Texas Insurance License exam
2023/2024 with 100% correct answers
Susie set fire to her house to collect the insurance. This is an example of a(n) - correct answer MORAL
HAZARDS
Henry's tires on his SUV are so worn that the steel belt is showing through the tread. The condition of
the tires is known as - correct answer PHYSICAL HAZARDS
When a driver of an auto breaks the posted speed limit, the driver's liability imposed by the law is
known as - correct answer ABOSLUTE LIABILITY
Under compensatory damages, medical expenses are an example of - correct answer SPECIAL damages.
Josh attends a hockey game. While at the game he is hit in the head by the hockey puck resulting in a
broken cheek bone. Josh immediately sues the hockey team for damages. What might be the most
logical defense for the hockey team? - correct answer ASSUMPTION OF RISK
The Smith family is planning to build a new house. They want the house to be constructed entirely of fire
resistance materials. This construction type is an example of a - correct answer FIRE RESISTIVE building.
________ contracts are written for a specified amount and they list the value of the insured property as
agreed to by both the insured and the insurer at policy inception. - correct answer Susie set fire to her
house to collect the insurance. This is an example of a(n) MORAL HAZARDS
Henry's tires on his SUV are so worn that the steel belt is showing through the tread. The condition of
the tires is known as - correct answer PHYSICAL HAZARDS
When a driver of an auto breaks the posted speed limit, the driver's liability imposed by the law is
known as - correct answer ABOSLUTE LIABILITY
,Under compensatory damages, medical expenses are an example of - correct answer SPECIAL damages.
Josh attends a hockey game. While at the game he is hit in the head by the hockey puck resulting in a
broken cheek bone. Josh immediately sues the hockey team for damages. What might be the most
logical defense for the hockey team? - correct answer ASSUMPTION OF RISK
The Smith family is planning to build a new house. They want the house to be constructed entirely of fire
resistance materials. This construction type is an example of a - correct answer FIRE RESISTIVE building.
______contracts are written for a specified amount and they list the value of the insured property as
agreed to by both the insured and the insurer at policy inception. - correct answer VALUED
The ABC Company has several business locations. They want to cover all the locations under one policy.
They should purchase a(n) - correct answer BLANKET policy
A building has a market value of $100,000, a replacement cost of $80,000 and a depreciated amount of
$25,000. Based on these factors, what is the ACV amount of the building? - correct answer ($80,000 -
$25,000 = $55,000) Actual cash value, or ACV is usually calculated by determining the item's
replacement cost (what it would cost to buy a replacement) and subtracting an amount for depreciation.
Here's what it looks like written as a formula: ACV = Replacement Cost - Depreciation
Joe has just purchased a new house. He wants to obtain the broadest possible insurance coverage. Joe
should purchase a(n) - correct answer SPECIAL FORMS policy.
Which of the following is NOT a method by which an insured can collect for damages? - correct answer
In general, the insured can collect the lesser of: Insurable interest; Policy limits; Actual cash value; Cost
to repair; or Replacement cost.
Which one of the following terms can be defined as a policy provision that omits certain risks from
coverage? - correct answer EXCLUSIONS
Joe asked his insurance agent to explain the purpose of the conditions section of his insurance policy.
Joe's agent stated that it is used to _____. - correct answer Policy conditions
, Jane has decided to add towing to her current auto policy with the ABC Insurance Company. What must
the ABC Insurance Company do to add the requested change to the policy? - correct answer
ENDORSEMENTS
Doug has just received his insurance policy. Where would Doug look to find the applicable deductibles
declared in the insurance policy? - correct answer DECLARATIONS
The XYZ Insurance Company is developing a new auto insurance contract. Which of the following is NOT
considered a major component of this insurance contract? - correct answer The contract does not
require the naming of senior officers of the insurance company.
Crossroad's commercial insurance coverage is automatically extended to cover newly acquired or
constructed locations and personal property covered off-premises within the policy territory. Which is
generally NOT covered under the policy territory? . On commercial policies, the policy territory is usually
the United States, Canada and Puerto Rico. - correct answer
The State Insurance Company has decided to non-renew Craig's auto insurance policy. The State
Insurance Company must - correct answer GIVE AT LEAST 30 DAYS NOTICE OF NONRENEWAL.
The State Insurance Company has decided to non-renew Janet's homeowners' insurance policy. The
State Insurance Company must. - correct answer GIVE AT LEAST 30 DAYS NOTICE OF CANCELLATION
FOR ANY REASON
Alfred wants to cancel his auto insurance policy. Which of the following is the most appropriate method
to accomplish this task? - correct answer GIVE WRITTEN NOTICE
The Big A Computer Store's commercial policy has a limit of liability that applies to all losses occurring
within any one policy period. This liability limit is an example of a(n) - correct answer AGGREGATE limit.
Mike trips over a tricycle in his neighbor's driveway. According to the Limits of Liability section of the
neighbor's homeowners' policy, Mike's accident is an example of a(n) - correct answer OCCURRENCE.
Ron sold his house to Connor. Ron calls his agent to inform him to assign the homeowners' policy to
Connor. What should Ron's agent do? - correct answer Assignment is a condition in insurance policies
2023/2024 with 100% correct answers
Susie set fire to her house to collect the insurance. This is an example of a(n) - correct answer MORAL
HAZARDS
Henry's tires on his SUV are so worn that the steel belt is showing through the tread. The condition of
the tires is known as - correct answer PHYSICAL HAZARDS
When a driver of an auto breaks the posted speed limit, the driver's liability imposed by the law is
known as - correct answer ABOSLUTE LIABILITY
Under compensatory damages, medical expenses are an example of - correct answer SPECIAL damages.
Josh attends a hockey game. While at the game he is hit in the head by the hockey puck resulting in a
broken cheek bone. Josh immediately sues the hockey team for damages. What might be the most
logical defense for the hockey team? - correct answer ASSUMPTION OF RISK
The Smith family is planning to build a new house. They want the house to be constructed entirely of fire
resistance materials. This construction type is an example of a - correct answer FIRE RESISTIVE building.
________ contracts are written for a specified amount and they list the value of the insured property as
agreed to by both the insured and the insurer at policy inception. - correct answer Susie set fire to her
house to collect the insurance. This is an example of a(n) MORAL HAZARDS
Henry's tires on his SUV are so worn that the steel belt is showing through the tread. The condition of
the tires is known as - correct answer PHYSICAL HAZARDS
When a driver of an auto breaks the posted speed limit, the driver's liability imposed by the law is
known as - correct answer ABOSLUTE LIABILITY
,Under compensatory damages, medical expenses are an example of - correct answer SPECIAL damages.
Josh attends a hockey game. While at the game he is hit in the head by the hockey puck resulting in a
broken cheek bone. Josh immediately sues the hockey team for damages. What might be the most
logical defense for the hockey team? - correct answer ASSUMPTION OF RISK
The Smith family is planning to build a new house. They want the house to be constructed entirely of fire
resistance materials. This construction type is an example of a - correct answer FIRE RESISTIVE building.
______contracts are written for a specified amount and they list the value of the insured property as
agreed to by both the insured and the insurer at policy inception. - correct answer VALUED
The ABC Company has several business locations. They want to cover all the locations under one policy.
They should purchase a(n) - correct answer BLANKET policy
A building has a market value of $100,000, a replacement cost of $80,000 and a depreciated amount of
$25,000. Based on these factors, what is the ACV amount of the building? - correct answer ($80,000 -
$25,000 = $55,000) Actual cash value, or ACV is usually calculated by determining the item's
replacement cost (what it would cost to buy a replacement) and subtracting an amount for depreciation.
Here's what it looks like written as a formula: ACV = Replacement Cost - Depreciation
Joe has just purchased a new house. He wants to obtain the broadest possible insurance coverage. Joe
should purchase a(n) - correct answer SPECIAL FORMS policy.
Which of the following is NOT a method by which an insured can collect for damages? - correct answer
In general, the insured can collect the lesser of: Insurable interest; Policy limits; Actual cash value; Cost
to repair; or Replacement cost.
Which one of the following terms can be defined as a policy provision that omits certain risks from
coverage? - correct answer EXCLUSIONS
Joe asked his insurance agent to explain the purpose of the conditions section of his insurance policy.
Joe's agent stated that it is used to _____. - correct answer Policy conditions
, Jane has decided to add towing to her current auto policy with the ABC Insurance Company. What must
the ABC Insurance Company do to add the requested change to the policy? - correct answer
ENDORSEMENTS
Doug has just received his insurance policy. Where would Doug look to find the applicable deductibles
declared in the insurance policy? - correct answer DECLARATIONS
The XYZ Insurance Company is developing a new auto insurance contract. Which of the following is NOT
considered a major component of this insurance contract? - correct answer The contract does not
require the naming of senior officers of the insurance company.
Crossroad's commercial insurance coverage is automatically extended to cover newly acquired or
constructed locations and personal property covered off-premises within the policy territory. Which is
generally NOT covered under the policy territory? . On commercial policies, the policy territory is usually
the United States, Canada and Puerto Rico. - correct answer
The State Insurance Company has decided to non-renew Craig's auto insurance policy. The State
Insurance Company must - correct answer GIVE AT LEAST 30 DAYS NOTICE OF NONRENEWAL.
The State Insurance Company has decided to non-renew Janet's homeowners' insurance policy. The
State Insurance Company must. - correct answer GIVE AT LEAST 30 DAYS NOTICE OF CANCELLATION
FOR ANY REASON
Alfred wants to cancel his auto insurance policy. Which of the following is the most appropriate method
to accomplish this task? - correct answer GIVE WRITTEN NOTICE
The Big A Computer Store's commercial policy has a limit of liability that applies to all losses occurring
within any one policy period. This liability limit is an example of a(n) - correct answer AGGREGATE limit.
Mike trips over a tricycle in his neighbor's driveway. According to the Limits of Liability section of the
neighbor's homeowners' policy, Mike's accident is an example of a(n) - correct answer OCCURRENCE.
Ron sold his house to Connor. Ron calls his agent to inform him to assign the homeowners' policy to
Connor. What should Ron's agent do? - correct answer Assignment is a condition in insurance policies
