Nevada Property & Casualty Insurance Practice Exam Free - 2026

• A. No; once a policy has been in effect for at least 70 days it may be cancelled midterm only on the statutory grounds, such as nonpayment, fraud or a substantial and material increase in the hazard
• B. Yes, with 30 days' notice for any reason
• C. Yes, with 60 days' notice because the policy is commercial
• D. Yes, with 10 days' notice

Correct answer: A. No; once a policy has been in effect for at least 70 days it may be cancelled midterm only on the statutory grounds, such as nonpayment, fraud or a substantial and material increase in the hazard

Explanation: NRS 687B.320(1) provides that no policy that has been in effect for at least 70 days, or that has been renewed, may be cancelled before the end of the agreed term (or 1 year, whichever is first) except for listed grounds: nonpayment, conviction of a crime increasing the hazard, fraud or material misrepresentation, an act or violation substantially increasing the hazard, a material change in the risk, or Commissioner determinations regarding solvency or Code violations. A change in the insurer's underwriting appetite is not a listed ground, so no notice period (30, 60 or 10 days) would make the cancellation valid. See NRS 687B.320.

• A. At least 10 days before expiration; a late notice simply extends the policy 10 days
• B. At least 30 days before expiration; a late notice has no consequence
• C. At least 60 days before expiration; if the notice is untimely, the insurer must provide a policy on identical terms to the expiring policy
• D. At least 90 days before expiration

Correct answer: C. At least 60 days before expiration; if the notice is untimely, the insurer must provide a policy on identical terms to the expiring policy

Explanation: NRS 687B.340(1) gives the policyholder a right to renewal unless the insurer mails or delivers a notice of intention not to renew at least 60 days before expiration for commercial or business policies (30 days for all other policies); if the insurer fails to provide timely notice, it must provide the insured a policy on the identical terms as the expiring policy. Thirty days applies only to non-commercial policies, and 10 and 90 days are not Nevada periods. See NRS 687B.340.

• A. The renewal at the new rate is valid because the insured can shop elsewhere
• B. Because written notice of the different rate was not given at least 30 days before expiration, the insurer must renew the policy at the expiring terms and rate for a period equal to the expiring term
• C. The policy is automatically nonrenewed
• D. The insurer may impose the new rate 30 days after the notice

Correct answer: B. Because written notice of the different rate was not given at least 30 days before expiration, the insurer must renew the policy at the expiring terms and rate for a period equal to the expiring term

Explanation: NRS 687B.350(1) prohibits renewing a policy on different terms, including different rates, unless the insurer notifies the insured in writing at least 30 days before expiration; if adequate and timely notice is not given, the insurer must renew at the expiring terms and rates for a period equal to the expiring term (or 1 year if the term is more than 1 year). The rate increase is not valid on 12 days' notice, the policy is not nonrenewed, and the statute does not allow a delayed effective date. See NRS 687B.350.

• A. Within 30 days
• B. Within 15 days
• C. Within 10 days
• D. Within 6 days after receipt of the written request

Correct answer: D. Within 6 days after receipt of the written request

Explanation: NRS 687B.360 provides that if a notice of cancellation or nonrenewal does not state with reasonable precision the facts on which the insurer's decision is based, the insurer shall supply that information within 6 days after receipt of a written request by the policyholder, and no notice is effective unless it tells the policyholder of the right to make such a request. Thirty, fifteen and ten days are not the statutory period. See NRS 687B.360.

• A. Any water damage from weather automatically qualifies as a flood
• B. The NFIP defines a flood as inundation of normally dry land affecting two or more acres or two or more properties, at least one being the policyholder's
• C. A flood requires an official disaster declaration before any claim is payable
• D. A flood exists only when a river or other named body of water overflows its banks

Correct answer: B. The NFIP defines a flood as inundation of normally dry land affecting two or more acres or two or more properties, at least one being the policyholder's

Explanation: The NFIP defines a flood as a general and temporary condition of partial or complete inundation of two or more acres of normally dry land, or of two or more properties, at least one of which is the policyholder's. Because two properties were inundated by an unusual and rapid accumulation of surface water, the event fits the definition; no disaster declaration or river overflow is required. See fema.gov.

• A. Ask FEMA to endorse the federal policy above its statutory maximum
• B. Add a flood endorsement to the standard homeowners policy
• C. Rely on federal disaster assistance to make up the difference
• D. Purchase excess flood insurance from a private insurer over the NFIP limit

Correct answer: D. Purchase excess flood insurance from a private insurer over the NFIP limit

Explanation: Private insurers sell excess flood coverage that sits above the NFIP maximums for owners whose exposure exceeds the federal limits. FEMA cannot issue limits above the statutory caps, standard homeowners policies exclude flood, and disaster assistance is neither guaranteed nor a substitute for insurance. See fema.gov.

• A. Employee theft coverage
• B. Inside the premises - robbery coverage
• C. Computer fraud coverage
• D. Forgery or alteration coverage for checks drawn against the insured by outsiders

Correct answer: A. Employee theft coverage

Explanation: Employee theft (fidelity) coverage pays for loss of money, securities, or other property caused by the dishonest acts of an employee, which is exactly what an embezzling bookkeeper is. Robbery coverage requires a threat against a person, and the forgery agreement targets instruments created by outsiders rather than a dishonest employee. See the NAIC glossary definition of fidelity coverage.

• A. Robbery, because property was taken unlawfully
• B. Burglary, because there are visible signs of forced entry into the premises
• C. Mysterious disappearance, because no one saw the crime
• D. Extortion, because the criminal profited from the store

Correct answer: B. Burglary, because there are visible signs of forced entry into the premises

Explanation: Burglary is the unlawful taking of property from inside premises evidenced by visible signs of forcible entry or exit - the pried door and splintered frame satisfy that requirement. Robbery requires violence or the threat of violence against a person, and no person was present. Legal references define burglary as illegally entering a building intending to commit a crime inside.

• A. Burglary
• B. Safe burglary
• C. Robbery, because property was taken from a person by threat of force
• D. Theft by deception

Correct answer: C. Robbery, because property was taken from a person by threat of force

Explanation: Robbery is the unlawful taking of property from a person, or in a person's presence, by violence or the threat of violence - the weapon pointed at the cashier supplies that element. Burglary instead requires visible signs of forced entry into premises with no confrontation of a person. See the legal definition of robbery at law.cornell.edu.

• A. Inside the premises - theft of money and securities
• B. Employee theft coverage
• C. Forgery or alteration coverage
• D. Outside the premises coverage, which applies to money and securities in the care of a messenger away from the premises

Correct answer: D. Outside the premises coverage, which applies to money and securities in the care of a messenger away from the premises

Explanation: Money and securities coverage is split by location: the inside-the-premises agreement applies at the insured's premises or a bank, while the outside-the-premises agreement covers theft, disappearance, or destruction of money and securities in the custody of a messenger away from the premises. The manager acting as messenger on the street is squarely an outside-the-premises loss, and no employee dishonesty or forged instrument is involved.

• A. The loss can be covered, because a discovery form applies to losses discovered during the policy period regardless of when they occurred
• B. The loss is excluded, because the theft occurred before the policy period began
• C. The loss is covered only if the prior insurer agrees to share it
• D. The loss is covered only for the portion that occurred after the policy inception

Correct answer: A. The loss can be covered, because a discovery form applies to losses discovered during the policy period regardless of when they occurred

Explanation: The discovery form's trigger is when the loss is discovered, not when it was sustained, so losses from prior years can be covered if first discovered during the policy period (subject to any retroactive date). The loss-sustained form works the other way: the loss generally must occur during the policy period or a prior policy with continuity. Answer B describes the loss-sustained trigger, not the discovery trigger.

• A. The homeowners policy excludes jewelry entirely, so a floater is the only possible coverage
• B. The homeowners policy applies only low special limits to theft of jewelry, while a floater insures the ring at its appraised value with broader open-perils protection
• C. A floater is legally required for any single item worth more than the dwelling limit
• D. Scheduling the ring reduces the homeowners premium

Correct answer: B. The homeowners policy applies only low special limits to theft of jewelry, while a floater insures the ring at its appraised value with broader open-perils protection

Explanation: Homeowners forms impose low special dollar limits on theft of jewelry, so a valuable ring is badly underinsured for theft under the unendorsed policy. Scheduling it on a personal articles floater insures it for an agreed or appraised value on an open-perils basis, typically including accidental loss such as a stone falling from its setting. Jewelry is not excluded entirely, so answer A overstates the gap. See iii.org.