Casualty Insurance Basics
Judgement - ✔✔ correct answer Using an air-cooled engine, a proposed insured has developed a
new, experimental aircraft. If the inventor applies for liability insurance, what rating type will the
insurer most likely use?
Loss costs rating - ✔✔ correct answer Which rating method provides an insurer with that portion of
a rate that does not include provisions of expenses (other than adjusting expense) or profit and is
based on historical aggregate loss and loss adjustment expenses projected through development to
their ultimate value and through trending to a future point in time?
Manual rates - ✔✔ correct answer Rates that are established based on the similarities of the risk
with other risks are known as
D
There are four essential elements of negligence: duty, breach, injury, and unbroken chain. - ✔✔
correct answer Which of the following is NOT an element of negligence?
A. Duty
B. Breach
C. Unbroken chain
D. Libel
Proximate cause - ✔✔ correct answer What fundamental principle in property insurance holds that
when there is an unbroken connection between an occurrence and damage that grows out of the
occurrence, then the resultant damage is all a part of the occurrence?
Contributory negligence - ✔✔ correct answer An insured is driving above the posted speed limit. As
he rounds a curve, he crashes into an illegally parked car. This is an example of
C - ✔✔ correct answer Which of the following describes contributory negligence?
A. Negligence is appointed between both parties in an accident
B. The voluntary assumption exposure to risk
C. Any degree of negligence by the injured party may bar recovery
D. The time period in which a claim must be filed.
C - ✔✔ correct answer All of the following statements describe the concept of strict liability EXCEPT:
Judgement - ✔✔ correct answer Using an air-cooled engine, a proposed insured has developed a
new, experimental aircraft. If the inventor applies for liability insurance, what rating type will the
insurer most likely use?
Loss costs rating - ✔✔ correct answer Which rating method provides an insurer with that portion of
a rate that does not include provisions of expenses (other than adjusting expense) or profit and is
based on historical aggregate loss and loss adjustment expenses projected through development to
their ultimate value and through trending to a future point in time?
Manual rates - ✔✔ correct answer Rates that are established based on the similarities of the risk
with other risks are known as
D
There are four essential elements of negligence: duty, breach, injury, and unbroken chain. - ✔✔
correct answer Which of the following is NOT an element of negligence?
A. Duty
B. Breach
C. Unbroken chain
D. Libel
Proximate cause - ✔✔ correct answer What fundamental principle in property insurance holds that
when there is an unbroken connection between an occurrence and damage that grows out of the
occurrence, then the resultant damage is all a part of the occurrence?
Contributory negligence - ✔✔ correct answer An insured is driving above the posted speed limit. As
he rounds a curve, he crashes into an illegally parked car. This is an example of
C - ✔✔ correct answer Which of the following describes contributory negligence?
A. Negligence is appointed between both parties in an accident
B. The voluntary assumption exposure to risk
C. Any degree of negligence by the injured party may bar recovery
D. The time period in which a claim must be filed.
C - ✔✔ correct answer All of the following statements describe the concept of strict liability EXCEPT:
