PERSONAL LINES LATEST 2026 CORE EXAM MANUAL
QUESTIONS AND SOLUTIONS GUARANTEE A+
✔✔Specific insurance provides coverage for different classes of property under on
policy - ✔✔False
✔✔The value that the insurance company would pay to replace a structure at its pre-
loss condition is called; - ✔✔Replacement value
✔✔A society of meme era both corporate and individual who underwrite in syndicates
on whose behalf of progressional underwrites accept risk is called: - ✔✔Lloyd's
associations
✔✔What exposure unit is used in calculating property insurance rates? - ✔✔$100
✔✔A term that represents an insurers average future claim costs and loss adjustment
expenses would be called: - ✔✔Loss costs
✔✔Joe and Jane own Tightwad Hardware Store. They are both listed in the business
policy declarations. The declarations also list Big Money Bank which loaned Joe and
Jane money to start the business. Who is considered a named insured on the policy? -
✔✔Joe and Jane
✔✔How many parties are there to a property insurance contract? - ✔✔Two
✔✔The primary insured in an insurance contract is the: - ✔✔First named insured
✔✔All of the following are correct about binders EXCEPT: - ✔✔The binder is good for a
set number of days, or until the policy is issued, whichever is longer.
✔✔American Life Insurance Company's home office is located in Arizona. What status
would this company be given if approved to conduct business in Indiana? - ✔✔Admitted
company
✔✔Gibraltar Insurance Company is owned by its policyholders. Gibraltar is a: -
✔✔Mutual Insurance Company
✔✔Career agents who represent only one company are referred to as: - ✔✔Exclusive
or captive producers
✔✔Of the following, which is NOT an element of insurability? - ✔✔Risk of loss is a
speculative risk
, ✔✔A hazard is defined as - ✔✔A condition that increases the chance that a loss will
occur
✔✔Specific insurance provides coverage for different classes of property under one
policy. - ✔✔False
✔✔When insurers are required to receive approval from the department of insurance for
a rate change before they can change it describes: - ✔✔Prior approval
✔✔Exposure can be defined as: - ✔✔A condition or situation that presents the
possibility of a loss
✔✔A written modification that either adds or deletes coverage in a policy is called: -
✔✔An endorsement
✔✔A contract in which only one party makes an enforceable promise is a(n): -
✔✔Unilateral contract
✔✔Which principle holds that both parties to an insurance contract have a responsibility
to be honest and truthful to the other? - ✔✔Utmost good faith
✔✔In completing an application for auto coverage, Joe told his agent that he had not
received any speeding tickets in the last 5 years. In truth, Joe received a ticket 2 years
ago. Joe is guilty of: - ✔✔Misrepresentation
✔✔An insurance binder can provide temporary insurance coverage while an application
is being underwritten. Which of the following statements is incorrect regarding binders?
- ✔✔A binder expires when the initial premium is paid
✔✔One week ago, Joe accidentally ran off the road and clipped 3 of Farmer John's
fence posts. Hidden by small print located in the middle of an obscure paragraph in
John's lengthy auto policy was one sentence that stated accidents occurring on dirt
roads would not be covered. Which of the following would probably be most helpful in
getting Joe's claim paid? - ✔✔Insurance policies are contracts of adhesion
✔✔Statements made by an applicant in an application for insurance are generally
considered to be: - ✔✔Representation
✔✔With an insurance contract, the uncertainty of events can lead to unequal financial
results for the two parties. This means that insurance is what kind of contract? -
✔✔Aleatory
QUESTIONS AND SOLUTIONS GUARANTEE A+
✔✔Specific insurance provides coverage for different classes of property under on
policy - ✔✔False
✔✔The value that the insurance company would pay to replace a structure at its pre-
loss condition is called; - ✔✔Replacement value
✔✔A society of meme era both corporate and individual who underwrite in syndicates
on whose behalf of progressional underwrites accept risk is called: - ✔✔Lloyd's
associations
✔✔What exposure unit is used in calculating property insurance rates? - ✔✔$100
✔✔A term that represents an insurers average future claim costs and loss adjustment
expenses would be called: - ✔✔Loss costs
✔✔Joe and Jane own Tightwad Hardware Store. They are both listed in the business
policy declarations. The declarations also list Big Money Bank which loaned Joe and
Jane money to start the business. Who is considered a named insured on the policy? -
✔✔Joe and Jane
✔✔How many parties are there to a property insurance contract? - ✔✔Two
✔✔The primary insured in an insurance contract is the: - ✔✔First named insured
✔✔All of the following are correct about binders EXCEPT: - ✔✔The binder is good for a
set number of days, or until the policy is issued, whichever is longer.
✔✔American Life Insurance Company's home office is located in Arizona. What status
would this company be given if approved to conduct business in Indiana? - ✔✔Admitted
company
✔✔Gibraltar Insurance Company is owned by its policyholders. Gibraltar is a: -
✔✔Mutual Insurance Company
✔✔Career agents who represent only one company are referred to as: - ✔✔Exclusive
or captive producers
✔✔Of the following, which is NOT an element of insurability? - ✔✔Risk of loss is a
speculative risk
, ✔✔A hazard is defined as - ✔✔A condition that increases the chance that a loss will
occur
✔✔Specific insurance provides coverage for different classes of property under one
policy. - ✔✔False
✔✔When insurers are required to receive approval from the department of insurance for
a rate change before they can change it describes: - ✔✔Prior approval
✔✔Exposure can be defined as: - ✔✔A condition or situation that presents the
possibility of a loss
✔✔A written modification that either adds or deletes coverage in a policy is called: -
✔✔An endorsement
✔✔A contract in which only one party makes an enforceable promise is a(n): -
✔✔Unilateral contract
✔✔Which principle holds that both parties to an insurance contract have a responsibility
to be honest and truthful to the other? - ✔✔Utmost good faith
✔✔In completing an application for auto coverage, Joe told his agent that he had not
received any speeding tickets in the last 5 years. In truth, Joe received a ticket 2 years
ago. Joe is guilty of: - ✔✔Misrepresentation
✔✔An insurance binder can provide temporary insurance coverage while an application
is being underwritten. Which of the following statements is incorrect regarding binders?
- ✔✔A binder expires when the initial premium is paid
✔✔One week ago, Joe accidentally ran off the road and clipped 3 of Farmer John's
fence posts. Hidden by small print located in the middle of an obscure paragraph in
John's lengthy auto policy was one sentence that stated accidents occurring on dirt
roads would not be covered. Which of the following would probably be most helpful in
getting Joe's claim paid? - ✔✔Insurance policies are contracts of adhesion
✔✔Statements made by an applicant in an application for insurance are generally
considered to be: - ✔✔Representation
✔✔With an insurance contract, the uncertainty of events can lead to unequal financial
results for the two parties. This means that insurance is what kind of contract? -
✔✔Aleatory
