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  4. General Insurance Concepts

Free General Insurance Concepts Practice Questions

Missouri Property & Casualty exam — 39 practice questions.

Subtopics: Risk avoidance, Risk retention, Speculative risk, Risk reduction, Reasonable expectations, Personal contract, Handling risk, Insurer classifications, Adverse selection, Elements of a contract, Insurable risk, Hazards, Definitions, Authority of producers, Legal interpretations, Law of large numbers, Principle of indemnity, Utmost good faith, Concealment, Warranty, Waiver and estoppel, Subrogation, Reinsurance, 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. Risk avoidance as a risk management technique means:

Eliminating the activity that creates the risk entirely

Risk avoidance eliminates exposure to a risk by not engaging in the activity that creates it.

2. Risk retention means the insured chooses to:

Assume some or all of the financial consequences of a risk

Risk retention involves keeping some or all of the financial consequences of a risk, such as through a deductible or self-insurance.

3. A speculative risk differs from a pure risk because it involves:

A chance of gain as well as loss

Speculative risk includes the possibility of gain as well as loss and is generally not insurable.

4. Loss control measures, such as installing sprinklers, are examples of:

Risk reduction

Risk reduction (loss control) uses measures like sprinklers and alarms to lower the frequency or severity of loss.

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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.