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Hawaii Personal Lines Practice Exam

20 exam-style questions drawn from the same bank as our full Hawaii Personal Lines course (Hawaii Insurance Producer — Personal Lines — 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. A policy has a $1,000 deductible. A covered loss totals $4,000. The insured pays the deductible. The insurer's loss payment is:
$1,000$4,000$5,000$3,000
2. Under FCRA, an insured who has been adversely affected by a consumer report is entitled to:
Free annual credit reports and the right to dispute inaccurate informationA premium refund of the unearned portion of the most recent renewal collectedAutomatic policy issuance regardless of underwriting findings on the reportPunitive damages under the FCRA private cause of action for adverse action
3. An HO-3 lists 16 named perils for personal property. Which of the following is NOT one of them?
FloodTheftFire or lightningVolcanic eruption
4. The Law of Large Numbers states that as the number of similar exposure units increases, the:
Cost per insured rises, under the alternative procedure that applies only when both parties stipulate to it in writingProbability of any single loss decreases, per the safe-harbor exception that activates only for primary-state filingsPredictability of group loss experience improvesInsurer's reserves can be lowered
5. When a Personal Articles Floater uses 'agreed value,' what does that mean?
The insurer determines the value at the time of loss using the standard ISO actual cash value depreciation schedule applied to scheduled propertyCoverage is limited to the depreciated value using the same straight-line method that applies to unscheduled personal property under the homeowners Coverage C provisionThe insured and insurer pre-agree to the item's value, and that figure is paid in the event of total lossThe insured must prove ownership at the time of loss through receipts and serial numbers consistent with the proof-of-loss requirements that apply to all unscheduled property
6. A baseball breaks the insured's large picture window during a covered occurrence; the glass cost is $1,800. The HO-3 Glass or Safety Glazing Material additional coverage:
Caps at $250 per pane of glass under the standard additional-coverage breakage sublimit applicable to window lossesCovers breakage of glass that is part of a covered building with no separate sublimit — paid up to the applicable Coverage A or BPays only when the window is constructed of shatterproof safety glass meeting current building-code impact-resistance standardsExcludes any glass breakage as a covered loss under the unendorsed HO-3, requiring a separate window-glass-breakage endorsement
7. On a liability policy, the duty to defend is generally:
Owed only to the named insured, not additional insureds listed on the schedule attached to the declarationsTriggered by allegations that, if true, would be covered — even if those allegations are later proven falseLimited to a specific dollar cap that is filed separately from the per-occurrence indemnity limit in the policyTriggered only if the insurer ultimately must indemnify after the underlying liability suit reaches a verdict on the merits
8. On a personal-lines property application, an applicant fails to mention that the home has had three prior fire-loss claims in five years. This omission is best characterized as:
An honest mistake with no consequenceA warranty breach only if the insurer askedA material concealment that may void the policyAn immaterial misstatement
9. An insured rents the basement apartment of her home to a tenant for $1,400/month. A covered fire makes the basement unit uninhabitable for four months while repairs are completed. The tenant relocates and stops paying rent. The insured had no separate business income coverage. How does her HO-3 respond to this rental income loss?
Coverage B Other Structures applies because the basement is a separate occupancyCoverage D Fair Rental Value reimburses the lost rent, up to the Coverage D limitCoverage E personal liability covers the lost rent because the tenant suffered a lossIt does not respond — rental of part of the dwelling voids Coverage D
10. An HO-3 has $400,000 Coverage A. What is the default Coverage C personal property limit?
$200,000 — 50% of Coverage A$400,000 — equal to Coverage A$80,000 — 20% of Coverage A$40,000 — 10% of Coverage A
11. An insured chooses a $250 comprehensive deductible and a $1,000 collision deductible. He has a $3,000 collision loss and a separate $2,000 hailstorm loss. The total amount the carrier pays is:
$2,000 collision (3,000 − 1,000) + $1,750 comprehensive (2,000 − 250) = $3,750$3,750 collision + $2,000 comp = $5,750 (deductibles waived for multi-event losses)$2,000 because only the larger loss is paid$1,250 because deductibles are added together
12. A PAP insured is involved in a crash. She has med-pay limits of $5,000 and PIP (in a no-fault state) of $10,000. Her own injuries total $7,500 in medicals. Her health insurer paid $7,500 already, subject to a $1,500 deductible/copay borne by the insured. The combined PAP recovery the insured may receive from med-pay and PIP, considering the indemnity principle and typical anti-stacking coordination, is closest to:
$0 — health insurance is primary and exhausts the indemnity ceiling$7,500 — the actual medical loss billed before any health-plan adjustment$1,500 — only the out-of-pocket deductible/copay$15,000 — full med-pay plus full PIP limit, stacked under the dual-coverage rule
13. An insured's car is stolen with a $1,500 set of golf clubs and a $400 car seat in the trunk. The car is recovered damaged. The PAP will respond to:
Only the vehicle itself and the child car seat — sporting equipment is excluded under the PAP's personal-effects-in-vehicle exclusion languageThe vehicle and built-in equipment under comprehensive — personal contents like golf clubs and the child car seat are not covered under the PAP and must be claimed under the homeowners policyThe vehicle, the golf clubs, and the car seat together under comprehensive theft coverage, which is extended to all personal property contained inside the insured auto at the time of the reported lossThe vehicle under Part D collision because theft involves displacement, and the contents separately under Part D comprehensive on the insured auto
14. Under a typical PAP med pay coverage, which person is LEAST likely to be considered an 'insured' eligible for med pay benefits?
A guest passenger in the covered auto injured during a single-vehicle wreck while the named insured was operating the vehicleThe named insured personally injured as a pedestrian struck by a car while crossing a public street near the residence premisesThe named insured's adult son who lives in his own apartment and is injured while driving his own car, which is insured under a separate PAPThe named insured's resident spouse injured while occupying a friend's non-owned auto on a weekend out-of-town shopping trip
15. Which dwelling form settles dwelling losses on an actual cash value basis as its default?
DP-3DP-1DP-2Both DP-2 and DP-3
16. On a DP-3, dwelling losses are paid on a replacement cost basis if the insured carries:
100% to valueAt least 80% to valueAt least 50% to valueAt least 70% to value
17. A driver insured under PAP A causes an accident while driving a friend's car (with permission) that is also insured. Whose policy responds first for liability?
The owner's PAP — the policy on the auto being driven is generally primaryBoth pro rata under the dual-policy concurrent-coverage rule that splits losses between covering carriersNeither — the driver pays personally under the permissive-use exclusion in the ISO PAP for non-owned autosThe driver's PAP under the operator-follows-the-driver rule applicable to non-owned auto claims
18. Which of the following is a typical duty of the insured under a casualty policy when a covered injury occurs on the premises?
Provide first aid only if a medical professional is present at the scene of the incident on the residence premisesTake steps to protect the injured person and provide reasonable first aid; cooperate with insurer's investigationPay the third party's medical bills personally before notifying the carrier or filing a claim under the casualty policyRefuse to discuss the incident with anyone including emergency responders, third parties, or claim investigators on file
19. An insured carries UMPD (uninsured motorist property damage) with a $250 deductible. Her parked car is struck by a hit-and-run driver overnight. Under most policies, what is the most common issue with paying a UMPD claim for a phantom vehicle?
UMPD waives the standard property-damage deductible entirely whenever the insured vehicle was parked and unoccupied at the moment of the loss eventMany policies exclude UMPD for hit-and-run unless there is physical contact AND the vehicle is identified, pushing the loss to collision insteadUMPD always pays first ahead of collision coverage regardless of physical contact requirements under the standard primary-UMPD rule for parked vehiclesUMPD pays only when the insured carries no collision coverage on the policy at the time the parked-vehicle hit-and-run loss occurred
20. An insured purchases liability limits of $250/500/100 but only $30/60/25 UM/UIM. Three years later he is severely injured by an underinsured driver. He sues his own carrier for the difference between his liability and UM limits, arguing UM should match liability. The most likely outcome is:
UM attaches at the state minimum regardless of his written electionThe court will reform the policy to set UM equal to liability automaticallyThe carrier owes him the liability limit because UM cannot be lower than liability under any state lawThe lower UM limits stand because he signed a valid written rejection of higher UM at application

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