Maine Property and Casualty Licensing Textbook Exam Questions & Answers
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Indemnity - ANSWER-
Insurance - ANSWER-the transfer of financial responsibility associated with a potential
of a lost to an insurance company, which in turn spreads the costs of unexpected losses
to many individuals.
Indemnity - ANSWER-A provision in an insurance policy that states an insured is
permitted to collect only to the extent of their financial loss and cannot make financial
gains.
Insurable Interest - ANSWER-Any interest an insured may have in property that is the
subject of insurance. Such as a monetary, blood relative, or business interest.
Hazard - ANSWER-is a condition or situation which creates or increases the probability
of or extent of a probable loss from a peril. Physical, moral, morale.
Peril - ANSWER-A specific cause of loss
Named Peril - ANSWER-is a term used in property insurance to describe the bredth of
coverage provided under an insurance policy form that insures against any risk of loss
that is not specifically excluded.
What are the four elements considered in establishing negligence? (tort) - ANSWER-
Legal Duty, standard of care, proximate cause, actual loss of damage
Actual Cash Value - ANSWER-method of valuation reinforces the principle of indemnity
because it recognizes the reduction of value of property as it ages and becomes subject
, to wear and tear and obsolescence. Current replacement cost- depreciation=
____________
Replacement Cost - ANSWER-is defined as the cost to replace damaged property with
like kind and quality at todays price, without any deduction for depreciation.
Per Occurance - ANSWER-is a "sub limit" in a liability policy that puts a ceiling on the
payment for all claims that arise from a single accident.
Per Person - ANSWER-the maximum amount available for payment of bodily injury to a
single person in an accident, regardless of the policy limit stated in the policy for bodily
injury claims.
Deductible - ANSWER-the amount of an insured loss for which the insured is financially
responsible before an insurance policy provides coverage.
Declarations - ANSWER-The section of an insurance policy containing the basic
underwriting information, such as the insureds name, address, amount of coverage and
premiums, and a description of insured locations.
Conditions- - ANSWER-the section of an insurance policy that indicated the general
rules or procedures that the insurer and insured agree to follow under the terms of the
policy.
Proof of Loss - ANSWER-a sworn statement that must usually be furnished by the
insured to an insurer before any loss under a policy can be paid.
Subrogation - ANSWER-is the insurers right to seek damages from third parties,
stemming from the fact that the insured has accepted payments from the insurer.
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Indemnity - ANSWER-
Insurance - ANSWER-the transfer of financial responsibility associated with a potential
of a lost to an insurance company, which in turn spreads the costs of unexpected losses
to many individuals.
Indemnity - ANSWER-A provision in an insurance policy that states an insured is
permitted to collect only to the extent of their financial loss and cannot make financial
gains.
Insurable Interest - ANSWER-Any interest an insured may have in property that is the
subject of insurance. Such as a monetary, blood relative, or business interest.
Hazard - ANSWER-is a condition or situation which creates or increases the probability
of or extent of a probable loss from a peril. Physical, moral, morale.
Peril - ANSWER-A specific cause of loss
Named Peril - ANSWER-is a term used in property insurance to describe the bredth of
coverage provided under an insurance policy form that insures against any risk of loss
that is not specifically excluded.
What are the four elements considered in establishing negligence? (tort) - ANSWER-
Legal Duty, standard of care, proximate cause, actual loss of damage
Actual Cash Value - ANSWER-method of valuation reinforces the principle of indemnity
because it recognizes the reduction of value of property as it ages and becomes subject
, to wear and tear and obsolescence. Current replacement cost- depreciation=
____________
Replacement Cost - ANSWER-is defined as the cost to replace damaged property with
like kind and quality at todays price, without any deduction for depreciation.
Per Occurance - ANSWER-is a "sub limit" in a liability policy that puts a ceiling on the
payment for all claims that arise from a single accident.
Per Person - ANSWER-the maximum amount available for payment of bodily injury to a
single person in an accident, regardless of the policy limit stated in the policy for bodily
injury claims.
Deductible - ANSWER-the amount of an insured loss for which the insured is financially
responsible before an insurance policy provides coverage.
Declarations - ANSWER-The section of an insurance policy containing the basic
underwriting information, such as the insureds name, address, amount of coverage and
premiums, and a description of insured locations.
Conditions- - ANSWER-the section of an insurance policy that indicated the general
rules or procedures that the insurer and insured agree to follow under the terms of the
policy.
Proof of Loss - ANSWER-a sworn statement that must usually be furnished by the
insured to an insurer before any loss under a policy can be paid.
Subrogation - ANSWER-is the insurers right to seek damages from third parties,
stemming from the fact that the insured has accepted payments from the insurer.
