TN Property and Casualty Exam COMPLETE EXAM Questions and
Answers (Verified Answers) (Latest Update 2026) UPDATE!!
Insurance - (ANSWER)Social device used for transferring risk from individuals or business to an insurance
company
Law of Large Numbers - (ANSWER)The larger the group the less uncertainty
Insurable Interest - (ANSWER)must have a legitimate interest in the property/subject that is to be
insured
risk - (ANSWER)Uncertainty or chance of possible loss
Property risk are called - (ANSWER)perils
Casualty risk are called - (ANSWER)Liability and Accident Losses
What kind of risk are insurable - (ANSWER)Pure risk
What are speculative risk? - (ANSWER)provide the chance of a gain and are NOT insurable. Example:
gambing
Hazard - (ANSWER)Anything that would increase the likelihood that a loss might occur or increase the
seriousness of the loss
What are the three types of Hazards - (ANSWER)1) Physical
2)Moral
3)Morale
Physical Hazard - (ANSWER)Structural, material or proximity to
,TN Property and Casualty Exam COMPLETE EXAM Questions and
Answers (Verified Answers) (Latest Update 2026) UPDATE!!
Moral Hazard - (ANSWER)Has to do with the insureds habits (dishonest)
Morale Hazards - (ANSWER)The insureds carelessness
Peril - (ANSWER)Cause of a possible loss
What are examples of a peril - (ANSWER)Flood
Fire
Accident
Explosion
Loss - (ANSWER)Decrease in value, Property, quality of life or liability owed
What are the two types of losses - (ANSWER)Direct
indirect
Direct Loss - (ANSWER)Actual Physical damage to the property
Indirect loss- - (ANSWER)Loss resulting from a peril but not directly
Actual Cash Value (ACV) - (ANSWER)Replacement cost (cost new)-less depreciation
Replacement Cost - (ANSWER)Cost new ( no deduction for deprication)
Market Value - (ANSWER)What it can be sold for at the time of loss
,TN Property and Casualty Exam COMPLETE EXAM Questions and
Answers (Verified Answers) (Latest Update 2026) UPDATE!!
Stated Value - (ANSWER)Value that meets coinsurance value
Salvage value - (ANSWER)Insurer takes damaged property after payment for a total loss and sells it to
reduce their loss
Proximate Clause - (ANSWER)Resulting cause of loss or damage. The unbroken chain of cause and edict
between the occurrence of an insured peril or a negligent act resulting in injury or damage
Decuctible - (ANSWER)The dollar amount that must be paid by the insured before any benefits are
payable by the insurer.
Standard Deductible for Homeowners - (ANSWER)$250
Standard Deductible for commercial Property - (ANSWER)$250
What are the 4 reasons for a deductible - (ANSWER)1) To keep premiums affordable and reduce small
claims
2) To increase profits of company
3) To make premiums excessive
4) increase the number insured
indemnity - (ANSWER)Restores the insured to the position enjoyed prior to a loss
Limits of Liability - (ANSWER)The maximum the insurer will pay on a claim
Coinsurance - (ANSWER)Offers the insured a reduced rate if they keep a certain amount of insurance
What is the minimum amount an insured must carry? - (ANSWER)80%
, TN Property and Casualty Exam COMPLETE EXAM Questions and
Answers (Verified Answers) (Latest Update 2026) UPDATE!!
How is a insured paid? - (ANSWER)Insurance carried/insurance required x Amount of loss= The amount
the insurer will pay - Deductible
Pair and Set Clause - (ANSWER)When insured the items are worth more as a set, if an item of the set is
damaged or destroyed the insurance company has the option of finding a replacement, repairing the
item or paying the difference difference in the value of the set before and after the loss
Extensions of coverage: - (ANSWER)No charge to the insured (11 total)
Removal Coverage dp - (ANSWER)property moved fringe premises to protect it from a covered peril.
5 days-basic
30 days Broad/special
*direct loss to the moved property from any clause is covered
Other Structures dp - (ANSWER)May use up to 10% of coverage A
Basic Form- payment will reduce coverage remaining on the dwelling by the amount paid
Does not affect the broad or special
Debris Removal: dp - (ANSWER)Covers all reasonable expenses for removal of debris from coverage
property
*amounts paid would be considered additional to the policy limits
Improvements, Alterations and Additions dp - (ANSWER)(when insured is a tenant) May apply to 10% of
coverage C limit on the basic DP form, payment would reduce the limit left
on broad/special- it would not reduce the limit
Personal Property covered anywhere in the world dp - (ANSWER)Would pay up to 10% of coverage C
limit.
Answers (Verified Answers) (Latest Update 2026) UPDATE!!
Insurance - (ANSWER)Social device used for transferring risk from individuals or business to an insurance
company
Law of Large Numbers - (ANSWER)The larger the group the less uncertainty
Insurable Interest - (ANSWER)must have a legitimate interest in the property/subject that is to be
insured
risk - (ANSWER)Uncertainty or chance of possible loss
Property risk are called - (ANSWER)perils
Casualty risk are called - (ANSWER)Liability and Accident Losses
What kind of risk are insurable - (ANSWER)Pure risk
What are speculative risk? - (ANSWER)provide the chance of a gain and are NOT insurable. Example:
gambing
Hazard - (ANSWER)Anything that would increase the likelihood that a loss might occur or increase the
seriousness of the loss
What are the three types of Hazards - (ANSWER)1) Physical
2)Moral
3)Morale
Physical Hazard - (ANSWER)Structural, material or proximity to
,TN Property and Casualty Exam COMPLETE EXAM Questions and
Answers (Verified Answers) (Latest Update 2026) UPDATE!!
Moral Hazard - (ANSWER)Has to do with the insureds habits (dishonest)
Morale Hazards - (ANSWER)The insureds carelessness
Peril - (ANSWER)Cause of a possible loss
What are examples of a peril - (ANSWER)Flood
Fire
Accident
Explosion
Loss - (ANSWER)Decrease in value, Property, quality of life or liability owed
What are the two types of losses - (ANSWER)Direct
indirect
Direct Loss - (ANSWER)Actual Physical damage to the property
Indirect loss- - (ANSWER)Loss resulting from a peril but not directly
Actual Cash Value (ACV) - (ANSWER)Replacement cost (cost new)-less depreciation
Replacement Cost - (ANSWER)Cost new ( no deduction for deprication)
Market Value - (ANSWER)What it can be sold for at the time of loss
,TN Property and Casualty Exam COMPLETE EXAM Questions and
Answers (Verified Answers) (Latest Update 2026) UPDATE!!
Stated Value - (ANSWER)Value that meets coinsurance value
Salvage value - (ANSWER)Insurer takes damaged property after payment for a total loss and sells it to
reduce their loss
Proximate Clause - (ANSWER)Resulting cause of loss or damage. The unbroken chain of cause and edict
between the occurrence of an insured peril or a negligent act resulting in injury or damage
Decuctible - (ANSWER)The dollar amount that must be paid by the insured before any benefits are
payable by the insurer.
Standard Deductible for Homeowners - (ANSWER)$250
Standard Deductible for commercial Property - (ANSWER)$250
What are the 4 reasons for a deductible - (ANSWER)1) To keep premiums affordable and reduce small
claims
2) To increase profits of company
3) To make premiums excessive
4) increase the number insured
indemnity - (ANSWER)Restores the insured to the position enjoyed prior to a loss
Limits of Liability - (ANSWER)The maximum the insurer will pay on a claim
Coinsurance - (ANSWER)Offers the insured a reduced rate if they keep a certain amount of insurance
What is the minimum amount an insured must carry? - (ANSWER)80%
, TN Property and Casualty Exam COMPLETE EXAM Questions and
Answers (Verified Answers) (Latest Update 2026) UPDATE!!
How is a insured paid? - (ANSWER)Insurance carried/insurance required x Amount of loss= The amount
the insurer will pay - Deductible
Pair and Set Clause - (ANSWER)When insured the items are worth more as a set, if an item of the set is
damaged or destroyed the insurance company has the option of finding a replacement, repairing the
item or paying the difference difference in the value of the set before and after the loss
Extensions of coverage: - (ANSWER)No charge to the insured (11 total)
Removal Coverage dp - (ANSWER)property moved fringe premises to protect it from a covered peril.
5 days-basic
30 days Broad/special
*direct loss to the moved property from any clause is covered
Other Structures dp - (ANSWER)May use up to 10% of coverage A
Basic Form- payment will reduce coverage remaining on the dwelling by the amount paid
Does not affect the broad or special
Debris Removal: dp - (ANSWER)Covers all reasonable expenses for removal of debris from coverage
property
*amounts paid would be considered additional to the policy limits
Improvements, Alterations and Additions dp - (ANSWER)(when insured is a tenant) May apply to 10% of
coverage C limit on the basic DP form, payment would reduce the limit left
on broad/special- it would not reduce the limit
Personal Property covered anywhere in the world dp - (ANSWER)Would pay up to 10% of coverage C
limit.
