17 Free California Property & Casualty Practice Questions: Personal Lines Casualty: Auto, CAARP and Umbrella (2026)

Question 1 (Chapter 6)

A California resident purchases a new car on Monday. Their current personal auto policy includes collision coverage on one listed vehicle. According to the ISO Personal Auto Policy provisions adopted in California, when does collision coverage automatically apply to the newly acquired vehicle?

• A) On the day of ownership, provided the insured carries collision on at least one other vehicle.
• B) Immediately upon taking ownership, with no notice required to the insurer.
• C) Only after the insured notifies the insurer within 14 days of acquisition.
• D) After 30 days, unless the insured pays an additional premium for immediate coverage.

Question 2 (Chapter 6)

A California driver carries the state minimum split limits of 30/60/15. They are at fault in an accident that injures three people, with damages of $40,000, $35,000 and $10,000 respectively. How much will their bodily injury liability coverage pay in total?

• A) $85,000 (sum of all injuries)
• B) $90,000 (three times the per-person limit)
• C) $70,000 (each claim capped at the per-person limit)
• D) $60,000 (the per-accident limit)

Question 3 (Chapter 6)

A California driver has an underlying auto policy with $50,000 bodily injury liability limit and purchases a $1 million umbrella policy with a $250 self-insured retention (SIR). If a covered loss occurs that is not covered by the underlying auto policy but is covered by the umbrella, how much will the umbrella policy pay for a $10,000 loss?

• A) $10,000
• B) $0
• C) $250
• D) $9,750

Question 4 (Chapter 6)

A California homeowner's guest slips on an icy sidewalk and fractures their hip. The homeowner's homeowners policy Section II Medical Payments to Others coverage will pay for which of the following?

• A) The guest's lost wages due to time off work
• B) The homeowner's own medical expenses if they also slipped on the ice
• C) The guest's pain and suffering damages awarded in a lawsuit
• D) Reasonable medical expenses for the guest's X-rays and emergency room visit, up to the policy limit

Question 5 (Chapter 6)

An insured in Los Angeles hires a part-time gardener to maintain their yard twice a month. While working, the gardener is injured by a malfunctioning lawnmower owned by the insured. How does the California homeowners policy handle this situation?

• A) The policy must include a mandatory California Workers' Compensation — Residence Employees endorsement to cover such injuries.
• B) The policy excludes all injuries to employees under the 'Business Pursuits' exclusion.
• C) The gardener must sue the manufacturer of the lawnmower as the homeowners policy never covers household employees.
• D) Medical Payments to Others automatically covers the gardener's injuries regardless of the number of hours worked.

Question 6 (Chapter 6)

A California driver participates in a 'share-the-expense' carpool where coworkers take turns driving and split the cost of gasoline. How does the Personal Auto Policy (PAP) respond to this arrangement?

• A) Coverage remains in effect because 'share-the-expense' carpools are specifically excepted from the public or livery conveyance exclusion.
• B) Coverage is excluded because this is considered 'public or livery conveyance.'
• C) Coverage is excluded because the driver is receiving 'for-hire' compensation.
• D) The driver must add a 'Commercial Use' endorsement to maintain coverage.

Question 7 (Chapter 6)

Which of the following is a characteristic of a 'Self-Insured Retention' (SIR) in a Personal Umbrella policy?

• A) It acts like a deductible for losses covered by the underlying policy.
• B) It is the amount the insurer pays before the umbrella policy responds.
• C) It is required by California law to be at least $1,000 for all policies.
• D) It applies only when the umbrella policy provides broader coverage than the underlying policy for a loss not covered by the underlying policy.

Question 8 (Chapter 6)

Under California Insurance Code §11580.24, a personal vehicle sharing program must provide insurance coverage during the sharing period. For the vehicle to remain classified as a 'private passenger' vehicle rather than 'commercial,' what condition must be met?

• A) The annual revenue from sharing must not exceed the annual cost of owning and operating the vehicle.
• B) The owner must not make any profit from the sharing program.
• C) The vehicle must not be shared for more than 10 days per year.
• D) The owner must be present in the vehicle during the sharing period.

Question 9 (Chapter 6)

An insured with a standard Homeowners policy is sued for 'Personal Injury' after posting a defamatory review of a local contractor on social media. Why might the standard Section II coverage fail to provide a defense or indemnity in this case?

• A) Section II only covers Bodily Injury and Property Damage, not Personal Injury (libel/slander), unless endorsed.
• B) Homeowners policies exclude all social media activities under the 'Cyber Liability' exclusion.
• C) The insured is only covered for Personal Injury if the incident occurs on the 'insured location.'
• D) The contractor is considered a 'residence employee' and is therefore excluded from liability claims.

Question 10 (Chapter 6)

A California driver is involved in an accident and is required to attend a court hearing at the insurer's request. Under the 'Supplementary Payments' section of Part A (Liability), how much will the policy pay for the insured's loss of earnings?

• A) Up to $100 per day
• B) Up to $250 per day
• C) Up to $200 per day
• D) Up to $500 total for the duration of the trial

Question 11 (Chapter 6)

Under California Insurance Code §11580.24, a vehicle owner participates in a personal vehicle sharing program (like Turo). The vehicle is NOT considered a 'commercial use' vehicle (which would void the PAP) as long as which condition is met?

• A) The vehicle is not shared for more than 15 days per month.
• B) The annual revenue from sharing does not exceed the annual cost of owning and operating the vehicle.
• C) The vehicle is never driven outside the county where it is registered.
• D) The owner only shares the vehicle with family members.

Question 12 (Chapter 6)

A California resident owns a three-axle motor home (RV) with a gross vehicle weight of 20,000 lbs. According to California Vehicle Code and Insurance Code §660, is this vehicle eligible for a Personal Auto Policy?

• A) No, any vehicle with more than two axles is considered commercial.
• B) Yes, a three-axle RV is specifically defined as a private passenger vehicle for insurance purposes in California.
• C) No, vehicles over 10,000 lbs must be on a Commercial Auto policy.
• D) Yes, but only if it is used as a primary residence.

Question 13 (Chapter 6)

An insured owns a vacant lot in a rural part of California where they intend to build a retirement home in five years. A hiker wanders onto the property, falls into an unmarked hole, and sues the insured for bodily injury. Does the insured's Homeowners policy provide liability coverage for this location?

• A) No, because the location is not listed on the Declarations page as a residence premises.
• B) No, because liability coverage only extends to locations where a structure currently exists.
• C) Yes, because 'insured location' includes vacant land, other than farm land, owned by or rented to an insured.
• D) Yes, but only if the insured purchased the 'Additional Residence Rented to Others' endorsement.

Question 14 (Chapter 6)

An insured's car is damaged in a collision with a tree on Tuesday at 10:00 AM. The car is undriveable and is taken to a repair shop. The insured has Collision and 'Transportation Expenses' coverage. When does the policy begin to reimburse the insured for the cost of a rental car?

• A) Immediately at 10:00 AM on Tuesday.
• B) Wednesday at 10:00 AM (24 hours after the loss).
• C) Thursday at 10:00 AM (48 hours after the loss).
• D) Only after the repairs have exceeded $1,000 in costs.

Question 15 (Chapter 6)

Under California Insurance Code §11580.24, a vehicle owner may participate in a personal vehicle sharing program without their Personal Auto Policy being classified as 'commercial' as long as the annual revenue from sharing the vehicle does not exceed:

• A) $5,000 per year.
• B) 10% of the vehicle's Actual Cash Value.
• C) The annual cost of owning and operating the vehicle.
• D) The total amount of the annual insurance premium.

Question 16 (Chapter 6)

A California resident purchases a new motorcycle. They attempt to add it to their existing personal auto policy for liability coverage. Which statement is correct regarding the personal auto policy's coverage for motorcycles?

• A) The motorcycle is automatically covered if the policy includes liability coverage.
• B) The motorcycle can be covered by adding a miscellaneous type vehicle endorsement.
• C) Motorcycles are generally excluded from coverage under a standard personal auto policy and require a separate motorcycle policy.
• D) The motorcycle is covered if it has an engine size under 500cc.

Question 17 (Chapter 6)

A California driver is logged into a Transportation Network Company (TNC) app but has not yet accepted a ride request (Phase 1). They strike a pedestrian. Which statement is true regarding liability coverage during this phase?

• A) The driver's personal auto policy provides primary liability coverage.
• B) The TNC must provide primary liability coverage of at least $50,000 per person/$100,000 per accident.
• C) No liability coverage is required during Phase 1.
• D) The driver's personal auto policy provides coverage if they have a rideshare endorsement.