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  4. Property and Casualty Insurance Basics

Free Property and Casualty Insurance Basics Practice Questions

South Dakota Property & Casualty exam — 66 practice questions.

Subtopics: Conditions, Claims-made, Strict liability, Vicarious liability, Proximate cause, Duty to defend, Supplementary payments, Aggregate limit, Other insurance, Appraisal, Salvage, Insurable interest, Loss valuation, Coinsurance, Negligence, Damages, Types of loss, Insurer provisions, 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, Comparative negligence, Punitive damages, Special vs general damages, 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. The policy section that states the rules and duties both parties must follow, such as duties after a loss, is the:

Conditions

The conditions section sets out the rules and duties governing the policy, including the insured's duties after a loss.

2. A liability policy that covers only claims first made against the insured during the policy period is written on a:

Claims-made basis

A claims-made policy responds to claims first presented during the policy period, subject to any retroactive date.

3. Liability that is imposed on a party regardless of fault, as with certain abnormally dangerous activities, is known as:

Strict (absolute) liability

Strict or absolute liability applies without proof of fault, often for inherently dangerous activities.

4. When an employer is held responsible for an employee's negligent acts within the scope of employment, this is:

Vicarious liability

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

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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.