Washington Property & Casualty Insurance Practice Exam Free - 2026

• A. 45 days
• B. 10 days
• C. 90 days
• D. No deadline applies

Correct answer: A. 45 days

Explanation: For homeowners, dwelling fire, and private passenger auto policies, the unearned premium computed pro rata must be paid or mailed to the insured as soon as possible and no later than 45 days after the date of the cancellation notice. See RCW 48.18.290.

• A. $450,000 minus a $100 deductible
• B. The portion of the claim above $100 and below $300,000
• C. The full $450,000
• D. Nothing, because the claim exceeds association limits

Correct answer: B. The portion of the claim above $100 and below $300,000

Explanation: The property and casualty guaranty association is obligated only for the amount of each covered claim that is in excess of $100 and less than $300,000, never exceeding the policy's face amount. See RCW 48.32.060.

• A. Private carriers may write it if rates are filed
• B. Coverage is optional for employers with fewer than 10 workers
• C. Employers must insure through the state fund or qualify as self-insurers; private workers compensation policies are not sold
• D. Coverage may be added to the employer's general liability policy

Correct answer: C. Employers must insure through the state fund or qualify as self-insurers; private workers compensation policies are not sold

Explanation: Washington is a monopolistic state-fund jurisdiction: every employer must secure payment of compensation either by insuring with the state fund (administered by the Department of Labor and Industries) or by qualifying as a self-insurer. See RCW 51.14.010.

• A. Benefits are paid regardless of fault, and civil suits against the employer are abolished as industrial insurance is the exclusive remedy
• B. He may sue only if the employer was grossly negligent
• C. Benefits are denied when the worker is at fault
• D. He must first arbitrate with the insurance commissioner

Correct answer: A. Benefits are paid regardless of fault, and civil suits against the employer are abolished as industrial insurance is the exclusive remedy

Explanation: Title 51 RCW provides sure and certain relief for injured workers regardless of questions of fault and to the exclusion of every other remedy; civil actions and court jurisdiction over such injuries are abolished except as the title provides. See RCW 51.04.010.

• A. farm policies exclude tractors, so each one needs a separate auto policy
• B. vehicles and equipment may not all fit neatly under farm property coverage
• C. federal crop insurance already covers farm vehicles, so duplicate coverage must be avoided
• D. the farm liability section already covers vehicles registered for public road use

Correct answer: B. vehicles and equipment may not all fit neatly under farm property coverage

Explanation: Farm vehicles and mobile equipment may require careful classification and separate or endorsed coverage.

• A. whether guest injuries can be paid from the farm property coverage limit
• B. whether workers compensation will respond to injuries suffered by paying guests
• C. whether agritourism or business liability exposures need special coverage
• D. whether crop insurance should be increased to reflect the added event income

Correct answer: C. whether agritourism or business liability exposures need special coverage

Explanation: Public events can create liability exposures beyond ordinary farm operations. Coverage should be reviewed and endorsed if needed.

• A. boilers, electrical systems, or mechanical equipment
• B. buildings, outdoor fences, and detached structures
• C. inventory, raw materials, and finished goods in storage
• D. vehicles, trailers, and mobile equipment driven on public roads

Correct answer: A. boilers, electrical systems, or mechanical equipment

Explanation: Equipment breakdown coverage addresses covered breakdown events involving certain mechanical, electrical, or pressure equipment.

• A. a boiler that fails from years of ordinary wear and tear
• B. a lightning strike that ignites a fire inside the building wiring system
• C. a machine destroyed by flooding of the basement machine room
• D. a covered electrical system failure damaging business equipment

Correct answer: D. a covered electrical system failure damaging business equipment

Explanation: Equipment breakdown coverage focuses on covered breakdowns of equipment, not general liability, theft of autos, or advertising injury.

• A. a refrigerator is stolen along with the goods stored inside it
• B. refrigerated goods spoil after covered refrigeration equipment fails
• C. food is contaminated by an employee's deliberate tampering
• D. inventory in cold storage is damaged by a fire that spreads through the warehouse

Correct answer: B. refrigerated goods spoil after covered refrigeration equipment fails

Explanation: Spoilage coverage can help with perishable property damaged because of a covered equipment breakdown, when included.

• A. property forms cover the breakdown itself but exclude the fire that follows it
• B. property forms exclude fire damage to equipment, so a second policy is needed
• C. standard property forms may exclude or limit mechanical breakdown losses
• D. equipment breakdown is required by law once a business owns a boiler

Correct answer: C. standard property forms may exclude or limit mechanical breakdown losses

Explanation: Standard property coverage may not fully cover mechanical or electrical breakdown exposures. Equipment breakdown fills that gap when properly added.

• A. lost profits during the period the equipment is out of service
• B. scheduled preventive maintenance performed to avoid a future breakdown
• C. the cost of replacing spoiled inventory that resulted from the breakdown
• D. extra costs to speed up repairs or replacement after a covered breakdown

Correct answer: D. extra costs to speed up repairs or replacement after a covered breakdown

Explanation: Expediting expense coverage can help pay reasonable extra costs to make temporary repairs or speed permanent repairs after a covered breakdown.

• A. equipment breakdown
• B. personal umbrella only
• C. life nonforfeiture options
• D. health coinsurance

Correct answer: A. equipment breakdown

Explanation: Boiler and machinery exposures are classic equipment breakdown concerns.