AR Crop Hail Exam
Question 1. What is the primary purpose of crop hail insurance?
A) To guarantee high crop prices
B) To protect farmers from losses caused by hail
C) To improve crop yield
D) To pay for farm equipment repairs
Answer: B
Explanation: Crop hail insurance is designed specifically to indemnify
farmers for losses to their crops caused by hail, which can be sudden
and devastating.
Question 2. Which of the following is considered a “peril” in crop
insurance terminology?
A) Insurance company
,AR Crop Hail Exam
B) Hailstorm
C) Crop yield
D) Premium
Answer: B
Explanation: In insurance, a “peril” is an event that causes a loss;
hailstorm is a peril covered under crop hail insurance.
Question 3. The principle of indemnity in crop hail insurance means:
A) The insured receives more than their loss
B) The insured is restored to their pre-loss financial position
C) The insured pays the insurer for the loss
D) The insurer profits from the claim
Answer: B
,AR Crop Hail Exam
Explanation: Indemnity ensures policyholders are compensated to the
extent of their loss but not to profit from insurance.
Question 4. What must an insured have in order to buy crop hail
insurance?
A) Insurable interest in the crop
B) Ownership of the insurance company
C) A government subsidy
D) At least 1,000 acres
Answer: A
Explanation: The insured must have a financial stake (insurable interest)
in the crop to purchase insurance for it.
Question 5. The Declarations Page of a crop hail policy contains:
, AR Crop Hail Exam
A) The crop’s scientific name
B) Key information such as the insured’s name, coverage amount, and
location
C) Instructions for crop planting
D) Details about crop yield history
Answer: B
Explanation: The Declarations Page outlines the essential details of the
policy’s coverage.
Question 6. Which of the following is NOT typically found in the Insuring
Agreement of a crop hail policy?
A) Covered perils
B) Exclusions
C) Premium due date
Question 1. What is the primary purpose of crop hail insurance?
A) To guarantee high crop prices
B) To protect farmers from losses caused by hail
C) To improve crop yield
D) To pay for farm equipment repairs
Answer: B
Explanation: Crop hail insurance is designed specifically to indemnify
farmers for losses to their crops caused by hail, which can be sudden
and devastating.
Question 2. Which of the following is considered a “peril” in crop
insurance terminology?
A) Insurance company
,AR Crop Hail Exam
B) Hailstorm
C) Crop yield
D) Premium
Answer: B
Explanation: In insurance, a “peril” is an event that causes a loss;
hailstorm is a peril covered under crop hail insurance.
Question 3. The principle of indemnity in crop hail insurance means:
A) The insured receives more than their loss
B) The insured is restored to their pre-loss financial position
C) The insured pays the insurer for the loss
D) The insurer profits from the claim
Answer: B
,AR Crop Hail Exam
Explanation: Indemnity ensures policyholders are compensated to the
extent of their loss but not to profit from insurance.
Question 4. What must an insured have in order to buy crop hail
insurance?
A) Insurable interest in the crop
B) Ownership of the insurance company
C) A government subsidy
D) At least 1,000 acres
Answer: A
Explanation: The insured must have a financial stake (insurable interest)
in the crop to purchase insurance for it.
Question 5. The Declarations Page of a crop hail policy contains:
, AR Crop Hail Exam
A) The crop’s scientific name
B) Key information such as the insured’s name, coverage amount, and
location
C) Instructions for crop planting
D) Details about crop yield history
Answer: B
Explanation: The Declarations Page outlines the essential details of the
policy’s coverage.
Question 6. Which of the following is NOT typically found in the Insuring
Agreement of a crop hail policy?
A) Covered perils
B) Exclusions
C) Premium due date
