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Pennsylvania Property Practice Exam

20 exam-style questions drawn from the same bank as our full Pennsylvania Property course (Pennsylvania Insurance Producer - Property - 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. NFIP pays replacement cost on a principal residence insured to at least
50% of replacement cost100% of replacement cost80% of replacement cost90% of replacement cost
2. An insured under a liability policy is sued. The carrier sends counsel, the case proceeds, and the insured begins missing scheduled depositions and refuses to provide requested documents to defense counsel. The carrier eventually withdraws coverage. The carrier's strongest basis is:
Breach of the duty to cooperate, where the carrier can demonstrate actual prejudice from the insured's noncooperation.Breach of the proof-of-loss condition that governs first-party property valuation disputes, not litigation conduct in a third-party suit.The insured's intentional-acts exclusion that bars coverage for harm the insured expected, not for missed depositions or document refusals.Anticipatory breach because the insured will likely lose the lawsuit under the UCC-derived repudiation standard used in commercial contracts.
3. An insured was injured in a covered accident and his health insurer paid $25,000 of his medical bills. He then settles a third-party liability claim with the at-fault driver for $90,000. The health insurer asserts a subrogation/reimbursement claim against the recovery. The insured argues he hasn't been made whole because the verdict was reduced by comparative fault. The most common doctrinal limit on the health insurer's recovery is:
The exhaustion doctrine, which delays subrogation until appeals are over and all umbrella and excess layers have been formally tapped.The collateral source rule, which permanently bars all subrogation claims as a categorical evidentiary defense applied at trial.The 'made-whole' doctrine, which can limit or bar subrogation when the insured has not been fully compensated for the loss.Sovereign immunity, which protects the insured from any reimbursement obligation by extending the public-entity tort cap to private parties.
4. Which dwelling form covers the dwelling on an open-perils basis?
DP-2DP-3DP-1HO-4
5. Under a homeowners policy, which coverage pays medical bills of an injured guest regardless of fault?
Coverage FCoverage DCoverage CCoverage E
6. On a dwelling policy, which coverage applies to personal property?
Coverage BCoverage CCoverage ACoverage E
7. A small fire damages an insured's garage. The insured waits eight months before reporting the loss, throws away the burned debris, and refuses to let the adjuster inspect the scene. The insurer denies the claim. The strongest legal basis for the denial is:
The premium was not yet earned, applying the pro-rata-earnings rule that suspends coverage whenever any portion of the annual premium remains unallocatedThe fire was excluded as a peril because intentional destruction of evidence converts the loss into an uncovered intentional act under the policyThe policy expired by operation of law because the insured's eight-month delay automatically terminated coverage under the standard lapse provisionMaterial breach of the insured's post-loss duties, prompt notice, protection of property, and cooperation with investigation
8. Which of the following best describes the difference between 'risk' and 'hazard'?
Risk is the insurer's net liability on the contract; hazard is the gross written premium the insured pays at policy inceptionRisk is the uncertainty of loss; hazard is a condition that increases the probability or severity of lossRisk is the actual peril of fire or theft; hazard is the resulting property damage measured under any ISO loss-settlement clauseThey are synonymous terms used interchangeably throughout NAIC model laws and the NAIC Unfair Trade Practices Model Act, with no meaningful distinction at all
9. The first phase of NFIP participation, offering limited coverage before a community's flood maps are complete, is the
Emergency ProgramInterim ProgramPilot ProgramRegular Program
10. An applicant for a homeowners policy is asked: 'Have you had any homeowners or fire claims in the past five years?' He answers 'No.' He had in fact filed a $30,000 fire claim 18 months earlier. The insurer issues the policy. Six months later, a kitchen fire causes a $25,000 loss. The insurer discovers the prior claim during the new claim's investigation. The insurer's strongest action is:
Issue a warning letter but pay, the insurer's exclusive remedy for application omissions discovered after a loss is to assess a renewal surcharge and disclose the prior misstatement to the consumer reporting agency for recordRefer the matter to the state DOI without taking action under the primary-jurisdiction-deference doctrine that compels carriers to obtain regulator approval before any post-loss rescission action against a residential homeownerPay the claim, the prior claim is unrelated to this fire under the separate-occurrence rule that bars rescission for any misrepresentation that does not have a direct causal link to the underlying covered loss now being submitted to the carrierRescind the policy and deny the claim for material misrepresentation, a prior fire claim is material to a fire underwriting decision, and rescission is the standard remedy within the contestability/rescission window
11. Homeowners Coverage D is called
Personal liabilityMedical paymentsLoss of useOther structures
12. A manufacturer's plant is damaged by a covered fire. The plant is shut down for four months. Business-income coverage applies, but the carrier and insured dispute whether the period of restoration ended when physical repairs were completed (month 3) or when the plant returned to pre-loss production levels (month 5). Standard business-income forms typically end the period of restoration:
When the property should be repaired, rebuilt, or replaced with reasonable speed and similar quality, generally tied to physical restoration, not full revenue recovery.On the date the proof of loss is submitted to the carrier under the documentation-trigger rule applied to first-party first-notice timing, not the business-income period of restoration.When the insured returns to full pre-loss revenue levels regardless of physical repair status, applying the extended-period-of-indemnity endorsement that is required on every standard business-income coverage form.Twelve months after the loss in all cases under the statutory cap embedded in most commercial-property forms that limits any time-element loss to a single fixed annual ceiling.
13. Which of the following is typically INELIGIBLE for a BOP?
A small accounting officeA small apartment building under 60,000 square feetA 6,000-square-foot retail clothing storeA 200-room hotel with a restaurant and bar
14. A homeowners policy has been in force continuously for four years. The carrier sends a mid-term cancellation notice citing 'material increase in risk' because the insured installed an in-ground pool without diving board or fence. Which statement best evaluates the carrier's action?
Mid-term cancellations are prohibited under any circumstances once a policy has been in force more than a year, a doctrine derived from the four-year incontestability standard used in life and health, not property and casualty.Only nonpayment can support cancellation; underwriting changes must wait for renewal under the surplus-lines stability rules that govern non-admitted markets, not standard admitted HO policies.Carriers may cancel any in-force policy mid-term with 10 days' notice for any reason, a rule that applies only during the initial underwriting period and never after the first renewal of a personal lines policy.After the first 60-90 days of new coverage, most state codes limit mid-term cancellations to specific grounds such as nonpayment, fraud, or substantial change in risk, a pool with no fence may qualify.
15. The maximum NFIP contents coverage for a residence is
$150,000$250,000$50,000$100,000
16. An umbrella policy (personal or commercial) generally requires:
Lower underlying limits than the umbrella's own retention amount, which would create a coverage gap below the SIRAn ocean marine cargo policy in force on every covered shipment, regardless of whether the insured ships any goods by seaNo underlying coverage of any kind, allowing the umbrella to drop down and respond from the first dollar of every covered lossSpecified minimum underlying limits on the primary HO/PAP/CGL/CA before the umbrella attaches
17. Inland marine coverage for a jeweler's stock is the
Jewelers blockPersonal articlesValuable papersFine arts floater
18. A commercial policy that combines two or more coverage parts, such as property and general liability, is a
Commercial package policyUmbrella policyBusinessowners policyMonoline policy
19. A Bailee's Customers form (e.g., Furrier's Customers, Cleaners') covers:
Workers' comp medical and lost-wage benefits for bailee employees under state workers' compensation law, which has nothing to do with bailment exposuresProperty of customers in the bailee's care, custody, or control, regardless of the bailee's legal liabilityBailee's auto fleet liability and physical damage exposures, which are written on the ISO Business Auto CA 00 01 coverage form rather than inland marineThe bailee's own equipment, machinery, and shop fixtures, a role the BPP Coverage B (Your Business Personal Property) actually fills on a CP 00 10
20. A surgical patient wakes from anesthesia with a burn on his thigh in a position the surgical team had exclusive access to during the procedure. He has no memory of the operation and cannot identify which staff member caused the injury. He sues the hospital. Which doctrine best supports his claim?
Res ipsa loquitur, the injury would not normally occur without negligence and the defendant had exclusive control.Vicarious liability without any need to prove negligence under the hospital-employee imputation doctrine applied to surgical teams.Strict liability because surgery is an ultrahazardous activity that automatically triggers no-fault liability for any participant.Last clear chance because the staff had the final opportunity to avoid the burn and the patient could not protect himself.

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