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Commercial Auto

Practice questions on commercial auto for the casualty exam, each with an answer and explanation.

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Study questions and answers

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1. Under the Business Auto Coverage Form, covered auto symbol 1 means:

  1. Owned autos only
  2. Hired autos only
  3. Any auto
  4. Specifically described autos
Show answer
C. Any auto
Symbol 1, any auto, is the broadest symbol and is used only for liability coverage.

2. An insured wants liability coverage only for autos it rents or borrows, not for autos it owns. Which covered auto symbol fits?

  1. Symbol 2
  2. Symbol 7
  3. Symbol 8
  4. Symbol 9
Show answer
C. Symbol 8
Symbol 8 covers hired autos only: autos the insured leases, hires, rents, or borrows, other than autos owned by employees or partners.

3. Employees use their own cars to run errands for the employer. Which covered auto symbol protects the employer's liability for those cars?

  1. Symbol 9, non-owned autos only
  2. Symbol 3, owned private passenger autos only
  3. Symbol 7, specifically described autos
  4. Symbol 4, owned autos other than private passenger
Show answer
A. Symbol 9, non-owned autos only
Symbol 9 covers autos the insured does not own, lease, hire, rent or borrow that are used in the business, including employees' personal autos.

4. An insured with covered auto symbol 7 buys a new truck. To have coverage for it, the insured must:

  1. Do nothing; it is covered automatically for the rest of the policy period
  2. Ask the insurer to cover it within 30 days after acquiring it
  3. Ask the insurer to cover it within 90 days after acquiring it
  4. Buy a separate policy for the truck
Show answer
B. Ask the insurer to cover it within 30 days after acquiring it
Symbol 7 covers only described autos. A newly acquired auto is covered only if the insured asks for coverage within 30 days and the insurer already covers all owned autos for that coverage or the new auto replaces one.

5. Under the Business Auto Coverage Form supplementary payments, the insurer pays up to what amount for the cost of bail bonds, including bonds for related traffic violations?

  1. $250
  2. $500
  3. $1,000
  4. $2,000
Show answer
D. $2,000
The Business Auto Coverage Form pays up to $2,000 for bail bonds required because of an accident covered under its liability coverage.

6. Under the Business Auto Coverage Form, which of the following is NOT an insured for covered autos liability?

  1. The named insured for any covered auto
  2. An employee driving a covered auto the named insured owns, with permission
  3. The owner of an auto the named insured hires or borrows
  4. Anyone liable for the conduct of an insured, to the extent of that liability
Show answer
C. The owner of an auto the named insured hires or borrows
The owner or anyone else from whom the named insured hires or borrows a covered auto is not an insured, with a limited exception for trailers.

7. The Business Auto Coverage Form excludes bodily injury to a fellow employee of the insured arising out of employment. This exclusion is meant to:

  1. Leave work injuries to workers compensation
  2. Exclude all passengers
  3. Exclude injuries outside the policy territory
  4. Limit coverage to private passenger autos
Show answer
A. Leave work injuries to workers compensation
The fellow employee exclusion keeps employees' work injuries within workers compensation rather than auto liability.

8. Which Business Auto physical damage coverage is the broadest and covers loss from any cause except those excluded?

  1. Collision
  2. Specified causes of loss
  3. Comprehensive
  4. Towing
Show answer
C. Comprehensive
Comprehensive covers any cause of loss except collision with another object, overturn, and the listed exclusions.

9. Under Business Auto physical damage coverage, which loss is paid under comprehensive rather than collision?

  1. The auto hits a guardrail
  2. The auto overturns on an icy road
  3. The auto collides with a parked trailer
  4. The auto is struck by a deer
Show answer
D. The auto is struck by a deer
Contact with a bird or animal is treated as a comprehensive loss, not a collision loss.

10. Which coverage form is designed to insure the auto liability and physical damage exposures of franchised and nonfranchised auto dealers?

  1. Business Auto Coverage Form
  2. Auto Dealers Coverage Form
  3. Motor Carrier Coverage Form
  4. Personal Auto Policy
Show answer
B. Auto Dealers Coverage Form
The Auto Dealers Coverage Form covers auto dealers, including their garage operations and autos held for sale.

11. A repair shop has customers' cars in its care while servicing them. Which coverage protects the shop for damage to those cars?

  1. Garagekeepers coverage
  2. Hired auto liability
  3. Coverage B of the CGL
  4. Uninsured motorists coverage
Show answer
A. Garagekeepers coverage
Garagekeepers coverage pays for damage to customers' autos left in the insured's care for service, repair, parking or storage.

12. Under garagekeepers coverage, which option pays for damage to a customer's auto regardless of the insured's legal liability and before the customer's own insurance?

  1. Legal liability
  2. Direct excess
  3. Direct primary
  4. Specified causes of loss only
Show answer
C. Direct primary
Direct primary pays regardless of the garage's liability and on a primary basis. Direct excess pays regardless of liability but only after the customer's own insurance.

13. Which coverage form is designed for a business that transports property by auto for others for hire?

  1. Business Auto Coverage Form
  2. Garage Coverage Form
  3. Personal Auto Policy
  4. Motor Carrier Coverage Form
Show answer
D. Motor Carrier Coverage Form
The Motor Carrier Coverage Form insures businesses that transport property by auto in their business or for others for hire.

14. The sole owner of a corporation has no personal auto and drives only company cars. Which endorsement extends the corporation's business auto policy to cover the owner while driving other autos, such as a rental car on vacation?

  1. Drive Other Car Coverage endorsement
  2. Hired auto physical damage endorsement
  3. Employee as Insured endorsement
  4. Additional Insured endorsement
Show answer
A. Drive Other Car Coverage endorsement
The Drive Other Car endorsement extends coverage to named individuals while they drive autos the business does not own, hire or borrow.

15. A contractor wants business auto coverage for its cherry picker only while it is driven on public roads where motor vehicle insurance laws apply. Which covered auto symbol is used?

  1. Covered auto Symbol 8
  2. Symbol 9
  3. Symbol 19
  4. Symbol 3
Show answer
C. Symbol 19
Symbol 19 provides auto coverage for mobile equipment that must meet motor vehicle insurance laws while it is used on public roads.

16. A contractor's bulldozer, used only on job sites, injures a worker from another company. Which policy is designed to cover this liability?

  1. The Business Auto Coverage Form
  2. The commercial general liability policy
  3. The Motor Carrier Coverage Form
  4. Garagekeepers coverage
Show answer
B. The commercial general liability policy
Bulldozers and other mobile equipment are covered for liability under the CGL, not the business auto form, unless they are operated on public roads under motor vehicle laws.
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