1 Johnson Lawnmower Repair Shop is insured under an unendorsed CGL Coverage Form. One of Johnson's repairpersons accidentally started a fire that destroyed the entire repair shop and all of the customers' lawnmowers in it. In responding to claims by customers for the damage to their mowers, Johnson's CGL would not provide coverage becasue which one of the following exclusions?

a. Contractual liability

b. Insurer's products and work

c. Mobile equipment

d. Damage to personal property in the insured's care, custody, or control

2. Carol's Giftshop and Antiques is insured under a BPP. Carol has selected the Replacement Cost optional coverage for her building and personal property. Stock has been indicated on the declarations page as being subject to the provision. Carol recently had a theft loss to her store. The Replacement Cost option would apply to which of the following?

a. Property of an employee

b. A signed work of art

c. An antique cherry table and four matching chairs

d. Five new brass floor lamps held for sale

3. Jones Automotive Parts Company has an Commercial Crime Coverage Form that provides $300,000 of Forgery or Alteration Coverage with a $5,000 deductible. Jones paid one of their suppliers for an order with a check in the amount of $40,000. One of the supplier's employees altered the check to read $400,000. Jones submits a claim for $400,000. How much will the insurance company pay for the claim?

a. $295,000

b. $300,000

c. $305,000

d. $395,000

4. A contactor who is insured under a CGL causes damage to a school building and bus with his bulldozer while renovating the school playground. A claim for reimbursement is submitted to the contractor's insurer for: $5,700 to repair the school building, and $1,000 to repair the school bus. Which one of the folloiwing is true egarding settlement of this claim under the CGL?

a. There is no coverage for the loss because of the Aircraft, Auto or Watercraft exclusion

b. There is no coverage for the loss because of the Mobile Equipment exclusion

c. The loss is payable up to $5,700

d. The loss is payable up to $6,700

5. Delmond and Sons, LLC, owns an office which is insured under a BPP. The new CEO of the company reduces the limit of insurance to $100,000 on the building with a $1,000 deductible. The policy has an Agreed Value optional coverage amount of $160,000 on the building. When a covered cause of loss damages Delmond and Son's building in the amount of $80,000, the most the company should receive as reimbursement from the insurer is

a. $49,000

b. $50,000

c. $79,000

d. $80,000

6. Fredline Industries insures its business personal property under the BPP with the Causes of Loss - Broad Form. Which one of the following water related losses involving the covered property would be covered by the Fredline's BPP?

a. Materials were destroyed when the windows were left open during a severe rainstorm

b. Heavy rainfall caused widespread flooding in the area. A piece of machinery that could not be moved was destroyed

c. A sewer pipe was blocked and caused sewerage to back up in the basement

d. A furnace pipe ruptured causing flooding in the storage area and destroying stock

7. Dr. Loretta Warner, a veterinarian, has been in business for one year. In her animal clinic, she employs three college veterinary students as well as two pet groomers. Dr. Warner believes her property insurance is adequate, but her insurance agent has advised her that she needs to consider her business income loss exposure. Which one of the following statements is true regarding a business interruption for Dr. Warner?

a. A substantial reduction in operating expenses during a brief shutdown period is a normal and expected occurrence

b. A business cannot incur extra expenses during a shutdown

c. If the animal clinic were not able to open for three months, there would be no continuing expenses.

d. When the animal clinic is temporarily closed, it must continue to pay most of its normal operating expenses

8. Ernest, a butcher, owns Spring Hill Farm and operates a meat and poultry delivery business. Spring Hill Farm owns and operates five trucks used to deliver the meat and poultry products to local restaurants. The employed truck drivers are required to back up to a platoform in the pick-up area of the butcher shop each morning to load the trucks. The trucks are loaded with up to $2,000 worth of meat and poultry. Ernest is concerned about damage to the building if one of the drivers is inattentive or careless when backing the trucks for loading. Which one of the following causes of loss forms best addresses Ernest's concerns about vehicle damage to the building?

a. Broad Form

b. Special Form

c. General Form

d. Basic Form

9. Jenkins Corporation is insured by Insurer A and Insurer B under separate CGL Forms which permit contribution by equal shares. A liability claim in the amount of $500,000, for which both companies provide primary coverage, is filed against Jenkins. Insurer A has a limit of $200,000 for each occurrence and Insurer B has a limit of $400,000 for each occurrence. How much will be paid by Insurer B towards settlement of the claim?

a. $100,000

b. $200,000

c. $300,000

d. $400,000

10. The heating and air conditioning system at Hager Industries is eighteen years old. Even though the system is inspected on an annual basis, the owners want to make sure that they are properly protected for the various perils that could affect the equipment. Which one of the folloiwing would need to be covered by a separate Equipment Breakdown Policy?

a. A combustion explosion created by the accumulation of unburned fuel in the system

b. Fire damage to the building resulting from the explosion of a steam boiler

c. The explosion of an unfired air tank in the basement

d. The rupturing of steam pipes carrying heat from the steam boiler