STUDY

Question 1

Which is a risk that is insurable?

Answer 1

PURE RISK - LOSS OF NOTHING. NO GAIN.

Question 2

What is an insurance policy?

Answer 2

A written agreement or contract for insurance coverage

Question 3

What is an insurance binder?

Answer 3

A temporary agreement for insurance coverage
subject to the decision of the insurer

Question 4

casualty insurance relates to
1
2
3

Answer 4

1 Marine insurance
2. insurance on property3
3.Liability insurance

Question 5

What insurance principle acts to place an insured in
the same or similar financial position after a loss as
was prior to the loss event?

Answer 5

a.The indemnity principle

Question 6

. What type of contract is it that the insured cannot
negotiate the terms of the contract and must accept
the terms specified in the contract

Answer 6

c.A contract of adhesion

Question 7

What type of contract is one where the obligation of
the insurer is to perform the terms of the contract
and is based on the insured satisfying certain conditions?

Answer 7

c.A conditional contract

Question 8

What insurance doctrine states that a cause of a loss
and all other directly related events flowing from the
same cause of the loss would be considered as one
event?

Answer 8

b.The doctrine of proximate cause

Question 9

What insurance clause is related to a lender or creditor’s interest in real property and the insurer would
pay losses to all parties that have an interest in the
same property?

Answer 9

b.Mortgage or mortgagee clause

Question 10

15. What insurance clause is related to a creditor’s interest in personal property such as an auto?

Answer 10

d.The loss payable or loss payee clause

Question 11

legal requirements for a contract

Answer 11

The contract must have a legal purpose and transfer of consideration (something of value such as payment of insurance premiums)
.There must be a valid offer and a voluntary acceptance
.The parties to the contract must have legal capacity to contract

Question 12

What insurance loss settlement method is defined as the cost to replace the item less allowance for
depreciation, and is the common method used for
settlement of personal property losses?

Answer 12

ACV

Question 13

What insurance loss settlement method is defined as:
the property loss is replaced with items that are similar and of like kind and quality, and is the common
method used in settling real property losses?

Answer 13

replacaemnt cost

Question 14

The Florida law that states that an insured must pay
the full coverage limits on property when there is a
total loss is referred to as?

Answer 14

Florida valued policy law