CALIFORNIA PROPERTY AND
CASUALTY EXAM PRACTICE
QUESTIONS AND ANSWERS WITH
VERIFIED SOLUTIONS 100% CORRECT
RATED A+ NEWLY UPDATED 2025
What is the name of the insurance principle that refers to an insurer giving up
its right to recover money or damages paid out to the insured from another
party?
A. Subrogation
B. Subrogree Waiver
C. Waiver of subrogation
D. Subrogor
ANSWER✔✔ C. Waiver of subrogation
Which portion of an insurance policy states that the insurance company will
make payment in the event a covered loss occurs?
A. Insuring agreement
B. Declarations
C. Exclusions
D. Conditions
E. Compensatory
ANSWER✔✔ A. Insuring agreement
NRG Oil Company fails to repair its pipeline despite the development of large
cracks and is found to have recklessly caused an oil spill. The government
requests that the company be punished with a large damages award against it.
What is the name of the type of damages that were requested?
A. Punitive
B. Compensatory
C. General
D. Special
ANSWER✔✔ A. Punitive
,Kylie lives in a condominium. A storm causes the brick façade of the building
to collapse. If Kylie has a Homeowners policy, which of the following would
represent the amount of her policy benefit?
A. Unlimited
B. $50,000
C. $1,000
D. $100,000
E. No coverage
ANSWER✔✔ C. $1,000
Which provision requires the policyholder to maintain a specific amount of
insurance in order to obtain full payment for a loss?
A. Cash
B. Valuation
C. Special
D. Coinsurance
ANSWER✔✔ D. Coinsurance
A group of businesses with similar exposures that get grouped together for
rating purposes is a(n):
A. Association
B. Grouping class
C. Classification
D. Class
ANSWER✔✔ D. Class
What must an insurance company provide an applicant if it orders an investigative
credit report?
A. It has no obligation to the applicant
B. Send the applicant an initial written notice within 3 days
C. Send the applicant an initial written notice within 5 business days
, D. A notice only if the insurance company uses the information to deny an
application - ANSWER✔✔B. Send the applicant an initial written notice within 3
days
What is the name of the provision in an insurance policy that requires the insured
to notify the carrier of a loss for which a claim for reimbursement is made?
A. Memorialization of claim
B. Proof of claim
C. Notice of claim
D. Proof of loss
E. Evidence of claim - ANSWER✔✔C. Notice of claiim
Costs that are covered by liability insurance, aside from costs paid for any injuries
or damages, are:
A. Supplemental costs
B. Ancillary costs
C. Consequential damages
D. Aleatory - ANSWER✔✔A. Supplemental costs
All but which of the following require coverage under a hired auto insurance
policy?
A. A vehicle that is leased for personal use
B. A minivan rented from a car rental business that is used to drive a child to
college
C. A vehicle that is borrowed from an employee
D. Car borrowed by insured from leasing center - ANSWER✔✔C. A vehicle that
is borrowed from an employee
CASUALTY EXAM PRACTICE
QUESTIONS AND ANSWERS WITH
VERIFIED SOLUTIONS 100% CORRECT
RATED A+ NEWLY UPDATED 2025
What is the name of the insurance principle that refers to an insurer giving up
its right to recover money or damages paid out to the insured from another
party?
A. Subrogation
B. Subrogree Waiver
C. Waiver of subrogation
D. Subrogor
ANSWER✔✔ C. Waiver of subrogation
Which portion of an insurance policy states that the insurance company will
make payment in the event a covered loss occurs?
A. Insuring agreement
B. Declarations
C. Exclusions
D. Conditions
E. Compensatory
ANSWER✔✔ A. Insuring agreement
NRG Oil Company fails to repair its pipeline despite the development of large
cracks and is found to have recklessly caused an oil spill. The government
requests that the company be punished with a large damages award against it.
What is the name of the type of damages that were requested?
A. Punitive
B. Compensatory
C. General
D. Special
ANSWER✔✔ A. Punitive
,Kylie lives in a condominium. A storm causes the brick façade of the building
to collapse. If Kylie has a Homeowners policy, which of the following would
represent the amount of her policy benefit?
A. Unlimited
B. $50,000
C. $1,000
D. $100,000
E. No coverage
ANSWER✔✔ C. $1,000
Which provision requires the policyholder to maintain a specific amount of
insurance in order to obtain full payment for a loss?
A. Cash
B. Valuation
C. Special
D. Coinsurance
ANSWER✔✔ D. Coinsurance
A group of businesses with similar exposures that get grouped together for
rating purposes is a(n):
A. Association
B. Grouping class
C. Classification
D. Class
ANSWER✔✔ D. Class
What must an insurance company provide an applicant if it orders an investigative
credit report?
A. It has no obligation to the applicant
B. Send the applicant an initial written notice within 3 days
C. Send the applicant an initial written notice within 5 business days
, D. A notice only if the insurance company uses the information to deny an
application - ANSWER✔✔B. Send the applicant an initial written notice within 3
days
What is the name of the provision in an insurance policy that requires the insured
to notify the carrier of a loss for which a claim for reimbursement is made?
A. Memorialization of claim
B. Proof of claim
C. Notice of claim
D. Proof of loss
E. Evidence of claim - ANSWER✔✔C. Notice of claiim
Costs that are covered by liability insurance, aside from costs paid for any injuries
or damages, are:
A. Supplemental costs
B. Ancillary costs
C. Consequential damages
D. Aleatory - ANSWER✔✔A. Supplemental costs
All but which of the following require coverage under a hired auto insurance
policy?
A. A vehicle that is leased for personal use
B. A minivan rented from a car rental business that is used to drive a child to
college
C. A vehicle that is borrowed from an employee
D. Car borrowed by insured from leasing center - ANSWER✔✔C. A vehicle that
is borrowed from an employee
