BNL - REVIEWER a.

refers to temporary detainment of property

with a view to ultimate release
1. Any person who for compensation solicits or b. refers to throwing overboard of cargo or part
obtains insurance on behalf of any insurance of a vessel equipment in order to relieve a vessel
company or transacts for a person other than himself when she is in peril
an application for a policy or contract of insurance to c. includes every wrongful act willfully committed by
or from such company shall be known as the master or the crew to the prejudice of the owner
of the charterer.
a. insurance agent d. none of the above
b. general agent
c. insurance broker 8. The fundamental principle of marine insurance
d. reinsurance broker includes the following except:
a. insurance interest
2. An actual loss in marine insurance may be b. profits
caused by any of the following except: c. indemnity
a. damage to the thing insured which renders it d. good faith
valueless to the owner for the purpose for which he
held it 9. A Surety bond is an agreement
b. irretrievable loss of the thing insured by sinking or a. between 2 parties
being broken up b. among 3 parties
c. total destruction of the thing insured c. unilaterally executed by the Surety Co.
d. stranding of the vessel d. none of the above

3. The Philippine Standard Fire Policy covers 10. The obligee, as a party to the Surety bond
basically. a. is primarily liable to perform a legal obligation
a. fire only b. is the beneficiary thereof
b. fire and lightning c. guarantees
c. fire and other extraneous perils d. none of the above
d. none of the above
11. Bonds conditioned to answer for non-
4. Earthquake-fire as an extraneous peril cover the performance of contractual obligations are classified
insured against loss. as
a. due to tremors of an earthquake a. Surety bonds
b. by fire which ensues after an earthquake b. Guaranty bonds
c. by both fire and earthquake whichever c. Fidelity bonds
occurs first d. none of the above
d. none of the above
12. The term Casualty Insurance includes but is not
5. One of whose name a Motor Vehicle is registered limited to
with the Land Transportation Commission as the a. Fire insurance
actual, legal owner thereof is called b. Life insurance
a. motor vehicle owner c. Motor Vehicle Liability insurance
b. combination of a & c d. Marine insurance
c. a land transportation operator
d. none of the above 13. The premium paid for a fire insurance policy is
supposed to cover
6. Even if the insured drives recklessly and against a. services rendered by the insurer
the speed limits, as a general rule. b. risk assumed by the insurer
c. both risk assured and services rendered by
a. the motor car policy is suspended the insurer
b. the motor car policy is not liable for bodily injury or d. none of the above
death of pedestrians
c. the motor car policy is liable for death/bodily 14. Under the average clause of the fire policy, the
injury/property damage of the third persons insured
d. none of the above a. is not bound to insure the property at its
sound value
7. Jettison, in Marine Insurance b. shall be paid the full value of his loss
c. shall be considered a self-insurer of the
uninsured portion if the policy is underinsured
d. none of the above
15. The open policy clause in the fire policy
a. is similar to a cover note
b. is the same as a marine cargo open policy
c. requires that in the event of loss, the amount
of loss shall be subject to adjustment, limiting
the liability
d. of the insurer to actual loss of the insured
e. none of the above
c. use for hire and reward
21. The No Fault Provision in the CMVLI refers to
payment of claim for death or bodily injury to any
passenger:
a. conditioned that the fault or negligence of any
kind is proven by the aggrieved party
b. provided the person making claim is not also
negligent
c. without need of proving fault or negligence of
any kind
d. none of the above

16. Which factor/s in a building’s construction, 22. Abandonment, in marine insurance is:
affects fire rating? a. the act of the insured by which, after a
a. inner walls and materials used constructive total loss, decline the relinquishment to
b. materials used in both inner and exterior the insurer of his right to the thing insured
walls b. the act of the insured by which, after a
c. exterior walls and materials used constructive total loss he relinquishes his right
d. none of the above to the thing insured
c. the act by which the owner waives all the benefits
17. If an insured property becomes vacant for a derived from the chartering of his ship or its
period of more than 30 days, employment for the carriage of goods by sea
a. the insurance coverage continues d. all of the above
b. the insurance ceases to attach
c. the insured is liable to pay additional 23. What information would an insurance company
premium need from a shipowner before he can place a Hull
d. the insurance company may not charge additional Risk?
premium I. Name of the vessel
II. Value to be insured
18. As defined, the term fire insurance III. Conditions of insurance required
a. is an agreement whereby the insurer, in return for IV. Trades to be engaged in
the premium undertakes to indemnify the insured for V. Recent survey report
the direct loss or damage to the latter’s property by
fire or lightning a. I, III & IV
b. shall include insurance against loss by fire, b. II, IV & V
lightning, windstorm, tornado or earthquake and c. I, IV & V
other allied risks when such risks are covered by d. all of the above
extension to fire insurance policies or under
separate policies. 24. There is constructive total loss when:
c. all of the above a. the loss is constructed
d. none of the above b. subject matter is so damaged it is no longer the
thing of the kind insured
19. A property valued at Ps. 50,000 is insured for c. subject matter could not be preserved from
Ps. 100,000, in case of a total loss, actual loss without an expenditure which could
exceed its value when recovered
a. the company is liable for only Ps. 50,000 d. none of the above
b. the company is liable for Ps. 100,000
c. the company can validly refuse to pay 25. After a Constructive Total Loss, the insured
d. the company is liable for Ps. 100,000 declares the relinquishment to the insurer of his
because it received the corresponding interest in the subject matter insured, this act is
premium coverage called
a. insurable interest
20. A Commercial Vehicle Comprehensive Policy b. deviation
usually covers the following: c. abandonment
a. use for the hauling and carrying of logs d. none of the above
b. use in connection with the insured’s business
26. In Marine Cargo Insurance, a policy which is
continuous contract covering automatically all
shipments to and from stated parts of the world is
called:
a. marine cargo note
b. special marine policy
c. open policy
d. none of the above
27. Bonds which undertake to answer for the
obligee’s loss of money or other property by reason
of the dishonest acts of the principal are classified
as:
a. Guaranty Bonds
b. Surety Bonds
c. Fidelity Bonds
d. None of the above
28. If there are more than one company who insured
the same property the liability of each company in
the event of loss:
a. shall be the total sum insured in the policy
b. shall be the actual loss of the insured
c. shall be its ratable proportion of such loss
d. none of the above
29. Under the automobile liability insurance policy,
the costs which the insurance company may incur in
defending any suit brought against the insured:
a. shall be paid in addition to the applicable
limits of liability
b. shall be deducted from the applicable limits of
liability
c. shall be borne by the insured
d. may be covered by endorsement
30. Personal accident insurance is an insurance
which:
a. provides indemnity to human life which are
capable of pecuniary estimation
b. provides pecuniary compensation for
expenses or loss of income brought about by
death or bodily injury arising from violent,
external, visible and accidental means
c. provides compensation for loss of income brought
by injury
d. all of the above
31. Under the provision of the Insurance Code, a
cancellation notice to the insured from the insurer, to
be effective shall be based on the occurrence of any
of the following, except:
a. non-payment of premium
b. discovery of fraud or material misrepresentation
c. verbal notice to the insured
d. physical changes in the property in the property
insured making property uninsurable
32. In health insurance, total disability is taken to
mean:
a. inability to engage in any gainful occupation for
which he is fitted by education and training
b. a complete disability of the insured to engage in
his occupation for a period specified in the policy
c. the insured is not able to perform any gainful
occupation
d. all of the above
33. If the property is covered by fire is sold, the new
owner:
a. is automatically covered
b. has an insurable interest and therefore has fire
protection
c. should have the policy endorsed in his name,
if coverage is desired
d. both a & b
34. An Impaired or Substandard Risk:
a. must submit to a medical examination in order to
obtain coverage
b. is an applicant whose physical condition does
not meet minimum standards for normal health
c. cannot collect Double Indemnity
d. is an applicant who is engaged in hazardous
business
35. War risks in marine insurance include:
a. act of the enemy agent in blowing up a vessel
b. loss by explosion caused by a drifting mine
c. loss due to collision with a submarine
d. all of the above
36. If in the change of occupation, the standard
provision is used and the insured changes to a less
hazardous occupation:
a. the insured can get a return of part of the
premium he has paid
b. the insured can get a return of all the premiums
paid
c. the policy must be cancelled
d. there is a reduction of benefits
37. In Inland Marine Insurance, a floater is one that:
a. covers hull insurance
b. is a valued policy rather than an open policy
c. follows the property insured wherever it
maybe
d. covers only ships
38. The typhoon and flood endorsement to the
Philippine Standard Fire Policy covers among others:
a. loss by windstorm and / or the common street
flood
b. loss by typhoon damaging the building
externally and/ or loss due to the rising of
navigable waters in case of flood
c. it is enough that there exists a typhoon and/ or
flood
d. none of the above
39. Any interest in property, real or personal, of such
a nature that the contemplated peril against it might
damnify the insured is called:
a. warranty
b. misrepresentation
c. concealment
d. insurable interest
40. The government regulates and supervises the
insurance industry because:
a. the industry performs acts of charity
b. some companies collect excessive premiums
c. company officials are engaged in various
enterprises
d. industry activities concern public interest
c. must be renewed for the lifetime of the insured,
but the premium may be increased at specified
intervals
d. must be renewed (up to age stated in the
policy) as long as the insured pays his
premiums, and the insurance company does not
have the right to increase the premiums
44. A man would be considered totally disabled if he
couldn’t:
a. perform any and all of his important duties
b. perform any and all of his usual duties
c. attend to his business for 50% or more of his
usual time
d. perform one or more of his important daily duties
45. An insured carries a family Automobile Policy
which affords protection for Bodily Injury and
Property Damage Liability. He runs the rear wall of a
private garage, which he rents. Coverage would be
afforded for:
a. damage to the garage
b. damage to the insured’s automobile
c. bodily injury to a passenger
d. both a & c

41. The assignment to the company of any right 46. If the insured carries “No Fault” Automobile
which the insured may have against other parties to Accident Insurance, he is only compensated for loss
cover a loss which have been paid by the company, by his own company:
caused by the act or neglect by a third person is a. if it is determined that the insured was not at fault
called: in the accident
a. concurrence b. if the insured’s loss is limited to damage to his
b. third party liability automobile
c. assignment c. if it is determined that the insured was at fault in
d. subrogation the accident
d. none of the above
42. Mr. Sy has a full-time-40-hour week position as
an office worker and a part-time position of 20 hours 47. Under a marine policy, the falsity of statement of
a week position as an office worker and a part-time the time when the vessel will sail, the nature of the
position of 20 hours a week as a construction cargo to be shipped, the amount of the profit will not
worker. Which classification would be applied? void the policy:
I. the full-time position a. true
II. the part-time position b. false
III. the least hazardous position c. true, in the absence of fraud
IV. the most hazardous position d. false, because these are not mere statements of
expectation
a. IV
b. II & IV 48. In an open policy, upon occurrence of loss, proof
c. III of value is no longer necessary while in valued policy
d. I & II the insured must prove the value of the thing lost:
a. true
43. A non-cancelable and Guaranteed Renewable b. false
Policy: c. true, in certain cases
a. can be renewed only when the guarantee period d. false, in certain cases
is in effect
b. is the same as the Guaranteed Renewable Policy 49. Under the “No Fault” provision of the CMVLI, in
the event of liability for death or bodily injury on one
hand and liability or damage to the property on the
other hand
a. the former has priority for settlement over the
latter
b. the latter has priority for settlement over the
former
c. both will equally share
d. none of the above
50. The main benefit under the loss or damage or
damage cover of the Motor Car Policy on the car
insured is:
a. the policy will be liable to damages of another’s
car or property in case of collision
b. the insurer will pay the repairs of the insured
car only in case it meets an accident less the
amount of deductible
c. combination of a & b
d. none of the above
51. Under the liability feature of an automobile
policy, the term “upper limit” means the:
a. extent of the liability for any accident
involving more than one person
b. extent of liability for one person injured or killed in
an accident
c. amount the company will pay for property damage
d. amount the company will pay
52. Over-insurance exists when:
a. an insured has a large amount of coverage
b. too many people have insurance
c. an insured transfers his coverage from one
hospital to another
d. an insured stands to make a profit on his
hospitalization or income insurance
53. Does the Standard Fire Policy cover:
I. Smoke damage from a hostile fire in a neighboring
building
II. Breakage of a valuable vase while being
removed from the premises to save it from fire
damage
III. Water damage caused by firemen in
extinguishing a hostile fire in another building
IV. Theft of a typewriter from the building during a
fire
a. all are covered
b. all are covered except I & II
c. all are covered except II & IV
d. all covered except IV
54. All of the following statements on a non-life
insurance policy are true except:
a. the value of the thing insured is not agreed upon
in an open policy at inception date
b. a policy is always valued
c. in a valued policy, the value of the thing insured is
expressed on the face of the policy
d. successive insurances are contemplated in a
running policy
55. The attachment of a standard mortgage clause
has the effect of:
a. making the mortgage the name insured
b. protecting the interest of the mortgagee
regardless of any act (or neglect) of the
mortgagor
c. relieving the insurance company of the
responsibility to notify the insured in the event of the
cancellation of the policy
d. making the mortgagee primarily responsible for
the Premium
56. There is actual loss when:
a. subject matter could not be preserved from the
actual loss without an expenditure which would
exceed its value when recovered
b. subject matter is so damaged it is no longer
the thing of the kind insured
c. subject has to be abandoned on account of its
actual total loss appearing to be unavoidable
d. none of the above
57. Why must an insured have an insurable interest
in the property insured?
a. to obtain a measurement of the insured’s loss
b. guard against moral hazard
c. prevent wagering
d. all of the above
58. Under the Standard Fire Policy, the insurance
company has the right to:
a. take all the damaged property and pay the
insured for his loss
b. repair the damaged property
c. take part of the damaged property and pay the
insured for his loss
d. all of the above
59. The Deed of Indemnity is a contract:
a. whereby the signatories thereof bind themselves
to pay the claim against the bond
b. whereby signatories bind themselves to
reimburse and/or indemnify the surety for losses
sustained in consequence or the issuance of the
bond
c. combination of a & b
d. none of the above
60. Of the following information, which would not be
important in the determination of the classification for
automobile liability insurance?
a. the geographical location in which the automobile 67. The bond required by the court of the person
is principally garaged appointed by it to guarantee the proper management
b. age of the automobile and disposition of the property of minor or
c. the age of the driver incompetent heirs, is called:
d. use of the automobile a. Heirs Bond
b. General Importers Bond
61. A misrepresentation is not material unless it led c. Guardian’s Bond
the insurance company to issue coverage that would d. none of the above
not have been issued if the facts had been known.
This statement is 68. The main undertaking of this type of bonds, in
general, is to guarantee the payment of custom
a. true taxes, duties and other charges on imported,
b. valid only if there was a witness exported goods. They are called collectively as:
c. false a. Judicial Bonds
d. false, a misrepresentation is always material b. Guaranteed Payment Bonds
c. Custom Bonds
62. The Surety, as a party of the Surety Bond: d. none of the above
a. is primarily liable to perform some legal obligation
b. is the beneficiary of the bond 69. Type of Custom’s Bond which guarantees that
c. guarantees the performance of an undertaking the principal shall produce the required authenticated
or obligation document/s which did not
d. none of the above accompany the merchandise which arrived into the
country:
63. Which of the following statements is not true a. Ship’s Side Bond
about “inherent vice” under the Inland Marine b. General Importers Bond
Insurance? c. General Documentary Bond
a. it is a defect within the object itself will cause d. none of the above
damage to the object under certain conditions
b. it is peculiar to gamblers 70. One of the most common types of judicial bond
c. loss due to inherent vice is a risk than can be is known as:
covered a. review bond
d. losses due to decay in fruits and vegetables fall b. petition bond
under inherent vice c. retrial bond
d. appeal bond
64. A Surety Bond, by reason of its formality:
a. may be oral 71. The employers pay the premium in certain types
b. can arise by implication of fidelity bonds, which are issued for the benefit of
c. must explicitly be in writing the obligee. This statement is:
d. none of the above a. false
b. true
65. The liability of the signatories to a Deed of c. true, if the obligee consents
Indemnity: d. false, the obligee pays the premium
a. personal
b. joint 72. The principal pays the premium in certain types
c. solidary of surety bonds which are issued for the benefit of
d. both a & b the obligee. This statement is:
a. false
66. When the obligee requires contractors, b. true
suppliers, and others to submit proposals for c. true, if the obligee consents
competitive bidding, the bond that undertakes that d. false, the obligee pays the premium
the principal shall, if he wins the bid, enter into the
resulting contract is called: 73. In a court action to regain possession of his
a. Performance Bond personal property, the plaintiff files a bond known as:
b. Surety Bond a. replevin bond
c. Bidder’s Bond b. attachment bond
d. none f the above c. seizure bond
d. requisition bond
 c. true, in certain cases
74. A person’s property was seized by a sheriff for d. false, in certain cases
an alleged debt, the owner desires to secure the
return of his property through a court action. The 80. A vessel was insured for one year. Suppose
type of bond which may be required in this case is during the same year, the vessel will undertake 12
called: voyages. When must the ship be seaworthy?
a. an injunction bond a. at the commencement of the risk
b. a counter-replevin bond b. at the beginning and at the end of the voyage
c. replevin bond c. at the commencement of each of the 12
d. a seizure bond voyages
d. at the end of the voyage
75. A bond executed in behalf of a person appointed
by a court to a position of trust, guarantees 81. A insured his ship for P100,000. The vessel was
performance, of statutory duties and proper damaged to such an extent as to reduce its value by
accounting: more than three fourths. The Insured gave notice of
a. bail bond abandonment. The insurer. The insurer refused to
b. bidder’s bond accept the abandonment. What is the right of the
c. firearm Insured?
d. fiduciary bond a. the Insured can recover double the amount of
loss
76. A license of permit bond required of a person b. the Insured cannot recover anything
applying for or possessing firearms in the Philippines c. the Insured can recover a partial loss
is known as: d. the Insured can recover a total loss
a. Firearms bond
b. Attachment bond 82. A insured his cargo from Manila to San
c. Administrator’s bond Francisco, California. After the vessel upon which
d. Surety bond said cargo was loaded, it left the port of Manila.
While it was still five days
77. The bond required under Section 7&8 of Rep. a. Yes, because the insurance was made for a
Act 26, guarantees the payment of loss or damage definite period of time
which might be sustained by the buyer or mortgagor b. No, because the risk was entire and individual
of the property the torrens title to which had been and the insurer has been exposed to the liability
reconstituted is called: already
a. Payment bond c. Yes, because it was not exposed to any of the
b. Rule 74 bond perils insured
c. Reconstituted title bond d. None of the above
d. none of the above
83. Perils of the ship as distinguished from perils of
78. The bill of lading in a marine insurance policy is: the sea include the following, except
a. the recipient of the shipowner for the goods a. losses or damages resulting from the natural
shipped on board his vessel, and states the and inevitable action of the sea
terms and conditions on which they are to be b. losses or damages that could not be foreseen
carried. and not attributable to the fault of anybody
b. the draft or order drawn by the seller on the c. losses or damages resulting from ordinary wear
buyer, requiring the latter to pay the stated sum on and tear of a ship
sight, to the person named on his order d. losses or damages due to the negligent failure of
c. an indication that the goods are fully insured the ship’s owner to provide the vessel with proper
against loss or damage by marine perils with equipment to convey the cargo under ordinary
approved underwriters conditions
d. none of the above
84. A policy of insurance upon a cargo of rice
79. In an open policy, upon occurrence of the loss, stipulated that the insurer should be liable for losses
proof of value is no longer necessary while in a incidental to the perils of the sea. During the
valued policy, the assured must prove the value of voyage, seawater entered the compartment (where
the thing lost: the cargo was stored) through a defective drainpipe,
a. true and damaged the rice. Will the insurer be liable?
b. false
a. Yes, because this was a loss incidental to the
perils of the sea
b. No, because the defect in the pipe was a
result of the ordinary use of the ship and lack of
necessary repairs
c. Yes, because the cause of the loss could not be
foreseen
d. None of the above
85. A deviation is proper in Marine Insurance, under
the following circumstances, except
a. When caused by circumstances over which
neither the master of the owner of the ship has any
control
b. When necessary to avoid peril
c. When the master of the ship would like to visit
a friend, he has not seen for quite sometime
d. For the purpose of relieving another vessel in
distress
86. A Canadian Steamer, with a defective compass,
while navigating Canadian water in a fog, was
stranded on an island and had to be abandoned. Is
the insurer of the vessel liable?
a. the insurer is liable as there was no improper
deviation from the agreed voyage
b. the insurer is not liable as the vessel was not
seaworthy
c. the insurer is not liable as the vessel is engaged
in illegal venture
d. the insurer is not liable because there was
abandonment
87. As a general rule, the Institute Cargo Clause-
Free of Particular Average:
a. pays all losses
b. pays particular loss only
c. pays total loss only
d. none of the above
88. Protection and Indemnity Clubs are:
a. simple organizations and similar to night clubs
and the like
b. any marine insurance club in the Philippines
Island, e.g. Manila Marine Association
c. association of shipowners who are liable for
certain marine losses
d. none of above
89. The Institute Cargo Clause with Average (WA)as
the name implies:
a. pays total loss only
b. pays partial loss, as a general rule
c. pays all risk, losses
d. none of the above
90. “Average”, in marine parlance, means:
a. the score attained by a shipowner specifying the
median of a ship’s several voyages
b. the points achieved by an Insured for preventing
or minimizing loss
c. loss or damage
d. none of the above
91. Fortuitous accidents or casualties of the seas
and for which certain marine policies may be liable in
the event of loss due thereto are known as:
a. perils on the sea
b. perils of the marine insurance
c. perils of the sea
d. none of the above
92. In the Philippines, the period of cover available
to the Insured under the Transit Clause
(Incorporating the Warehouse Clause) is:
a. 60 days from midnight of the day of discharge
from vessel at port of destination
b. 15 days from midnight of the day of discharge
from vessel at port of destination
c. no limit
d. none of the above
93. Losses or damages due to heavy weather are
covered by:
a. Institute Cargo Clause (FPA)
b. Institute Cargo Clause (WA)
c. Freight Insurance
d. None of the above
94. Losses or damages due to consequences of civil
war, revolution, rebellion insurrection or civil strike,
are covered by:
a. Institute Cargo Clause-strike, riots and civil
commotion
b. Institute War Clause
c. Institute all risks (AR)
d. None of the above
95. Which of the following statements in Marine
Insurance on “abandonment” is false?
a. it is an act of the Insured by which, after a
constructive total loss, he declares the
relinquishment to the insurer of the insurer of his
interest in the thing insured
b. it can be partial or conditional
c. it is equivalent to a transfer by the Insured of his
interest in the thing insured
d. it can be sustained only upon cause specified in
the notice of abandonment
96. The main benefit under the loss or own damage
of the of the Motor Car Policy on the car insured is:
a. the policy will be liable to damages of another’s
car or property in case of collision
b. the insurer will pay the repairs of the insured
car only in case it meets an accident less the
amount of deductible (declared from claims)
c. combination of a & b
d. none of the above
97. A comprehensive motor car policy is:
a. liable for passenger claims
b. liable for all kinds of death or bodily injury
and property damage
c. not as comprehensive as it may seem
d. none of the above
98. A pedestrian run over and injured by an insured
vehicle should:
a. File a claim directly against the owner of the
insured vehicle
b. File a claim directly against the Motor Pool
c. File a claim directly against the Insurance
Company
d. Combination of the above
99. Under LTO Insurance, required for the third-
party liability is the:
a. Unladen Weight
b. Horse power
c. Displacement capacity
d. None of the above
100. Under Compulsory Motor Vehicle Insurance,
the basis for determining the amount of insurance
required for passenger liability is:
a. Horse power
b. Displacement capacity
c. Number of passengers
d. Unladen Weight
101. A passenger, under the LTO Insurance:
a. .is always a fare paying person being transported
and conveyed by a motor vehicle for transportation
of passenger for compensation
b. need not necessarily be fare paying
passenger
c. combination of a & b
d. none of the above
102. For the purpose of the CMVLI, a third party is:
a. Passenger
b. Any person other than a passenger
c. Combination of a & b
d. None of the above
103. For operators of public utility vehicles, the
cover either by insurance policy or a surety bond
must be:
a. Combination against both passenger and
third-party liabilities for death and bodily injury
b. Comprehensive against passengers only
c. Comprehensive against third parties only
d. None of the above
104. A “No-Fault” claim can be made:
a. against more than one motor vehicle in case
more than one vehicle figured in an accident
b. against only one motor vehicle even if more
than one vehicle figured in accident
c. combination of a & b
d. none of the above
105. Indicate which of the following situations would
not be covered by the comprehensive portion of the
automobile insurance policy:
a. falling object denting a car top
b. broken windshield
c. frozen radiator
d. stolen car
106. Under the “No-Fault” provisions of the CMVLI
in case of disagreement as to the extent of claim:
a. payment is suspended
b. indemnity must be made not exceeding
P10,000
c. indemnity must be made not exceeding P5,000
d. none of the above
107. In Compulsory Motor Vehicle Liability
Insurance, action or suit for recovery of damage due
to loss or injury must be brought through cases, with
the Commissioner or the courts with competent
jurisdiction, within:
a. one year from the date of the accident
b. six months from the date of the accident
c. ninety days from the date of accident
d. one month from the date of accident
108. The territorial definitions of the commercial
vehicle insurance comprehensive policy issued in the
Philippines limits protection in:
a. the United States, its territories or possessions
b. the Philippines and Japan
c. the Philippines
d. both a & c
109. Under the Commercial Vehicle Comprehensive
Policy, the company shall be liable to pay for, among
others,
a. damage caused by overloading or strain
b. damage to tires
c. consequential loss, depreciation, wear and tear,
mechanical electrical breakdown, failures and
breakage
d. damage whilst in transit (including the
process of loading and unloading incidental to
such transit) by road, rail inland waterway, lift or
elevator
110. The typhoon and flood endorsement of the
Philippine Standard Fire Policy covers among others:
a. loss by the windstorms and/ or the common street
flood
b. loss by the typhoon damaging the building
externally and/or due to the rising of the
navigable waters in case of flood
c. it is enough that there exists a typhoon and/ or
flood
d. none of the above
111. Which factor/s in a building’s construction,
affects fire rating?
a. inner walls and materials used
b. materials used in both inner and exterior walls
c. exterior walls and materials
d. none of the above
112. A statement of fact in the fire policy or its
endorsements relating to the property insured upon,
which the truth or fulfillment or validity depends on, is
called:
a. clause
b. warranty
c. an endorsement
d. none of the above
113. A fire policy takes effect:
a. when it specifies the commencement date
b. when it specified the beginning time and date of
the policy
c. when it specifies both the commencement
date and the beginning time
d. none of the above
114. Which of the following is covered under the
Standard Fire Policy?
a. loss due to subterranean fire
b. loss due to spontaneous combustion
c. loss due to volcanic eruption
d. loss due to lightning
115. Rates of premium applied to buildings are
affected by the following factors, except:
a. occupancy
b. type of construction
c. actual cash value of building
d. location
116. What type of insurance would protect a
mortgagor if the mortgaged property was damaged
by fire and (through an oversight) the broker did not
insure it?
a. earning insurance
b. extra expense
c. errors and omissions
d. all of the above
117. A fire loss occurs due to the negligence of Mr.
Ko., Mr. Ty who is the Insured, collects in full from
the insurance company. May Mr. Ty also collect from
Mr. Ko?
a. yes
b. yes, but he must pay the insurance company for
their expense
c. no, because his right to sue must be assigned
to the insurance company (to the extent of its
payment of the loss)
d. none of the above
118. According to the terms of the <loss clause
(which is contained in the coverage form attached to
a fire policy), must an Insured request for the
reinstatement of his insurance after a loss has
occurred?
a. yes, if the loss exceeds 5%
b. not until the premises have been restored
c. no, the insurance company will reinstate the
coverage automatically
d. no, the coverage is not reduced by the
occurrence (for payment of a loss)
119. The Property Damage Fire Forms which in
effect states that; the insurance contract shall not be
prejudiced by any act or neglect of any person other
than the name Insured, when such act or neglect is
not within the control of the named Insured. This
clause is known as the:
a. automatic sprinkler clause
b. control of property clause
c. other insurance clause
d. waiver clause
120. The provision in Standard Fire Policy that
except as may be stated on face of this policy there
is no other insurance on the property hereby covered
breach of this condition will render the policy “null
and void” is known as:
a. average clause
b. control of property clause
c. other insurance clause
d. waiver clause
121. The “other insurance” clause in the fire
insurance policy provides that:
a. in case of loss, the amount payable shall be
shared by several insurance companies 128. Government agency which issues Certificate of
b. the insured at his election may be allowed to buy Authority to insurance agents is:
any other insurance or additional insurance on the a. Office of the President
same property b. Secretary of Finance
c. no other insurance aside from the one granted c. Insurance Commission
shall be allowed without the insurer’s consent by d. All of the above
written endorsement
d. none of the above 129. An insurance agent’s license can be revoked
for
122. With respect to a Standard Fire Policy, the term
“Vacancy” means: a. fraudulent practices
a. unfurnished and not lived in b. violation of any provision of the Insurance code
b. furnished but not lived in c. misrepresentation in the application for license
c. lived in but not furnished d. any or all of the above
d. none of the above
130. Penalty for a person criminally prosecuted for
123. An agreement whereby one undertakes for a selling insurance without a license is
consideration to pay the Insured against loss,
damage or liability arising from an unknown or a. P10,000 fine
contingent event is called: b. representation
a. Contract of Suretyship c. assignment of policy
b. Contract of Indemnity d. none of the above
c. Contract of Insurance
d. None of the above 131. An act made to deceive an insurance company
in order to obtain the benefits therein unlawfully such
124. A written instrument in which a contract of as intentionally overstating the claim against the
insurance is set forth is called: property insured is called
a. Surety bond
b. Insurance policy a. misrepresentation
c. Both a & b b. concealment
d. None of the above c. fraud
d. none of the above
125. A certificate issued by the Insurance
Commission which serves as evidence that the 132. When the Insured intentionally did not disclose
holder thereof is duly authorized by law to act as an a material fact or information about the property
insurance agent is called: insured which if the insurer should have known, the
a. Certificate of Graduation risk would have been declined is an act called
b. Certificate of Brokerage
c. Certificate of Authority a. misrepresentation
d. None of the above b. fraud
c. concealment
126. The office that regulates and supervises the d. none of the above
business of insurance industry is called:
a. Office of the Insurance Commissioner 133. To retain an old client, Agent gives half of his
b. Insurance Commission commission to his Insured. This is called
c. Insurance and Surety Association
d. All of the above a. Rebating
b. Inequitable
127. Those which pertains to an Insured’s c. Twisting
character, reputation and habits, the negative factor d. Misrepresenting
of which may cause the non-acceptance of fire
insurance application is called: 134. An insurable interest in non-life insurance is
a. underwriting hazard
b. physical hazard a. that part of your interest in property that may be
c. moral hazard insured
d. fire hazard b. the interest on your insurance
c. any interest which could be insured
d. every interest in property or relation thereto,
or liability in respect thereof, of such a nature
that contemplated peril might directly damnify
the Insured

135. A type of risk, which the insurer will not accept

from its agent, is usually called a
a. Prohibited risk
b. Assigned risk
c. Financial risk
d. Compensated risk