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Free Property and Casualty Insurance Basics Practice Questions

Minnesota Property & Casualty exam — 66 practice questions.

Subtopics: Vicarious liability, Strict liability, Comparative negligence, Direct and consequential loss, Additional insured, Occurrence and claims-made, Moral hazard, Declarations, Conditions, Exclusions, Salvage, 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, 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

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Sample questions & answers

1. When an employer is held responsible for the negligent acts of an employee performed on the job this is called what?

Vicarious liability

Vicarious liability holds one party, such as an employer, responsible for the negligent acts of another, such as an employee acting within the scope of employment.

2. Liability imposed without regard to fault often for inherently dangerous activities is called what?

Strict liability

Strict liability imposes responsibility without regard to fault, often for abnormally dangerous activities or defective products.

3. A legal rule that reduces a claimant's recovery in proportion to his or her own fault is called what?

Comparative negligence

Comparative negligence reduces the claimant's recovery in proportion to the degree the claimant's own negligence contributed to the loss.

4. Lost business income resulting from a covered fire is best described as what type of loss?

A consequential or indirect loss

Lost income that follows from a direct physical loss, such as a fire, is a consequential or indirect loss.

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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.