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Virginia Personal Lines Practice Exam

20 exam-style questions drawn from the same bank as our full Virginia Personal Lines course (Virginia Personal Lines Property and Casualty Agent — 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 Virginia agency circulates a flyer claiming a rival carrier 'is close to insolvency and will not be able to pay claims,' with no basis. What is this?
Twisting, an inducement to lapse a policy in favour of another oneDefamation, a maliciously false statement about an insurer's conditionFalse advertising, an untrue statement made to sell the agency's productBoycott, an agreement to withhold business from a competing insurer
2. The standard increment for personal umbrella limits is:
$10,000,000$1,000,000$100,000$10,000
3. An insured carries UM/UIM limits of $30,000 per person. He is hit by an at-fault driver carrying $25,000 in BI liability per person. His medical bills total $40,000. Under a typical 'limits-reduced' (offset) UIM clause, how much UIM is payable?
$0 — UIM never pays when the tortfeasor had any liability coverage$5,000 — his $30,000 UIM limit reduced by the $25,000 already recovered$30,000 — the full per-person UIM limit$15,000 — the difference between his medical bills and the tortfeasor's limit
4. A representation on an insurance application must be:
Substantially true and material to the underwriting decisionNotarized by a commissioned officer of the carrier on fileAbsolutely true in every detail with no exceptions allowedMade under oath before a notary or other authorized officer
5. Personal injury coverage under an umbrella commonly extends to:
Libel, slander, defamation, false arrest, malicious prosecution, invasion of privacyProperty damage only including economic loss to tangible items but excluding any bodily-injury or emotional-distress claimsWorkers' comp injuries to household employees under the broadened occupational injury extension of the personal umbrellaBodily injury only under the standard ISO definition that excludes any non-physical or emotional injury claims
6. An insured carries a $1M umbrella above 250/500/100 PAP and $300,000 HO liability. A covered auto accident results in a $2,000,000 BI award against the insured. How does coverage stack?
PAP pays $250,000; umbrella pays $1,750,000; insured pays nothing under the umbrella drop-downUmbrella pays the full $2M under the broadened liability extension that ignores underlying limitsPAP pays $500,000 under the per-accident BI limit; umbrella pays $1.5M; insured pays nothing personallyPAP pays $250,000 (per-person limit); umbrella pays $1,000,000; insured personally owes $750,000
7. Notice of nonrenewal on a casualty policy is generally required:
On the renewal date itself under the same-day notice rule applied to casualty insuranceWithin 10 days of the renewal date under the post-expiration notice provision of casualty lawOnly orally through a telephone call to the named insured before the casualty policy expiresA specified number of days (commonly 30-60) before the policy's expiration date, in writing
8. Which statement about the interaction of federal and Virginia privacy rules is accurate?
Neither applies to a producer, because both reach insurers and banks onlyVirginia's act preempts federal privacy law because insurance is state regulatedFederal privacy law preempts Virginia's act entirely for licensed producersA producer must satisfy both the federal notice rules and Virginia's own act
9. A PAP insured carries $25,000 UIM (underinsured motorist). She is hit by an at-fault driver carrying state-minimum 25/50 BI. Her actual BI damages are $65,000. Under a typical 'limits-reduction' UIM provision (offset), her recovery from her own UIM is:
$65,000 — full damages up to UIM availability$25,000 — full UIM limit, in addition to the $25,000 from the at-fault driverZero — her UIM limit equals the at-fault driver's limit, so UIM does not 'trigger'$40,000 — damages less the at-fault liability payment
10. What is the federal government's role under the National Flood Insurance Program's Write Your Own arrangement?
It bears the underwriting risk while private insurers issue and service policiesIt issues every flood policy directly and pays claims through federal adjustersIt reinsures private flood insurers for the portion of loss above their retentionIt guarantees the solvency of private flood insurers writing in coastal counties
11. Which of the following is a typical duty of the insured under a casualty policy when a covered injury occurs on the premises?
Refuse to discuss the incident with anyone including emergency responders, third parties, or claim investigators on fileTake steps to protect the injured person and provide reasonable first aid; cooperate with insurer's investigationProvide first aid only if a medical professional is present at the scene of the incident on the residence premisesPay the third party's medical bills personally before notifying the carrier or filing a claim under the casualty policy
12. An insured uses his personal vehicle to deliver food via a gig-economy app three nights a week. He does not disclose this on his application or renewal. He is involved in a wreck while between deliveries (logged into the app, awaiting an order). The PAP will most likely:
Pay the entire claim because between-delivery periods while a gig driver is awaiting an order are treated as personal use under the PAP's standard 'private-passenger-use' coverage extension provision in every state's filingPay subject to a 20% coinsurance penalty for the undisclosed delivery use under the PAP's standard 'use-misclassification' partial-payment formula filed and approved as a permitted rating-correction remedyPay because gig-economy delivery app drivers are statutorily covered under personal auto policies the same way resident-relative family members are insured under the standard household-coverage provision of the PAP formDeny under the public/livery or 'transportation network company' exclusion, which is commonly written to exclude the entire period from logging in until the passenger or food is delivered
13. A PAP insured rents a car for a weeklong vacation. He decides to decline the rental car company's loss-damage-waiver to save money. He believes his PAP covers the rental. He damages the rental in a parking lot. His PAP carries 100/300 BI, $50,000 PD, comprehensive and collision with $500 deductibles on his owned sedan. Coverage for the rental:
Applies only if the insured purchased the rental company's collision damage waiver, which must be in force for the PAP's non-owned-auto extension to drop down behind it as excess coverage at the time of lossDoes not apply — short-term rentals are categorically excluded from the PAP definition of 'your covered auto' and require a separate non-owned-auto endorsement filed and rated as a commercial-auto extensionApplies only for liability under Part A; physical damage to the rental vehicle requires the specifically-filed 'rental physical damage endorsement' added at policy inception with an additional premium chargeApplies — the rental qualifies as a 'temporary substitute' or 'non-owned auto'; physical-damage coverage extends to it on the same terms as the broadest coverage on any owned auto
14. A Virginia resident agent's nonresident license in another state is suspended by that state's regulator. What is her Virginia obligation?
Report nothing, since the other state notifies Virginia through the NAICReport the administrative action within 30 days of the initial notice of itReport the administrative action within 30 days of its final dispositionReport the action only if the other state's conduct would violate Va. law
15. A property worth $500,000 is insured under a policy with an 80% coinsurance clause. The insured carries $300,000. A $100,000 loss occurs. Ignoring deductible, the insurer pays:
$75,000$100,000$60,000$80,000
16. Which Virginia chapter governs the collection, use and disclosure of personal information gathered in insurance transactions?
Chapter 20, the Regulation of Rates for Certain Types of InsuranceChapter 6, the Insurance Information and Privacy Protection ActChapter 5, the Virginia Unfair Trade Practices Act provisionsChapter 16, the Property and Casualty Guaranty Association law
17. A PAP insured swerves to avoid a deer at 50 mph, leaves the roadway, and hits a tree. The car is totaled. The damage is paid under:
Collision — impact with a stationary objectUM — no other driver involvedLiability — single-vehicle accidentsComprehensive — animal-related loss
18. Compulsory auto insurance laws require:
Drivers to carry PIP only under the no-fault first-party benefit mandate adopted by statesAll drivers to be self-insured through filing a financial-responsibility bond with the state DMVDrivers to carry comp and collision under the mandatory physical-damage statutesDrivers to carry liability insurance at minimum statutory limits
19. Burglary is generally distinguished from robbery by:
Robbery only occurs at night under the common-law nighttime requirement, while burglary can occur during daylight hours within commercial or residential premises that have been left unattendedBurglary involves only commercial property under the commercial crime form, while robbery applies to personal property taken from individuals on residential premises or in any public locationBurglary involves a victim while robbery does not, since burglary requires an occupant on the premises but robbery can be committed against unattended property in a public area or commercial locationBurglary requires forcible entry into closed premises with visible signs of forced entry; robbery is the taking of property from a person by force or threat
20. An insured stores fireworks in his attached garage, lights one, and it ignites the garage AND severely burns a friend who was helping. The HO-3 excludes 'expected or intended' bodily injury and property damage. The insured argues he 'didn't expect' anyone to get hurt. The insurer's coverage analysis turns on:
Whether the act of lighting fireworks was a covered 'occurrence' — meaning an ACCIDENT — given that the burn injury was the direct expected outcome of an intentional actWhether the homeowner had completed a state-approved fire-safety certification course within the 12 months immediately preceding the date of lossWhether the injured friend signed an enforceable assumption-of-risk waiver before participating in the pyrotechnics demonstration under premises-liability case lawWhether the state DOI has approved an indoor-fireworks endorsement on the HO-3 form for use within attached-garage spaces at residential premises

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