the bond to the obligee, or insured, as
damages.
surety bond Correct Ans-Surety bonds are not insurance in the traditional sense, and differ
from insurance in several ways. First of all, insurance is a two-party agreement between the
insurer and the insured, while surety is a 3-party contract between a principal, obligee, and
surety.
fidelity bond Correct Ans-Fidelity bonds are used to guarantee honesty and trust as opposed
to surety bonds that guarantee performance. A fidelity bond is crime coverage, and
is often called honesty insurance. It protects the business from employee larceny,
embezzlement, forgery, theft, and identity theft, to name just a few. For example, the bond
, covers a bonded employee for dishonesty. It can cover an individual or a group for loss of real
property, personal property, money, securities, or merchandise.
bond period Correct Ans-The fidelity bond period is the term of coverage by stating the time
and date for the effective and expiration dates.
discovery period Correct Ans-The discovery period is the span of time after bond
termination to discover any losses that occurred during the term of the bond.
Professional liability coverage Correct Ans-Professional liability coverage is needed by
individuals who provide professional services to others for a fee. It protects the professional
against legal liability that can result from negligence, errors and omissions, and the rendering or
failure to render professional service
physicians, surgeons, and dental malpractice Correct Ans-The physicians, surgeons, and
dentists malpractice form provides coverage for liability arising out of malpractice, error, or
mistakes made in rendering or failing to render professional services.
lawyers professional liability Correct Ans-Lawyers professional liability coverage is designed
to protect lawyers from these claims.
errors and omissions Correct Ans-Errors and omissions coverage protects insurance agents
and brokers from financial losses they may suffer if an insured sues to recover his or her
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