PROPERTY AND CASUALTY INSURANCE EXAMS
ANSWERS AND QUESTIONS SET A+
✔✔Punitive Damages - ✔✔type of damages intended to punish the defendant and
make an example out of her to discourage others from behaving the same way.
✔✔Proximate Cause - ✔✔An act, through an uniterrupted chain of events, that can be
determined to be the immediate or actual cause of a loss.
✔✔4 elements of negligence - ✔✔1. The existence of a DUTY to act in a certain way
2. A FAILURE to live up to this duty
3. An actual INJURY must occur
4. The failure in duty must be the PROXIMATE CAUSE of the injury.
✔✔Negligence - ✔✔An unreasonable or prudent act, A thoughtless or careless act or
one committed out of ignorance. It may be a non-act or omission, but it is NEVER an
intentional act.
✔✔Casualty Insurance - ✔✔Refers to coverage designed to address the liability of
individuals and organizations resulting from negligent acts in their personal, business, or
professional roles.
✔✔Overinsurance - ✔✔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.
✔✔Specific Insurance - ✔✔Coverage on ONE type of property (real or personal) in
ONE location.
✔✔Blanket Insurance - ✔✔A single policy written on an insured's interest for 2 or more
different types of property (dwelling/building and contents) at the same location, or at
different locations.
✔✔Uninsured Motor Vehicle - ✔✔A motor vehicle or trailer to which:
,- No liability coverage at the time of accident
-has liability coverage but not enough to meet the state's financial responsibility
requirement
- Operated by a hit and run driver
- Has invalid liability insurance at the time of the accident because the insurer is
insolvent or denies coverage
✔✔Part C: Uninsured Motorist Coverage - ✔✔this coverage compensates the insured
for bodily injury ONLY as a result of an accident with an uninsured motorist.
✔✔Medical Payments - ✔✔Insurance company agrees to pay for reasonable expenses
incurred for necessary medical and funeral services because of bodily injury.
- Covers first party.
- "Stays in the car"
- 3 years is time limit for incurring medical expenses
✔✔Supplementary Payments - ✔✔Payments made in addition to the Limits of Liability.
- Up to $200/day for loss of earnings
- Up to $250 for the cost of bail bonds required because of an accident.
✔✔Excess - ✔✔Any insurance that is provided for a vehicle you do not own, shall be
excess over any other collectible insurance.
Example:
If you borrowed your friend's car, your own liability coverage will act as excess to your
friend's primary coverage.
✔✔Single Limit Basis - ✔✔One amount representing the total (aggregate) limit for all
claims arising from any one accident. (1 amount for Bodily Injury and Property Damage)
✔✔Split Limit Basis - ✔✔This limit has separate limits for BI and PD.
For example: 20/50/10 - $20,000 for per person bodily injury, $50,000 total per accident
bodily injury, $10,000 per accident for property damage.
✔✔Split/ Combined Single Limit - ✔✔This limit has only one limit that applies to both BI
and PD.
✔✔Part A - Liability Coverage - ✔✔Provides payment for Bodily Injury (BI) & Property
Damage (PD) damage resulting from the injured's use of an automobile for which the
insured becomes legally liable.
, - Covers Third Party Only
- Pays for both $pecial and General Damages
✔✔Loss of Use - ✔✔The inconvenience caused to an individual for the inability to use
property.
✔✔Underinsured Motorist Coverage (UIM) - ✔✔Covers the insured when involved in an
accident with a driver who has auto liability insurance, but the limit of this insurance is
insufficient to pay for the insured's damage.
✔✔Collision - ✔✔The upset of a covered auto or its impact with another motor vehicle .
✔✔Comprehensive - ✔✔Addresses property damage losses to the insured vehicle
involving losses other than collisions.
Examples:
- Contact with birds or animals
- Theft or larceny
- Fire
- Hair, water, or flood
- Vandalism or malicious mischief (VMM)
- Breakage of glass
✔✔Nonowned Auto - ✔✔Any private passenger vehicle not owned by the insured being
operated by the insured.
Examples:
- Rental Car
- Temporary Substitute
✔✔APIP - ✔✔Additional Personal Injury Protection (optional)
✔✔OBEL - ✔✔Optional Basic Economic Loss
Additional $25,000 to be assigned to any combination of Medical Expenses, Loss
Wages, Rehab.
✔✔Red Lining - ✔✔No insurer may refuse to issue or renew an auto policy because of
age, sex, race, occupation or principal place of garaging of the named insured.
✔✔Stacking - ✔✔The practice of adding (stacking) the limits of all applicable policies to
address a given loss.
✔✔Flood - ✔✔A general or temporary condition of partial or complete inundation of
normally dry land areas.
ANSWERS AND QUESTIONS SET A+
✔✔Punitive Damages - ✔✔type of damages intended to punish the defendant and
make an example out of her to discourage others from behaving the same way.
✔✔Proximate Cause - ✔✔An act, through an uniterrupted chain of events, that can be
determined to be the immediate or actual cause of a loss.
✔✔4 elements of negligence - ✔✔1. The existence of a DUTY to act in a certain way
2. A FAILURE to live up to this duty
3. An actual INJURY must occur
4. The failure in duty must be the PROXIMATE CAUSE of the injury.
✔✔Negligence - ✔✔An unreasonable or prudent act, A thoughtless or careless act or
one committed out of ignorance. It may be a non-act or omission, but it is NEVER an
intentional act.
✔✔Casualty Insurance - ✔✔Refers to coverage designed to address the liability of
individuals and organizations resulting from negligent acts in their personal, business, or
professional roles.
✔✔Overinsurance - ✔✔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.
✔✔Specific Insurance - ✔✔Coverage on ONE type of property (real or personal) in
ONE location.
✔✔Blanket Insurance - ✔✔A single policy written on an insured's interest for 2 or more
different types of property (dwelling/building and contents) at the same location, or at
different locations.
✔✔Uninsured Motor Vehicle - ✔✔A motor vehicle or trailer to which:
,- No liability coverage at the time of accident
-has liability coverage but not enough to meet the state's financial responsibility
requirement
- Operated by a hit and run driver
- Has invalid liability insurance at the time of the accident because the insurer is
insolvent or denies coverage
✔✔Part C: Uninsured Motorist Coverage - ✔✔this coverage compensates the insured
for bodily injury ONLY as a result of an accident with an uninsured motorist.
✔✔Medical Payments - ✔✔Insurance company agrees to pay for reasonable expenses
incurred for necessary medical and funeral services because of bodily injury.
- Covers first party.
- "Stays in the car"
- 3 years is time limit for incurring medical expenses
✔✔Supplementary Payments - ✔✔Payments made in addition to the Limits of Liability.
- Up to $200/day for loss of earnings
- Up to $250 for the cost of bail bonds required because of an accident.
✔✔Excess - ✔✔Any insurance that is provided for a vehicle you do not own, shall be
excess over any other collectible insurance.
Example:
If you borrowed your friend's car, your own liability coverage will act as excess to your
friend's primary coverage.
✔✔Single Limit Basis - ✔✔One amount representing the total (aggregate) limit for all
claims arising from any one accident. (1 amount for Bodily Injury and Property Damage)
✔✔Split Limit Basis - ✔✔This limit has separate limits for BI and PD.
For example: 20/50/10 - $20,000 for per person bodily injury, $50,000 total per accident
bodily injury, $10,000 per accident for property damage.
✔✔Split/ Combined Single Limit - ✔✔This limit has only one limit that applies to both BI
and PD.
✔✔Part A - Liability Coverage - ✔✔Provides payment for Bodily Injury (BI) & Property
Damage (PD) damage resulting from the injured's use of an automobile for which the
insured becomes legally liable.
, - Covers Third Party Only
- Pays for both $pecial and General Damages
✔✔Loss of Use - ✔✔The inconvenience caused to an individual for the inability to use
property.
✔✔Underinsured Motorist Coverage (UIM) - ✔✔Covers the insured when involved in an
accident with a driver who has auto liability insurance, but the limit of this insurance is
insufficient to pay for the insured's damage.
✔✔Collision - ✔✔The upset of a covered auto or its impact with another motor vehicle .
✔✔Comprehensive - ✔✔Addresses property damage losses to the insured vehicle
involving losses other than collisions.
Examples:
- Contact with birds or animals
- Theft or larceny
- Fire
- Hair, water, or flood
- Vandalism or malicious mischief (VMM)
- Breakage of glass
✔✔Nonowned Auto - ✔✔Any private passenger vehicle not owned by the insured being
operated by the insured.
Examples:
- Rental Car
- Temporary Substitute
✔✔APIP - ✔✔Additional Personal Injury Protection (optional)
✔✔OBEL - ✔✔Optional Basic Economic Loss
Additional $25,000 to be assigned to any combination of Medical Expenses, Loss
Wages, Rehab.
✔✔Red Lining - ✔✔No insurer may refuse to issue or renew an auto policy because of
age, sex, race, occupation or principal place of garaging of the named insured.
✔✔Stacking - ✔✔The practice of adding (stacking) the limits of all applicable policies to
address a given loss.
✔✔Flood - ✔✔A general or temporary condition of partial or complete inundation of
normally dry land areas.
