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Free Property and Casualty Insurance Basics Practice Questions

Maryland Property & Casualty exam — 66 practice questions.

Subtopics: Negligence elements, Strict liability, Vicarious liability, Consequential loss, Open peril, Coinsurance formula, Endorsement, Mortgagee clause, Appraisal provision, Policy structure, Vacancy clause, Insurable interest, Loss valuation, Coinsurance, Negligence, Damages, Types of loss, Insurer provisions, Other insurance, Liability, Limits of liability, Deductibles, 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, 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. To establish negligence, a claimant generally must show duty, breach, damages, and:

Proximate cause linking the breach to the harm

Negligence requires a duty owed, breach of that duty, proximate causation, and actual damages.

2. Strict (absolute) liability may be imposed for:

Inherently dangerous activities regardless of fault

Strict liability applies to abnormally dangerous activities (and some product cases) where liability attaches regardless of fault.

3. Vicarious liability holds a party responsible for the acts of:

Another, such as an employer for an employee acting within the scope of employment

Vicarious liability imputes responsibility to one party (such as an employer) for the negligent acts of another (such as an employee on the job).

4. An indirect (consequential) loss is best illustrated by:

Lost business income after a fire damages the building

A direct loss is the physical damage; an indirect (consequential) loss is the resulting financial loss, such as lost income during repairs.

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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.