1. Exam Prep
  2. Vermont
  3. Personal Lines
  4. General Insurance Concepts

Free General Insurance Concepts Practice Questions

Vermont Personal Lines exam — 60 practice questions.

Subtopics: Insurable interest timing, Principle of indemnity, Actual cash value, Replacement cost, Subrogation, Salvage, Deductible purpose, Coinsurance calculation, Pure vs speculative risk, Hazard, Peril, Moral hazard, Morale hazard, Physical hazard, Law of large numbers, Risk avoidance, Risk retention, Risk transfer, Insurable interest, Indemnity, Elements of a contract, Contract of adhesion, Aleatory contract, Utmost good faith, Representation, Concealment, Warranty, Express authority, Apparent authority, Implied authority, Stock vs mutual insurer, Domestic foreign alien, Admitted insurer, Estoppel, Adverse selection, Reinsurance, Underwriting, Loss ratio, Rate regulation goals, Reciprocal insurer, Lloyds of London, Risk retention group, Self-insurance, Surplus lines, Fundamental vs particular risk, Loss exposure, Frequency vs severity, Unilateral contract, Conditional contract, Personal contract, Waiver, Material misrepresentation, Fiduciary duty, Commingling, Agent vs broker, Rebating, Twisting, Coercion, Defamation, Unfair claims settlement

Read the General Insurance Concepts study guide

Sample questions & answers

1. In property insurance, insurable interest must exist:

At the time of the loss

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

2. The principle of indemnity in property insurance means the insured should be:

Restored to about the same financial position as before the loss, without profiting from it

Indemnity restores the insured to roughly their pre-loss financial position without allowing a profit from the loss.

3. Actual cash value (ACV) is generally calculated as:

Replacement cost minus depreciation

ACV equals the replacement cost of the property minus depreciation for age and wear.

4. Replacement cost coverage pays to repair or replace damaged property:

Without a deduction for depreciation, subject to policy terms

Replacement cost coverage pays to repair or replace with like kind and quality without deducting depreciation, subject to policy conditions.

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