New Jersey Property And Casualty Insurance Practice Test

Under the New Jersey FAIR Plan, a producer may do which of the following?

Set the insurance rates Approve a claim Cancel policies Submit an application on an insurable property

Correct Answer:

Submit an application on an insurable property

Explanation:

The NJ FAIR Plan exists to provide basic property insurance to applicants who can’t get coverage in the standard market, and producers serve as the conduit to apply for that coverage. A producer’s role is to gather the needed information and submit an application on behalf of the insured for an insurable property. Rates, underwriting decisions, and policy actions like claims handling or cancellations are not set or performed by the producer; those functions are handled by the FAIR Plan and the issuing insurer. Therefore, submitting an application on an insurable property is the action a producer may perform.

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