California Insurance Practice Test - Free 20 Questions

Question 1

Under an HO-3 (Special Form) policy in California, which of the following perils is covered for personal property (Coverage C)?

Accepted Answer

Named perils specifically listed in the policy such as fire, theft, and windstorm

Answer

All risks/open perils except those specifically excluded

Answer

Flood and earth movement automatically

Answer

Wear and tear, rust, and smog

Question 2

If a building valued at $300,000 has an 80% coinsurance clause and is insured for $180,000, how much will the policy pay for a $60,000 loss (ignoring deductible)?

Accepted Answer

$45,000

Answer

$60,000

Answer

$36,000

Answer

$48,000

Question 3

In California property insurance, actual cash value (ACV) is best defined as:

Accepted Answer

Replacement cost minus physical depreciation

Answer

Original purchase price minus inflation

Answer

Market value at the time of purchase

Answer

Full cost to rebuild without depreciation

Question 4

Which dwelling policy form (DP) provides open-perils coverage on the dwelling structure?

Accepted Answer

DP-3 (Special Form)

Answer

DP-1 (Basic Form)

Answer

DP-2 (Broad Form)

Answer

None of the above

Question 5

Under California insurance regulations, the FAIR Plan (Fair Access to Insurance Requirements) is designed to:

Accepted Answer

Provide basic property insurance to property owners unable to obtain coverage in the voluntary market

Answer

Provide free property insurance to low-income homeowners

Answer

Regulate real estate property prices

Answer

Guarantee zero deductibles for high-risk properties

Question 6

Under an HO-3 (Special Form) policy in California, which of the following perils is covered for personal property (Coverage C)?

Accepted Answer

Named perils specifically listed in the policy such as fire, theft, and windstorm

Answer

All risks/open perils except those specifically excluded

Answer

Flood and earth movement automatically

Answer

Wear and tear, rust, and smog

Question 7

If a building valued at $300,000 has an 80% coinsurance clause and is insured for $180,000, how much will the policy pay for a $60,000 loss (ignoring deductible)?

Accepted Answer

$45,000

Answer

$60,000

Answer

$36,000

Answer

$48,000

Question 8

In California property insurance, actual cash value (ACV) is best defined as:

Accepted Answer

Replacement cost minus physical depreciation

Answer

Original purchase price minus inflation

Answer

Market value at the time of purchase

Answer

Full cost to rebuild without depreciation

Question 9

Which dwelling policy form (DP) provides open-perils coverage on the dwelling structure?

Accepted Answer

DP-3 (Special Form)

Answer

DP-1 (Basic Form)

Answer

DP-2 (Broad Form)

Answer

None of the above

Question 10

Under California insurance regulations, the FAIR Plan (Fair Access to Insurance Requirements) is designed to:

Accepted Answer

Provide basic property insurance to property owners unable to obtain coverage in the voluntary market

Answer

Provide free property insurance to low-income homeowners

Answer

Regulate real estate property prices

Answer

Guarantee zero deductibles for high-risk properties

Free California Property Insurance Practice Test

Question 1 of 10

Under an HO-3 (Special Form) policy in California, which of the following perils is covered for personal property (Coverage C)?