Vermont Personal Lines Insurance License Exam — All Questions

What minimum auto liability limits must a Vermont personal auto policy carry to satisfy the state's financial-responsibility law?

• a.$15,000 per person / $30,000 per accident bodily injury and $5,000 property damage
• b.$50,000 per person / $100,000 per accident bodily injury and $25,000 property damage
• c.$25,000 bodily injury per person, $50,000 bodily injury per accident, and $10,000 property damage✓
• d.$20,000 per person / $40,000 per accident bodily injury and $15,000 property damage

Vermont sets minimum motor-vehicle liability limits of 25/50/10 - $25,000 bodily injury per person, $50,000 bodily injury per accident, and $10,000 property damage. These are floors; producers should offer higher limits to better protect the insured's assets. Source: 23 V.S.A. section 801; verify current figures with the Vermont Department of Financial Regulation.

How does Vermont generally handle liability for auto accidents?

• a.It is an at-fault (tort) state - the driver who causes the crash is liable for the other party's injuries and damage✓
• b.It is a no-fault state where each driver's own PIP pays first regardless of fault
• c.Fault is never considered; claims are split evenly
• d.Only a state fund pays auto claims

Vermont is a traditional at-fault (tort) state, not a no-fault state: the driver who causes a crash is responsible for the other party's bodily injury and property damage, so liability limits and uninsured/underinsured motorist coverage matter. Source: Vermont Department of Financial Regulation (https://dfr.vermont.gov).

How is uninsured/underinsured motorist (UM/UIM) coverage generally handled on a Vermont personal auto policy?

• a.It is prohibited in Vermont
• b.Vermont requires UM/UIM coverage on personal auto policies✓
• c.It is available only to commercial fleets
• d.It replaces the need for liability coverage

Vermont requires uninsured/underinsured motorist (UM/UIM) coverage on personal auto policies, protecting an insured injured by an at-fault driver who has no or too little insurance. The exact required UM/UIM limits should be confirmed with the Vermont Department of Financial Regulation (https://dfr.vermont.gov) rather than assumed.

How are cancellation and nonrenewal of a personal auto or homeowners policy regulated in Vermont?

• a.Insurers may cancel any policy at any time without notice
• b.Policies can never be cancelled once issued
• c.Only the insured may cancel; the insurer never can
• d.State law limits the permissible reasons and requires advance written notice of cancellation or nonrenewal✓

Vermont law limits the reasons an insurer may cancel a personal auto or homeowners policy mid-term and requires advance written notice of cancellation or nonrenewal. The exact number of days depends on the reason and line - verify current Vermont notice periods with the Vermont Department of Financial Regulation (https://dfr.vermont.gov).

Which best describes the body that writes and enforces Vermont's insurance regulations affecting personal lines policies?

• a.The Insurance Division of the Vermont Department of Financial Regulation, under the Commissioner✓
• b.A private trade association of insurers
• c.The U.S. Department of the Treasury
• d.County insurance boards

The Insurance Division of the Vermont Department of Financial Regulation, headed by the Commissioner, adopts and enforces the administrative rules and market-conduct standards that apply to personal lines insurers and producers in Vermont. Source: Vermont Department of Financial Regulation (https://dfr.vermont.gov).