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  4. General Insurance Concepts

Free General Insurance Concepts Practice Questions

Connecticut Life, Accident & Health exam — 33 practice questions.

Subtopics: Law of large numbers, Indemnity, Peril, Hazard, Risk transfer, Handling risk, Insurable risk, Hazards, Definitions, Insurer classifications, Adverse selection, Elements of a contract, Legal interpretations, Aleatory contract, Contract of adhesion, Utmost good faith, Unilateral contract, Conditional contract, Express authority, Apparent authority, Fiduciary duty, Reinsurance, Reciprocal insurer, Estoppel, Insurable interest timing

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Sample questions & answers

1. The law of large numbers helps an insurer:

Predict losses more accurately as the insured group grows

As the number of similar exposures grows, the law of large numbers improves the accuracy of loss predictions.

2. The principle of indemnity provides that an insured should be:

Restored to the pre-loss financial position without profiting

Indemnity seeks to restore the insured to the pre-loss position without allowing a profit from the loss.

3. A peril in insurance terms is:

The cause of a loss such as illness or accident

A peril is the cause of a loss, such as illness, accident, or fire.

4. A hazard is a condition that:

Increases the chance or severity of a loss

A hazard increases the likelihood or severity of a loss but is not itself the cause of the loss.

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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.