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  4. General Insurance Concepts

Free General Insurance Concepts Practice Questions

Arizona Personal Lines exam — 58 practice questions.

Subtopics: Indemnity, Conditions, Exclusions, Insuring agreement, Pro rata cancellation, Proximate cause, Pure vs speculative risk, Hazard, Peril, Moral hazard, Morale hazard, Physical hazard, Law of large numbers, Risk avoidance, Risk retention, Risk transfer, Insurable interest, Elements of a contract, Contract of adhesion, Aleatory contract, Utmost good faith, Representation, Concealment, Warranty, Express authority, Apparent authority, Implied authority, Stock vs mutual insurer, Domestic foreign alien, Admitted insurer, Estoppel, Adverse selection, Reinsurance, Underwriting, Loss ratio, Rate regulation goals, Reciprocal insurer, Lloyds of London, Risk retention group, Self-insurance, Surplus lines, Fundamental vs particular risk, Loss exposure, Frequency vs severity, Unilateral contract, Conditional contract, Personal contract, Waiver, Material misrepresentation, Fiduciary duty, Commingling, Agent vs broker, Rebating, Twisting, Coercion, Defamation, Unfair claims settlement

Read the General Insurance Concepts study guide

Sample questions & answers

1. The principle of indemnity in personal lines insurance means a claim payment should:

Restore the insured to the pre-loss financial position

Indemnity restores the insured to the financial position held before the loss, without profit.

2. A condition in an insurance policy is:

A requirement the insured must meet for coverage to apply

Conditions are provisions the insured must comply with for coverage to respond to a loss.

3. An exclusion in a personal lines policy:

Describes losses the policy does not cover

Exclusions identify the losses, perils, or property the policy will not cover.

4. The insuring agreement of a policy:

States the insurer's basic promise to pay for covered losses

The insuring agreement is the insurer's core promise to pay for covered losses under the policy.

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Practice: General Insurance Concepts

Take a randomized, timed-style practice test. Answer choices are shuffled and your results are scored instantly with an explanation for every question.

Practice questions are study aids generated for exam preparation and are not actual exam questions. Content is provided for educational purposes and is not legal advice. Verify current statutes, rules, and exam specifications with the Insurance Department and the exam administrator before relying on it.