Texas Property & Casualty License
Questions Answered Correctly (Qs)
2026 update
Property vs Casualty: What is considered property? - CORRECT ANSWERS Structure &
Personal Property
Property vs Casualty: What is considered casualty? - CORRECT ANSWERS Non-property
losses. Legal liability to others. 3rd Party
Risk - CORRECT ANSWERS uncertainty of financial loss
Pure Risk - CORRECT ANSWERS Chance of Loss
Speculative Risk - CORRECT ANSWERS Chance of Loss or Gain (Gamble)
Insurance (covers which type of risk?) - CORRECT ANSWERS Pure Risk Only
How does the law of large numbers apply in insurance? - CORRECT ANSWERS Actuaries use
the law of large numbers to estimate claims
What is the law of large numbers? - CORRECT ANSWERS as the number of a similar loss
exposure increases, the more accurate claims can be predicted from the group.
What is a peril? - CORRECT ANSWERS cause of loss
What is a hazard? - CORRECT ANSWERS things that increase the chance of a peril happening
, Three types of hazards - CORRECT ANSWERS Physical: visible characteristic (dead tree)
Moral: Dishonest tendencies
Morale: Attitude of carelessness
Proximate Cause - CORRECT ANSWERS First cause in an unbroken chain of events
Elements of a legal contract (CALC) - CORRECT ANSWERS 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 ANSWERS Information believed to be true.
What is misrepresentation? - CORRECT ANSWERS Information that is not true. False
information.
What is material misrepresentation? - CORRECT ANSWERS Information that is not true but
would have caused the insurer not to issue the policy. (4 prev spd tix)
What is fraud? - CORRECT ANSWERS An all out effort by one party to deceive and cheat the
other.
What is warranty? - CORRECT ANSWERS Guarantee that an insured will or will not do
something
Questions Answered Correctly (Qs)
2026 update
Property vs Casualty: What is considered property? - CORRECT ANSWERS Structure &
Personal Property
Property vs Casualty: What is considered casualty? - CORRECT ANSWERS Non-property
losses. Legal liability to others. 3rd Party
Risk - CORRECT ANSWERS uncertainty of financial loss
Pure Risk - CORRECT ANSWERS Chance of Loss
Speculative Risk - CORRECT ANSWERS Chance of Loss or Gain (Gamble)
Insurance (covers which type of risk?) - CORRECT ANSWERS Pure Risk Only
How does the law of large numbers apply in insurance? - CORRECT ANSWERS Actuaries use
the law of large numbers to estimate claims
What is the law of large numbers? - CORRECT ANSWERS as the number of a similar loss
exposure increases, the more accurate claims can be predicted from the group.
What is a peril? - CORRECT ANSWERS cause of loss
What is a hazard? - CORRECT ANSWERS things that increase the chance of a peril happening
, Three types of hazards - CORRECT ANSWERS Physical: visible characteristic (dead tree)
Moral: Dishonest tendencies
Morale: Attitude of carelessness
Proximate Cause - CORRECT ANSWERS First cause in an unbroken chain of events
Elements of a legal contract (CALC) - CORRECT ANSWERS 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 ANSWERS Information believed to be true.
What is misrepresentation? - CORRECT ANSWERS Information that is not true. False
information.
What is material misrepresentation? - CORRECT ANSWERS Information that is not true but
would have caused the insurer not to issue the policy. (4 prev spd tix)
What is fraud? - CORRECT ANSWERS An all out effort by one party to deceive and cheat the
other.
What is warranty? - CORRECT ANSWERS Guarantee that an insured will or will not do
something
