1. Nationwide, approximately 75 percent of the FEMA flood maps
A. were created from satellite images since 1981.
B. are more than 10 years old.
C. are unintelligible.
D. are less than 2 years old.
2. There are certain things the insurance company may require before a loss can be settled,
A. the immediate and permanent removal from the property of the property owner.
B. certified copies of the bank accounts and other investments of the property owner.
C. any policies of property insurance insuring the insured against loss and a deed that
establishes the ownership of the insured real property.
D. acceptance of an estimated loss of income payment to the property owner.
3. An Elevation Certificate that is submitted without the required photographs
A. is acceptable if the verbal description is encompassing.
B. will cause the policy to be nullified and all premiums returned.
C. is not considered valid for rating purposes.
D. can make the agent return the commission on that policy.
4. A Federal program enabling property owners in participating communities to purchase
insurance as a protection against flood losses in exchange for State and community
floodplain management regulations that reduce future flood damages is
B. the Bureauau of Reclamation.
C. the SFIP.
D. the National Flood Insurance Program.
5. In rating flood insurance, after the location has been established, the next step is
A. to determine whether the community is in the Regular or the Emergency Program.
B. to determine if the applicant has the financial means to pay the premiums.
C. to search the rate tables for the applicable premium.
D. to contact FEMA to see if that location is acceptable.
6. When marketing flood insurance to a condominium association, the agent
A. must first establish the fact that he, the agent, is in control.
B. must first call an emergency meeting of the Board of Directors of the Condominium and
have himself appointed as special member for insurance matters, or similar title.
C. should not spend a lot of time on it, as it is not commissionable.
D. should maintain a good working relationship with the Directors and tenants and educate
the owners/members about their exposure to flood risks.
7. When sending in an application for flood insurance, attach all required certifications or other
documents to NFIP with
A. the check, draft or money order made out to the local NFIP representative.
B. the check, draft or money order made out to the NFIP for the deposit of 20% of the
C. a check, draft or money order made out to the NFIP for the total prepaid amount.
D. a zerox copy of the credit card.
8. A general and temporary condition of partial or complete inundation of two or more acres of
normally dry land area is the definition of
B. a flood.
C. a lake basin.
9. Legitimate refunds as submitted on a cancellation form will be
A. made by the insurance company for the current and one prior year.
B. made by the insurance company for as many years as the policy has been in force.
C. not more than 6 months, regardless of the circumstances.
D. made directly to the NFIP Trustee who must process the refund.
10. In providing the rating for property, the agent must first
A. obtain essential rating information so as to determine the correct rate table to be used with
that particular risk.
B. fax or overnight mail all necessary data about location to the NFIP.
C. require the applicant to make a good- faith deposit of 6 months premium.
D. have the property inspected to by the local fire department to see if there is any sign of
prior water damage.
11. The basic Application Form
A. can be used for any and all flood insurance forms.
B. is simple and the applicant should complete most of it himself.
C. varies widely between the NFIP form and insurers, and even between insurers.
D. can be used for all flood policies except for the Preferred Risk policies.
12. V Zones are the more hazardous coastal flood Zones because they are subject to high
velocity wave action. FEMA applies the V- Zone designation to those areas along the coast
where water depth and other conditions
A. would support at least a 3-foot wave height.
B. never have wave action creating waves more than 18 inches.
C. would support at least a 6-foot wave height, such as in Hawaii and Malibu.
D. can very often overrun the land (beach) by more than 6 meters.
13. On the Application, Part 2, the building type is required and elevation. The agent may
obtain the requested elevation information from
A. the owner of the property only.
B. an independent surveyor or land engineer only.
C. the Elevation Certificate, or the applicant or his representative.
D. from NFIP.
14. A policy on the condominium unit can be issued that names the owner and the Association,
as their interests may appear,
A. thereby making sure that the coverage applies first to the common element.
B. wherein coverage under the unit would apply first to the unit owner and then to the
damage of the building's common element.
C. and that way the Association and the owner share pro-rata in any flood loss.
D. however, that could cause the Association Board of Director member to be personally
liable in case the unit owner refuses to cooperate in settling a flood loss.
15. The effective date of the policy is determined by
A. the home office of the insurer.
B. adding the appropriate waiting period to the date of application listed in the "Signature"
C. the NFIP.
D. agreement between the agent and the applicant, but not more than 60 days from the date
of the signature on the Application.
16. When it is time for policy renewal
A. it is up to the agent to send the policyholder a renewal notice.
B. the policyholder is responsible for knowing when to pay and paying the premium.
C. the NFIP notifies the policyholder, who has 30 days to respond with the premium.
D. at least 45 days prior to expiration, all parties listed on the policy are mailed a renewal
17. Under a SFIP, contents coverage
A. is included in coverage and in premium.
B. is not available.
C. must be purchased separately.
D. is available for personal goods stored in a crawlspace in an A or V Zone.
18. Under a Residential Condominium Building Association Policy (RCBAP) policy, if the
amount of insurance carried is not at least 80% of the building replacement cost or $250,000
time the number of units, whichever is less
A. there is a coinsurance penalty.
B. commissions are reduced.
C. the policy will be cancelled.
D. in case of a total loss, the policyholder must pay the premium that would have provided
complete coverage over the policy period.
19. If the insurer makes a change that broadens the coverage under this edition of the policy,
but does not require any additional premium, then that change will automatically apply to
the insurance policy of the date the insurers implemented the change, provided
A. the agent is willing to relinquish any commissions due.
B. that this implementation date falls within 60 days before, or during, the p olicy term
stated on the Declarations Page.
C. that a new policy is immediately issued.
D. the new change creates an additional premium for future renewals.
20. When stating that "It is to be used to provide elevation information necessary to ensure
compliance with community floodplain management ordinance, to determine the proper
insurance premium rate, …" –this pertains to
A. the ICC coverage.
C. surveyor's report.
D. Elevation Certificate.
21. If a flood destroys the insured home and nearly all of the contents and all the owner wants
from the ruins is some family albums, photographs, and personal mementos ; and then as far
as the owner is concerned, he will leave and abandon the property and the flood insurer can
do what he wishes.
A. The policyholder cannot abandon damaged or undamaged property to the insurer,
however the insurer would probably allow the policyholder to keep the personal items.
B. It is the right of the property owner to abandon his property to the insurer.
C. The policyholder cannot take any items from a destroyed insured building.
D. The policyholder has the right to abandon the building within 30 days of loss, but the
only thing that he can take is literally the clothes on his back.
22. Certain building items in a basement are covered under the flood insurance policy, such as
A. furnaces and hot water heaters.
C. antique auto parts.
D. hot tubs.
23. Flood insurance can be purchased at any time
A. and becomes effective immediately.
B. but there is an enrollment period of 30 to 60 days.
C. there is a 30-day waiting period before the NFIP becomes effective.
D. except during the traditional rainy season at that particular geographical location.
24. The NFIP annual premium is
A. considered as earned when paid.
B. considered as earned at the end of the second policy year, at which time it is then sent to
C. held in a special escrow account until the end of the policy year by the selling agency.
D. held in a Claims Reserve account by the NFIP but is not considered as "earned" for a
period of five loss- free years.
25. Special Loss settlement conditions apply to a single- family dwelling that is a manufactured
or mobile home or travel trailer and is at least 16 feet wide when fully assembled and has an
area of at least 600 square feet within its perimeter walls when fully assembled;
A. and which is used for rental purposes only.
B. and is the principle residence of the policyholder.
C. but the dwelling must be on a permanent foundation of concrete or stone.
D. but only if the dwelling is in Zone B or C.
26. A flood insurance policy used to insure non-residential buildings and other residential
structures that are not classified as single family or two-to- four family dwellings, such as
apartment buildings with five or more families, motels, retail stores, municipal buildings,
churches and hospitals, is the
C. General Property policy.
D. Preferred Risk policy.
27. "…any area of the building, including any sunken rooms or sunken portion of room, having
its floor below ground level (subgrade) on all sides"–in a flood insurance policy, is the definition
B. uninsurable building areas.
C. property that must have a new Elevation Certificate.
D. a basement.
28. There are three methods of settling losses in the Standard Flood Insurance Policy: by Actual
Cash Value (ACV), Replacement Cost Value (RCV) or
A. by Arbitration.
B. through a Special Loss Settlement, usually in respect to manufactured homes or travel
C. by lawsuit.
D. by Agency determination.
29. Perhaps the most important responsibility of an agent at times of claims is
A. to obtain a written notice of loss.
B. to recommend contracts for repair work.
C. to take pictures of the loss, interior and exterior.
D. making sure that none of the property is stolen.
30. If a lender or servicer determines that the building securing the loan is not adequately
A. they cannot require flood insurance to be placed on the building as that would be
B. the 1994 Act requires the force placement of flood insurance.
C. they can stop anyone else from borrowing on the property.
D. they can insist that the property owner obtain flood and homeowner's insurance.
31. The Actual Cash Value is the Replacement Cost Value of property
A. minus the value of the depreciation of the property
B. increased by inflation.
C. but neither form is used for flood insurance losses.
D. and for manufactured homes, either method can be used.
32. In case the policyholder is not happy with a proposed loss settlement,
A. his only recourse is to gripe at the agent.
B. the NFIP can recommend an attorney to contest the settlement.
C. his first step should be to talk to the adjuster.
D. he should immediately request a trial date for the circuit court
33. On the Application, if the insured's mailing address is a post office box or rural route
A. give the street address, legal description and/or geographic location of the property.
B. it is permissible to just give the post office box or RR number.
C. the Application must be accompanied by a notarized and sworn statement as to the exact
location of the property to be insured, using easily understandable references.
D. then give the GPS reading.
34. An Elevation Certificate must be
A. signed by the agent and signature notarized.
B. obtained for all properties in any area that is not in an A or Z Zone.
C. accompanied by two recent photographs showing the front and back of the building,
taken within 90 days of Application date.
D. verified by a GPS reading.
35. The Application covers a building with an attached outside staircase (leading to a second
floor balcony), with a daylight basement, and with a patio and walkway from the house that
are located outside the perimeter of the house or exterior walls. In case of loss, what would
be covered, besides the building?
A. only the basement.
B. the basement and outside staircase only.
C. the patio and walkway and outside staircase only.
D. the staircase, basement and patio only would be covered.
36. For rating purposes, there are three types of buildings: buildings with no basement and built
on a slab, buildings with basement and subgrade on all four sides, and
A. buildings with daylight basements.
B. elevated buildings, with foundation walls, shear walls, piers, posts, pilings or columns.
C. buildings with two walls as foundation and with a second level of shear walls.
D. houseboats, RVs, and other moveable living quarters.
37. In completed an Application, if the building was constructed or substantially improved on
or before December 31, 1974, or before the effective date of the initial FIRM for the
community, then show the building as
B. substantially improved.
C. Pre-FIRM construction. Otherwise, the building is considered Post-FIRM.
D. the building is no longer eligible for flood insurance coverage.
38. If a premium payment is not sufficient to purchase the coverage requested,
A. only the amount of coverage that can be purchased with the premium received, will be
B. the requested coverage will be provided until renewal time.
C. the coverage will be denied and policy cancelled.
D. the agent will have to take a cut in commission but coverage will be as requested.
39. In settling a claim, the agent should inform the policyholder that
A. the check will be made out to him only, even if there is a mortgagor involved.
B. now the policyholder has no responsibility, everything will be taken care of by the
C. if the claim is on mortgaged property, the insurance check is required to be delivered
directly to the mortgage company.
D. repairs should start as soon as he can get a contractor to agree to do it as they are scarce
after a flood or hurricane.
40. Under the NFIP, the minimum floodplain management requirements that a community must
adopt depends on the type of flood risk data that the community has been provided by
FEMA. Under the NFIP regulations, participating NFIP communities are required to
regulate all development in SFHAs. “Development” is defined as:
A. any changes in existing real estate buildings and building code.
B. an area of homes and/or businesses within a geographical area of not more than one mile.
C. any man- made change to improved or unimproved real estate, including but not limited to
buildings or other structures, mining, dredging, filling, grading, paving, excavation or
drilling operations or storage of equipment or material.
D. any type of construction that will add more people to a set geographical area that contains
flowing water or a dammed lake.
41. Additional living expenses, loss or use, or loss of income under a flood insurance policy
A. are included in the SFIP up to a maximum of $2,500.
B. are included in the SFIP up to the policy maximum and such usage will reduce the
maximum amount available proportionately.
C. are not covered.
D. are included but not to exceed $1,000 per month for a period of time that it takes to
rebuild or restore the building, but not to exceed total payments of $10,000.
42. After a building has sustained substantial damage by or from flood or is declared a repetitive
loss structure, the Increased Cost of Compliance coverage
A. pays for any fines the policyholder may incur in removing property from the loss site.
B. helps to pay for the costs the policyholder will incur in order to comply with State or local
floodplain management ordinances.
C. is designed to increase the maximum loss amount because of inflation.
D. is available only to business and office buildings.
43. The flood insurance statutory coverage total maximum limits under the Regular Program
for a Single Family Dwelling, is
44. NFIP is sold through state- licensed property and casualty insurance agents through two
mechanisms: through state licensed property and casualty insurance agents and brokers who
deal directly with FEMA; and
A. through security dealers and investment brokers.
B. through life and health insurance agents and brokers who deal directly with FEMA.
C. through private insurance companies with a program known as "Write Your Own Policy."
D. through Independent Insurers Association (IIA) only.
45. In order to defray certain administrative expenses by the NFIP
A. the WYO company pays a royalty fee to the NFIP, based on the premium income written.
B. the agent must pay a $25 finders fee for every policy written through a WYO company.
C. a Federal Policy Fee is a flat fee that is charged to the policyholder on each new or
D. the Department of Homeland Security has placed the NFIP into their adminis trative
46. The Residential Condominium Building Association Policy (RCBAP)
A. is used to collect much more premium for the same flood coverage, than if each unit was
insured under a SFIP.
B. does not cover rowhouses or townhouses.
C. provides a cost savings to the owners of the units as the RCBAP premiums are
proportionately lower than individual residences.
D. is an actual cost policy.
47. "Base Flood" is a technical term that means
A. that a flood has a one percent chance of being equaled or exceeded in any one year.
B. a flood that fills basements that are below ground level.
C. a flood that created less than four feet of water on level ground.
D. a severe flood, usually one that is caused by hurricanes or tidal waves.
48. The reasons for Cancellation or nullification of a policy
A. are whatever the policyholder wants it to be, the insurer cannot cancel otherwise.
B. are contained in "cancellation codes" as outlined in the manual.
C. are highly technical and must be signed off by an attorney.
D. can be accomplished only by the state Department of Insurance.
49. When FEMA determines that there has been fraud in the transaction (purchasing a flood
A. there is no premium refund, the agent will retain full commission, and the company's
expense allowance will not be reduced (the policy will be cancelled).
B. there is immediate cancellation and it will be referred to the U.S. Attorney General for
prosecution. Premium will be refunded.
C. this is called "cancelled ab initio," meaning that it is as if the policy never existed and
premiums are refunded, commissions are returned and that is the end of that.
D. the agent is fired, but the policy must stay in force.
50. There is a deductible in the NFIP, shown on the Declarations Page, which is
A. either $500 or $1,000.
B. either $5,000 or $10,000.
D. 10% of the coverage.