USAA LICENSING EXAM AND STUDY GUIDE LATEST VERSION THIS YEAR ALL 380 QUESTIONS AND CORRECT DETAILED

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USAA LICENSING EXAM AND STUDY GUIDE
LATEST VERSION THIS YEAR ALL 380
QUESTIONS AND CORRECT DETAILED


USAA Licensing Exam

Question: Insurance - CORRECT ANSWER✔✔Transfer of risk from one person or organization to
an insurance company




Question: Indemnity - CORRECT ANSWER✔✔The principle to restore the insured to the pre-loss
economic or financial condition.




Question: Law of Large numbers - CORRECT ANSWER✔✔Mathematical principle used by
insurers to predict losses to charge the appropriate premiums




Question: Insurable Interest - CORRECT ANSWER✔✔Proof that someone stands to lose
financially if a loss occurs; must exist at the time of the loss in property and casualty insurance




Question: Binder - CORRECT ANSWER✔✔Temporary insurance contract; commits the company
to act as if a policy has been issued




Question: Peril - CORRECT ANSWER✔✔Cause of loss



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Question: Direct Loss - CORRECT ANSWER✔✔Immediate actual physical damage to tangible
property




Question: Indirect loss - CORRECT ANSWER✔✔Inability to use property as a result of a direct
loss




Question: Risk - CORRECT ANSWER✔✔Chance of loss; uncertainty of loss




Question: What are the two types of risk? - CORRECT ANSWER✔✔Speculative and Pure




Question: Speculative Risk - CORRECT ANSWER✔✔Involves the simultaneous chance of gain or
loss: is not insurable




Question: Pure Risk - CORRECT ANSWER✔✔a risk that presents the chance of loss but no
opportunity for gain (insurable)




Question: What are two examples of speculative risk? - CORRECT ANSWER✔✔Gambling

Investing




Question: What is an example of your risk? - CORRECT ANSWER✔✔Car accident




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Question: Physical hazards include - CORRECT ANSWER✔✔Visible condition that increases the
chance of loss




Question: Morale Hazard - CORRECT ANSWER✔✔Attitude of carelessness or indifference to loss




Question: Insurer - CORRECT ANSWER✔✔The insurance company (a.k.a. second party to the
contract)




Question: Named Insured - CORRECT ANSWER✔✔A party named on the declarations who is
purchasing the insurance policy (a.k.a. first party to the contract)




Question: Insured - CORRECT ANSWER✔✔Who the insurer promises to protect in addition to
the named insured




Question: Limit of Liability - CORRECT ANSWER✔✔The maximum amount that can be paid for a
covered loss




Question: Consideration - CORRECT ANSWER✔✔An exchange of value between parties to a
contract




Question: Waiver - CORRECT ANSWER✔✔The voluntary relinquishment of a known right




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Question: What is Estopple? - CORRECT ANSWER✔✔When an agent tells an insured/makes the
statement there is coverage for a loss when there is no such coverage, then the insurer is
prevented from denying the claim as a result of what precedent?




Question: Concealment - CORRECT ANSWER✔✔Insured or prospect deliberately withholding
material information from the insurer, this voids coverage




Question: Material Misrepresentation - CORRECT ANSWER✔✔Insured or prospect giving
incorrect material information to the insurer, this voids coverage




Question: Warranty - CORRECT ANSWER✔✔A written condition in the policy that must be true
at the time of the loss




Question: Texas Department of Insurance - CORRECT ANSWER✔✔In Texas, the insurance
industry is regulated by the




Question: Commissioner - CORRECT ANSWER✔✔The (_______) is appointed by the governor
and heads the Texas Department of Insurance




Question: Adjuster - CORRECT ANSWER✔✔According to the Texas Insurance Code, any person
who investigates or adjusts losses, or any person who supervises the handling of claims must be
licensed as an (_______________)




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