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Free General Insurance Concepts Practice Questions

Hawaii Property & Casualty exam — 39 practice questions.

Subtopics: Exposure unit, Risk pooling, Loss frequency, Loss severity, Representation, Estoppel, Handling risk, Insurer classifications, Adverse selection, Elements of a contract, Insurable risk, Hazards, Definitions, Authority of producers, Legal interpretations, Law of large numbers, Principle of indemnity, Utmost good faith, Concealment, Warranty, Waiver and estoppel, Subrogation, Reinsurance, Admitted vs nonadmitted, Domestic foreign alien, Aleatory contract, Contract of adhesion, Unilateral contract, Apparent authority, Rebating, Pro-rata cancellation

Read the General Insurance Concepts study guide

Sample questions & answers

1. An exposure unit in insurance is best described as:

A unit of measure of the loss potential being insured

An exposure unit is a unit used to measure the loss potential being insured, helping insurers price coverage.

2. Spreading the risk of loss among many insureds so that the premiums of the many pay the losses of the few is called:

Risk pooling (the sharing of risk)

Risk pooling spreads losses across many insureds so the premiums of the many cover the losses of the few.

3. Loss frequency refers to:

How often losses are likely to occur

Loss frequency measures how often losses are expected to occur over a period.

4. Loss severity refers to:

The potential dollar size or seriousness of a loss

Loss severity measures the potential dollar amount or seriousness of a loss when it occurs.

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Practice: General Insurance Concepts

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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.