PSI PROPERTY AND CASUALTY EXAM |
COMPREHENSIVE EXAM PREP, PRACTICE
QUESTIONS, CORRECT ANSWERS AND
STUDY GUIDE
| GRADED A+ | GUARANTEED SUCCESS
Updated 2026 Questions and Answers
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,Property Insurance Basics- B
when property is valued on a replacement cost basis losses
are paid: remember functional replacement cost is for materials or techniques that are outdated or
A too expensive
At the cost to replace with functionally equivalent property
B
At today's costs, without any deduction for depreciation
C
At market value of the damaged property
D
At an amount previously agreed upon by the insured and
insurer
Property Insurance Basics- Fire-Resistive
Which construction classification uses materials that can
withstand fire for at least 2 hours?
A
Frame
B
Noncombustible
C
Fire-Resistive
D
Masonry
The pair and set clause found in property policies states that Repairing or replacing the damaged part
in the event of a loss to only part of pair or set, losses will be OR
settled paying the difference of ACV before and after loss
either by
A. repairing or replacing the damaged part or by paying the
difference between the actual cash value before and after the
loss
B. deny coverage
C. Replace entire set with equal value
D. Pay the appraised value
,Property Insurance Basics- A
when filing a property insurance claim, the insured is required
to do all of the following except Insured's duties after a loss
A -furnishing inventory
Hire an appraiser -submitting to examination
B -giving prompt notice of loss
Give notice of loss as soon as possible -protect property from further damage
C
Protect property from further damage
D
Submit to an examination under oath at the insurer's request
Does fire insurance insure against C
A-friendly fires (confined to their intended place) Fire insurance insures against uncontrolled or hostile fires
B- accidental fires
C-Hostile fires
Property Insurance Basics- theft
FIRE THINK (RFL)
The standard fire policy requires that all property insurance ROLL (removal of property)
policies provide coverage for all of the following perils, FLOOR (fire)
except: LAUGHING (lightning)
A
Fire
B
Lightning
C
Theft
D
Removal of property
when you think of liability think of money going to the third party
, Casualty (liability) insurance basics B
Property damage covered by a liability policy includes which
of the following?
A
Damage to property owned by, or leased to, the insured
B
Damage to tangible property belonging to a third party,
including loss of use of that property, caused by the insured's
negligence
C
Damage to the insured's products arising out of the products
D
Damage to property of others in the insured's care, custody,
or control that results from a criminal wrong
Casualty Basics medical and legal fees if you're held legally responsible for someone else's injury, or
what does a liability policy cover damage to someone else's property.--including loss of use of that property caused by
acts of the insured
casualty basics payments that the insurer makes to the insured for costs to resolve claims or investigate
what are supplementary payments
casualty basics: per person, per occurence, aggregate limit
explain the order of limits
#/#/#
casualty basics: Absolute Liability (strict liability-party is liable even when no negligent act is committed)
what does it mean when something is so inherently dangerous even though H is not being negligent they are still legally liable
that negligence cannot be defend the insured who is liable-
example d's child plays with H's venomous snake at neighbors.
Causality Basics- -duty owed to a third party
what are the 4 elements of negligence -breach of that duty (breach when a persons conduct fails to meet a standard of care,
example failing to look at traffic signals breaches the duty to drive safely )
-wrongful act was the direct cause
-forseeable consequence
COMPREHENSIVE EXAM PREP, PRACTICE
QUESTIONS, CORRECT ANSWERS AND
STUDY GUIDE
| GRADED A+ | GUARANTEED SUCCESS
Updated 2026 Questions and Answers
100% Verified Exam Prep
,Property Insurance Basics- B
when property is valued on a replacement cost basis losses
are paid: remember functional replacement cost is for materials or techniques that are outdated or
A too expensive
At the cost to replace with functionally equivalent property
B
At today's costs, without any deduction for depreciation
C
At market value of the damaged property
D
At an amount previously agreed upon by the insured and
insurer
Property Insurance Basics- Fire-Resistive
Which construction classification uses materials that can
withstand fire for at least 2 hours?
A
Frame
B
Noncombustible
C
Fire-Resistive
D
Masonry
The pair and set clause found in property policies states that Repairing or replacing the damaged part
in the event of a loss to only part of pair or set, losses will be OR
settled paying the difference of ACV before and after loss
either by
A. repairing or replacing the damaged part or by paying the
difference between the actual cash value before and after the
loss
B. deny coverage
C. Replace entire set with equal value
D. Pay the appraised value
,Property Insurance Basics- A
when filing a property insurance claim, the insured is required
to do all of the following except Insured's duties after a loss
A -furnishing inventory
Hire an appraiser -submitting to examination
B -giving prompt notice of loss
Give notice of loss as soon as possible -protect property from further damage
C
Protect property from further damage
D
Submit to an examination under oath at the insurer's request
Does fire insurance insure against C
A-friendly fires (confined to their intended place) Fire insurance insures against uncontrolled or hostile fires
B- accidental fires
C-Hostile fires
Property Insurance Basics- theft
FIRE THINK (RFL)
The standard fire policy requires that all property insurance ROLL (removal of property)
policies provide coverage for all of the following perils, FLOOR (fire)
except: LAUGHING (lightning)
A
Fire
B
Lightning
C
Theft
D
Removal of property
when you think of liability think of money going to the third party
, Casualty (liability) insurance basics B
Property damage covered by a liability policy includes which
of the following?
A
Damage to property owned by, or leased to, the insured
B
Damage to tangible property belonging to a third party,
including loss of use of that property, caused by the insured's
negligence
C
Damage to the insured's products arising out of the products
D
Damage to property of others in the insured's care, custody,
or control that results from a criminal wrong
Casualty Basics medical and legal fees if you're held legally responsible for someone else's injury, or
what does a liability policy cover damage to someone else's property.--including loss of use of that property caused by
acts of the insured
casualty basics payments that the insurer makes to the insured for costs to resolve claims or investigate
what are supplementary payments
casualty basics: per person, per occurence, aggregate limit
explain the order of limits
#/#/#
casualty basics: Absolute Liability (strict liability-party is liable even when no negligent act is committed)
what does it mean when something is so inherently dangerous even though H is not being negligent they are still legally liable
that negligence cannot be defend the insured who is liable-
example d's child plays with H's venomous snake at neighbors.
Causality Basics- -duty owed to a third party
what are the 4 elements of negligence -breach of that duty (breach when a persons conduct fails to meet a standard of care,
example failing to look at traffic signals breaches the duty to drive safely )
-wrongful act was the direct cause
-forseeable consequence
