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  3. Property & Casualty
  4. General Insurance Concepts

Free General Insurance Concepts Practice Questions

Minnesota Property & Casualty exam — 39 practice questions.

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

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Sample questions & answers

1. A stock insurance company is generally owned by whom?

Its stockholders

A stock insurer is owned by its stockholders, while a mutual insurer is owned by its policyholders.

2. An insurer organized under the laws of Minnesota and operating in Minnesota is classified as what?

A domestic insurer

An insurer formed under the laws of the state in which it operates is a domestic insurer; in Minnesota that means organized under Minnesota law.

3. Reinsurance is best described as what?

Insurance that an insurer buys to transfer part of its risk to another insurer

Reinsurance is insurance purchased by an insurer to transfer part of its risk to another insurer, helping it manage large or concentrated exposures.

4. Choosing to pay for small losses out of pocket rather than insuring them is an example of which technique?

Risk retention

Risk retention means keeping the financial responsibility for certain losses, such as through a deductible or self-insurance, rather than transferring them.

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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.