Mississippi Property and Casualty
Insurance Test 2025/2026 Exam
Questions and Correct Answers | New
Update
Risk - 🧠 ANSWER ✔✔uncertain, possibility of loss.
Speculative risk - 🧠 ANSWER ✔✔chance of loss or gain
Pure risk - 🧠 ANSWER ✔✔chance of loss only
What type of risk is insurable? - 🧠 ANSWER ✔✔Pure risk
peril - 🧠 ANSWER ✔✔the cause of loss
If a house burns down what is the peril? - 🧠 ANSWER ✔✔Fire
loss - 🧠 ANSWER ✔✔the unintended, unforeseen damage to property,
injury, or amount paid.
,direct loss - 🧠 ANSWER ✔✔physical loss to property with no intervening
cause.
Indirect loss - 🧠 ANSWER ✔✔consequential loss as the result from direct
loss.
hazard - 🧠 ANSWER ✔✔anything that increases the chance that a loss will
occur
physical hazard - 🧠 ANSWER ✔✔the hazard can be seen
moral hazard - 🧠 ANSWER ✔✔dishonesty; lacks moral standards that
cause them to be more likely to have a loss
morale hazard - 🧠 ANSWER ✔✔carelessness
Sharing - 🧠 ANSWER ✔✔two or more individuals or businesses agree to
pay a portion of any loss incurred by any member of the group.
transfer - 🧠 ANSWER ✔✔one party transfers the risk to another party. this
is how insurance works. the insured transfers the risk to the insurer. this
cost is much less than what the cost of a loss would be.
,avoidance - 🧠 ANSWER ✔✔eliminating a risk by not engaging in a certain
activity. Someone who doesn't drive avoids the risk of injuring someone in
an automobile
retention - 🧠 ANSWER ✔✔a risk management strategy that involves a party
assuming the responsibility for a certain level of risk or losses. A deductible
would be an example of this
reduction - 🧠 ANSWER ✔✔lessens the chance that a loss will occur
An individual applied for auto insurance and obtained coverage. Who is the
first party in the contract - 🧠 ANSWER ✔✔the insured
Wearing a seat belt in a car is an example of which method of managing
risk? - 🧠 ANSWER ✔✔Reduce
Tiffany leaves car unlocked because it is insured. This is an example of
what kind of hazard? - 🧠 ANSWER ✔✔Morale
A flood is an example of a - 🧠 ANSWER ✔✔peril
law of large numbers - 🧠 ANSWER ✔✔The larger the group, the more
accurate losses can be predicted. principle that makes insurance possible
COPYRIGHT©PROFFKERRYMARTIN 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE.
PRIVACY STATEMENT. ALL RIGHTS RESERVED
, Elements of insurable risks: affordable - 🧠 ANSWER ✔✔the premium for
transferring the risk should be affordable for the average consumer
Elements of insurable risks: Accidental - 🧠 ANSWER ✔✔the loss must have
been caused due to chance. Intentional losses caused by insured are not
covered by insurance.
Elements of insurable risks: measurable - 🧠 ANSWER ✔✔proof of loss
must be established with numbers and dollar amounts, not just casual
references.
Elements of insurable risks: Non-Catastrophic - 🧠 ANSWER ✔✔National or
are disaster, such as floods, riots, wars, and earthquakes, will often have
coverage limitations in insurance policies. If the insurer were to cover these
types of risks, the risk could be detrimental to the insurer.
adverse selection - 🧠 ANSWER ✔✔the tendency for higher-risk individuals
to get and keep insurance as compared to individuals that represent an
average level risk.
reinsurance - 🧠 ANSWER ✔✔like insurance for insurers.
Insurance Test 2025/2026 Exam
Questions and Correct Answers | New
Update
Risk - 🧠 ANSWER ✔✔uncertain, possibility of loss.
Speculative risk - 🧠 ANSWER ✔✔chance of loss or gain
Pure risk - 🧠 ANSWER ✔✔chance of loss only
What type of risk is insurable? - 🧠 ANSWER ✔✔Pure risk
peril - 🧠 ANSWER ✔✔the cause of loss
If a house burns down what is the peril? - 🧠 ANSWER ✔✔Fire
loss - 🧠 ANSWER ✔✔the unintended, unforeseen damage to property,
injury, or amount paid.
,direct loss - 🧠 ANSWER ✔✔physical loss to property with no intervening
cause.
Indirect loss - 🧠 ANSWER ✔✔consequential loss as the result from direct
loss.
hazard - 🧠 ANSWER ✔✔anything that increases the chance that a loss will
occur
physical hazard - 🧠 ANSWER ✔✔the hazard can be seen
moral hazard - 🧠 ANSWER ✔✔dishonesty; lacks moral standards that
cause them to be more likely to have a loss
morale hazard - 🧠 ANSWER ✔✔carelessness
Sharing - 🧠 ANSWER ✔✔two or more individuals or businesses agree to
pay a portion of any loss incurred by any member of the group.
transfer - 🧠 ANSWER ✔✔one party transfers the risk to another party. this
is how insurance works. the insured transfers the risk to the insurer. this
cost is much less than what the cost of a loss would be.
,avoidance - 🧠 ANSWER ✔✔eliminating a risk by not engaging in a certain
activity. Someone who doesn't drive avoids the risk of injuring someone in
an automobile
retention - 🧠 ANSWER ✔✔a risk management strategy that involves a party
assuming the responsibility for a certain level of risk or losses. A deductible
would be an example of this
reduction - 🧠 ANSWER ✔✔lessens the chance that a loss will occur
An individual applied for auto insurance and obtained coverage. Who is the
first party in the contract - 🧠 ANSWER ✔✔the insured
Wearing a seat belt in a car is an example of which method of managing
risk? - 🧠 ANSWER ✔✔Reduce
Tiffany leaves car unlocked because it is insured. This is an example of
what kind of hazard? - 🧠 ANSWER ✔✔Morale
A flood is an example of a - 🧠 ANSWER ✔✔peril
law of large numbers - 🧠 ANSWER ✔✔The larger the group, the more
accurate losses can be predicted. principle that makes insurance possible
COPYRIGHT©PROFFKERRYMARTIN 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE.
PRIVACY STATEMENT. ALL RIGHTS RESERVED
, Elements of insurable risks: affordable - 🧠 ANSWER ✔✔the premium for
transferring the risk should be affordable for the average consumer
Elements of insurable risks: Accidental - 🧠 ANSWER ✔✔the loss must have
been caused due to chance. Intentional losses caused by insured are not
covered by insurance.
Elements of insurable risks: measurable - 🧠 ANSWER ✔✔proof of loss
must be established with numbers and dollar amounts, not just casual
references.
Elements of insurable risks: Non-Catastrophic - 🧠 ANSWER ✔✔National or
are disaster, such as floods, riots, wars, and earthquakes, will often have
coverage limitations in insurance policies. If the insurer were to cover these
types of risks, the risk could be detrimental to the insurer.
adverse selection - 🧠 ANSWER ✔✔the tendency for higher-risk individuals
to get and keep insurance as compared to individuals that represent an
average level risk.
reinsurance - 🧠 ANSWER ✔✔like insurance for insurers.
