Property & Casualty Final Exam
1. ________ prevents a party from enforcing a right that it voluntarily waived by its past
conduct. - ANS-Estoppel;
2. _________ is the transfer of rights from the policyholder to some other party. A
policyholder may not transfer his or her rights in the policy without the written consent of
the insurance company. - ANS-Assignment;
3. ___________ is imposed in limited situations where the insured's inherently dangerous
operations or other activities will always be considered a breach of duty if injury or
damage results. Examples of such operations and activities include demolitions
operations and keeping wild animals. - ANS-Strict liability;
4. ___________ is making false statements regarding an insurer or person engaged in the
insurance business that are derogatory and intended to injure that person. Steven has
defamed the competing insurer by spreading false information regarding its integrity and
financial condition. - ANS-Defamation;
5. ___________ results when one party is legally responsible for the acts of another.
Examples include parents, who are vicariously liable for their minor children, and
employers, who are vicariously liable for their employees. - ANS-Vicarious liability;
6. ___________ use the agreed value approach to insure valuable works of art. -
ANS-Valued policies;
7. A __________ is the party listed on the Declarations page. On personal lines policies,
the named insured often includes the resident spouse of the party named on the
Declarations page. - ANS-named insured;
8. A _____________ policy is a property insurance policy that is purchased in addition to a
commercial property policy to obtain coverage for perils, like flood and earthquake, that
the commercial property policy does not cover. Many DIC policies are issued by
nonadmitted excess and surplus lines insurers. - ANS-difference-in-conditions (DIC);
9. A party to a contract may not enforce a right it has voluntarily waived by its past conduct.
This is known as - ANS-estoppel
10. A property insurance policy that uses the named perils approach includes - ANS-a list or
description of the perils that are covered. In contrast to the named perils approach, the
open perils approach describes the causes of loss (perils) that are not covered;.
11. A renewal policy is not necessarily identical to the policy it replaces. Insurers often revise
their standard policy forms to deal with - ANS-court decisions, new exposures, or a need
to clarify the insurer's intentions. Some policy updates expand coverage, while others
reduce it.;
12. A warranty is stronger than a representation. A ________ guarantees that something is
true and will remain true. - ANS-warranty;
13. A___________ writes property and casualty insurance that is used primarily for personal
or household purposes by individuals and families. - ANS-personal lines agent;
, 14. A_______________ is a document issued as evidence that a certain type of insurance
has been purchased by a particular party. For example, a homeowner may request that
a plumber provide a certificate of insurance before beginning work in her kitchen. -
ANS-certificate of insurance;
15. Academic records typically are not requested by underwriters as part of the underwriting
review process for standard insurance policies. Underwriters typically get the necessary
information from - ANS-the application, an agency report, loss history data, the motor
vehicle records, inspection reports and photos, a loss control report, and credit
information, if applicable.;
16. Alex asks your advice seeking objective information about the financial reliability of an
insurance company from which he is considering the purchase of insurance. You might
suggest that he - ANS-Check the company's financial rating from an established rating
organization
17. All of the following might cause an insurer to revise a standard policy form at the time of
renewal: - ANS-New exposures
18. Court decisions
19. Need to clarify an insurer's intentions
20. Although a written or an oral binder are both legally binding, a__________ is best
because it reduces the likelihood of a dispute. A written binder should clearly designate
the insurer to which the risk is bound. This is vital when an agent represents more than
one insurer. It should also indicate the amount of insurance, the type of policy, effective
dates of coverage, and with property insurance, the covered perils. - ANS-written binder;
21. An ______________ is a condition or object on property that is likely to attract children
who are unable to recognize any risks associated with the condition or object. Under the
doctrine, landowners may be held legally liable for injuries sustained by children simply
by ownership of an attractive nuisance, regardless of the property owner's negligence. -
ANS-attractive nuisance;
22. An example of __________ is when a business establishes a self-insurance program
through which funds are set aside, or other advance arrangements are made, to pay for
losses that occur within that business. - ANS-risk retention;
23. An insurance agent must determine whether a product sold to a consumer appears to
__________ _______. Due to some abuses, suitability has been a special concern of
state insurance regulators, especially with respect to life insurance and annuities.
However, property and casualty insurance agents should also make sure the insurance
products they sell are suitable for their clients' needs. - ANS-suit the needs of that
consumer.;
24. An insurance agent must determine whether a product sold to a consumer appears to
suit the needs of that consumer. An agent must also decide what information is relevant
for making specific recommendations regarding an insurance transaction. By
________________________ an agent is able to demonstrate that he or she has made
a suitable recommendation. - ANS-keeping a record of the information that was gathered
and the processes used in gathering it;
25. An insurance company's ______ is the state in which its home office is located. -
ANS-domicile;
1. ________ prevents a party from enforcing a right that it voluntarily waived by its past
conduct. - ANS-Estoppel;
2. _________ is the transfer of rights from the policyholder to some other party. A
policyholder may not transfer his or her rights in the policy without the written consent of
the insurance company. - ANS-Assignment;
3. ___________ is imposed in limited situations where the insured's inherently dangerous
operations or other activities will always be considered a breach of duty if injury or
damage results. Examples of such operations and activities include demolitions
operations and keeping wild animals. - ANS-Strict liability;
4. ___________ is making false statements regarding an insurer or person engaged in the
insurance business that are derogatory and intended to injure that person. Steven has
defamed the competing insurer by spreading false information regarding its integrity and
financial condition. - ANS-Defamation;
5. ___________ results when one party is legally responsible for the acts of another.
Examples include parents, who are vicariously liable for their minor children, and
employers, who are vicariously liable for their employees. - ANS-Vicarious liability;
6. ___________ use the agreed value approach to insure valuable works of art. -
ANS-Valued policies;
7. A __________ is the party listed on the Declarations page. On personal lines policies,
the named insured often includes the resident spouse of the party named on the
Declarations page. - ANS-named insured;
8. A _____________ policy is a property insurance policy that is purchased in addition to a
commercial property policy to obtain coverage for perils, like flood and earthquake, that
the commercial property policy does not cover. Many DIC policies are issued by
nonadmitted excess and surplus lines insurers. - ANS-difference-in-conditions (DIC);
9. A party to a contract may not enforce a right it has voluntarily waived by its past conduct.
This is known as - ANS-estoppel
10. A property insurance policy that uses the named perils approach includes - ANS-a list or
description of the perils that are covered. In contrast to the named perils approach, the
open perils approach describes the causes of loss (perils) that are not covered;.
11. A renewal policy is not necessarily identical to the policy it replaces. Insurers often revise
their standard policy forms to deal with - ANS-court decisions, new exposures, or a need
to clarify the insurer's intentions. Some policy updates expand coverage, while others
reduce it.;
12. A warranty is stronger than a representation. A ________ guarantees that something is
true and will remain true. - ANS-warranty;
13. A___________ writes property and casualty insurance that is used primarily for personal
or household purposes by individuals and families. - ANS-personal lines agent;
, 14. A_______________ is a document issued as evidence that a certain type of insurance
has been purchased by a particular party. For example, a homeowner may request that
a plumber provide a certificate of insurance before beginning work in her kitchen. -
ANS-certificate of insurance;
15. Academic records typically are not requested by underwriters as part of the underwriting
review process for standard insurance policies. Underwriters typically get the necessary
information from - ANS-the application, an agency report, loss history data, the motor
vehicle records, inspection reports and photos, a loss control report, and credit
information, if applicable.;
16. Alex asks your advice seeking objective information about the financial reliability of an
insurance company from which he is considering the purchase of insurance. You might
suggest that he - ANS-Check the company's financial rating from an established rating
organization
17. All of the following might cause an insurer to revise a standard policy form at the time of
renewal: - ANS-New exposures
18. Court decisions
19. Need to clarify an insurer's intentions
20. Although a written or an oral binder are both legally binding, a__________ is best
because it reduces the likelihood of a dispute. A written binder should clearly designate
the insurer to which the risk is bound. This is vital when an agent represents more than
one insurer. It should also indicate the amount of insurance, the type of policy, effective
dates of coverage, and with property insurance, the covered perils. - ANS-written binder;
21. An ______________ is a condition or object on property that is likely to attract children
who are unable to recognize any risks associated with the condition or object. Under the
doctrine, landowners may be held legally liable for injuries sustained by children simply
by ownership of an attractive nuisance, regardless of the property owner's negligence. -
ANS-attractive nuisance;
22. An example of __________ is when a business establishes a self-insurance program
through which funds are set aside, or other advance arrangements are made, to pay for
losses that occur within that business. - ANS-risk retention;
23. An insurance agent must determine whether a product sold to a consumer appears to
__________ _______. Due to some abuses, suitability has been a special concern of
state insurance regulators, especially with respect to life insurance and annuities.
However, property and casualty insurance agents should also make sure the insurance
products they sell are suitable for their clients' needs. - ANS-suit the needs of that
consumer.;
24. An insurance agent must determine whether a product sold to a consumer appears to
suit the needs of that consumer. An agent must also decide what information is relevant
for making specific recommendations regarding an insurance transaction. By
________________________ an agent is able to demonstrate that he or she has made
a suitable recommendation. - ANS-keeping a record of the information that was gathered
and the processes used in gathering it;
25. An insurance company's ______ is the state in which its home office is located. -
ANS-domicile;
