LIMITED LINES TEST UPDATED
ACTUAL Exam Questions and CORRECT
Answers
How many hours of completion does a licensee have to have to renew his or her license -
CORRECT ANSWER- ✔✔10
Deductibles - CORRECT ANSWER- ✔✔Are used to prevent covered small claims, it helps
by reducing the premium
Agent - CORRECT ANSWER- ✔✔An individual authorized by an insurer to solicit app or to
negotiate insurance on its behalf.
Temporary Licenses - CORRECT ANSWER- ✔✔Commissioner May issue this license
without examination.
May be obtained before a person passes the state exam if the person completes a 40-hour
course before applying for the license or within 14 days after applying for the license.
Good for no more than 90 days.
Conditional Licenses - CORRECT ANSWER- ✔✔May be issued without having to wait for
the results of a criminal history search ( fingerprint check )
If something comes up app will be revoked and shall refuse to issue permanent license.
Non resident Agent - CORRECT ANSWER- ✔✔If properly licensed in their home state, may
work in any other state with that license (if allowed) or must pay the proper fees, file proper
forms, and furnish a letter of good standing from their home state.
Indemnity - CORRECT ANSWER- ✔✔Restore and insure to the same financial condition
they were in prior to the loss.
Peril - CORRECT ANSWER- ✔✔A cause of loss.
Ex: fire, theft, flood..
, Indirect loss - CORRECT ANSWER- ✔✔The consequence of the direct loss.
Ex: staying in a hotel after your house burned down.
Subrogation - CORRECT ANSWER- ✔✔"Right of recovery " When an insured is involved
Ina n accident, and another part is at fault, and the at fault party I le taking too long to pay the
claim, the insureds company can subrogate
Arbitration - CORRECT ANSWER- ✔✔Used to realize claim disputes.
Avoidance - CORRECT ANSWER- ✔✔Eliminate the exposure-underwriting rejects a policy
Mutual Companies - CORRECT ANSWER- ✔✔Are owned by policy holders
Accidental - CORRECT ANSWER- ✔✔losses must be a random event which the insured has
no control over
Representation - CORRECT ANSWER- ✔✔a written or oral statement made by the insured
Misrepresentation - CORRECT ANSWER- ✔✔a false statement made by the insured
Fraud - CORRECT ANSWER- ✔✔intentional perversion of the truth
Admitted Insurer - CORRECT ANSWER- ✔✔Authorized to sell insurance. Granted a
certificate of authority from the dept of insurance
Non admitted insurer - CORRECT ANSWER- ✔✔UNAUTHORIZED to sell insurance. DO
NOT qualify for a certificate of authority, Often called Surplus lines insurance companies.
Domestic Insurer - CORRECT ANSWER- ✔✔companies organized under the laws of a
particular state ( TEXAS )
ACTUAL Exam Questions and CORRECT
Answers
How many hours of completion does a licensee have to have to renew his or her license -
CORRECT ANSWER- ✔✔10
Deductibles - CORRECT ANSWER- ✔✔Are used to prevent covered small claims, it helps
by reducing the premium
Agent - CORRECT ANSWER- ✔✔An individual authorized by an insurer to solicit app or to
negotiate insurance on its behalf.
Temporary Licenses - CORRECT ANSWER- ✔✔Commissioner May issue this license
without examination.
May be obtained before a person passes the state exam if the person completes a 40-hour
course before applying for the license or within 14 days after applying for the license.
Good for no more than 90 days.
Conditional Licenses - CORRECT ANSWER- ✔✔May be issued without having to wait for
the results of a criminal history search ( fingerprint check )
If something comes up app will be revoked and shall refuse to issue permanent license.
Non resident Agent - CORRECT ANSWER- ✔✔If properly licensed in their home state, may
work in any other state with that license (if allowed) or must pay the proper fees, file proper
forms, and furnish a letter of good standing from their home state.
Indemnity - CORRECT ANSWER- ✔✔Restore and insure to the same financial condition
they were in prior to the loss.
Peril - CORRECT ANSWER- ✔✔A cause of loss.
Ex: fire, theft, flood..
, Indirect loss - CORRECT ANSWER- ✔✔The consequence of the direct loss.
Ex: staying in a hotel after your house burned down.
Subrogation - CORRECT ANSWER- ✔✔"Right of recovery " When an insured is involved
Ina n accident, and another part is at fault, and the at fault party I le taking too long to pay the
claim, the insureds company can subrogate
Arbitration - CORRECT ANSWER- ✔✔Used to realize claim disputes.
Avoidance - CORRECT ANSWER- ✔✔Eliminate the exposure-underwriting rejects a policy
Mutual Companies - CORRECT ANSWER- ✔✔Are owned by policy holders
Accidental - CORRECT ANSWER- ✔✔losses must be a random event which the insured has
no control over
Representation - CORRECT ANSWER- ✔✔a written or oral statement made by the insured
Misrepresentation - CORRECT ANSWER- ✔✔a false statement made by the insured
Fraud - CORRECT ANSWER- ✔✔intentional perversion of the truth
Admitted Insurer - CORRECT ANSWER- ✔✔Authorized to sell insurance. Granted a
certificate of authority from the dept of insurance
Non admitted insurer - CORRECT ANSWER- ✔✔UNAUTHORIZED to sell insurance. DO
NOT qualify for a certificate of authority, Often called Surplus lines insurance companies.
Domestic Insurer - CORRECT ANSWER- ✔✔companies organized under the laws of a
particular state ( TEXAS )
