Texas Property & Casualty License
question and answers(100%) verified.
Property vs Casualty: What is considered property? - CORRECT
ANSWER.Structure & Personal Property
Property vs Casualty: What is considered casualty? - CORRECT ANSWER.Non-
property losses. Legal liability to others. 3rd Party
Risk - CORRECT ANSWER.uncertainty of financial loss
Pure Risk - CORRECT ANSWER.Chance of Loss
Speculative Risk - CORRECT ANSWER.Chance of Loss or Gain (Gamble)
Insurance (covers which type of risk?) - CORRECT ANSWER.Pure Risk Only
How does the law of large numbers apply in insurance? - CORRECT
ANSWER.Actuaries use the law of large numbers to estimate claims
What is the law of large numbers? - CORRECT ANSWER.as the number of a similar
loss exposure increases, the more accurate claims can be predicted from the group.
What is a peril? - CORRECT ANSWER.cause of loss
What is a hazard? - CORRECT ANSWER.things that increase the chance of a peril
happening
Three types of hazards - CORRECT ANSWER.Physical: visible characteristic (dead
tree)
Moral: Dishonest tendencies
Morale: Attitude of carelessness
Proximate Cause - CORRECT ANSWER.First cause in an unbroken chain of events
Elements of a legal contract (CALC) - CORRECT ANSWER.C - Competent parties
(18/Right frame of mind)
A - Agreement (Both parties agree)
L - Legal Purpose (The risk is LEGAL)
C - Consideration (It has to be fair)
What is representation? - CORRECT ANSWER.Information believed to be true.
, What is misrepresentation? - CORRECT ANSWER.Information that is not true. False
information.
What is material misrepresentation? - CORRECT ANSWER.Information that is not
true but would have caused the insurer not to issue the policy. (4 prev spd tix)
What is fraud? - CORRECT ANSWER.An all out effort by one party to deceive and
cheat the other.
What is warranty? - CORRECT ANSWER.Guarantee that an insured will or will not
do something
What are the four major parts to an insurance policy structure? (DICE) - CORRECT
ANSWER.D - Declarations Page (First Page)
I - Insuring Agreement (Insurers promise to pay)
C - Conditions (Rules)
E - Exclusions (Not covered)
What information is on the declarations page? (Remember 6 Ps) - CORRECT
ANSWER.Policy Number
Parties
Property Description/Location
Policy Term
Policy Limits/Deductibles
Premium
What is Limit of Liability? - CORRECT ANSWER.The max amount of coverage
agreed to be paid per loss
What is Aggregate Limit? - CORRECT ANSWER.The max amount of the total of all
claims paid per policy period
Insuring Agreement? - CORRECT ANSWER.Insurers promise to pay
Conditions - CORRECT ANSWER.Contains the duties and rights of both parties
What are the Insured's duties after a loss? - CORRECT ANSWER.Submit a proof of
loss or sworn statement within 91 days. Protect property from further damage.
Cooperate with the insurer.
What is the Mortgage Clause? - CORRECT ANSWER.Nothing the insured does,
even dishonestly, can prevent the mortgagee from collecting under the policy
What are the two types of termination of a policy? - CORRECT
ANSWER.Cancellation - occurs when the insured/insurer cancels the contract before
the end of the policy period.
Non-Renewals - occurs at the end of the policy period.
question and answers(100%) verified.
Property vs Casualty: What is considered property? - CORRECT
ANSWER.Structure & Personal Property
Property vs Casualty: What is considered casualty? - CORRECT ANSWER.Non-
property losses. Legal liability to others. 3rd Party
Risk - CORRECT ANSWER.uncertainty of financial loss
Pure Risk - CORRECT ANSWER.Chance of Loss
Speculative Risk - CORRECT ANSWER.Chance of Loss or Gain (Gamble)
Insurance (covers which type of risk?) - CORRECT ANSWER.Pure Risk Only
How does the law of large numbers apply in insurance? - CORRECT
ANSWER.Actuaries use the law of large numbers to estimate claims
What is the law of large numbers? - CORRECT ANSWER.as the number of a similar
loss exposure increases, the more accurate claims can be predicted from the group.
What is a peril? - CORRECT ANSWER.cause of loss
What is a hazard? - CORRECT ANSWER.things that increase the chance of a peril
happening
Three types of hazards - CORRECT ANSWER.Physical: visible characteristic (dead
tree)
Moral: Dishonest tendencies
Morale: Attitude of carelessness
Proximate Cause - CORRECT ANSWER.First cause in an unbroken chain of events
Elements of a legal contract (CALC) - CORRECT ANSWER.C - Competent parties
(18/Right frame of mind)
A - Agreement (Both parties agree)
L - Legal Purpose (The risk is LEGAL)
C - Consideration (It has to be fair)
What is representation? - CORRECT ANSWER.Information believed to be true.
, What is misrepresentation? - CORRECT ANSWER.Information that is not true. False
information.
What is material misrepresentation? - CORRECT ANSWER.Information that is not
true but would have caused the insurer not to issue the policy. (4 prev spd tix)
What is fraud? - CORRECT ANSWER.An all out effort by one party to deceive and
cheat the other.
What is warranty? - CORRECT ANSWER.Guarantee that an insured will or will not
do something
What are the four major parts to an insurance policy structure? (DICE) - CORRECT
ANSWER.D - Declarations Page (First Page)
I - Insuring Agreement (Insurers promise to pay)
C - Conditions (Rules)
E - Exclusions (Not covered)
What information is on the declarations page? (Remember 6 Ps) - CORRECT
ANSWER.Policy Number
Parties
Property Description/Location
Policy Term
Policy Limits/Deductibles
Premium
What is Limit of Liability? - CORRECT ANSWER.The max amount of coverage
agreed to be paid per loss
What is Aggregate Limit? - CORRECT ANSWER.The max amount of the total of all
claims paid per policy period
Insuring Agreement? - CORRECT ANSWER.Insurers promise to pay
Conditions - CORRECT ANSWER.Contains the duties and rights of both parties
What are the Insured's duties after a loss? - CORRECT ANSWER.Submit a proof of
loss or sworn statement within 91 days. Protect property from further damage.
Cooperate with the insurer.
What is the Mortgage Clause? - CORRECT ANSWER.Nothing the insured does,
even dishonestly, can prevent the mortgagee from collecting under the policy
What are the two types of termination of a policy? - CORRECT
ANSWER.Cancellation - occurs when the insured/insurer cancels the contract before
the end of the policy period.
Non-Renewals - occurs at the end of the policy period.
