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Cheat sheet

Arizona P&C Cheat Sheet

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General P&C Concepts

  • 30% of exam
  • Key Terms Policy Parts Settlement Peril vs Hazard

Residential + Commercial

  • 36% of exam
  • HO Forms HO Coverages Commercial Lines BOP Basics

Auto + Liability

  • 27% of exam
  • PAP Coverages CGL Basics Negligence Workers Comp

Arizona Law + Regulation

  • 7% of exam
  • DIFI 25/50/15 Pure Comparative Licensing + CE

Quick Facts

  • Exam Series 13-34
  • Questions 150
  • Time 150 min
  • Pass 70%
  • Fee $59
  • Vendor PSI
  • Regulator DIFI
  • Pre-license None required

Policy Parts DICE BA

  • D-I-C-E builds every policy
  • D: Declarations I: Insuring agreement C: Conditions E: Exclusions

Peril vs Hazard BA

Peril

  • Cause of loss
  • Fire wind theft
  • Direct event

Hazard

  • Increases chance
  • Condition risk
  • Physical moral
  • Cause vs condition

Key Terms BA

  • Peril Cause of loss
  • Hazard Increases loss chance
  • Indemnity Restore, no profit
  • Insurable interest Financial stake at loss
  • Subrogation Insurer recovers third party
  • Salvage Insurer sells damaged goods
  • Aleatory Unequal exchange
  • Adhesion Take-it-or-leave-it contract

ACV vs RCV BA

ACV

  • Minus depreciation
  • Lower payout
  • Actual cash value

RCV

  • Full replacement
  • No depreciation
  • Like kind quality
  • Depreciation vs full pay

Policy Parts BA

  • Declarations Who what limits premium
  • Insuring agreement Promise to pay
  • Definitions Defined policy terms
  • Conditions Duties of parties
  • Exclusions Not covered
  • Endorsements Policy modifications
  • Warranty Guaranteed true statement
  • Representation Believed true statement

Settlement Terms BA

  • ACV Replacement minus depreciation
  • RCV No depreciation deducted
  • Coinsurance Carry percent or penalty
  • Deductible Insured retention amount
  • Pro rata Share by policy limits
  • Equal shares Each pays equally
  • Valued policy Agreed value at loss

HO Forms PR

  • 4 rent 6 condo 8 old
  • HO-4: renter HO-6: condo HO-3: open dwelling HO-5: open both

HO-4 vs HO-6 PR

HO-4

  • Renter tenant
  • Contents only
  • No dwelling cover

HO-6

  • Condo owner
  • Unit improvements
  • Association master policy
  • Rent vs own unit

HO Form Picker PR

  • Renter needs contents → HO-4 ( No dwelling )
  • Condo unit owner → HO-6 ( Walls-in )
  • Standard owner occupied → HO-3 ( Most common )
  • Want open peril both → HO-5 ( Broadest )
  • Older home value → HO-8 ( Repair cost )
  • Named peril budget → HO-2 ( Basic )
  • Landlord rental only → DP-3 ( Dwelling policy )
  • Vacant property → DP-1 ( Basic peril )

HO Forms PR

  • HO-2 Broad named peril both
  • HO-3 Open dwelling named contents Common
  • HO-4 Renters contents only
  • HO-5 Open peril both
  • HO-6 Condo unit owner
  • HO-8 Older home repair cost
  • Section I Property coverages A-D
  • Section II Liability coverages E-F

HO Coverages PR

  • Coverage A Dwelling structure
  • Coverage B Other structures
  • Coverage C Personal property
  • Coverage D Loss of use
  • Coverage E Personal liability
  • Coverage F Medical payments others
  • Special limits Cash jewelry caps
  • Scheduled floater High value items listed

Commercial Lines PR

  • BOP Small business package
  • CPP Modular commercial policy
  • Building Structure coverage
  • BPP Business personal property
  • Business income Lost profit coverage
  • Extra expense Temp relocation costs
  • Inland marine Mobile property coverage

Occurrence vs Claims-Made CA

Occurrence

  • Loss during period
  • Long tail covered
  • CGL standard

Claims-made

  • Claim filed during
  • Needs tail coverage
  • Professional lines
  • When loss vs claim

Auto Coverage Picker CA

  • Bodily injury others → Part A BI ( Required AZ )
  • Property damage others → Part A PD ( Required AZ )
  • Passenger medical bills → Part B ( No fault needed )
  • Uninsured hits you → Part C UM ( Offered AZ )
  • Underinsured at fault → Part C UIM ( Offered AZ )
  • Your car collision → Part D collision ( Optional )
  • Theft vandalism hail → Part D comp ( Optional )
  • Rental car short term → Loss of use ( Endorsement )

PAP Coverages CA

  • Part A Liability BI PD
  • Part B Medical payments
  • Part C Uninsured motorist
  • Part D Physical damage auto
  • Collision Upset or impact loss
  • Comprehensive Other than collision
  • Split limits Per person accident PD
  • UM UIM Uninsured underinsured motorist

Collision vs Comprehensive CA

Collision

  • Upset impact
  • Hit object
  • Your fault crash

Comprehensive

  • Theft vandalism
  • Hail flood glass
  • Other than collision
  • Impact vs other peril

Liability + WC CA

  • CGL Commercial general liability
  • Occurrence Loss during policy period
  • Claims-made Claim filed during period
  • BI Bodily injury liability
  • PD Property damage liability
  • Workers comp Employer injury coverage
  • Exclusive remedy WC bars most suits

AZ Auto Limits AR

  • 25 person 50 accident 15 PD
  • 25: BI per person 50: BI per accident 15: property damage Tort at-fault state

DIFI vs ADOI AR

DIFI

  • Current regulator
  • Insurance plus banking
  • Title 20 enforcer

ADOI

  • Old department name
  • Pre-2020 only
  • Trap answer
  • Current vs outdated

Arizona Auto Law AR

  • 25/50/15 AZ minimum liability limits
  • Tort state At fault pays damages
  • Pure comparative Fault reduces recovery only
  • No PIP No no-fault medical
  • UM offer Must offer reject writing
  • UIM offer Must offer reject writing
  • SR-22 Proof financial responsibility
  • Competitive rating File and use rates

Rate Standards AR

  • Not excessive inadequate discriminatory
  • Excessive: too high Inadequate: threatens solvency Discriminatory: unfair class gap

DIFI + Licensing AR

  • DIFI AZ insurance regulator
  • Title 20 Arizona Insurance Code
  • Producer Licensed seller negotiator
  • 4 year term License renewal cycle
  • 48 CE hours Per four year period
  • 6 ethics Required CE ethics hours
  • 4 retakes Max attempts per year
  • APCIGF AZ guaranty fund

Common Traps

Cause vs condition

  • Peril causes loss ≠ Hazard increases chance

ACV vs replacement

  • ACV minus depreciation ≠ RCV full like kind

Renter vs condo

  • HO-4 is renters ≠ HO-6 is condo

DIFI vs ADOI

  • DIFI is current ≠ ADOI is outdated

AZ comparative fault

  • Pure reduces only ≠ No fifty one bar

PSI vs Prometric

  • PSI runs AZ exam ≠ Prometric is wrong vendor

Last Minute

  • 1. 150 Q 150 min 70% pass
  • 2. PSI vendor not Prometric
  • 3. No pre-license education required
  • 4. 25 per 50 accident 15 PD
  • 5. Pure comparative negligence AZ
  • 6. DIFI not ADOI regulator
  • 7. 4 year license 48 CE hours
  • 8. 6 ethics hours per renewal
  • 9. File and use competitive rating
  • 10. HO-4 renter HO-6 condo