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Free General Insurance Concepts Practice Questions

Texas Life Agent exam (series InsTX-Life01) — 20 practice questions.

Subtopics: Definition of risk, Hazard, Peril, Handling risk, Retention, Insurable risk, Stock insurer, Mutual insurer, Admitted insurer, Domestic foreign alien, Consideration, Legal purpose, Competent parties, Offer and acceptance, Express authority, Apparent authority, Indemnity, Utmost good faith, Representations, Concealment

Sample questions & answers

1. In insurance, 'risk' is best defined as:

Uncertainty regarding loss

Risk is uncertainty about whether a loss will occur; insurance addresses pure risk, the chance of loss or no loss.

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

Hazard

A hazard increases the chance or size of a loss; a peril is the actual cause of loss.

3. The actual cause of a loss, such as fire or premature death, is a:

Peril

A peril is the direct cause of loss; life insurance insures against the peril of death.

4. Transferring the financial consequences of a risk to an insurer is an example of risk:

Transfer

Buying insurance transfers the financial risk of loss to the insurer in exchange for premium.

All Life Agent 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.