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  4. Property and Casualty Insurance Basics

Free Property and Casualty Insurance Basics Practice Questions

Iowa Property & Casualty exam — 66 practice questions.

Subtopics: Coinsurance, Claims-made, Indemnity, Deductible, Replacement cost, Other insurance, Casualty insurance, Strict liability, Vicarious liability, Punitive damages, Hold harmless, Insurable interest, Loss valuation, Negligence, Damages, Types of loss, Insurer provisions, Liability, Limits of liability, Deductibles, Policy structure, Policy conditions, Actual cash value, Pair and set clause, Vacancy provision, Mortgagee rights, Appraisal condition, Proof of loss, Salvage and abandonment, Liberalization clause, Assignment condition, Binder, Sublimit, Named perils vs open perils, Burden of proof, Direct vs indirect loss, Comparative negligence, Special vs general damages, Proximate cause, Absolute liability, Bailee liability, Attractive nuisance, Res ipsa loquitur, Coinsurance calculation, Actual cash value calculation, Split limits application

Read the Property and Casualty Insurance Basics study guide

Sample questions & answers

1. A property owner who insures a building for less than the coinsurance clause requires will, on a partial loss, generally:

Be penalized and receive less than the full loss amount

Failing to meet the coinsurance requirement triggers a penalty that reduces the partial loss payment.

2. A liability policy that covers claims first made during the policy period or an extended reporting period is written on a(n):

Claims-made basis

A claims-made policy responds to claims first made during the policy period or any applicable extended reporting period.

3. The principle that an insured should be restored to their pre-loss financial position but not profit is:

The principle of indemnity

The principle of indemnity restores the insured to the pre-loss position without permitting a profit from the loss.

4. One purpose of a property deductible is to:

Reduce small claims and help lower premium costs

Deductibles discourage small claims and reduce administrative costs, helping keep premiums affordable.

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Practice: Property and Casualty Insurance Basics

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.