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Personal Lines

Provider
Prometric
Format
Four-option multiple choice; test center or remote proctoring; English or Spanish
Exam questions
100 scored questions plus 10 unscored questions
Time limit
2 hours 15 minutes
Passing score
70% or higher
Exam fee
$62
Examination outline
  • 1.0 Insurance Regulation (30%)
    • 1.1 Licensing Purpose Process (Insurance Article Annotated Code- Sec. 10-115; Sec.10-116; Sec. 10-104) Initial Licensure Qualifications Examination License fee & application Exemptions to Licensure Types of licensees Producers Business entity producers Nonresident producers Temporary Advisers Public insurance adjusters Limited Lines Producer Portable Electronics Insurance Limited Lines license Maintenance and duration(Insurance Article Annotated Code- Sec. 10-116; Sec. 10-117(b)(1)) Reinstatement and renewal Address change Reporting of actions Assumed names Continuing education requirements, exemptions and penalties Disciplinary actions Cease and desist order Hearings Probation, suspension, revocation, refusal to issue or renew Penalties and fines
    • 1.2 State regulation Commissioner's general duties and powers (Insurance Article Annotated Code-Sec. 2-205 (a)(2)) State Specific Definitions (Insurance Article Annotated Code- Sec. 10-401; Sec. 27-209; Sec. 27-213; Sec. 10-201; Sec 10-126; Ref: COMAR Sec. 31.08.06.02) Company regulation (Insurance Article Annotated Code-Sec. 10-118; COMAR- Sec. 31.15.12.03(B)) Certificate of authority Solvency Rates Policy forms Examination of books and records Producer appointments Producer's Contract with Insurer versus Producer's Appointment with Insurer Producer's Individual Appointment versus Business Entity Appointment Maintaining Record of Appointment Notice Termination of producer appointment Producer regulation (Insurance Article Annotated Code-Sec. 27-212(d)) Examination of Books and Records Insurance Information and Privacy Protection Fiduciary Responsibilities (COMAR- Sec. 31.03.03) Bail Bond (COMAR- Sec. 31.03.05.02(B)(1); Sec. 31.03.05.05) Acting for Unlicensed Insurer Record Retention Activities of Unlicensed Individual Payment and sharing of Commissions Charging of fees Responsibility for Trust Accounts Complaint Record Binders Solvency Rates and Forms Impersonation Larceny Unlicensed persons compensation Unfair or deceptive insurance practices (Insurance Article Annotated Code-Sec. 19-107(a)(2); Sec. 27-501; Sec. 27-213, 212) Misrepresentation False advertising Defamation of insurer Boycott, coercion and intimidation False financial statements Failure to maintain complaint record Unfair discrimination (Insurance Article Annotated Code-Sec. 19-107(a)(2); Sec. 27-501; Sec. 27-213, 212) Unfair claims settlement practices Rebating Insurance fraud regulation Insurance Information and Privacy Protection Competitive Rating
    • 1.3 Federal regulation Fair Credit Reporting Act (15 USC 1681–1681d; Insurance Article Annotated Code- Sec. 27-501) Fraud and false statements including 1033 waiver (18 USC 1033, 1034)
    • 1.4 Maryland laws, regulations and required provisions Maryland Insurers Insolvency Fund Cancellation and nonrenewal (Insurance Article Annotated Code- Sec. 27-609) Concealment, misrepresentation or fraud Appraisal Federal Terrorism Insurance Program
    • 1.5 Maryland auto insurance policy State Auto Insurance Laws & Regulations State Required Limits of Liability (Insurance Article Annotated Code- Sec. 19-512; Sec. 19-504.1(3)(ii); Sec. 19-106; Sec. 17-103) Uninsured/Underinsured Motorist (Insurance Article Annotated Code- Sec. 19-509; COMAR- Sec. 31.15.10.03 Definitions Compulsory coverage Bodily injury to others Personal injury protection (Insurance Article Annotated Code- Sec. 19-505; Sec. 19-506; COMAR-Sec. 31.15.07.05) Benefits/waivers Exclusions Damage to someone else's property Uninsured/underinsured motorist (Insurance Article Annotated Code- Sec. 19-509; COMAR- Sec. 31.15.10.03) Coverage for damage to your auto Medical payments Collision Limited collision Comprehensive Deductibles Substitute transportation Towing and labor General provisions Duties after an accident or loss Selected endorsements Use of other autos — vehicles furnished or available for regular use Coverage for anyone renting an auto to you additional insured — lessor Named Driver Exclusion Maryland Automobile Insurance Fund (MAIF) (Insurance Article Annotated Code- Sec. 20-501(b); Sec. 20-502; Sec. 20-509(e-1)(ii); Sec. 20-201; Sec. 20-511)
  • 2.0 General Insurance (8%)
    • 2.1 Concepts Risk management key terms Risk Exposure Hazard Peril Loss Methods of handling risk Avoidance Retention Sharing Reduction Transfer Elements of insurable risks Adverse selection Law of large numbers Reinsurance
    • 2.2 Insurers Types of insurers Stock companies Mutual companies Reciprocals Self Insurers Risk retention groups Surplus lines carriers Purchasing groups Private versus government insurers Admitted versus nonadmitted insurers Domestic, foreign and alien insurers Financial status (independent rating services) and operating results Marketing (distribution) systems
    • 2.3 Producers and general rules of agency Types Captive Independent Insurer as principal Producer of insurer Authority and powers of producers Express Implied Apparent Responsibilities to the applicant/insured
    • 2.4 Contracts Elements of a legal contract Offer and acceptance Consideration Competent parties Legal purpose Distinct Characteristics of an Insurance Contract Contract of adhesion Aleatory contract Personal contract Unilateral contract Conditional contract Legal interpretations affecting contracts Ambiguities in a contract of adhesion Reasonable expectations Indemnity Utmost good faith Representations/misrepresentations Warranties Concealment Fraud Waiver and estoppel
  • 3.0 Property and Casualty Insurance Basics (9%)
    • 3.1 Principles and concepts Insurable interest Underwriting Function Loss ratio Rates Types Loss costs Components Hazards Physical Moral Morale Negligence Elements of a negligent act Defenses against negligence Proximate cause Torts Damages Compensatory — special versus general Punitive Absolute liability Strict liability Vicarious liability Causes of loss (perils) Named perils versus special (open) perils Direct loss Consequential or indirect loss Blanket versus specific insurance Basic types of construction Loss valuation Actual cash value Replacement cost Functional replacement cost Guaranteed replacement cost Market value Agreed value Stated amount Valued policy
    • 3.2 Policy structure Declarations Definitions Insuring agreement or clause Additional/supplementary coverage Conditions Exclusions Endorsements
    • 3.3 Common policy provisions Insureds — named, first named and additional Policy period Policy territory Cancellation and nonrenewal Deductibles Other insurance Nonconcurrent Primary and excess Pro rata Contribution by equal shares Limits of liability Per occurrence (accident) Per person Split Combined single Restoration/nonreduction of limits Coinsurance Third Party Provisions Vacancy or unoccupancy Named insured provisions Duties after loss Assignment Abandonment Insurer provisions Liberalization Subrogation Salvage Claim settlement options Duty to defend Lien holder provisions Standard mortgage clause Loss payable clause No benefit to the bailee
  • 4.0 Casualty Specific (10%)
    • 4.1 Strict Liability
    • 4.2 Vicarious Liability
    • 4.3 Limits of Liability Per occurrence (accident) Per person Aggregate (general versus products) completed operations Split Combined single
    • 4.4 Restoration - Non-Reduction of Limits
    • 4.5 Named lnsured Provisions Duties after loss Assignment Abandonment
    • 4.6 Insurer Provisions Liberalization Subrogation Salvage Claim settlement options Duty to defend
  • 5.0 Property Specific (9%)
    • 5.1 Causes of Loss (Basic, Broad and Special Forms)
    • 5.2 Direct Loss
    • 5.3 Consequential vs Indirect Loss
    • 5.4 Basic Types of Construction
    • 5.6 Coinsurance
    • 5.7 Loss Valuation Actual cash value Replacement cost Functional replacement cost Guaranteed Replacement Cost Market value Agreed value
  • 6.0 Dwelling Policy (10%)
    • 6.1 Characteristics and purpose
    • 6.2 Coverage forms — Perils insured against DP-1 Basic DP-2 Broad DP-3 Special
    • 6.3 Property coverages Coverage A — Dwelling Coverage B — Other structures Coverage C — Personal property Coverage D — Fair rental value Coverage E — Additional living expense Other coverages
    • 6.4 General exclusions
    • 6.5 Conditions
    • 6.6 Personal liability supplement
    • 6.7 Selected Endorsements Automatic Increase in Insurance Dwelling Under Construction Broad Theft Coverage Limited Theft Coverage Special Provisions
  • 7.0 Homeowners Policy (14%)
    • 7.1 Characteristics and Purpose
    • 7.2 Coverage forms HO-3 Special HO-4 Tenants HO-5 Comprehensive HO-6 Condominium Unit-Owners
    • 7.3 Definitions
    • 7.4 Section I — Property coverages Coverage A — Dwelling Coverage B — Other structures Coverage C — Personal property Coverage D — Additional Living Expense and Fair Rental Value Loss of Use
    • 7.5 Section II — Liability coverages Coverage E — Personal liability Coverage F — Medical payments to others
    • 7.6 Perils insured against
    • 7.7 Additional coverages Debris removal Reasonable repairs Trees, shrubs and other plants Fire department service charge Property removed Credit card, fund transfer card, forgery and counterfeit money Loss assessment Glass or safety glazing material Landlord's furnishings Building Additions and Alterations Claim expenses First aid expenses Damage to property of others
    • 7.8 Exclusions
    • 7.9 Conditions
    • 7.10 Other Policies Mobile Homes
    • 7.11 Selected Endorsements Business Pursuits Earthquake Home Day Care Permitted Incidental Occupancies Personal Injury Personal Property Replacement Cost Scheduled Personal Property Valuable papers Computers Watercraft Special Provisions
  • 8.0 Auto Insurance (8%)
    • 8.1 Personal auto policy Definitions Liability coverage Bodily injury and property damage Supplementary payments Exclusions Coverage for damage to your auto Collision Other than collision Deductibles Transportation expenses Exclusions Medical Payments Protection Against Uninsured/Underinsured Motorists General Provisions Conditions Duties after an accident or loss General provisions Selected endorsements Towing and labor costs Miscellaneous type vehicle Amendment of policy provisions — Maryland Medical expense and income loss benefits coverage — Maryland Transportation expenses coverage — Maryland Joint ownership coverage — Maryland Towing and labor costs — Maryland Extended non-owned coverage for named individual — Maryland Miscellaneous type vehicle — Maryland Uninsured motorists coverage — Maryland Loss Payable Clause
  • 9.0 Other Coverages and Options (2%)
    • 9.1 Personal umbrella Coverages Underlying Coverages Self-Insured Retention
    • 9.2 National Flood Insurance Program "Write your own" versus government Eligibility Coverage Limits Deductibles
    • 9.3 Boatowners including uninsured private pleasure watercraft coverage
    • 9.4 Basic Property Residual Market Maryland Property Insurance Association (FAIR plan)
    • 9.5 Inland marine Personal Articles floaters
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