MA Property & Casualty common mistakes
MA Property & Casualty · Understand the traps and how to avoid them.
When asked which exposures are insurable, the candidate picks a speculative exposure (a stock purchase, a casino bet, a new product launch) or rejects a valid pure-risk exposure because the loss seems unlikely.
Exam stems are written as short everyday scenarios, and the textbook labels (pure vs. speculative, static vs. dynamic, fundamental vs. particular) blur once the words 'risk' and 'loss' appear in the same sentence. Candidates answer on intuition about whether a loss 'could really happen' instead of testing the exposure against the definition.
What to do instead
Apply a fixed decision test to every exposure in the stem: (1) is the outcome loss-or-no-loss only, with no possibility of gain? (2) is the loss accidental and outside the insured's control? (3) is the loss measurable in dollars? (4) are there many similar exposure units? (5) would a single loss or a catastrophe wipe out the pool? If the outcome includes a chance of gain, it is speculative and automatically uninsurable, no matter how large or unlikely the potential loss is.
On a coinsurance (value-reporting or percentage) problem, the candidate builds the ratio upside down, applying 'amount required divided by amount carried,' or applies the ratio to the policy limit instead of to the loss.
The ratio is memorized as a sound-bite ('carried over required') without a mental picture of what it is measuring. Under exam time pressure the two numbers get swapped because both appear in the stem and neither is labelled 'numerator.'
What to do instead
Say the meaning out loud before calculating: the fraction measures 'how much of the value did I actually insure,' so the amount carried is always the top number and the amount required is always the bottom number. Then follow a fixed four-step script: required = coinsurance % x value at time of loss; if carried is greater than or equal to required, pay the loss (less deductible) up to the limit; if carried is less, recovery = (carried / required) x loss; finally subtract the deductible once and cap the answer at the limit of insurance.
The candidate treats 'comparative negligence' and 'contributory negligence' as interchangeable, and on a Massachusetts fact pattern awards the plaintiff full damages or nothing without first computing each party's percentage of fault.
Most candidates arrive with a generic torts background where 'contributory negligence' is the default label, and the word 'comparative' in the stem is skimmed as a synonym. The percentage figures in the fact pattern then look like decoration rather than the operative fact.
What to do instead
Anchor on four elements of negligence first (duty, breach, proximate cause, damages), then on the jurisdiction rule: Massachusetts uses modified comparative negligence, so a plaintiff whose own negligence is not greater than the defendant's recovers damages reduced by their percentage of fault, and a plaintiff more than 50% at fault recovers nothing. Practise converting fact patterns into a percentage line before touching the answer choices.
On a liability policy limits question, the candidate assumes the cost of defending the insured reduces the limit of liability, treats the general aggregate and the each-occurrence limit as the same pool, and applies a claims-made trigger to an occurrence-form policy.
The candidate transfers the property-insurance habit (one limit, everything comes out of it) onto liability coverage, where defense and supplementary payments sit outside the limits. Claims-made and occurrence triggers are also learned as vocabulary rather than as timing rules.
What to do instead
Draw the liability limit structure once and reuse it: defense costs and supplementary payments are paid in addition to the limits and do not erode them; the each-occurrence limit responds per event, the general aggregate caps all events in the policy period, and the products-completed operations aggregate is a separate pool. For triggers, ask a single question, 'what event must happen inside the policy period?' - bodily injury or property damage for an occurrence form, the claim itself for a claims-made form (subject to the retroactive date).
On Massachusetts auto questions the candidate answers from general 'no-fault' intuition and produces a PIP amount, minimum liability limit, or lawsuit threshold that is not the Massachusetts figure.
Auto coverage is studied early and the state-specific numbers are studied later, so the generic chapter numbers are the ones that come to mind under time pressure. The state motor vehicle chapter feels like trivia and gets deferred to the end of the study plan.
What to do instead
Build a one-page Massachusetts auto card and drill it weekly: compulsory bodily injury $20,000 per person / $40,000 per accident, compulsory property damage $5,000, Personal Injury Protection $8,000 per person payable regardless of fault (medical expenses and 75% of lost wages), uninsured motorist coverage required at limits matching the bodily injury limits, and a tort threshold that lets a claim proceed for medical expenses above the statutory dollar threshold or for serious injury as defined in the statute. Write the numbers, not the concept, on the card.
On licensing and regulation items the candidate mixes up the agent's and the broker's role, treats a license and an insurer appointment as the same thing, and cannot state which enforcement tools the Commissioner of Insurance actually has.
The three layers - license from the state, appointment from the insurer, and the Commissioner's authority - are studied in one dense chapter and collapse into a single vague memory of 'the state licenses you.' Questions asking 'who does this person represent' then get answered from the job title rather than from the legal relationship.
What to do instead
Build a three-column table: who issues it, what it authorizes, and who the person legally represents. An agent holds an appointment from an insurer and represents that insurer; a broker is licensed to deal with applicants and insureds and represents the buyer; the license comes from the Division of Insurance and the appointment comes from the carrier, and one does not substitute for the other. Add a short list of the Commissioner's tools (examination, cease-and-desist, fines, suspension or revocation, and the state guaranty and residual market mechanisms) and rehearse which tool fits which fact pattern.
The candidate assumes that because the Homeowners Coverage A section is written on an open-perils basis, the personal property in Coverage C is too, and treats HO-3 and HO-5 as the same form.
The forms are learned as a ranked list ('HO-3 is better than HO-2, HO-5 is better than HO-3') rather than as a matrix of which coverage section uses which basis of loss settlement. The word 'open' from the Coverage A discussion carries over to the whole policy in memory.
What to do instead
Memorize the grid, not the ranking: HO-2 is named perils on both Coverage A and Coverage C; HO-3 is open perils on Coverage A (dwelling) and Coverage B (other structures) but named perils on Coverage C (personal property); HO-5 is open perils on A, B, and C. Also state the burden-of-proof consequence: on an open-perils section the insurer must point to an exclusion, while on a named-perils section the insured must point to a listed peril.
On personal auto fact patterns the candidate assumes a vehicle the insured can use any time is covered, that delivering pizzas or driving for a rideshare platform is ordinary personal use, and that a driver's own policy is primary for a car the driver owns.
The phrase 'the insured was driving a car' triggers a general assumption of coverage, and coverage follows the vehicle for owned autos, so the habit of looking only at the car (never at the arrangement or the use) usually produces the right answer on easy items and the wrong one on exclusions.
What to do instead
Run three checks on every personal auto stem before reading choices: (1) ownership - is the auto a covered auto, a newly acquired auto, or a vehicle furnished for regular use (excluded)? (2) use - is the trip personal, or is it livery, delivery, or rideshare (business use excluded on an unendorsed PAP)? (3) priority - for an owned auto the policy on the car responds first; for a non-owned auto the driver's own PAP responds first and the vehicle owner's policy is excess. Name the check the stem is testing out loud.
The candidate applies a general liability policy to an auto claim or an employee injury claim, and assumes hired autos and employees' personal cars used for business are covered without checking the business auto symbol on the declarations.
Commercial forms are built by assembling coverage parts and symbols, but candidates revise them as one undifferentiated 'business policy.' The symbols on the declarations page are treated as administrative detail rather than as the clause that decides which autos are covered.
What to do instead
Learn the coverage parts as a set of sealed boxes: the CGL responds to bodily injury and property damage arising from premises, operations, products and completed operations, but excludes auto liability and obligations under workers compensation law; business auto coverage is a separate part driven by the covered-auto symbol (1 any auto, 7 specifically described autos, 8 hired autos, 9 non-owned autos); workers compensation is a separate part again. On any commercial stem, first identify which box the loss belongs in, then check the symbol or limits.
On workers compensation items the candidate looks for a dollar limit on Part One, treats Part Two as the section that pays statutory benefits, or describes workers compensation as fault-based.
Every other coverage the candidate has studied is limit-driven and fault-driven, so the two features that make workers compensation distinctive - statutory benefits with no dollar limit and liability without fault - look like traps rather than defining characteristics.
What to do instead
Memorize the pairing as a contrast: Part One (workers compensation) pays the benefits the statute requires, has no dollar limit, applies regardless of fault, and is generally the employee's exclusive remedy against the employer; Part Two (employer's liability) is a separate limit for suits the statute does not cover (such as third-party-over actions) and carries per-accident, per-employee, and policy-limit figures. When a stem mentions a specific dollar figure for an employee's injury, ask whether the claim belongs to Part One or Part Two before choosing an answer.