Mississippi Property & Casualty Insurance Practice Exam Free - 2026

• A. At least 30 days before expiration (by September 1)
• B. At least 10 days before expiration
• C. At least 45 days before expiration
• D. At least 60 days before expiration

Correct answer: A. At least 30 days before expiration (by September 1)

Explanation: No Mississippi auto insurer may fail to renew a policy unless it mails or delivers to the named insured at the policy address, and to any named creditor loss payee, at least thirty (30) days' advance notice of its intention not to renew, subject to limited statutory exceptions. Ten days is the nonpayment cancellation notice, and 45 and 60 days are not the statutory nonrenewal period. See Miss. Code Ann. § 83-11-7.

• A. Nothing further; any unidentified vehicle qualifies
• B. Actual physical contact must have occurred between the unknown vehicle and the insured or her vehicle
• C. A police report filed within 24 hours is sufficient
• D. A sworn statement from an independent witness is sufficient

Correct answer: B. Actual physical contact must have occurred between the unknown vehicle and the insured or her vehicle

Explanation: Mississippi's uninsured motorist law includes a motor vehicle whose owner or operator is unknown, provided that actual physical contact must have occurred between the unknown vehicle and the insured or the insured's vehicle. Because there was no contact, the miss-and-run claim does not qualify as an uninsured motor vehicle claim, and a police report or witness statement does not substitute for the contact requirement. See Miss. Code Ann. § 83-11-103.

• A. A $500 fine; a paper card is required
• B. A $250 fine and 30-day suspension; electronic cards are allowed
• C. A $100 fine and suspension of driving privilege for one year or until proof of liability insurance is shown; the card may be displayed electronically on a cellular phone
• D. No fine, only a warning; electronic cards are not allowed

Correct answer: C. A $100 fine and suspension of driving privilege for one year or until proof of liability insurance is shown; the card may be displayed electronically on a cellular phone

Explanation: Every motor vehicle operated in Mississippi must be covered by a liability policy meeting the § 63-15-3(j) limits, and the operator must carry the insurer's card, which may be in paper or electronic form displayed on a cellular phone. Failure to carry or display it is a misdemeanor punishable by a fine of One Hundred Dollars ($100.00) and suspension of the driving privilege for one year or until proof of liability insurance is shown; the case is dismissed if the owner proves coverage was in force at the time. The $500 and $250 figures and the 30-day suspension are not the statutory penalties. See Miss. Code Ann. § 63-15-4.

• A. 30 days
• B. 20 days
• C. 15 days
• D. 10 days

Correct answer: D. 10 days

Explanation: For liability, fire and single-premium multiperil policies (personal and commercial lines), Mississippi requires notice of cancellation to be mailed or delivered to the insured and any named creditor loss payee not less than thirty (30) days before the effective date, except that where the cancellation is for nonpayment of premium and there is a named creditor loss payee, at least ten (10) days' notice is required. Thirty days is the general rule for other reasons; 15 and 20 days are not statutory periods. See Miss. Code Ann. § 83-5-28.

• A. To make basic property insurance available to owners of eligible properties who cannot obtain it in the voluntary market
• B. To pay the covered claims of policyholders whose admitted property insurer has been declared insolvent by a court
• C. To provide flood insurance to property owners in communities that have adopted approved floodplain management rules
• D. To distribute high risk auto applicants among licensed insurers in proportion to their share of the state's premium

Correct answer: A. To make basic property insurance available to owners of eligible properties who cannot obtain it in the voluntary market

Explanation: FAIR Plans are shared market mechanisms created to deliver basic property coverage where private insurers decline to write, often because of location or age of the property. Paying claims of failed insurers is the guaranty association's job. Flood coverage in participating communities comes from the federal flood program, and distributing high risk auto applicants among insurers is the role of an assigned risk plan.

• A. A state guaranty association
• B. A beach and windstorm plan
• C. An automobile assigned risk plan
• D. A workers compensation rating bureau

Correct answer: B. A beach and windstorm plan

Explanation: Beach and windstorm plans are coastal residual markets created specifically to provide wind and hail coverage in designated shoreline areas that private insurers avoid. Assigned risk plans handle hard to place drivers, and guaranty associations respond to insurer insolvency. A rating bureau develops loss costs and classifications rather than issuing coverage.

• A. Applicants who cannot obtain coverage voluntarily are insured directly by the state, which issues the policy and pays claims from an assessment on all insurers
• B. Applicants who cannot obtain coverage voluntarily are referred to non-admitted surplus lines carriers after a diligent search of the admitted market
• C. Applicants who cannot obtain coverage voluntarily are distributed among participating insurers in proportion to their share of the state's business
• D. Applicants who cannot obtain coverage voluntarily are insured by the FAIR Plan, which writes auto liability alongside basic property coverage

Correct answer: C. Applicants who cannot obtain coverage voluntarily are distributed among participating insurers in proportion to their share of the state's business

Explanation: An assigned risk plan spreads hard to place drivers across insurers writing auto business in the state, with each carrier taking a share tied to its voluntary market volume. The state administers the plan rather than underwriting and paying claims itself. Surplus lines placement is a separate avenue, and assigned risk premiums are typically higher, not free.

• A. Convert the applicant's existing policy to an assigned risk plan
• B. Obtain approval of the policy form and rates from the insurance department
• C. Add the risk to the state FAIR Plan first
• D. Document a diligent search showing that admitted insurers declined the risk

Correct answer: D. Document a diligent search showing that admitted insurers declined the risk

Explanation: Surplus lines exists for risks the admitted market will not accept, so producers must show a good faith effort and record declinations before exporting the business. Surplus lines forms and rates are generally exempt from the filing and approval requirements imposed on admitted carriers. FAIR Plans and assigned risk plans are separate mechanisms and are not prerequisites for a surplus lines placement.

• A. An admitted insurer holds a certificate of authority in the state and is generally subject to form and rate filing requirements, while a non-admitted insurer is not licensed there
• B. An admitted insurer is one domiciled in the state, while a non-admitted insurer is a foreign or alien insurer that has been licensed to do business there under a different classification
• C. An admitted insurer is exempt from state form and rate filing requirements, while a non-admitted insurer must file its forms and rates before writing surplus lines business
• D. An admitted insurer is regulated by the state insurance department, while a non-admitted insurer is licensed and regulated by the federal government under the surplus lines law

Correct answer: A. An admitted insurer holds a certificate of authority in the state and is generally subject to form and rate filing requirements, while a non-admitted insurer is not licensed there

Explanation: Admitted status means the insurer has been licensed by the state and accepts its filing, solvency, and market conduct oversight, while non-admitted carriers operate through the surplus lines channel without that license. Domicile outside the country describes an alien insurer, a different classification. Neither status is limited to a line of business, and admitted insurers are the more heavily regulated of the two.

• A. The guaranty association provides coverage to applicants the voluntary market rejects, while residual market plans pay covered claims of insolvent admitted insurers
• B. The guaranty association pays covered claims of insolvent admitted insurers, while residual market plans provide coverage to applicants the voluntary market rejects
• C. The guaranty association pays covered claims of insolvent surplus lines insurers, while residual market plans protect policyholders of insolvent admitted insurers
• D. The guaranty association reimburses member insurers for catastrophic losses above a retention, while residual market plans provide coverage of last resort for property alone

Correct answer: B. The guaranty association pays covered claims of insolvent admitted insurers, while residual market plans provide coverage to applicants the voluntary market rejects

Explanation: Guaranty associations step in after an admitted insurer fails, funding covered claims through assessments on solvent member insurers, and they are not a source of new coverage. Residual markets solve an availability problem for applicants at the front end. Surplus lines placements are generally not protected by guaranty associations, which is a key disclosure point for consumers.

• A. At 12:01 a.m. on the day after the application is signed
• B. Immediately upon payment of the full annual premium to the agent
• C. Thirty days after the application and premium are submitted
• D. Fourteen days after the application and premium are submitted

Correct answer: C. Thirty days after the application and premium are submitted

Explanation: The federal flood program imposes a standard thirty day waiting period so that people cannot buy coverage only when a flood is imminent, which would make the program financially unsustainable. Immediate or same day effective dates are not available for ordinary purchases. The limited exceptions relate to loan closings and certain map changes, not to the naming of a storm.

• A. Coverage in below grade areas is the same as for above grade living space, so finished walls, flooring, furniture, and contents in the family room are paid up to the policy limits
• B. Coverage in below grade areas is excluded entirely, so neither the foundation walls nor the furnace and electrical panel in the basement are covered under the program
• C. Coverage in below grade areas reaches finished improvements such as drywall and carpeting, but excludes structural elements and building equipment like the furnace and water heater
• D. Coverage in below grade areas is sharply limited, generally reaching structural elements and essential building equipment rather than finished improvements and most personal property

Correct answer: D. Coverage in below grade areas is sharply limited, generally reaching structural elements and essential building equipment rather than finished improvements and most personal property

Explanation: The program restricts below grade coverage to items such as foundation walls, furnaces, water heaters, and electrical panels, while finished walls, flooring, and most contents in a basement are not covered. Treating a basement like a living area badly overstates the coverage. Saying basements get nothing at all is also wrong, since essential building elements are included.