PROPERTY AND CASUALTY INSURANCE ACTUAL EXAM TEST QUESTIONS WITH
VERIFIED & ACCURATE SOLUTIONS- GRADED A+
Specific insurance
This type of insurance designates a particular item to be insured
Blanket insurance
This type of insurance covers more than one item of 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 managing or handling risk?
avoid, control, retain, and transfer risk.
Hazard
A condition or situation which increases the chance for loss
,Physical Hazards
a hazard that arises from the condition, occupancy, or use of the property itself.
ex: skateboard left on the steps
Moral Hazards
when an individual through carelessness or by irresponsible actions can increase the
possibly for a loss.
ex: person who drives carelessly just because they know they are insured.
Morale Hazards
when a person might create a loss situation on purpose just to collect from the insurance
company.
ex: Prearranged, faked theft of someone's old vehicle so they can get an insurance payout
to buy a new vehicle.
Replacement Cost
The amount of money it would take to replace a damaged or destroyed item with one of like
kind and quality AT THE TIME OF LOSS. No deduction for depreciation.
,Actual Cash Value (ACV)
Replacement Cost, minus depreciation.
Pair and Set Clause
Loss to one item of a pair or set does not constitute loss to the entire pair or set.
Appraisal
A method of resolving disputes between insurers and insureds over the amount owed on a
covered loss.
-both parties select an appraiser
-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
Subrogation
An insurer's right to recover the amount of its loss payment from the third party who is
legally responsible for the loss.
Arbitration
this condition is similar to the Appraisal Condition but it is not limited to disputes over the
value of the loss. It may also be used to resolve other areas of disagreement between the
insured and the insurance company.
, What does WC SHAVVER stand for?
Windstorm, Civil commotion, Smoke, Hail, Aircraft, Vehicles, Volcanic eruption, Explosion,
Riot
Liability risk
is the risk that we will suffer financial loss as a result of our actions toward others.
Personal Lines
are property and casualty coverage that protect an individual or family.
Commercial Lines
are coverages designed for businesses.
Suspense or dairy system
this system alerts an agent before a policies renewal time.
Countersigning
this is when the agent signs each new policy prepared by the company before delivering it
to the insured.
Most states require this in order to validate the contract.
VERIFIED & ACCURATE SOLUTIONS- GRADED A+
Specific insurance
This type of insurance designates a particular item to be insured
Blanket insurance
This type of insurance covers more than one item of 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 managing or handling risk?
avoid, control, retain, and transfer risk.
Hazard
A condition or situation which increases the chance for loss
,Physical Hazards
a hazard that arises from the condition, occupancy, or use of the property itself.
ex: skateboard left on the steps
Moral Hazards
when an individual through carelessness or by irresponsible actions can increase the
possibly for a loss.
ex: person who drives carelessly just because they know they are insured.
Morale Hazards
when a person might create a loss situation on purpose just to collect from the insurance
company.
ex: Prearranged, faked theft of someone's old vehicle so they can get an insurance payout
to buy a new vehicle.
Replacement Cost
The amount of money it would take to replace a damaged or destroyed item with one of like
kind and quality AT THE TIME OF LOSS. No deduction for depreciation.
,Actual Cash Value (ACV)
Replacement Cost, minus depreciation.
Pair and Set Clause
Loss to one item of a pair or set does not constitute loss to the entire pair or set.
Appraisal
A method of resolving disputes between insurers and insureds over the amount owed on a
covered loss.
-both parties select an appraiser
-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
Subrogation
An insurer's right to recover the amount of its loss payment from the third party who is
legally responsible for the loss.
Arbitration
this condition is similar to the Appraisal Condition but it is not limited to disputes over the
value of the loss. It may also be used to resolve other areas of disagreement between the
insured and the insurance company.
, What does WC SHAVVER stand for?
Windstorm, Civil commotion, Smoke, Hail, Aircraft, Vehicles, Volcanic eruption, Explosion,
Riot
Liability risk
is the risk that we will suffer financial loss as a result of our actions toward others.
Personal Lines
are property and casualty coverage that protect an individual or family.
Commercial Lines
are coverages designed for businesses.
Suspense or dairy system
this system alerts an agent before a policies renewal time.
Countersigning
this is when the agent signs each new policy prepared by the company before delivering it
to the insured.
Most states require this in order to validate the contract.
