04/08/2025, 09:03 Property and casualty insurance Exam comprehensive questions and verified accurate solution (detailed & elaborated) 2025 TES…
Property and casualty insurance Exam
comprehensive questions and verified accurate
solution (detailed & elaborated) 2025 TEST!!
Save
Terms in this set (301)
This type of insurance designates a particular item to
Specific insurance
be insured
This type of insurance covers more than one item of
Blanket insurance property at a single location or one more items of
property at multiple locations.
Speculative possibility of both gain and loss. Not insurable.
Pure only the possibility of loss. Insurable.
What are the 5 methods of avoid, control, retain, and transfer risk.
managing or handling
risk?
A condition or situation which increases the chance
Hazard
for loss
a hazard that arises from the condition, occupancy, or
use of the property itself.
Physical Hazards
ex: skateboard left on the steps
https://quizlet.com/1063777572/property-and-casualty-insurance-exam-comprehensive-questions-and-verified-accurate-solution-detailed-elaborated-… 1/38
,04/08/2025, 09:03 Property and casualty insurance Exam comprehensive questions and verified accurate solution (detailed & elaborated) 2025 TES…
when an individual through carelessness or by
irresponsible actions can increase the possibly for a
loss.
Moral Hazards
ex: person who drives carelessly just because they
know they are insured.
when a person might create a loss situation on
purpose just to collect from the insurance company.
Morale Hazards
ex: Prearranged, faked theft of someone's old vehicle
so they can get an insurance payout to buy a new
vehicle.
The amount of money it would take to replace a
damaged or destroyed item with one of like kind and
Replacement Cost
quality AT THE TIME OF LOSS. No deduction for
depreciation.
Actual Cash Value (ACV) Replacement Cost, minus depreciation.
Loss to one item of a pair or set does not constitute
Pair and Set Clause
loss to the entire pair or set.
A method of resolving disputes between insurers and
insureds over the amount owed on a covered loss.
-both parties select an appraiser
Appraisal -the two appraisers select an umpire
-if the appraisers do not agree, the umpire is
consulted
-the amount agreed on by 2 out of 3 is the amount
that will be paid
An insurer's right to recover the amount of its loss
Subrogation payment from the third party who is legally
responsible for the loss.
https://quizlet.com/1063777572/property-and-casualty-insurance-exam-comprehensive-questions-and-verified-accurate-solution-detailed-elaborated-… 2/38
,04/08/2025, 09:03 Property and casualty insurance Exam comprehensive questions and verified accurate solution (detailed & elaborated) 2025 TES…
this condition is similar to the Appraisal Condition but
it is not limited to disputes over the value of the loss. It
Arbitration may also be used to resolve other areas of
disagreement between the insured and the insurance
company.
What does WC SHAVVER Windstorm, Civil commotion, Smoke, Hail, Aircraft,
stand for? Vehicles, Volcanic eruption, Explosion, Riot
Burglar damage, Ice & snow weight, Glass breakage,
What does BIG AFFECT
Accidental discharge, Falling objects, Freezing of
stand for?
pipes, Electrical damage, Collapse, Tearing apart.
A financial state that occurs if liabilities are greater
Insolvency
than assets.
Knowledge of the Agents is Knowledge of the
Law of Agency
Principal (Insurance Company)
Principal Insurance Company
Insurance Services Office which is an organization
established for the benefit of its member insurance
companies. This organization gathers statistics,
What is the ISO?
provides loss costs, drafts policy forms and coverage
provisions and conducts inspections for rate making
purposes.
Requires the insured to carry a minimum specified
amount (generally 80%) of the replacement cost value
Coinsurance Clause
of the insured property in order for partial losses to
be paid in full.
A legal bar to changing or denying a fact because of
one's own previous actions or words to the contrary.
Estoppel ex: If an insurance company representative
intentionally or unintentionally gives the impression
that a specific fact exists when it does not and a client
relies on that impression and is damaged a result.
https://quizlet.com/1063777572/property-and-casualty-insurance-exam-comprehensive-questions-and-verified-accurate-solution-detailed-elaborated-… 3/38
, 04/08/2025, 09:03 Property and casualty insurance Exam comprehensive questions and verified accurate solution (detailed & elaborated) 2025 TES…
A temporary contract of insurance, oral or written,
offered by an insurer pending issuance of the policy.
Binder Usually written for a period of 30-60 days and
remains in force for that period or until a permanent
policy is either issued or denied by the insurer.
A provision in a policy that pledges that a condition
Warranty
does exist or will exist at some time in the future.
Tentative charge made at the beginning of certain
policies and reinsurance agreements to be adjusted
Deposit Premium
when the actual earned charge has been later
determined.
Verification of books or accounts to determine their
Audit
accuracy.
An accident, including continuous or repeated
Occurrence exposure to the same harmful conditions, which result
in bodily injury or property damage.
type of compensatory damages that reimburse the
injured part for direct and specific expenses involved
Special Damages
in the loss. Such as medical expenses, funeral
expenses and loss wages.
type of compensatory damages that reimburse the
General Damages injured party for such things as pain and suffering and
disfigurement.
type of damages intended to punish the defendant
Punitive Damages and make an example out of her to discourage others
from behaving the same way.
An act, through an uniterrupted chain of events, that
Proximate Cause can be determined to be the immediate or actual
cause of a loss.
https://quizlet.com/1063777572/property-and-casualty-insurance-exam-comprehensive-questions-and-verified-accurate-solution-detailed-elaborated-… 4/38
Property and casualty insurance Exam
comprehensive questions and verified accurate
solution (detailed & elaborated) 2025 TEST!!
Save
Terms in this set (301)
This type of insurance designates a particular item to
Specific insurance
be insured
This type of insurance covers more than one item of
Blanket insurance property at a single location or one more items of
property at multiple locations.
Speculative possibility of both gain and loss. Not insurable.
Pure only the possibility of loss. Insurable.
What are the 5 methods of avoid, control, retain, and transfer risk.
managing or handling
risk?
A condition or situation which increases the chance
Hazard
for loss
a hazard that arises from the condition, occupancy, or
use of the property itself.
Physical Hazards
ex: skateboard left on the steps
https://quizlet.com/1063777572/property-and-casualty-insurance-exam-comprehensive-questions-and-verified-accurate-solution-detailed-elaborated-… 1/38
,04/08/2025, 09:03 Property and casualty insurance Exam comprehensive questions and verified accurate solution (detailed & elaborated) 2025 TES…
when an individual through carelessness or by
irresponsible actions can increase the possibly for a
loss.
Moral Hazards
ex: person who drives carelessly just because they
know they are insured.
when a person might create a loss situation on
purpose just to collect from the insurance company.
Morale Hazards
ex: Prearranged, faked theft of someone's old vehicle
so they can get an insurance payout to buy a new
vehicle.
The amount of money it would take to replace a
damaged or destroyed item with one of like kind and
Replacement Cost
quality AT THE TIME OF LOSS. No deduction for
depreciation.
Actual Cash Value (ACV) Replacement Cost, minus depreciation.
Loss to one item of a pair or set does not constitute
Pair and Set Clause
loss to the entire pair or set.
A method of resolving disputes between insurers and
insureds over the amount owed on a covered loss.
-both parties select an appraiser
Appraisal -the two appraisers select an umpire
-if the appraisers do not agree, the umpire is
consulted
-the amount agreed on by 2 out of 3 is the amount
that will be paid
An insurer's right to recover the amount of its loss
Subrogation payment from the third party who is legally
responsible for the loss.
https://quizlet.com/1063777572/property-and-casualty-insurance-exam-comprehensive-questions-and-verified-accurate-solution-detailed-elaborated-… 2/38
,04/08/2025, 09:03 Property and casualty insurance Exam comprehensive questions and verified accurate solution (detailed & elaborated) 2025 TES…
this condition is similar to the Appraisal Condition but
it is not limited to disputes over the value of the loss. It
Arbitration may also be used to resolve other areas of
disagreement between the insured and the insurance
company.
What does WC SHAVVER Windstorm, Civil commotion, Smoke, Hail, Aircraft,
stand for? Vehicles, Volcanic eruption, Explosion, Riot
Burglar damage, Ice & snow weight, Glass breakage,
What does BIG AFFECT
Accidental discharge, Falling objects, Freezing of
stand for?
pipes, Electrical damage, Collapse, Tearing apart.
A financial state that occurs if liabilities are greater
Insolvency
than assets.
Knowledge of the Agents is Knowledge of the
Law of Agency
Principal (Insurance Company)
Principal Insurance Company
Insurance Services Office which is an organization
established for the benefit of its member insurance
companies. This organization gathers statistics,
What is the ISO?
provides loss costs, drafts policy forms and coverage
provisions and conducts inspections for rate making
purposes.
Requires the insured to carry a minimum specified
amount (generally 80%) of the replacement cost value
Coinsurance Clause
of the insured property in order for partial losses to
be paid in full.
A legal bar to changing or denying a fact because of
one's own previous actions or words to the contrary.
Estoppel ex: If an insurance company representative
intentionally or unintentionally gives the impression
that a specific fact exists when it does not and a client
relies on that impression and is damaged a result.
https://quizlet.com/1063777572/property-and-casualty-insurance-exam-comprehensive-questions-and-verified-accurate-solution-detailed-elaborated-… 3/38
, 04/08/2025, 09:03 Property and casualty insurance Exam comprehensive questions and verified accurate solution (detailed & elaborated) 2025 TES…
A temporary contract of insurance, oral or written,
offered by an insurer pending issuance of the policy.
Binder Usually written for a period of 30-60 days and
remains in force for that period or until a permanent
policy is either issued or denied by the insurer.
A provision in a policy that pledges that a condition
Warranty
does exist or will exist at some time in the future.
Tentative charge made at the beginning of certain
policies and reinsurance agreements to be adjusted
Deposit Premium
when the actual earned charge has been later
determined.
Verification of books or accounts to determine their
Audit
accuracy.
An accident, including continuous or repeated
Occurrence exposure to the same harmful conditions, which result
in bodily injury or property damage.
type of compensatory damages that reimburse the
injured part for direct and specific expenses involved
Special Damages
in the loss. Such as medical expenses, funeral
expenses and loss wages.
type of compensatory damages that reimburse the
General Damages injured party for such things as pain and suffering and
disfigurement.
type of damages intended to punish the defendant
Punitive Damages and make an example out of her to discourage others
from behaving the same way.
An act, through an uniterrupted chain of events, that
Proximate Cause can be determined to be the immediate or actual
cause of a loss.
https://quizlet.com/1063777572/property-and-casualty-insurance-exam-comprehensive-questions-and-verified-accurate-solution-detailed-elaborated-… 4/38
