Louisiana Property & Casualty Insurance Practice Exam Free - 2026

• A. Only by purchasing a policy from the Louisiana Workers' Compensation Corporation
• B. By buying a general liability policy with an employer's liability endorsement
• C. By insuring with an insurer authorized to write workers' compensation in Louisiana, joining a group self-insurance fund, joining an interlocal risk management agency (public entities), or qualifying as a self-insurer by proving financial ability to pay
• D. Employers with fewer than five employees are exempt and need not secure compensation

Correct answer: C. By insuring with an insurer authorized to write workers' compensation in Louisiana, joining a group self-insurance fund, joining an interlocal risk management agency (public entities), or qualifying as a self-insurer by proving financial ability to pay

Explanation: Louisiana requires an employer to secure compensation in one of the statutory ways: insuring and keeping insured with a stock, mutual or other insurer authorized to transact workers' compensation insurance in the state; entering an agreement with a group self-insurance fund under R.S. 23:1191 et seq.; entering an agreement with an interlocal risk management agency under R.S. 33:1341 et seq.; or furnishing satisfactory proof of financial ability to self-insure (with any required deposit, surety bond and excess coverage). The law applies to every person performing services incidental to employment without a minimum-employee exemption (the only exemptions are narrow, such as certain household and farm labor under the $1,000/$2,500 thresholds and performers under a performance contract), LWCC is one option rather than the only one, and a general liability policy does not secure compensation. See La. R.S. 23:1168(A) and 23:1035.

• A. Within 30 days; commissions may be paid as soon as the contract is signed
• B. Within 15 days from the date the agency contract is executed; no commissions may be paid until the appointment has been recorded by the commissioner
• C. Within 90 days; commissions may be paid at any time because appointment is optional for P&C producers
• D. Within 10 days; commissions may be paid once the first policy is issued

Correct answer: B. Within 15 days from the date the agency contract is executed; no commissions may be paid until the appointment has been recorded by the commissioner

Explanation: A Louisiana producer may not act as an agent of an insurer unless appointed (except for surplus lines placements and LWCC workers' compensation policies); the appointing insurer must file a notice of appointment in the manner prescribed by the commissioner within fifteen days from the date the agency contract is executed, the commissioner then verifies eligibility within thirty days, and no commissions may be paid by that insurer to the producer until the appointment has been recorded by the commissioner. Thirty days is the period for reporting a termination of appointment, and 90 or 10 days are not statutory. See La. R.S. 22:1558(B)(1) and (C).

• A. $15,000 bodily injury per person, $30,000 bodily injury per accident, and $25,000 property damage
• B. $25,000 bodily injury per person, $50,000 per accident, and $25,000 property damage
• C. $10,000 bodily injury per person, $20,000 per accident, and $10,000 property damage
• D. $30,000 bodily injury per person, $60,000 per accident, and $25,000 property damage

Correct answer: A. $15,000 bodily injury per person, $30,000 bodily injury per accident, and $25,000 property damage

Explanation: A Louisiana motor vehicle liability policy must insure against loss in at least $15,000 for bodily injury to or death of one person in any one accident, $30,000 for bodily injury to or death of two or more persons, and $25,000 for damage to the property of others; the Department of Insurance's 2026 consumer guide states the same 15/30/25 limits. The 10/20/10 limits were replaced in 2010, and the 25/50/25 and 30/60/25 combinations are not Louisiana's requirement. See La. R.S. 32:900(B)(2).

• A. UM coverage at the state minimum of $15,000/$30,000; it may be declined orally to the producer
• B. No UM coverage unless the insured requests it in writing
• C. UM coverage of $100,000/$300,000 (equal to the bodily injury limits), unless the named insured rejects it, selects lower limits, or selects economic-only coverage on the form prescribed by the commissioner and signs it
• D. UM coverage equal to the property damage limit, which may be rejected only at renewal

Correct answer: C. UM coverage of $100,000/$300,000 (equal to the bodily injury limits), unless the named insured rejects it, selects lower limits, or selects economic-only coverage on the form prescribed by the commissioner and signs it

Explanation: No automobile liability policy may be issued in Louisiana unless it provides uninsured/underinsured motorist coverage in not less than the bodily injury liability limits of the policy; the coverage does not apply only if the named insured rejects it, selects lower limits (not below the R.S. 32:900 minimums), or selects economic-only coverage, and that choice must be made on the commissioner-prescribed form signed by the named insured or legal representative, which remains valid for the life of the policy. UM is automatic (not by request), an oral rejection is ineffective, and the default is the BI limit, not the minimum or the PD limit. See La. R.S. 22:1295(1)(a).

• A. personal auto comprehensive coverage
• B. equipment breakdown only
• C. errors and omissions liability
• D. commercial property building coverage

Correct answer: C. errors and omissions liability

Explanation: An agent E&O policy may address covered claims alleging professional mistakes, such as failure to procure requested coverage.

• A. cash value accumulation basis
• B. personal auto split-limit basis only
• C. guaranteed lifetime benefit basis
• D. claims-made basis

Correct answer: D. claims-made basis

Explanation: Professional liability is often written on a claims-made basis, meaning timing of the claim and reporting requirements are critical.

• A. claims from acts before that date may not be covered
• B. claims must be reported within one year of that date
• C. acts after that date are covered under the prior policy
• D. it fixes the date on which the extended reporting period begins

Correct answer: A. claims from acts before that date may not be covered

Explanation: A retroactive date limits coverage for acts occurring before that date. Claims-made policies require careful attention to dates and reporting conditions.

• A. extend the policy period so new acts stay covered after expiration
• B. allow certain claims to be reported after a claims-made policy ends
• C. move the retroactive date backward to pick up earlier acts
• D. convert a claims-made policy into an occurrence policy at renewal

Correct answer: B. allow certain claims to be reported after a claims-made policy ends

Explanation: An extended reporting period allows reporting of certain claims after policy termination for acts that occurred during the covered period, subject to terms.

• A. a retail clerk stocking shelves for a store
• B. a landlord renting an apartment to a tenant
• C. an accountant giving professional tax advice
• D. a delivery driver operating a company truck

Correct answer: C. an accountant giving professional tax advice

Explanation: Professionals who provide specialized services or advice can face professional liability exposure.

• A. ignore policy conditions
• B. increase the policy limit after the loss
• C. repair everything without telling the insurer
• D. give prompt notice to the insurer

Correct answer: D. give prompt notice to the insurer

Explanation: Most policies require prompt notice of loss so the insurer can investigate and handle the claim.

• A. a formal statement of the details and amount of a claimed loss
• B. the adjuster's written estimate of the cost to repair the damage
• C. the insurer's written acknowledgment that a claim has been received
• D. a release the insured signs when accepting the final claim payment

Correct answer: A. a formal statement of the details and amount of a claimed loss

Explanation: A proof of loss gives the insurer information about the loss and the amount claimed, when required by the policy.

• A. rebating
• B. mitigation of damages
• C. adverse selection
• D. waiver of subrogation

Correct answer: B. mitigation of damages

Explanation: Policies often require the insured to take reasonable steps to protect property from further damage after a loss.