Free New Jersey Property & Casualty Practice Exam 2026

New Jersey property and casualty insurance exam sample questions and answers

6 of the 150 practice questions, one from each topic, with the answer explained.

1. 1. To nonrenew a private passenger auto policy for a reason other than nonpayment, the insurer must give the named insured advance notice of at least:

   • A.90 days
   • B.60 days
   • C.20 days
   • D.30 days

   Answer: B. N.J.S.A. 17:29C-9 requires at least 60 days' notice of intent not to renew, and N.J.A.C. 11:3-8.6(a) sets the window at no less than 60 and no more than 90 days before expiration. Twenty days applies to midterm cancellations.

2. 2. An insurer cancels a commercial property policy for nonpayment of premium. It must mail or deliver notice of the amount due at least:

   • A.20 days before cancellation
   • B.30 days before cancellation
   • C.15 days before cancellation
   • D.10 days before cancellation

   Answer: D. N.J.A.C. 11:1-20.2(e) requires at least 10 days' notice of the amount and due date before a nonpayment cancellation, and payment before the date stops it. Most other midterm cancellations need 30 to 120 days' notice.

3. 3. An insurer that does not hold a current New Jersey certificate of authority is, in New Jersey:

   • A.An unauthorized insurer
   • B.A reciprocal exchange
   • C.A foreign admitted insurer
   • D.A domestic mutual insurer

   Answer: A. N.J.S.A. 17B:17-11 calls an insurer authorized only if it holds a current certificate of authority from the commissioner; any other insurer is unauthorized. Foreign describes where an insurer was formed, not whether it is authorized.

4. 4. In New Jersey's designated coastal ZIP codes, insurers and the FAIR Plan may file to use a mandatory hurricane deductible of up to:

   • A.2 percent
   • B.10 percent
   • C.5 percent
   • D.15 percent

   Answer: C. N.J.A.C. 11:2-42.9(a) allows mandatory hurricane deductibles up to 5 percent and optional ones up to 10 percent. Each new and renewal policy must come with a hurricane deductible notice under 11:2-42.8.

5. 5. Every New Jersey homeowners or comprehensive personal liability policy must cover the policyholder's liability for:

   • A.Business pursuits of any insured
   • B.Injury from owned motor vehicles
   • C.Comp owed to household workers
   • D.Errors in professional services

   Answer: C. N.J.S.A. 17:36-5.29 requires homeowners and personal liability policies to cover obligations under the workers compensation law to an injured domestic servant or household employee. Business pursuits and owned autos are handled by other coverages.

6. 6. A producer convinces a client to replace an existing policy by misrepresenting the current coverage. This unethical practice is called:

   • A.Twisting
   • B.Defamation
   • C.Rebating
   • D.Coercion

   Answer: A. Twisting is inducing replacement through misrepresentation. Rebating is returning part of the commission to the buyer, and coercion is forcing a purchase, such as tying insurance to a loan.