Free Property Insurance Basics Practice Questions
Vermont Property exam (series 14-41) — 183 practice questions.
Subtopics: Physical hazard, Coinsurance concept, Insurable interest timing, Actual cash value, Replacement cost, Subrogation, Salvage, Deductible purpose, Coinsurance calculation, Declarations page, Endorsement, Pro rata cancellation, Proof of loss, Other insurance, Credit information, Insurance scores, Credit updates, Extraordinary life events, Guaranty association, Renewal notice, Late renewal notice, Transfer to affiliate, Cancellation reasons, Increase in hazard, New business period, Cancellation notice, Notice by mail, Nonrenewal, Agent termination, Penalties, Commercial cancellation, Commercial nonrenewal, Consent to rate, Premium finance, Terrorism program, Loss payment, Defective proof of loss, Vermont contracts, Agreed valuation, Claim acknowledgment, Department inquiries, Claim decisions, Claim denials, Investigation delays, Time limit warnings, Payment timing, Claims contact, Payment explanations, Regulation scope, Estimates, Hidden damage, Insurable interest, Agreed value, Functional replacement cost, Direct vs indirect loss, Coinsurance purpose, Deductible, Declarations, Insuring agreement, Exclusions, Conditions, First named insured, Duties after loss, Subrogation condition, Liberalization, Other insurance pro rata, Blanket insurance, Loss payable clause, Construction class, Rate components, Underwriting purpose, Valued policy, Market value, Cancellation short rate, Policy territory, Assignment property, No benefit to bailee, Claim settlement options, Pair and set clause, Vacancy, Specific insurance, Indirect loss time element, Hazard reduction underwriting, Named perils form, Open perils form, Burden of proof, Proximate cause, Concurrent causation, Anti-concurrent causation clause, Flat cancellation, Nonrenewal notice, Policy period, Salvage rights, No abandonment clause, Appraisal provision, Notice of loss, Depreciation, Recoverable depreciation, Percentage deductible, Period of restoration, Business income waiting period, Contribution by equal shares, Excess other insurance, Margin clause, Waiver of subrogation, Mysterious disappearance, Inherent vice exclusion, Wear and tear exclusion, Earth movement exclusion, Flood exclusion, Ensuing loss, Ordinance or law exclusion, Sue and labor, Ingress and egress, Reinstatement of limit, Coverage extension, Stated amount, Actual cash value calculation, Deductible application, Coinsurance - adequate insurance, Coinsurance with deductible, Coinsurance - limit cap, Coinsurance - value at time of loss, Coinsurance - who bears shortfall, ACV calculation - contents, Pro rata other insurance calc, Pro rata return premium calc, Pair and set calc, Proximate cause example, Direct loss example, Endorsements, Definitions section, Limits - sublimits, Mortgagee - proof of loss, Mortgagee - premium, Mortgagee - cancellation notice, Subrogation example, Appraisal procedure, Appraisal costs, Proof of loss timing, Suit against insurer, Burglary definition, Robbery definition, Theft definition, Water damage vs flood, Valued policy law, Liberalization timing, Occurrence, Named insured, Salvage value, Unearned premium, Settlement of claims - deductible, Additional coverages vs extensions, Policy conditions - concealment, Valuation
Read the Property Insurance Basics study guide
Sample questions & answers
1. A pile of oily rags stored near a furnace is an example of a:
Physical hazard
A hazard is a condition that creates or increases the chance of loss. Oily rags near a furnace are a physical (tangible) hazard, as opposed to a moral or morale hazard, which relate to attitude or honesty.
2. A coinsurance clause in commercial property insurance encourages the insured to:
Carry insurance to a stated percentage of value
A coinsurance clause requires insurance equal to at least a stated percentage of value for partial losses to be paid in full. An underinsured owner shares the loss. Vermont lets an insured ask to agree the building's value with the insurer (8 V.S.A. § 3961).
3. In property insurance, insurable interest must exist:
At the time of the loss
In property insurance, the insured must have an insurable interest at the time of the loss to collect. This prevents gambling on others' property.
4. How is actual cash value (ACV) usually determined for a damaged item?
Replacement cost minus depreciation
ACV is generally replacement cost at the time of loss minus depreciation, never more than the policy limit.
Practice: Property Insurance Basics
Answer choices are shuffled every time, and every question comes with an explanation.
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.
