Evergreen Insurance Prep

New Jersey Property & Casualty Insurance License, Practice Exams

New Jersey Property & Casualty producer licensing (PSI). National P&C insurance knowledge plus New Jersey insurance law (choice no-fault auto, property and homeowners, workers' compensation), authored from public-domain statutes.
Content last updated 2 July 2026

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Each module is scored separately here so you know exactly where you stand. To pass the real New Jersey exam you need 70%.

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The free sample gives you about 20 questions per module. The full bank contains every question — general insurance plus state law — with written, statute-cited explanations. $49, one time, lifetime access on up to 3 devices — every state and line we add later included.

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Frequently asked questions

How is the New Jersey producer licensing exam structured?

New Jersey licenses Property & Casualty producers through PSI, requiring 70% to pass. This bank covers the national property & casualty material plus New Jersey law - choice no-fault auto (the Standard vs. Basic policy, the current 35/70/25 minimum limits and the verbal-threshold tort options), property and homeowners (the standard fire policy, the FAIR Plan and PLIGA), and workers' compensation (the 70%-of-wage benefit and the Second Injury Fund).

What score do I need to pass?

You need 70%. Revise each module to that level in Revision Mode, then run the full exam simulation in Exam Mode before your test date.

Are these real exam questions?

No vendor publishes the live exam. Every question here is original, written to the official content outline and grounded in public-domain sources — including the New Jersey statutes (Titles 17, 39 and 34) for the state-law questions, with the statute section cited in each explanation.

How many practice questions are included?

The full New Jersey bank contains 1023 questions (general insurance plus New Jersey law), with written, source-cited explanations. The free sample gives you about 20 questions per module.

What does access cost?

$49, one time, for lifetime access — and it includes every state and line we add later, at no extra charge. No subscription.

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Yes. One purchase works on up to 3 of your devices, for example your laptop, phone and tablet, so you can practise wherever you are. Your progress is saved on each device.

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No. The practice tests run in your browser with no signup. Your score history is saved on your own device.

Sample New Jersey Property & Casualty Insurance License practice questions

A selection of free questions with answers and explanations. Use the interactive modules above for timed, scored drills.

Under the law of agency, the acts of the producer (agent) are generally considered to be the acts of the:

  1. Reinsurer
  2. Insured
  3. State insurance department
  4. Insurer ✓

Why: An agent represents the insurer; under the law of agency, the agent's actions within authority are treated as those of the insurer (principal).

Shareholders sue a corporation's board alleging mismanagement caused a stock drop. Which policy responds?

  1. CGL Coverage B
  2. Directors and Officers (D&O) Liability ✓
  3. Liquor liability under the policy's terms
  4. EPLI

Why: Claims against directors and officers for wrongful management acts are handled by D&O liability insurance.

Under N.J.S.A. 17:30A-5, PLIGA covered claims are limited to insurers that become insolvent after what date?

  1. July 1, 1968
  2. January 1, 1990
  3. January 1, 1974 ✓
  4. January 1, 2004

Why: Section 5 provides the covered-claim definition applies 'if such insurer becomes an insolvent insurer after January 1, 1974.'

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Under the PAP, fire damage to the covered auto while parked in a garage is covered under:

  1. Other Than Collision (comprehensive) ✓
  2. Collision
  3. Liability
  4. It is not covered under the policy's terms

Why: Fire is a peril insured under Other Than Collision (comprehensive) coverage in Part D.

Regarding the producer licensing examination, N.J.S.A. 17:22A-31 requires that:

  1. The exam be offered only in English
  2. The exam fee be fully refundable if the applicant fails under the policy's terms
  3. The examination and registration materials be offered in English and Spanish ✓
  4. Applicants pay no fee for a retake

Why: N.J.S.A. 17:22A-31(e) requires the Commissioner to ensure the examination and registration materials are offered in English and Spanish; the exam fee is nonrefundable.

A homeowner's fire loss is denied. Under the Standard Fire Policy suit-limitation clause, the homeowner waits 14 months and then sues. The likely result is:

  1. The suit proceeds because the limit runs from the denial, not the loss
  2. The suit proceeds because there is no time limit on fire claims
  3. The suit is barred because it was not brought within 12 months of the loss ✓
  4. The suit is barred only if the insurer proves prejudice

Why: The Standard Fire Policy requires suit within 12 months after inception of the loss; a suit filed after that period is contractually time-barred.

Under the New Jersey scheduled-loss table, loss of a leg is worth how many weeks of compensation?

  1. 330 weeks
  2. 200 weeks
  3. 315 weeks ✓
  4. 250 weeks

Why: N.J.S.A. 34:15-12(c) lists the leg at 315 weeks, distinct from the arm (330 weeks) and the foot (250 weeks).

How does the New Jersey Act define "business entity" for licensing purposes?

  1. A corporation, association, partnership, limited liability company, limited liability partnership, or other legal entity ✓
  2. An individual doing business under a trade name
  3. A corporation only
  4. A sole proprietorship owned by one licensed producer unless an exception clearly applies for the coverage that is in force

Why: N.J.S.A. 17:22A-28 defines "business entity" as a corporation, association, partnership, limited liability company, limited liability partnership, or other legal entity.

A customer slips on a wet floor in the insured's store and is hurt. This is most clearly a claim under:

  1. Employee Benefits Liability
  2. Coverage A — Premises and Operations ✓
  3. Coverage B — Personal and Advertising Injury
  4. A surety bond

Why: A slip-and-fall on the insured's premises is a Coverage A bodily injury (premises and operations) claim.

A property worth $500,000 has a 90% coinsurance requirement. The insured carries $360,000 and has a $50,000 loss. Ignoring deductible, the insurer pays:

  1. $50,000
  2. $40,000 ✓
  3. $36,000
  4. $45,000

Why: Required = 90% x $500,000 = $450,000. Did/should = $360,000/$450,000 = 0.80. Payment = 0.80 x $50,000 = $40,000.

For an injury to be compensable under workers' compensation, it generally must arise:

  1. Solely from the employer's negligence
  2. From a single sudden accident only
  3. During regularly scheduled hours only
  4. Out of and in the course of employment ✓

Why: The basic compensability test is that the injury must 'arise out of and in the course of employment' — connected to the work and occurring within the scope of the job.

Under New Jersey's nonresident licensing provision, a nonresident applicant shall receive a nonresident producer license if, among other conditions, the applicant:

  1. Is appointed by a New Jersey-domiciled insurer unless an exception clearly applies for the coverage that is in force according to the insurer's rules
  2. Establishes a New Jersey office
  3. Is currently licensed and in good standing as a resident producer in his home state, and the home state reciprocates for New Jersey residents ✓
  4. Passes the New Jersey written examination

Why: N.J.S.A. 17:22A-34(a) grants a nonresident license where the applicant is currently licensed and in good standing in his home state, submits the proper request and fees, provides the home-state application or uniform application, and the home state awards reciprocal licenses to New Jersey residents.

The Homeowners loss settlement (coinsurance) provision generally requires the dwelling to be insured to at least what percentage of replacement cost to receive full replacement-cost settlement on a partial loss?

  1. 100%
  2. 70%
  3. 50%
  4. 80% ✓

Why: The replacement-cost loss settlement condition requires the dwelling to be insured to at least 80% of full replacement cost at the time of loss.

Under N.J.S.A. 17:22A-37, a temporary producer license shall not continue after:

  1. The owner or the personal representative disposes of the producer's business ✓
  2. The Commissioner sends a renewal notice
  3. The temporary licensee passes the examination according to the insurer's rules
  4. 30 days have elapsed

Why: N.J.S.A. 17:22A-37(b) provides that a temporary license shall not continue after the owner or personal representative disposes of the insurance producer's business; the Commissioner may also revoke it if insureds or the public are endangered.

In property insurance, the insured generally may NOT abandon damaged property to the insurer because:

  1. It violates subrogation
  2. The insured owns the salvage
  3. The abandonment clause prohibits forcing the insurer to take the property ✓
  4. Abandonment increases the premium unless an exception clearly applies for the coverage that is in force

Why: Most property policies state the insured cannot abandon property to the insurer; the insurer is not required to accept it.

The DP-3 (Special Form) insures the dwelling and other structures on what basis?

  1. Open perils (all risks except those excluded) ✓
  2. Named perils, broad form under the policy's terms
  3. Liability only
  4. Named perils, basic form

Why: DP-3 provides open-perils (special form) coverage on the dwelling and other structures, covering all causes of loss except those specifically excluded.

In the Homeowners policy, the term 'insured location' generally includes all of the following EXCEPT:

  1. Other premises acquired during the policy period for use as a residence
  2. The residence premises
  3. A commercial warehouse rented to a third party ✓
  4. Vacant land owned by the insured

Why: Insured location includes the residence premises, newly acquired residences, vacant land, and certain other personal-use premises, but not a separately rented commercial property.

If a claims-made insured switches carriers and the new policy uses the same retroactive date, the insured generally:

  1. Loses all prior coverage
  2. Must buy a supplemental ERP unless an exception clearly applies for the coverage that is in force
  3. Maintains continuity of coverage for prior occurrences without buying a tail ✓
  4. Doubles the SIR

Why: Keeping the same retroactive date with the new carrier preserves continuity, so a tail on the expiring policy is typically unnecessary.

A risk purchasing group (RPG) differs from a risk retention group in that the RPG:

  1. Cannot include members from the same industry unless an exception clearly applies for the coverage that is in force
  2. Writes only crop insurance
  3. Purchases liability insurance on a group basis from an existing insurer rather than forming its own ✓
  4. Owns its own insurer

Why: A risk purchasing group does not assume risk itself; its members band together to buy liability coverage as a group from a traditional insurer.

Under the Unfair Trade Practices Act, the term 'Person' is defined to include which of the following?

  1. Only policyholders and claimants
  2. Agents, brokers and adjusters, along with insurers and other legal entities engaged in the business of insurance ✓
  3. Only domestic stock insurers
  4. Only the Commissioner and Department staff unless an exception clearly applies for the coverage that is in force according to the insurer's rules

Why: Section 17:29B-2(a) defines 'Person' broadly to mean any individual, corporation, association, partnership and other legal entity engaged in the business of insurance, expressly including agents, brokers and adjusters.

Because an insurance policy is a contract of adhesion, any ambiguity in its wording is generally:

  1. Considered void and unenforceable
  2. Resolved in favor of the insured, against the insurer who drafted it ✓
  3. Sent to the state for interpretation
  4. Resolved in favor of the insurer who drafted it under the policy's terms

Why: Since the insurer drafts the contract, ambiguities are construed against the drafter and in favor of the insured.

Under TRIA, federal sharing of terrorism losses is triggered only for a 'certified act of terrorism,' which is certified by:

  1. FEMA
  2. The individual insurer
  3. The state insurance commissioner unless an exception clearly applies for the coverage that is in force
  4. The Secretary of the Treasury (in consultation with other officials) ✓

Why: A terrorism event must be certified by the Secretary of the Treasury, in consultation with designated officials, before TRIA's loss-sharing applies.

A New Jersey verbal-threshold plaintiff's physician certification of injury must be supported by what?

  1. The plaintiff's own sworn statement describing the pain and limitations they experience under the policy's terms
  2. A police accident report identifying the at-fault driver and describing the collision
  3. Two eyewitness affidavits from persons who observed the accident and the injuries
  4. Objective clinical evidence, which may include valid diagnostic testing performed under medical protocols ✓

Why: The certification must be based on and refer to objective clinical evidence, which may include medical testing performed in accordance with the statutory protocols and not dependent entirely on subjective patient response.

An employer with a poor loss history cannot find a private insurer willing to write its workers' compensation voluntarily. Where would this employer most likely obtain coverage?

  1. The assigned-risk (residual market) plan ✓
  2. The Jones Act pool
  3. The federal LHWCA program
  4. A monopolistic fund in a competitive state

Why: Employers unable to obtain WC in the voluntary market are placed in the assigned-risk or residual market plan, which guarantees availability of mandatory coverage.

For a non-scheduled (partial permanent) disability determined as a percentage of total, the duration of compensation in New Jersey is a corresponding portion of how many weeks?

  1. 500 weeks
  2. 450 weeks
  3. 600 weeks ✓
  4. 400 weeks

Why: N.J.S.A. 34:15-12(c), paragraph 22, provides that where disability is determined as a percentage of total and permanent disability, the duration is a corresponding portion of 600 weeks.

In insurance, exposure refers to:

  1. The maximum policy limit
  2. The amount of the deductible
  3. A unit of measure to determine the rate charged unless an exception clearly applies for the coverage that is in force
  4. A condition or situation that presents a possibility of loss, whether or not it occurs ✓

Why: Exposure is a condition presenting a possibility of loss; it may or may not result in an actual loss.

A risk retention group (RRG) is:

  1. A reinsurance company
  2. A consumer-reporting agency unless an exception clearly applies for the coverage that is in force
  3. A liability insurer owned by its members who are engaged in similar businesses ✓
  4. A federal flood pool

Why: Authorized under the federal Liability Risk Retention Act, an RRG is a member-owned insurer that writes liability coverage for its members engaged in similar or related businesses.

After the initial 60-day new-business period has passed, a New Jersey insurer's mid-term cancellation of an auto policy is limited to which grounds?

  1. Any legitimate business reason the insurer chooses to document in its underwriting file unless an exception clearly applies for the coverage that is in force
  2. Failure to install approved anti-theft devices or to garage the vehicle as represented
  3. A single at-fault accident occurring at any point during the current policy period
  4. Nonpayment of premium; suspension/revocation of the license or registration of the insured or a household/customary operator; or material misrepresentation ✓

Why: Once the 60-day window closes, cancellation is permitted only for nonpayment of premium, driver's license or registration suspension/revocation, or knowingly providing materially false or misleading information.

Actual cash value (ACV) is most commonly calculated as:

  1. The original purchase price
  2. Market value plus depreciation
  3. Replacement cost minus depreciation ✓
  4. Replacement cost plus appreciation

Why: ACV is typically replacement cost at the time of loss minus depreciation for age, wear, and obsolescence.

Which of the following is typically a FIRST-PARTY coverage under a cyber policy?

  1. Bodily injury liability
  2. Advertising injury
  3. Breach notification, credit monitoring, and data restoration costs for the insured ✓
  4. Defense of a third-party privacy lawsuit unless an exception clearly applies for the coverage that is in force

Why: First-party cyber coverages reimburse the insured's own costs, such as breach notification, forensics, and data restoration.