Alabama Insurance Adjuster Practice Exam

What type of coverage could protect a business from financial loss associated with accepting a fake bill?

1. Business personal property coverage

2. Commercial crime coverage

3. General liability insurance

4. Product liability coverage

The correct answer is: Commercial crime coverage

Commercial crime coverage is specifically designed to protect businesses from financial losses resulting from criminal activities like fraud and forgery. If a business unknowingly accepts a fake bill, this type of coverage could help reimburse the financial loss incurred from that fraudulent transaction. This coverage typically includes protection against losses from dishonest acts by employees, theft of money and securities, forgery, and other crimes that can result in financial harm to the business. Given the scenario of accepting a fake bill, this coverage would directly address the risk involved in financial loss due to deceptive practices. In contrast, business personal property coverage primarily protects tangible assets owned by the business, such as equipment and inventory, rather than addressing losses resulting from fraud. General liability insurance covers bodily injury and property damage claims against the business but does not encompass criminal acts like the acceptance of fake bills. Product liability coverage is focused on claims related to injuries or damages caused by a business's products, which is also unrelated to the issue of fraudulent billing.