Property and Casualty Insurance
EXAM latest updates!!! 2026-2027 |
correct solutions with quiz &
answers | highly graded a+
Specific insurance - CORRECT ANSWERS-This type of insurance designates a
particular item to be insured
Blanket insurance - CORRECT ANSWERS-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 - CORRECT ANSWERS-possibility of both gain and loss. Not insurable.
Pure - CORRECT ANSWERS-only the possibility of loss. Insurable.
What are the 5 methods of managing or handling risk? - CORRECT ANSWERS-avoid,
control, retain, and transfer risk.
Hazard - CORRECT ANSWERS-A condition or situation which increases the chance for
loss
Physical Hazards - CORRECT ANSWERS-a hazard that arises from the condition,
occupancy, or use of the property itself.
ex: skateboard left on the steps
Moral Hazards - CORRECT ANSWERS-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 - CORRECT ANSWERS-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 - CORRECT ANSWERS-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) - CORRECT ANSWERS-Replacement Cost, minus
depreciation.
Pair and Set Clause - CORRECT ANSWERS-Loss to one item of a pair or set does not
constitute loss to the entire pair or set.
Appraisal - CORRECT ANSWERS-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 - CORRECT ANSWERS-An insurer's right to recover the amount of its loss
payment from the third party who is legally responsible for the loss.
Arbitration - CORRECT ANSWERS-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? - CORRECT ANSWERS-Windstorm, Civil
commotion, Smoke, Hail, Aircraft, Vehicles, Volcanic eruption, Explosion, Riot
What does BIG AFFECT stand for? - CORRECT ANSWERS-Burglar damage, Ice &
snow weight, Glass breakage, Accidental discharge, Falling objects, Freezing of pipes,
Electrical damage, Collapse, Tearing apart.
Insolvency - CORRECT ANSWERS-A financial state that occurs if liabilities are greater
than assets.
Law of Agency - CORRECT ANSWERS-Knowledge of the Agents is Knowledge of the
Principal (Insurance Company)
Principal - CORRECT ANSWERS-Insurance Company
What is the ISO? - CORRECT ANSWERS-Insurance Services Office which is an
organization established for the benefit of its member insurance companies. This
organization gathers statistics, provides loss costs, drafts policy forms and coverage
provisions and conducts inspections for rate making purposes.
, Coinsurance Clause - CORRECT ANSWERS-Requires the insured to carry a minimum
specified amount (generally 80%) of the replacement cost value of the insured property
in order for partial losses to be paid in full.
Estoppel - CORRECT ANSWERS-A legal bar to changing or denying a fact because of
one's own previous actions or words to the contrary.
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.
Binder - CORRECT ANSWERS-A temporary contract of insurance, oral or written,
offered by an insurer pending issuance of the policy. 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.
Warranty - CORRECT ANSWERS-A provision in a policy that pledges that a condition
does exist or will exist at some time in the future.
Deposit Premium - CORRECT ANSWERS-Tentative charge made at the beginning of
certain policies and reinsurance agreements to be adjusted when the actual earned
charge has been later determined.
Audit - CORRECT ANSWERS-Verification of books or accounts to determine their
accuracy.
Occurrence - CORRECT ANSWERS-An accident, including continuous or repeated
exposure to the same harmful conditions, which result in bodily injury or property
damage.
Special Damages - CORRECT ANSWERS-type of compensatory damages that
reimburse the injured part for direct and specific expenses involved in the loss. Such as
medical expenses, funeral expenses and loss wages.
General Damages - CORRECT ANSWERS-type of compensatory damages that
reimburse the injured party for such things as pain and suffering and disfigurement.
Punitive Damages - CORRECT ANSWERS-type of damages intended to punish the
defendant and make an example out of her to discourage others from behaving the
same way.
Proximate Cause - CORRECT ANSWERS-An act, through an uniterrupted chain of
events, that can be determined to be the immediate or actual cause of a loss.
4 elements of negligence - CORRECT ANSWERS-1. The existence of a DUTY to act in
a certain way
EXAM latest updates!!! 2026-2027 |
correct solutions with quiz &
answers | highly graded a+
Specific insurance - CORRECT ANSWERS-This type of insurance designates a
particular item to be insured
Blanket insurance - CORRECT ANSWERS-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 - CORRECT ANSWERS-possibility of both gain and loss. Not insurable.
Pure - CORRECT ANSWERS-only the possibility of loss. Insurable.
What are the 5 methods of managing or handling risk? - CORRECT ANSWERS-avoid,
control, retain, and transfer risk.
Hazard - CORRECT ANSWERS-A condition or situation which increases the chance for
loss
Physical Hazards - CORRECT ANSWERS-a hazard that arises from the condition,
occupancy, or use of the property itself.
ex: skateboard left on the steps
Moral Hazards - CORRECT ANSWERS-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 - CORRECT ANSWERS-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 - CORRECT ANSWERS-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) - CORRECT ANSWERS-Replacement Cost, minus
depreciation.
Pair and Set Clause - CORRECT ANSWERS-Loss to one item of a pair or set does not
constitute loss to the entire pair or set.
Appraisal - CORRECT ANSWERS-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 - CORRECT ANSWERS-An insurer's right to recover the amount of its loss
payment from the third party who is legally responsible for the loss.
Arbitration - CORRECT ANSWERS-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? - CORRECT ANSWERS-Windstorm, Civil
commotion, Smoke, Hail, Aircraft, Vehicles, Volcanic eruption, Explosion, Riot
What does BIG AFFECT stand for? - CORRECT ANSWERS-Burglar damage, Ice &
snow weight, Glass breakage, Accidental discharge, Falling objects, Freezing of pipes,
Electrical damage, Collapse, Tearing apart.
Insolvency - CORRECT ANSWERS-A financial state that occurs if liabilities are greater
than assets.
Law of Agency - CORRECT ANSWERS-Knowledge of the Agents is Knowledge of the
Principal (Insurance Company)
Principal - CORRECT ANSWERS-Insurance Company
What is the ISO? - CORRECT ANSWERS-Insurance Services Office which is an
organization established for the benefit of its member insurance companies. This
organization gathers statistics, provides loss costs, drafts policy forms and coverage
provisions and conducts inspections for rate making purposes.
, Coinsurance Clause - CORRECT ANSWERS-Requires the insured to carry a minimum
specified amount (generally 80%) of the replacement cost value of the insured property
in order for partial losses to be paid in full.
Estoppel - CORRECT ANSWERS-A legal bar to changing or denying a fact because of
one's own previous actions or words to the contrary.
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.
Binder - CORRECT ANSWERS-A temporary contract of insurance, oral or written,
offered by an insurer pending issuance of the policy. 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.
Warranty - CORRECT ANSWERS-A provision in a policy that pledges that a condition
does exist or will exist at some time in the future.
Deposit Premium - CORRECT ANSWERS-Tentative charge made at the beginning of
certain policies and reinsurance agreements to be adjusted when the actual earned
charge has been later determined.
Audit - CORRECT ANSWERS-Verification of books or accounts to determine their
accuracy.
Occurrence - CORRECT ANSWERS-An accident, including continuous or repeated
exposure to the same harmful conditions, which result in bodily injury or property
damage.
Special Damages - CORRECT ANSWERS-type of compensatory damages that
reimburse the injured part for direct and specific expenses involved in the loss. Such as
medical expenses, funeral expenses and loss wages.
General Damages - CORRECT ANSWERS-type of compensatory damages that
reimburse the injured party for such things as pain and suffering and disfigurement.
Punitive Damages - CORRECT ANSWERS-type of damages intended to punish the
defendant and make an example out of her to discourage others from behaving the
same way.
Proximate Cause - CORRECT ANSWERS-An act, through an uniterrupted chain of
events, that can be determined to be the immediate or actual cause of a loss.
4 elements of negligence - CORRECT ANSWERS-1. The existence of a DUTY to act in
a certain way
