Free New Hampshire Producer's Casualty Insurance Practice Questions

Sample Practice Questions

Try these 10 sample questions from the New Hampshire Producer's Casualty Insurance practice bank. Each includes the answer and explanation. Continue with the interactive practice above to review the full question set.

1. 1A New Hampshire applicant plans to advise buyers about the substantive terms of casualty policies and obtain coverage for them. Which licensed role does state law describe?

   1. A. Insurance producer
   2. B. Insurance adjuster
   3. C. Insurance consultant only
   4. D. Surplus lines insurer

   Answer: A

   Explanation: RSA 402-J:2(V) describes an insurance producer as "a person required to be licensed under the laws of this state to sell, solicit, or negotiate insurance." The planned activity falls within that role.

   Reference: Chapter 402-J PRODUCER LICENSING — Section 402-J:2

2. 2An insurer increases an applicant's premium partly because of a consumer report. Under the FCRA, to whom must the insurer provide notice of this adverse insurance action?

   1. A. To the consumer affected by the premium increase.
   2. B. To the producer who submitted the insurance application.
   3. C. To the agency that supplied the consumer report.
   4. D. To the state commissioner supervising the insurer.

   Answer: A

   Explanation: "Section 615(a) of the FCRA requires you to provide a notice of the adverse action to the consumer." The FCRA §615(a) notice goes to the affected consumer. Producers, reporting agencies and regulators have other roles but do not replace that recipient.

   Reference: FTC Consumer Reports: What Insurers Need to Know — FTC guidance, Adverse Action Notices, opening paragraph

3. 3A warehouse owner asks which term names the fire itself as the cause of a covered property loss. What is that cause called?

   1. A. Hazard
   2. B. Peril
   3. C. Risk
   4. D. Exposure

   Answer: B

   Explanation: "Peril - the cause of property damage or personal injury, origin of desire for insurance." Fire is the cause of damage, which is a peril; risk describes uncertainty about loss rather than its cause.

   Reference: NAIC Glossary of Insurance Terms — Entry: Peril

4. 4A court awards an injured claimant the wages lost because of an accident. What type of damages is the wage-loss award?

   1. A. Compensatory damages
   2. B. Punitive damages
   3. C. Nominal damages
   4. D. Statutory damages

   Answer: A

   Explanation: "Compensatory damages, financial losses" "Punitive damages, additional penalties" Lost wages compensate an actual financial loss. Punitive, nominal and statutory damages are genuine award categories with different purposes or bases.

   Reference: NAIC Small Business Insurance — Liability coverage, damages table

5. 5A driver damages a neighbor's fence with the insured car. Which personal auto coverage addresses the driver's liability for the neighbor's property damage?

   1. A. Collision coverage
   2. B. Property damage liability
   3. C. Other-than-collision coverage
   4. D. Uninsured motorists coverage

   Answer: B

   Explanation: "Property damage liability coverage pays for damages you cause to someone else’s car or objects and structures you hit with your car." The damaged fence belongs to someone else, so the driver's third-party property damage liability is implicated, rather than coverage for the driver's own car.

   Reference: NAIC What You Should Know About Auto Insurance Coverage — Auto insurance coverages, Property Damage Liability

6. 6A company employee uses a car the employee personally owns to visit customers on company business. How is that car classified from the company's business-auto ownership perspective?

   1. A. A company-owned automobile
   2. B. A company-hired automobile
   3. C. A company-leased automobile
   4. D. A company non-owned automobile

   Answer: D

   Explanation: "special provisions for rented and other non-owned vehicles, including employees' cars driven" "for company business." The company neither owns, hires nor leases this employee-owned car; its business use is a non-owned auto exposure.

   Reference: NAIC Small Business Insurance — Commercial auto insurance, non-owned vehicles

7. 7A contractor installs a handrail and leaves the premises. Several weeks later the rail fails and injures a visitor. Which CGL exposure addresses injury arising from the contractor's prior work?

   1. A. Premises liability exposure
   2. B. Ongoing-operations exposure
   3. C. Completed-operations exposure
   4. D. Contractual-liability exposure

   Answer: C

   Explanation: "Completed operations covers your potential liability for bodily injury or property damage that arises out of your completed work." The handrail injury arose after installation and departure, so it is completed operations rather than the contractor's current operations or a separate assumed contract duty.

   Reference: California Department of Insurance Commercial Insurance Guide — Commercial General Liability, completed operations

8. 8A consultant gives faulty risk analysis to a business client, causing the client a financial loss. Which specialty liability coverage addresses a claim based on the quality of that advisory service?

   1. A. Professional errors-and-omissions coverage
   2. B. Directors-and-officers liability coverage
   3. C. Employment-practices liability coverage
   4. D. Cyber-liability-and-network coverage

   Answer: A

   Explanation: "Professional liability for errors and omissions such as" "failure to provide appropriate advice, errors in the delivery of professional services" Errors in professional advice or service are the E&O exposure; director conduct, employment practices and network events are different specialty risks.

   Reference: NAIC Small Business Insurance — Professional Liability Insurance

9. 9A New Hampshire claims examiner evaluates whether an accidental injury is a workers' compensation injury. Which paired relationship to employment does the statute require?

   1. A. It arises from work and is reported to the employer.
   2. B. It occurs on employer premises during a scheduled shift.
   3. C. It occurs during a shift and produces lost work time.
   4. D. It arises out of work and occurs in its course.

   Answer: D

   Explanation: "means accidental injury or death arising out of and in the course of employment, or any occupational disease" The statute requires both causal connection to work and occurrence in the course of employment. Reporting, physical location and lost time are different facts.

   Reference: Chapter 281-A Workers Compensation — RSA 281-A:2(XI), Injury

10. 10A licensed producer claims that possession of the New Hampshire license itself authorizes her to bind any insurer. What is correct?

    1. A. The license creates inherent authority only
    2. B. The license creates apparent authority only
    3. C. The license itself creates no authority to represent or commit an insurer
    4. D. The license creates actual authority for every admitted insurer

    Answer: C

    Explanation: RSA 402-J:2(VI) says, "The license itself does not create any authority, actual, apparent, or inherent, in the holder to represent or commit an insurance carrier." Separate authority is required.

    Reference: Chapter 402-J PRODUCER LICENSING — Section 402-J:2