Commercial Auto Q&a

20 Questions | Total Attempts: 12

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Commercial Auto Q&a

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Questions and Answers
  • 1. 
    The BAP is generally appropriate for insuring all of the following vehicles except which one?
    • A. 

      Delivery vehicles

    • B. 

      Fleets

    • C. 

      Pick-ups and vans

    • D. 

      18-wheel semi-trucks

  • 2. 
    If the client wishes to take a comprehensive approach and insure any auto that the company owns, hires, borrows, or uses in its business, which covered auto designation symbol is used? 
    • A. 

      Symbol 9

    • B. 

      Symbol 1

    • C. 

      Symbol 6

    • D. 

      Symbol 8

  • 3. 
    Trailers with a load capacity of how many pounds are considered covered autos for liability coverage if the BAP provides liability coverage?
    • A. 

      1,000 pounds

    • B. 

      2,000 pounds or less

    • C. 

      500 pounds or less

    • D. 

      There is no load capacity limit

  • 4. 
    Under what circumstances does the BAP consider mobile equipment to be a covered auto for liability purposes? 
    • A. 

      While the equipment is being carried or towed by a covered auto

    • B. 

      While the equipment is owned by the named insured and used in his business

    • C. 

      While the equipment is being used off public roadways

    • D. 

      While the equipment is in storage on the named insured’s premises

  • 5. 
    In part two of the liability insuring agreement under the BAP, what does the insurer promise to do?
    • A. 

      To pay for all damages the insured causes due to an auto accident

    • B. 

      To pay all sums the insured legally must pay as a covered pollution cost or expense resulting from an auto accident

    • C. 

      To reimburse the insured for his legal defense costs

    • D. 

      To pay the damages caused by the insured’s breach of contract

  • 6. 
    Is a salesman using his own personal auto on company business an insured under the company’s BAP?
    • A. 

      Yes, if the salesman does not have any personal auto insurance

    • B. 

      No, the employee of the named insured is not an insured while using an auto owned by the employee under the terms of no, the employee of the named insured is not an insured while using an auto owned by the employee under the terms of the BAP

    • C. 

      Yes, but only if the salesman has paid an extra premium for the coverage

    • D. 

      No, unless the work contract between the salesman and the named insured employer requires the salesman to be an additional insured on the employer’s BAP

  • 7. 
    Give an example of an exception to the pollution exclusion in the BAP.
    • A. 

      One of the named insured’s covered autos runs into a tank truck causing the truck’s cargo of pollutants to spill out and result in injuries and property damage

    • B. 

      One of the named insured’s covered autos is transporting pollutants and is hit by a train spilling the pollutants onto the train tracks

    • C. 

      While the pollutants are being moved from the covered auto, they are spilled accidentally into a lake owned by the state

    • D. 

      Bodily injury is claimed when the covered auto overturns and fumes from a resulting hostile fire spread into the air

  • 8. 
    If the insured has three covered autos and all are involved in the same accident, what limits of insurance are available to the insured under the terms of the BAP?
    • A. 

      The insured has the declared limits of liability available to him, not three times the limit

    • B. 

      The insured has three times the declared limits of liability since all three cars are covered autos

    • C. 

      The available limit of insurance depends on whether one or all of the covered autos caused the accident

    • D. 

      The available limits of insurance depend on whether the covered autos were driven by insureds or non-insureds.

  • 9. 
    In the physical damage section of the BAP, the specified causes of loss coverage includes all of the following with one exception. Which one is the exception?
    • A. 

      Fire

    • B. 

      Vandalism

    • C. 

      Collision with another vehicle

    • D. 

      Theft

  • 10. 
    The labor costs the insurer agrees to pay as part of the towing coverage are covered only for what type of performance?
    • A. 

      Labor performed at the place of the covered auto’s disablement

    • B. 

      All the labor necessary to repair the auto at the repair shop

    • C. 

      Only labor costs associated with repairing glass breakage

    • D. 

      The labor costs charged by the repair garage over and above the insured’s physical damage deductible

  • 11. 
    The insurer can pay the actual cash value of the damaged or stolen property at the time of loss or it has one other option. What is the other option?
    • A. 

      The insurer can pay the cost of repairing or replacing the damaged or stolen property with other property of like kind or quality

    • B. 

      The insurer can pay on a replacement cost basis

    • C. 

      The insurer can pay the value agreed upon by the insured and the insurer before the inception date of the auto policy

    • D. 

      The insurer can pay the amount for which the insured is liable

  • 12. 
    How is the deductible shown in the declarations applied?
    • A. 

      The deductible is applied per occurrence

    • B. 

      The deductible is applied on an each covered auto basis

    • C. 

      The deductible is applied on a per claims-made basis

    • D. 

      The deductible is applied on a per insured basis

  • 13. 
    If the named insured and the insurer disagree on the amount of loss, what is the procedure at that point?
    • A. 

      Either party may demand an appraisal of the loss

    • B. 

      The insured must file a lawsuit to determine the proper amount of loss

    • C. 

      Both parties must agree to an appraisal process

    • D. 

      The insurer can pay the amount it decides is appropriate and the insured must file a complaint with the state insurance department

  • 14. 
    All of the following are duties of the insured in the event of a loss except which one?
    • A. 

      Give the insurer prompt notice of the loss

    • B. 

      Send copies of legal papers immediately to the insurer

    • C. 

      Cooperate with the insurer in the investigation of the loss

    • D. 

      Pay the claimant as soon as possible so that the insurer can then reimburse the insured

  • 15. 
    The definition of mobile equipment is detailed but mobile equipment generally refers to what type of vehicles?
    • A. 

      Vehicles that are not usually used on public roads

    • B. 

      Vehicles that the insured uses on personal business

    • C. 

      Vehicles that are used to tow other vehicles or equipment

    • D. 

      Vehicles that are not owned by the named insured

  • 16. 
    What is the meaning of  “covered pollution cost or expense”?
    • A. 

      Any cost or expense arising out of any demand, request or order to test for, clean up, or assess the effects of pollutants

    • B. 

      Property damage claims that are covered by the BAP

    • C. 

      Costs or expenses arising out of the release of pollutants being transported by the insured

    • D. 

      Excess liability coverage offered as an endorsement to the BAP that applies to a pollution claim

  • 17. 
    What is a leased worker?
    • A. 

      A person furnished to the insured for a finite time period to supplement the workforce

    • B. 

      A part time or seasonal employee

    • C. 

      A person leased to the named insured under an agreement with a labor leasing firm

    • D. 

      An independent contractor who leases himself out for periods of six months or less

  • 18. 
    Which one of the following is not considered an “insured contract”?
    • A. 

      A lease of premises

    • B. 

      The obligation to indemnify a municipality

    • C. 

      A car rental contract for a leased auto that comes with a driver

    • D. 

      Any easement or license agreement

  • 19. 
    What is the general purpose of drive other car coverage?
    • A. 

      To grant insurance coverage to a driver of an auto that is not owned by either the driver or the named insured

    • B. 

      To make sure the named insured is an insured for the use of any car

    • C. 

      To allow the physical damage coverage of the BAP to extend to non-owned autos

    • D. 

      To give coverage to a named insured corporation if an employee rents a car for business purposes

  • 20. 
    Under the Drive Other Car Coverage endorsement, which of the following statements is true?
    • A. 

      The spouse of the individual named in the schedule has to be named on the endorsement in order to be considered an insured

    • B. 

      If the spouse is covered under the endorsement, there is an additional premium charged

    • C. 

      The auto used by the named individual can be an auto owned by the individual

    • D. 

      The auto is a covered auto while being used and the named insured is an insured while using the covered auto