CPCU® 553 Practice Exam Questions
The CPCU® 553 exam questions are tough. The CPCU® 553 exam consists of 75 multiple choice questions broken up into two sections, part A and part B.
Let’s look at an example of a Part A and Part B question. Below we will breakdown two sample questions, including an answer and full explanation, from the CPCU® 553 exam. These questions are written by AssociatePI, though we do not offer an CPCU® 553 course at this time I do recommend this study material from AB Training Center. This is the study material I use; it includes practice questions much like the question and explanations in this blog.
CPCU® 553 Sample Exam Questions – Part A
The no-fault insurance law in Jeff’s state allows him to sue another driver in an accident if the damages incurred by Jeff exceed his no-fault coverage limit. What type of no-fault law is this?
- Modified no-fault plan
- Add-on plan
- Choice no-fault plan
- Compulsory auto insurance
Answer: A) Modified no-fault plan
Under a modified no-fault plan, the insured adds the benefit of no-fault insurance coverage to the auto insurance policy but loses the right to sue the at-fault party that caused the accident. The insured is only allowed to sue the at-fault party if the damage caused exceeds the insured’s policy limits.
CPCU® 553 Sample Exam Questions – Part B
Michelle was driving on the highway on her way to a doctor’s appointment when a deer jumped out in front of her car. Michelle swerved to the right, off of the highway, causing her car to roll over. This caused extensive damage to Michelle’s car but no bodily injury to Michelle or other drivers. What coverage under Michelle’s PAP would apply to this accident?
- Comprehensive coverage
- UIM coverage
- Liability coverage
- Collision coverage
Answer: D) Collision coverage
The damage to Part D would be covered under Michelle’s collision coverage because the damage was caused by an overturned vehicle.
Part D covers physical damage to a vehicle caused by collision. This is called collision coverage. Under collision coverage, the insurer agrees to pay for any physical damage to a covered auto resulting from a physical collision with another object, collision with another vehicle, or damage resulting from an overturn of the vehicle. An overturn, or rollover, is a type of vehicle crash in which a vehicle tips over onto its side or roof; this is covered by collision coverage.
Collision coverage is paid to the insured regardless of fault, whether the insured is at fault or not, and whether the damage is direct or accidental. If the insured is at fault, then the Part D coverage will pay the insured for the physical damage incurred to the insured’s vehicle. If the insured is not at fault, then the insured can collect damages from their personal auto policy under Part D or the insured can collect damages from the at-fault party.
Collision coverage covers all physical damage as a result of an automobile collision. This is very broad; this includes coverage for losses such as:
- Colliding with a stationary object, such as a building or street light
- Colliding with a stationary vehicle, such as a stopped car or parked car
- Colliding with another moving vehicle
- Overturn or rollover accident
On your exam, you will be given a scenario like the one seen above; it is your job to understand what is being asked of you and how to solve or recommend a solution to the scenario.
Free Practice Exam
Ready to get started studying? We’re here to help (for free). Download our free CPCU® 553 practice exams to get a feel for the type of questions you will see on the exam.
For more information about the CPCU® 553 exam, check out some of our other free resources:
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Difficulty rank, importance rank, and the advice provided in this resource are solely the opinion of AssociatePI. This resource is intended to provide you with a general idea of where your focus should be. Each exam administered by The Institutes is different. AssociatePI is not affiliated with The Institutes or involved in the exam writing process. Please be sure to thoroughly study every chapter and every topic of this course.
CPCU® 553 exams are administered by the American Institute for Chartered Property Casualty Underwriters (“The Institutes”). AssociatePI does not administer the actual exams, we are an independent resource of free content, advice, and study material for professional insurance education. This blog is intended for informational purposes only, to inform prospective students of the benefit of the CPCU® 553 designation.
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