PROPERTY AND CASUALTY INSURANCE EXAM EXAM

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PROPERTY AND CASUALTY INSURANCE EXAM EXAM

QUESTIONS

Actual Qs and Ans - Expert-Verified Explanation -Guaranteed passing score -100 Questions and Answers

-Format: Multiple-choice / Flashcard

Question 1: Agreement

Answer:

occurs when the other party agrees to the offer or does what was proposed in the offer.

Question 2: What does BIG AFFECT stand for?

Answer:

Burglar damage, Ice & snow weight, Glass breakage, Accidental discharge, Falling objects, Freezing of pipes, Electrical damage, Collapse, Tearing apart.

Question 3: Pair and Set Clause

Answer:

Loss to one item of a pair or set does not constitute loss to the entire pair or set.

Question 4: Actual Cash Value (ACV)

Answer:

Replacement Cost, minus depreciation.

Question 5: Declaration

Answer:

-Almost always are found on the first page -Contain information such as the name of the insured, the address, and the amount of coverage, a description of the property and the cost of the policy.

Question 6: Property insurance

Answer:

Insurance that includes many types of insurance which is designed to handle property risks, risks that will suffer financial loss because something we own is damaged or destroyed.such as dwelling, homeowners etc.

Question 7: Overinsurance

Answer:

Exists if a property or an insurable interest in property is insured by one or more insurance contracts against the same hazard in excess of the fair value of the property or of such interest.

Question 8: Residual Market Insurance

Answer:

insurance provided by the government which is not typically available from private insurers.Such war risk, flood, workers comp, etc.

Question 9: Fair Credit Reporting Act

Answer:

Mandates confidential, fair and accurate reporting of information on consumers by reporting organizations as well as organizations (such as insurers) which use the services of reporting organizations.Consumers must be informed if a credit report is needed in order to underwrite a particular line of insurance.

Question 10: Specific insurance

Answer:

This type of insurance designates a particular item to be insured

Question 11: Principle of Indemnity

Answer:

states that when a loss occurs, an individual should be restored to the approximate financial condition he/she was before the loss, no more and no less.No one will profit from the result of a loss.

Question 12: Producer (Agent)

Answer:

general term used to describe someone who sells insurance.-represents the insurance company

Question 13: Casualty Insurance

Answer:

Refers to coverage designed to address the liability of individuals and organizations resulting from negligent acts in their personal, business, or professional roles.

Question 14: Moral Hazards

Answer:

when an individual through carelessness or by irresponsible actions can increase the possibly for a loss.

ex: person who drives carelessly just because they know they are insured.

Question 15: Punitive Damages

Answer:

type of damages intended to punish the defendant and make an example out of her to discourage others from behaving the same way.

Question 16: Specific Insurance

Answer:

Coverage on ONE type of property (real or personal) in ONE location.

Question 17: Life insurance

Answer:

insurance designed to handle the risk of premature death or the risk that an individual may outlive his or her financial resources.

Question 18: Broker

Answer:

An individual, partnership, or corporation who, for a commission, acts or aids in any manner in the sale of insurance as the representative of the insured.In an insurance transaction, this person represents the insured.

Question 19: Warranty

Answer:

A provision in a policy that pledges that a condition does exist or will exist at some time in the future.

Question 20: Unilateral Contract

Answer:

Only one of the parties in the contract is legally bound to do anything.-Insurance policies are one sided because only the insurance company is legally bound to perform its part of the agreement.

Question 21: Consideration

Answer:

a thing of value exchanged for the performance promised in the contract.

Question 22: 4 elements of negligence

Answer:

• The existence of a DUTY to act in a certain way

• A FAILURE to live up to this duty

• An actual INJURY must occur

• The failure in duty must be the PROXIMATE CAUSE of the injury.

Question 23: Vicarious Liability

Answer:

liability situation where someone is held responsible for the actions or omissions of another person.ex: an employer can be liable for the acts or omissions of its employees, provided it can be shown that they took place in the course of their employment.