TEXAS PROPERTY AND C ASUALTY
INSURANCE, INSURANCE PRACTICE
EXAM, P&C TEST BANK, TEXAS
INSURANCE EXAM PREP, PROPERTY
CASUALTY QUESTIONS, LATEST
INSURANCE TEST
Question: Which of the following represent pure risk?
Correct Answer: margaret's dog is temperamental. she's
afraid it will bite a neighbor someday, and she will be held responsible.
Question: The law of large numbers
Correct Answer: states that the more examples used to
develop a statistic, the more reliable the statistic will be
Question: LaTonya purchases a house from John. She
borrows $75,000 from First City Bank which, along with her $25,000 down payment, equals the $100,000 purchase price of the home. Who has an insurable interest in this home?
Correct Answer: LaTonya and the bank
Question: Which is not a criteria a risk must meet to be
insurable?
Correct Answer: risk of loss is not definite
Question: Highpower Industries has an automatic sprinkler
system installed in its office building. This is an example of which risk management method?
Correct Answer: Reduction
Question: Benson Pharmaceutical Company decides not to
manufacture a new drug after determining that it has serious potential side effects. This is an example of which risk management method?
Correct Answer: Avoidance
Question: Since she has always been in good health, Donna
decides to cancel her health insurance policy. This is an example of which risk management method?
Correct Answer: Retention
Question: Determine the peril involved in this loss: Mr.Reed's home was destroyed in a fire.
Correct Answer: fire
Question: Suzanne's house was damaged in a flood.
Determine the peril involved in this loss.
Correct Answer: flood
Question: Jim's automobile collided with Sue's. Determine
the peril involved in this loss.
Correct Answer: collision
Question: Veronica forgets to lock her front door when she
leaves for work. Later that day, a thief enters her apartment and steals her television. What's the peril?
Correct Answer: theft
Question: Veronica forgets to lock her front door when she
leaves for work. Later that day, a thief enters her apartment and steals her television. What's the hazard?
Correct Answer: leaving the door unlocked
Question: Named insured and mailing address: Leah Bachman, 11491 Bretson Rd, Elysium, Anystate 01901
Correct Answer: declarations
Question: In this policy, property damage means physical
injury to or destruction of property.
Correct Answer: definitions
Question: This policy does not cover any loss caused by
earthquake.
Correct Answer: exclusions
Question: This policy may be canceled if the insured does not
pay premiums.
Correct Answer: conditions
Question: This policy covers personal property owned or
used by the insured.
Correct Answer: insuring agreements
Question: What is missing? Jack agrees to burn down
Albert's house for $10,000.
Correct Answer: legal purpose
Question: What is missing? Susan's insurance policy is
canceled for nonpayment of premium.
Correct Answer: consideration
Question: What is missing? JAG Insurance Company denies
George's application for auto insurance.
Correct Answer: offer and acceptance
Question: What is missing? Andrea, age 15, signs a lease for
an apartment in Highview Estates.