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Delaware Casualty Practice Exam

20 exam-style questions drawn from the same bank as our full Delaware Casualty course (Delaware Insurance Producer - Casualty - Exam Prep). Answer all 20, then grade yourself — most state exams require 70% to pass. Explanations for every question are part of the full course.

1. CGL policies generally exclude 'pollution' liability with a few narrow exceptions. Which of the following is typically NOT excluded as 'pollution'?
Toxic chemicals intentionally discharged by the insured — applicable to commercial scenarios only, not the personal-lines contextLeaking pesticides from a contractor's truck on a customer's farm.Gradual seepage from an underground storage tank on the insured's premises.A BOPE (building owner/protective equipment) heating-system fumes hostile-fire exception — BI to guests from smoke at a covered hotel.
2. A defendant obtains insurance between being charged under 2118 and being sentenced. What may the court do?
Nothing, because the penalties are fixed by statuteSuspend the minimum fine that would otherwise applyDismiss the charge and restore the licence at onceReduce the suspension from six months to three
3. A Certificate of Insurance (COI) issued to a third party (e.g., a general contractor receiving a COI from its subcontractor's insurer) does which of the following?
Obligates the insurer to notify the certificate holder of cancellation.Provides evidence of coverage without altering, extending, or granting rights under the actual policy.Grants the certificate holder additional-insured status automatically.Is considered a policy change and binds the insurer to whatever is on the certificate.
4. A Businessowners Policy (BOP) is BEST described as:
A package policy combining property, liability, and certain time-element coverages into one contract for eligible small-to-mid-size businesses.A workers compensation policy with liability attached, under the broader consumer-protection construction sometimes applied hereA homeowners form adapted for small businesses — required if and only if the policy includes a co-insurance penalty endorsementA monoline commercial property policy — only when the contract was issued before the regulatory amendment described above
5. Under which chapter of Title 18 is a Delaware surplus lines broker separately licensed?
Chapter 19Chapter 17 aloneChapter 23Chapter 41
6. Which of the following is typically required by a personal umbrella policy as an 'underlying limit'?
A minimum of $1,000,000 on every underlying policy.Minimum limits only if the insured has a swimming pool, per the safe-harbor exception that activates only for primary-state filingsNo underlying coverage — the umbrella stands alone.Specified minimum limits on auto liability, personal liability (HO), and sometimes watercraft/RV — often 250/500/100 for auto and $300K for HO.
7. Workers' Compensation Part One is unique among P&C coverages because it has:
Per-occurrence limits of $1,000,000 per claim regardless of statute, an artificial cap that contradicts the unlimited benefits payable under WC Part OneAn aggregate annual limit of $50,000 per insured regardless of the statutory benefits actually owed under the state workers' compensation systemNo dollar limit — the insurer pays whatever statutory benefits applyA 50% coinsurance penalty applicable to every claim, an artificial limitation that no workers' compensation statute or any WC 00 00 00 A form ever imposes
8. On a CGL, 'supplementary payments' (e.g., interest on judgments, bond premiums, expenses incurred at the insurer's request, lost-wage reimbursement up to a daily cap) are paid:
Only if insured pays a separate premiumIn ADDITION to the limitOut of the per-occurrence limitOnly after the deductible is paid
9. A surety bond involves three parties:
Insurer, agent, insuredEmployer, employee, beneficiaryPrincipal, obligee, suretyLender, borrower, mortgagee
10. A customer slips on a wet floor inside a hardware store and breaks her wrist. The store's CGL pays her $8,400 ER bill without any dispute over fault, and also pays $62,000 in damages after she sues. Which CGL coverage parts responded to the $8,400 and the $62,000, respectively?
Coverage A for both paymentsCoverage B for the $8,400; Coverage A for the $62,000Coverage A for the $8,400; Coverage C for the $62,000Coverage C for the $8,400; Coverage A for the $62,000
11. A producer has been continuously licensed for twenty-eight years. What does Regulation 504 give them?
An automatic 12 credits each biennium, which cannot be ethics creditsAn automatic 24 credits, satisfying the whole requirementA reduction of the ethics requirement to one creditA complete exemption from all continuing education
12. Which power belongs to the FIRST named insured alone?
Cancelling the policy and receiving the cancellation noticeBeing defended by the company against a covered suitBeing named on a certificate of insurance for a jobMaking a first-party claim under the policy conditions
13. A physician's malpractice policy contains a 'consent-to-settle' (hammer) clause. The insurer wants to settle for $125,000; the physician refuses because he believes he did nothing wrong. Under a typical hammer clause, what happens if the claim later exceeds the proposed settlement?
The policy is void for failure to cooperate — though only when the underlying contract contains an explicit waiver, which the scenario doesn't establishThe insurer may unilaterally settle despite the insured's refusal — required under a separate compliance provision that doesn't reach this fact patternThe insurer pays whatever the final verdict is, up to the policy limit, consistent with the model regulation but inapplicable to this scenarioThe insurer's liability is capped at the amount for which it could have settled ($125,000), plus defense to that point — the insured pays anything above.
14. A producer licensed in another state holds a Delaware non-resident licence. What continuing education does Delaware require of them?
3 credits of Delaware law each biennium24 credits including 3 ethics, as for residentsNone, because non-residents are exempt from Delaware CE12 credits including 3 ethics each biennium
15. A general contractor receives a certificate of insurance from a subcontractor's agent stating that the GC is listed as an additional insured on the sub's CGL. No AI endorsement is actually attached to the sub's policy. A worker is injured on the jobsite and sues both the sub and the GC. Which statement is CORRECT?
The COI modifies the policy to add the GC, as long as the carrier was notified of the COI's issuance, under the broader consumer-protection construction sometimes applied hereThe COI evidences coverage but does not grant it; the GC is not an additional insured, and the issuing agent has serious E&O exposureThe COI creates additional-insured coverage because the GC relied on it in good faith — applies if the loss is partial; this question describes a constructive total lossThe GC has coverage under the doctrine of reasonable expectations, regardless of the underlying endorsement, consistent with the model regulation but inapplicable to this scenario
16. Under 18 Del. C. 3905, how much notice is required to cancel a Delaware AUTOMOBILE policy for nonpayment?
20 days15 days10 days30 days
17. The Business Owners Policy (BOP — BP 00 03) automatically includes which coverage that the CPP does NOT include without scheduling?
Statutory workers' compensation Part One benefits for injured employees12 months of business income with no separate dollar limitCommercial auto liability for owned, hired, and non-owned autosStand-alone pollution liability with full-limit environmental restoration
18. An umbrella policy provides three benefits compared to an excess policy. Which is NOT one of them?
Coverage for some losses not covered by the underlying policies (subject to a self-insured retention)Higher overall limitsAutomatic primary coverage from dollar oneDrop-down coverage when underlying limits are exhausted by other claims
19. Part Two of a Workers' Compensation and Employers Liability policy (WC 00 00 00 A) provides:
Employers Liability — coverage for the employer's tort liability for workplace injuries that fall outside the workers' comp systemWorkers' compensation statutory benefits payable to injured employees under the state act, an exposure addressed by Part One — not Part Two — of WC 00 00 00 AFirst-party short-term and long-term disability income benefits payable directly to the employee, an unrelated coverage line not provided under any part of WC 00 00 00 AFirst-party group or individual health insurance benefits payable directly to the employee, an unrelated coverage line not provided under any part of WC 00 00 00 A
20. A drywaller finishes hanging sheetrock in a new home and tells the general contractor the job is done. Two days later, the drywaller returns to inspect for blemishes — at the GC's request — and notices nothing. Six months later, a sheet falls and injures the homeowner. Which CGL category applies?
Products-completed operations — work was put to its intended use after being abandoned by the insuredOperations — because the inspection visit returned the insured to the job site under the return-to-the-work rule that resets completionPremises — the loss occurred at someone's premises and any third-party injury at a residence falls under premises liability rather than completed operationsExcluded — once a job is turned over, the CGL terminates exposure under the strict completion-cutoff rule that bars all post-completion claims

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