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Free General Insurance Concepts Practice Questions

Pennsylvania Casualty & Allied Lines exam (series 16-05) — 26 practice questions.

Subtopics: Pure risk, Hazard, Peril, Methods of handling risk, Retention, Insurable interest, Stock insurer, Reciprocal, Admitted insurer, Foreign insurer, Elements of contract, Apparent authority, Express authority, Implied authority, Indemnity, Subrogation, Utmost good faith, Warranty, Representation, Concealment, Adhesion, Aleatory, Waiver, Estoppel, Moral hazard, Law of large numbers

Sample questions & answers

1. Casualty insurance covers:

Pure risk, involving only the chance of loss or no loss

Only pure risk (no chance of gain) is insurable; speculative risk involves the possibility of gain.

2. A condition that increases the chance or severity of a loss is a:

Hazard

A hazard increases the likelihood or severity of loss; the peril is the actual cause of loss.

3. In casualty insurance, negligence leading to bodily injury is associated with the:

Peril of liability

A peril is the cause of loss; in casualty/liability, the covered peril is the insured's legal liability for injury or damage.

4. Buying a liability policy to shift the cost of lawsuits to an insurer is risk:

Transfer

Purchasing insurance transfers the financial consequences of a risk to the insurer.

All Casualty & Allied Lines topics

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 Pennsylvania Insurance Department and the exam administrator before relying on it.