Maryland's producer licensing structure lists Personal Lines as a distinct major line of authority, alongside Life, Health, Property, Casualty, and Variable Life/Annuity Products. What does the Personal Lines line of authority generally authorize a producer to sell?
A. Only commercial general liability and workers' compensation policies
B. Insurance for individual and family exposures such as homeowners, auto, dwelling fire, and similar personal-lines products, rather than the full scope of commercial property/casualty risks
C. Life insurance and annuities exclusively
D. Surplus lines coverage placed with non-admitted insurers only
Show answer and reasoning
Correct answer: B. Insurance for individual and family exposures such as homeowners, auto, dwelling fire, and similar personal-lines products, rather than the full scope of commercial property/casualty risks
Correct: Personal Lines authority is scoped to individual/family insurance products, such as homeowners, auto, and dwelling fire, distinguishing it from the broader commercial Property and Casualty authority.
- A: Commercial general liability and workers' compensation fall under the broader Property/Casualty authority for commercial risk, not the Personal Lines authority.
- C: Life and annuities are separate lines of authority under Maryland's licensing structure, not part of Personal Lines.
- D: Surplus lines placement requires a distinct surplus lines broker license under COMAR 31.03.06, not the Personal Lines authority.
Source: Maryland Insurance Administration producer licensing lines of authority
A producer holds only a Personal Lines line of authority in Maryland. Which type of risk would this authority NOT permit the producer to write?
A. A homeowners policy for a family residence
B. A private passenger auto policy for an individual
C. A commercial general liability policy for a retail store
D. A dwelling fire policy for a rental property owned by an individual
Show answer and reasoning
Correct answer: C. A commercial general liability policy for a retail store
Correct: commercial general liability for a business is a commercial exposure, which requires the broader Property and/or Casualty line of authority rather than Personal Lines.
- A: Homeowners insurance for an individual family residence is squarely within the Personal Lines scope.
- B: Private passenger auto insurance for an individual is a core Personal Lines product.
- D: A dwelling fire policy is a personal-lines product commonly written under this authority, even when covering a rental dwelling owned by an individual.
Source: Maryland Insurance Administration producer licensing lines of authority
In the standard Personal Auto Policy (PAP), which coverage part addresses the insured's legal obligation to pay for bodily injury or property damage the insured causes to others?
A. Part A - Liability Coverage
B. Part B - Medical Payments Coverage
C. Part C - Uninsured Motorist Coverage
D. Part D - Coverage for Damage to Your Auto
Show answer and reasoning
Correct answer: A. Part A - Liability Coverage
Correct: Part A (Liability Coverage) of the PAP responds to the insured's legal liability for bodily injury and property damage caused to others.
- B: Part B addresses medical expenses for the insured and passengers, regardless of fault, not the insured's liability to others.
- C: Part C addresses injuries caused by uninsured/underinsured motorists to the insured, not the insured's liability to third parties.
- D: Part D covers physical damage to the insured's own vehicle (collision/comprehensive), not the insured's liability exposure.
Source: General P&C product knowledge (Personal Auto Policy)
A Maryland personal-lines producer is explaining minimum liability requirements to a new auto insurance client. What should the producer accurately state as Maryland's current minimum limits?
A. $25,000 per person / $50,000 per accident bodily injury and $10,000 property damage
B. $30,000 per person / $60,000 per accident bodily injury and $15,000 property damage
C. $50,000 per person / $100,000 per accident bodily injury and $25,000 property damage
D. $100,000 combined single limit with no property damage sublimit
Show answer and reasoning
Correct answer: B. $30,000 per person / $60,000 per accident bodily injury and $15,000 property damage
Correct: Maryland's current minimum liability limits are $30,000 per person / $60,000 per accident bodily injury and $15,000 per accident property damage (30/60/15).
- A: 25/50/10 is a common minimum structure in some other states, but understates Maryland's actual current minimum.
- C: 50/100/25 is higher than Maryland's statutory minimum; those limits could be purchased voluntarily but are not required.
- D: Maryland's minimum is structured as per-person/per-accident/property-damage split limits, not a combined single limit.
Source: Md. Code, Ins. § 19-505
A client tells the producer they do not want Personal Injury Protection (PIP) coverage on their new Maryland auto policy. What must happen for the insurer to properly exclude PIP from the policy?
A. Nothing further is needed; simply not requesting PIP is sufficient to exclude it
B. The client must sign a written (or properly documented electronic) waiver rejecting PIP coverage
C. PIP cannot be waived under any circumstances in Maryland
D. The producer alone can verbally waive PIP on the client's behalf without any client signature
Show answer and reasoning
Correct answer: B. The client must sign a written (or properly documented electronic) waiver rejecting PIP coverage
Correct: PIP coverage must be included at the minimum $2,500 level unless the named insured executes a written waiver (or properly documented electronic equivalent) rejecting it.
- A: Simply failing to request or pay for PIP does not constitute a valid waiver; an affirmative rejection is required.
- C: PIP is a default coverage in Maryland, but it can be waived through the proper written waiver process; it is not unwaivable.
- D: The named insured, not the producer alone, must make and sign the rejection; a producer cannot unilaterally waive it on the client's behalf without the client's own execution of the waiver.
Source: Md. Code, Ins. § 19-505 (PIP)
