Insurance Foundations
Not publishedof exam
Risk TermsContract PartsPolicy ClausesLoss Valuation
Property Coverages
Not publishedof exam
Dwelling FormsHomeowners FormsCommercial PropertyMarine and Flood
Casualty and Commercial
Not publishedof exam
Personal AutoCGLWorkers CompensationSpecialty Liability
Arkansas Law and Licensing
Not publishedof exam
Producer LicensingState RegulationArkansas AutoExam Administration
Quick Facts
- Exam
- Combined P&C
- Vendor
- PSI
- Total Items
- 150 scored, 10 pretest
- Total Time
- 210 minutes
- Pass Mark
- 70%
- Exam Fee
- $50
- General Section
- 125 scored, 8 pretest
- General Time
- 160 minutes
- Arkansas Section
- 25 scored, 2 pretest
- Arkansas Time
- 50 minutes
- Prelicense
- 40 combined hours
- Approval Window
- 90 days
- Attempt Limit
- Three per approval
DICE Policy Parts
Declarations, Insuring agreement, Conditions, Exclusions
D = DeclarationsI = Insuring agreementC = ConditionsE = Exclusions
Peril vs Hazard
Peril
- Causes the loss
- Example: fire
Hazard
- Raises loss chance
- Example: faulty wiring
Cause versus risk amplifier
Risk and Contract Basics
- Peril
- Direct loss cause
- Hazard
- Raises loss probability
- Physical hazard
- Tangible dangerous condition
- Moral hazard
- Dishonesty increases risk
- Morale hazard
- Carelessness increases risk
- Indemnity
- Restore, never profit
- Insurable interest
- Financial stake at loss
- Subrogation
- Insurer pursues responsible party
PMM Hazards
Physical, Moral, Morale raise risk
Physical = conditionMoral = dishonestyMorale = carelessness
ACV vs Replacement Cost
Actual cash value
- Subtracts depreciation
- Lower older-property payment
Replacement cost
- No depreciation deduction
- Replacement conditions may apply
Depreciation creates difference
Policy Structure and Authority
- Declarations
- Who, what, limits, premium
- Insuring agreement
- Insurer coverage promise
- Conditions
- Parties' required duties
- Exclusions
- Removed coverage
- Endorsement
- Changes policy terms
- Express authority
- Explicitly granted authority
- Implied authority
- Necessary supporting authority
- Apparent authority
- Public reasonably perceives authority
Valuation and Claims
- Actual cash value
- Replacement cost minus depreciation
- Replacement cost
- Replace without depreciation
- Agreed value
- Value fixed beforehand
- Stated amount
- Maximum stated recovery
- Market value
- Current sale price
- Deductible
- Insured's retained loss
- Coinsurance
- Required insurance percentage
- Proximate cause
- Dominant unbroken loss cause
Named vs Open Perils
Named perils
- Only listed causes
- Insured proves coverage
Open perils
- All except exclusions
- Insurer proves exclusion
Check the burden
Choose Property Coverage
- Owner-occupied home→Homeowners form
- Tenant needs contents→HO-4
- Condo unit owner→HO-6
- Older specialized home→HO-8
- Non-owner dwelling→Dwelling form
- Business building→Commercial property
- Mobile property→Inland marine
- Flood loss→Flood policy
Dwelling and Homeowners
- DP-1
- Basic named perils
- DP-2
- Broad named perils
- DP-3
- Open-peril dwelling
- HO-3
- Open dwelling, named contents
- HO-4
- Tenant contents coverage
- HO-5
- Open dwelling and contents
- HO-6
- Condominium unit owner
- HO-8
- Modified older-home coverage
Property Coverage Parts
- Coverage A
- Dwelling
- Coverage B
- Other structures
- Coverage C
- Personal property
- Coverage D
- Loss of use
- Coverage E
- Personal liability
- Coverage F
- Medical payments
- Direct loss
- Immediate physical damage
- Indirect loss
- Consequential financial loss
Commercial Property and Marine
- Building coverage
- Structures and fixtures
- Business personal property
- Business contents
- Basic causes
- Limited named perils
- Broad causes
- Expanded named perils
- Special causes
- Open-peril coverage
- Business income
- Covered shutdown earnings
- Inland marine
- Mobile property and transit
- Ocean marine
- Ships, cargo, maritime liability
- Flood insurance
- NFIP or private policy
Negligence Elements
Duty, Breach, Causation, Damages
Duty owedDuty breachedBreach caused lossActual damages
Occurrence vs Claims-Made
Occurrence
- Injury date controls
- Claim may arrive later
Claims-made
- Claim timing controls
- Retroactive date matters
Identify the trigger
Choose Liability Coverage
- Private auto liability→Personal auto
- Business auto exposure→Commercial auto
- Premises liability→CGL
- Professional service error→Errors and omissions
- Employee job injury→Workers compensation
- Employer lawsuit→Employers liability
- Extra broad limits→Umbrella
- Contract performance guarantee→Surety bond
Personal Auto Coverage
- Part A
- Liability coverage
- Part B
- Medical payments
- Part C
- Uninsured motorists
- Part D
- Physical damage
- Collision
- Vehicle impact or upset
- Other-than-collision
- Noncollision covered losses
- Split limits
- Per-person, per-accident, property
- Combined single limit
- One aggregate liability limit
Surety Parties
Principal performs, obligee receives, surety guarantees
Principal = performerObligee = beneficiarySurety = guarantor
Workers Comp vs Employers Liability
Workers compensation
- Statutory benefits
- No-fault framework
Employers liability
- Employer tort liability
- Outside statutory benefits
Benefits versus employer liability
Liability and Commercial Lines
- Negligence
- Duty, breach, causation, damages
- CGL Coverage A
- Injury and property damage
- CGL Coverage B
- Personal and advertising injury
- CGL Coverage C
- Medical payments
- Occurrence form
- Trigger is injury date
- Claims-made form
- Trigger is claim timing
- Businessowners policy
- Bundled property and liability
- Commercial package
- Modular commercial coverages
Specialty Casualty Coverages
- Workers compensation
- Statutory employee benefits
- Employers liability
- Employer liability beyond benefits
- Surety bond
- Principal, obligee, surety
- Umbrella
- Broad excess liability
- Excess liability
- Higher underlying limits
- Errors and omissions
- Professional negligence liability
- Employment practices
- Workplace allegation liability
- Cyber liability
- Network and data losses
Prelicense vs Continuing Education
Prelicense
- Before initial exam
- 40 combined hours
Continuing education
- After licensing
- 24 biennial hours
Different lifecycle stages
Arkansas License Path
- Starting combined line→Complete 40 hours
- Education completed→Keep completion certificate
- Application ready→File through NIPR
- Background review needed→Submit online check
- AID approves testing→Schedule with PSI
- Exam attempt day→Bring current ID
- Exam passed→Print after 24 hours
- Three attempts fail→Wait four weeks
Published Exam Split
- Combined exam
- Property, casualty, commercial lines
- General scored
- 125 questions
- General pretest
- 8 unscored questions
- General time
- 160 minutes
- Arkansas scored
- 25 questions
- Arkansas pretest
- 2 unscored questions
- Arkansas time
- 50 minutes
- Passing score
- 70% minimum
- Topic weights
- Not published
General vs Arkansas Section
General section
- 125 scored questions
- 160 minutes
Arkansas section
- 25 scored questions
- 50 minutes
One combined exam
Arkansas Licensing Rules
- Property prelicense
- 20 classroom hours
- Casualty prelicense
- 20 classroom hours
- Combined prelicense
- 40 classroom hours
- Certificate validity
- Two years
- Resident application
- Submit electronically through NIPR
- Application fee
- $20
- Background check
- Complete online submission
- Continuing education
- 24 hours biennially
- Ethics education
- Three CE hours
Exam Fee vs Application Fee
Exam fee
- $50
- Paid for testing
Application fee
- $20
- Paid for licensing
Separate payments
Arkansas State Topics
- Auto minimum
- $25K/$50K/$25K
- Uninsured motorists
- Written rejection required
- Underinsured motorists
- Written rejection permitted
- Valued policy law
- Listed state topic
- Comparative fault
- Listed state topic
- Guaranty association
- Listed state topic
- Surplus lines
- Listed state topic
- Unfair trade practices
- Listed state topic
- Rural risk underwriting
- Listed state topic
Exam and Retake Rules
- Testing window
- Pass within 90 days
- Window attempts
- Maximum three attempts
- Reset wait
- Four weeks
- Reset trigger
- Window lapse or failures
- Retake booking
- Begin following day
- Required identification
- One current government ID
- Exam books
- Closed book
- Handheld calculator
- Prohibited
- Cancellation deadline
- Two days beforehand
Common Traps
Bank Size Is Not Exam Size
Use PSI published counts ≠ Ignore local category totals
Topic Weights Are Unpublished
Section counts are published ≠ Subtopic percentages are not
Pretest Items Are Unidentified
Ten items are unscored ≠ Answer every presented item
One Exam, Two Sections
General has 125 scored ≠ Arkansas has 25 scored
Prelicense Is Not CE
Forty hours before exam ≠ CE follows licensure
Exam Fee Is Separate
$50 pays PSI ≠ $20 is application fee
Retake Reset Has Two Triggers
Ninety-day window expires ≠ Three failures exhaust approval
Coverage Letters Change Meaning
HO letters differ from CGL ≠ Read the policy family
Last Minute
- 1.Memorize 125 plus 25 split
- 2.Separate scored and pretest items
- 3.Keep unpublished weights unpublished
- 4.Review DICE policy parts
- 5.Distinguish peril from hazard
- 6.Compare ACV with replacement cost
- 7.Match HO and DP forms
- 8.Review PAP coverage parts
- 9.Memorize CGL coverage parts
- 10.Separate prelicense from CE
- 11.Know 25/50/25 auto limits
- 12.Track three-attempt approval limit
- 13.Bring one current government ID
- 14.Leave handheld calculator home
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