Chapter 22: Practice Exam 2 2025 latest
practice test with questions and best solutions
1/46 Questions
The primary purpose of insurance is to do which of the following?
Avoid risk
Eliminate risk
Transfer risk
Reduce risk
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Property And Casualty Quizzes & Trivia
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Property and Casualty Insurance License Exam Cram™
Practice Exam 2 Questions
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2.
Under which policy provision is an insured's right to recover for a loss from a third party
transferred to the insurance company?
Abandonment
,Pair or set clause
Subrogation
Arbitration
Correct Answer
A. Subrogation
Explanation
Answer C is correct. The Transfer of Rights of Recovery clause, also known as subrogation, gives
the insurance company the right to recover from a third party who was at fault for a loss, up to
the amount that the insurer has paid the insured for the loss. The abandonment provision
merely states that the insured cannot decide to surrender damaged property to the insurer in
return for full payment. (The acquisition of damaged property is at the option of the insurance
company.) The pair or set clause states that the settlement for damage to one item that is part
of a pair or set will be made with recognition of the reduction in value of the pair or set.
Arbitration is a means of settling claims disputes when the insured and the insurance company
disagree on the value of damaged property.
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3.
Businessowners policies provide an additional coverage for preservation of property when it is
removed from the premises to protect it from loss by a covered peril. The coverage will apply at
other locations for up to
,60 days
30 days
20 days
15 days
Correct Answer
A. 30 days
Explanation
Answer B is correct. The preservation of property additional coverage under a businessowners
policy covers direct physical loss or damage from any cause if the property has been removed to
another location in order to protect it from loss by a covered peril. Coverage applies while the
property is being moved and while it is temporarily stored at another location, but only for 30
days after the property is first moved.
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4.
Under the 1989 dwelling policy forms, if coverage for vandalism and malicious mischief is
attached to a policy, it will be suspended whenever the building has been vacant for more than
how many days?
45 consecutive days
, 30 consecutive days
20 consecutive days
10 consecutive days
Correct Answer
A. 30 consecutive days
Explanation
Answer B is correct. If a dwelling policy includes the extended coverage (EC) perils, coverage for
vandalism and malicious mischief (V&MM) may also be added. However, this coverage will not
apply whenever the building has been vacant for more than 30 consecutive days.
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5.
The taking of money or other property from inside a premises by someone who has unlawfully
and forcefully entered or exited is an example of what kind of crime?
Robbery
Burglary
practice test with questions and best solutions
1/46 Questions
The primary purpose of insurance is to do which of the following?
Avoid risk
Eliminate risk
Transfer risk
Reduce risk
Start
Property And Casualty Quizzes & Trivia
About This Quiz
Property and Casualty Insurance License Exam Cram™
Practice Exam 2 Questions
Quiz Preview
2.
Under which policy provision is an insured's right to recover for a loss from a third party
transferred to the insurance company?
Abandonment
,Pair or set clause
Subrogation
Arbitration
Correct Answer
A. Subrogation
Explanation
Answer C is correct. The Transfer of Rights of Recovery clause, also known as subrogation, gives
the insurance company the right to recover from a third party who was at fault for a loss, up to
the amount that the insurer has paid the insured for the loss. The abandonment provision
merely states that the insured cannot decide to surrender damaged property to the insurer in
return for full payment. (The acquisition of damaged property is at the option of the insurance
company.) The pair or set clause states that the settlement for damage to one item that is part
of a pair or set will be made with recognition of the reduction in value of the pair or set.
Arbitration is a means of settling claims disputes when the insured and the insurance company
disagree on the value of damaged property.
Rate this question:
3.
Businessowners policies provide an additional coverage for preservation of property when it is
removed from the premises to protect it from loss by a covered peril. The coverage will apply at
other locations for up to
,60 days
30 days
20 days
15 days
Correct Answer
A. 30 days
Explanation
Answer B is correct. The preservation of property additional coverage under a businessowners
policy covers direct physical loss or damage from any cause if the property has been removed to
another location in order to protect it from loss by a covered peril. Coverage applies while the
property is being moved and while it is temporarily stored at another location, but only for 30
days after the property is first moved.
Rate this question:
4.
Under the 1989 dwelling policy forms, if coverage for vandalism and malicious mischief is
attached to a policy, it will be suspended whenever the building has been vacant for more than
how many days?
45 consecutive days
, 30 consecutive days
20 consecutive days
10 consecutive days
Correct Answer
A. 30 consecutive days
Explanation
Answer B is correct. If a dwelling policy includes the extended coverage (EC) perils, coverage for
vandalism and malicious mischief (V&MM) may also be added. However, this coverage will not
apply whenever the building has been vacant for more than 30 consecutive days.
Rate this question:
5.
The taking of money or other property from inside a premises by someone who has unlawfully
and forcefully entered or exited is an example of what kind of crime?
Robbery
Burglary
