Property and Casualty Insurance Test Question Notes. Questions and answers, 100% Accurate. Rated A

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Property and Casualty Insurance Test Question Notes. Questions and answers, 100% Accurate. Rated A What is a peril? - ✔✔A Peril is a cause of loss What is a hazard? - ✔✔Something that in... creases the chance of a loss What is the difference between a Moral hazard and a Morale Hazard? - ✔✔Moral Hazard - dishonesty, against the law Morale Hazard - carelessness What is the method of handling risk that involves a deductible? - ✔✔Retention (loss or portion of loss) If a fire causes damage to a building, what is the fire considered? - ✔✔A Peril What are the elements of an insurable risk? - ✔✔CANHAM Calculable, Affordable, Non-Catastrophic, Homogeneous, Accidental, Measurable If an insurance company is housed in Tennessee, what type of insurer are they considered? - ✔✔Domestic An insurance company incorporated in Wisconsin and conducting business in Minnesota is know as what type of insurer? - ✔✔Foreign What is it meant by "Express Authority"? - ✔✔Authorities are written in agent contract What is a term that is typically used to describe an Insurance Agent? - ✔✔Fiduciary - a person in a position of financial trust What is a contract or device for transferring risk from a persons, business, or organization to an insurance company? - ✔✔Insurance What is Reinsurance? - ✔✔When insurance companies purchase insurance to cover their own exposures to loss What is a fiduciary? - ✔✔A person in a position of financial trust What is it meant by a contract of adhesion? - ✔✔Policy written by the insurer with the insured having no input What part of the insurance policy shows the premium payment? - ✔✔Declarations page What are the duties of the insured after a loss? - ✔✔Notice to insurer, protect property from further damage, Proof of loss, property available for inspection, examination under oath if needed, cooperate with insurer What is the FCRA? - ✔✔Fair Credit Reporting Act - If the insurer uses credit, must inform insured What are the parts to an insurance contract? - ✔✔Declarations, Conditions, Insuring Agreements, and Exclusions When an insured decides to cancel an insurance policy before the expiration date, how is the unearned premium returned? - ✔✔Short-Rate basis What are the three basic perils? - ✔✔Fire, Lightning, and Internal Explosion What are the extended coverage perils? - ✔✔WCSHAVVER and V&MM -Wind, Civil commotion, Smoke, Hail, Aircraft, Vehicles, Volcanic Eruption, Explosion, Riot, Vandalism and malicious mischef What is the difference between a direct loss and an indirect loss? - ✔✔Direct - immediate damage caused by peril Indirect - loss over time as a result of the direct loss How is ACV calculated? - ✔✔Replacement Cost - depreciation = What is the coinsurance clause and what is the percentage required by the insurer? - ✔✔Requires the insured to carry the standard coinsurance amount of the insurance policy; 80% What is the method called when the insured and insurance company cannot agree on a settlement? - ✔✔Appraisal method What is a bailee? - ✔✔A person or organization that has temporary possession of someone else's personal property What is a tort? - ✔✔A civil wrong that causes someone else to suffer a loss What is Vicarious Liability? - ✔✔Liability for the actions of another What are the five property coverages and associated lettering? - ✔✔A - Dwelling B - Other structured (detached, appurtenant) C - Insured's personal property (off-premises covered up to 10% of C) D - Fair Rental Value E - Additional Living Expense Property coverage B provides coverage for what? - ✔✔Other structures; 10% of A How much will DP-2 and DP-3 cover for trees, shrubs, and other plants? - ✔✔$500 for any one tree/shrub/plant Which dwelling form covers collapse? - ✔✔DP-2 and DP-3 For Dwelling insurance, how long will the insured cover medical payments to others after the policy expires? - ✔✔3 years after the accident Which section of the Homeowners policy does not contain a deductible? - ✔✔Section II - Liability What are the three perils covered in a basic form for ho [Show More]

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