PERSONAL LINES - INSURANCE EXAM QUESTIONS
WITH CORRECT ANSWERS 2025/2026
What is premium? - CORRECT ANSWER -the amount of money paid for an insurance policy
What is deductible? - CORRECT ANSWER -the amount you pay out of pocket before your
insurance coverage kicks in
What is liability coverage? - CORRECT ANSWER -insurance that pays for damages or injuries YOU
caused to others
What is personal property? - CORRECT ANSWER -items owned by an individual, such as
furniture, electronics, or clothing
What is endorsement? - CORRECT ANSWER -an amendment to an insurance policy that alters its
coverage
What is a claim? - CORRECT ANSWER -a request for payment from an insurance company for a
covered loss
What is underwriting? - CORRECT ANSWER -the process of evaluating the risk of insuring a
person or property
What is coverage limit? - CORRECT ANSWER -the maximum an insurance policy will pay for a
covered loss
What is a policyholder? - CORRECT ANSWER -the person or entity that owns an insurance policy
, What is a renewal? - CORRECT ANSWER -extending the term of an insurance policy for another
period
What is rider? - CORRECT ANSWER -an additional coverage added to an insurance policy
What is actual cash value? - CORRECT ANSWER -the value of an item, considering depreciation,
at the time of loss
What is replacement cost? - CORRECT ANSWER -the cost to replace an item with a new one of
similar quality, without deducting for depreciation?
What is insurable interest? - CORRECT ANSWER -a financial interest in the insured item or
person giving the policyholder a legitimate reason to insure them
What is a binder? - CORRECT ANSWER -A temporary insurance contract that goes in effect prior
to the policy issue
What is subrogation? - CORRECT ANSWER -the process by which an insurance company seeks
reimbursement from the party responsible for a loss
What is co-insurance? - CORRECT ANSWER -a provision in an insurance policy that requires the
policyholder to hare a percentage of the cosy of a covered loss
What is a named insured? - CORRECT ANSWER -the individual or entity specifically named as
the insured party in an insurance policy
What is an additional insured? - CORRECT ANSWER -a person or entity added to an insurance
policy, extending coverage beyond the named insured
WITH CORRECT ANSWERS 2025/2026
What is premium? - CORRECT ANSWER -the amount of money paid for an insurance policy
What is deductible? - CORRECT ANSWER -the amount you pay out of pocket before your
insurance coverage kicks in
What is liability coverage? - CORRECT ANSWER -insurance that pays for damages or injuries YOU
caused to others
What is personal property? - CORRECT ANSWER -items owned by an individual, such as
furniture, electronics, or clothing
What is endorsement? - CORRECT ANSWER -an amendment to an insurance policy that alters its
coverage
What is a claim? - CORRECT ANSWER -a request for payment from an insurance company for a
covered loss
What is underwriting? - CORRECT ANSWER -the process of evaluating the risk of insuring a
person or property
What is coverage limit? - CORRECT ANSWER -the maximum an insurance policy will pay for a
covered loss
What is a policyholder? - CORRECT ANSWER -the person or entity that owns an insurance policy
, What is a renewal? - CORRECT ANSWER -extending the term of an insurance policy for another
period
What is rider? - CORRECT ANSWER -an additional coverage added to an insurance policy
What is actual cash value? - CORRECT ANSWER -the value of an item, considering depreciation,
at the time of loss
What is replacement cost? - CORRECT ANSWER -the cost to replace an item with a new one of
similar quality, without deducting for depreciation?
What is insurable interest? - CORRECT ANSWER -a financial interest in the insured item or
person giving the policyholder a legitimate reason to insure them
What is a binder? - CORRECT ANSWER -A temporary insurance contract that goes in effect prior
to the policy issue
What is subrogation? - CORRECT ANSWER -the process by which an insurance company seeks
reimbursement from the party responsible for a loss
What is co-insurance? - CORRECT ANSWER -a provision in an insurance policy that requires the
policyholder to hare a percentage of the cosy of a covered loss
What is a named insured? - CORRECT ANSWER -the individual or entity specifically named as
the insured party in an insurance policy
What is an additional insured? - CORRECT ANSWER -a person or entity added to an insurance
policy, extending coverage beyond the named insured
