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Free Property and Casualty Insurance Basics Practice Questions

Kentucky Property & Casualty exam — 66 practice questions.

Subtopics: Indirect loss, Named peril, Occurrence policy, Claims-made policy, Valued policy, Concealment, Warranty, Utmost good faith, Salvage, Abandonment, Blanket insurance, Insurable interest, Loss valuation, Coinsurance, Negligence, Damages, Types of loss, Insurer provisions, Other insurance, Liability, Limits of liability, Deductibles, Policy structure, Policy conditions, Actual cash value, Replacement cost, 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, Strict liability, Vicarious liability, Punitive damages, Special vs general damages, Proximate cause, Absolute liability, Hold harmless, 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 loss of business income that follows a covered fire is an example of a(n):

Indirect (consequential) loss

An indirect or consequential loss, such as lost income, results from a direct loss like a fire but is itself a separate type of loss.

2. A coverage form that insures only against perils specifically listed in the policy is a:

Named-peril form

A named-peril form covers only the causes of loss specifically listed, placing the burden on the insured to show the peril is covered.

3. An occurrence-based liability policy covers injury or damage that takes place:

During the policy period, regardless of when the claim is later made

An occurrence policy responds to covered events that occur during the policy period even if the claim is reported later.

4. A claims-made liability policy generally covers a loss only if the claim is:

First made during the policy period or an extended reporting period

A claims-made policy covers claims first made during the policy period or an applicable extended reporting period.

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Practice: Property and Casualty Insurance Basics

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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.