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Free General Insurance Concepts Practice Questions

Virginia Life exam — 47 practice questions.

Subtopics: Insurable interest, Utmost good faith, Adhesion, Aleatory, Representations, Concealment, Warranty, 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, Pure vs speculative risk, Law of large numbers, Adverse selection, Moral hazard, Morale hazard, Physical hazard, Implied authority, Fiduciary duty, Aleatory contract, Contract of adhesion, Unilateral contract, Conditional contract, Waiver, Estoppel, Reciprocal insurer, Fraternal benefit society, Reinsurance, Surplus lines insurer, Self-insurance

Read the General Insurance Concepts study guide

Sample questions & answers

1. In a life insurance application the insurable interest must generally exist:

At the time of application (policy inception)

For life insurance, insurable interest must exist at policy inception, unlike property insurance where it must exist at loss.

2. The principle that both parties to an insurance contract rely on each other's honesty is:

Utmost good faith

Insurance contracts are based on utmost good faith, requiring honesty and full disclosure from both parties.

3. A life insurance policy is a contract of adhesion because:

The insurer writes it and the applicant accepts or rejects it

As a contract of adhesion, one party (the insurer) prepares the terms and the other accepts them, so ambiguities are construed against the drafter.

4. Calling an insurance contract aleatory means:

The values exchanged may be unequal and depend on an uncertain event

An aleatory contract involves an exchange of unequal amounts depending on an uncertain future event.

All Life 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 Insurance Department and the exam administrator before relying on it.