TEXAS PROPERTY & CASUALTY INSURANCE EXAM
(ACTUAL 2026/2027) QUESTIONS WITH 100% CORRECT
ANSWERS | NEW UPDATE | GRADED A+.
Hazard – ANSWER Conditions or situations that increase the probability of an
insured loss occurring
3 Classifications of Hazards - ANSWER_1. Physical hazards
2. Moral hazards
3. Morale hazards
Physical Hazards – ANSWER Hazards arising from the material, structural, or
operational features of the risk, apart from the persons owning or managing it
Moral Hazards – ANSWER Applicants that may lie on an application for
insurance, or in the past have submitted fraudulent claims against an insurer
Morale Hazards – ANSWER Increase in the hazard presented by a risk, arising
from the insured's indifference to loss because of the existence of insurance
Stated Value – ANSWER An amount of insurance scheduled in a property policy
that is not subject to any coinsurance requirements in the event of a covered loss
2. Strict liability
Absolute Liability – ANSWER Imposed on defendants engaged in hazardous
activities, such as harboring wild animals, using explosives, etc.
, Strict Liability – ANSWER If a product causes injury and the claimant can prove
the defect, the defendant will be held strictly liable for the damage
Per Occurrence - ANSWER_A sublimit in a liability policy that puts a ceiling on
the payment for all claims that arise from a single accident/occurrence
Per Person – ANSWER The maximum amount available for payment of bodily
injury to a single person in an accident, regardless of the policy limit stated in the
policy for bodily injury claims
Salvage Value – ANSWER The estimated value an asset will realize upon its sale
at the end of its useful life
Two Types of Liability - ANSWER_1. Absolute liability
Aggregate Limit – ANSWER The maximum limit of coverage available under a
liability policy during a policy year, regardless of the number of claims made or
the number of accidents that occur
Split Limits – ANSWER Separately stated limits of liability for different coverages
- may be stated on a per person, per occurrence, or per policy period basis, or can
be split between bodily injury and property damage
Combined Single - ANSWER_A single dollar limit of liability applying to the total
of damages for bodily injury and property damage combined, resulting from one
accident or occurrence
(ACTUAL 2026/2027) QUESTIONS WITH 100% CORRECT
ANSWERS | NEW UPDATE | GRADED A+.
Hazard – ANSWER Conditions or situations that increase the probability of an
insured loss occurring
3 Classifications of Hazards - ANSWER_1. Physical hazards
2. Moral hazards
3. Morale hazards
Physical Hazards – ANSWER Hazards arising from the material, structural, or
operational features of the risk, apart from the persons owning or managing it
Moral Hazards – ANSWER Applicants that may lie on an application for
insurance, or in the past have submitted fraudulent claims against an insurer
Morale Hazards – ANSWER Increase in the hazard presented by a risk, arising
from the insured's indifference to loss because of the existence of insurance
Stated Value – ANSWER An amount of insurance scheduled in a property policy
that is not subject to any coinsurance requirements in the event of a covered loss
2. Strict liability
Absolute Liability – ANSWER Imposed on defendants engaged in hazardous
activities, such as harboring wild animals, using explosives, etc.
, Strict Liability – ANSWER If a product causes injury and the claimant can prove
the defect, the defendant will be held strictly liable for the damage
Per Occurrence - ANSWER_A sublimit in a liability policy that puts a ceiling on
the payment for all claims that arise from a single accident/occurrence
Per Person – ANSWER The maximum amount available for payment of bodily
injury to a single person in an accident, regardless of the policy limit stated in the
policy for bodily injury claims
Salvage Value – ANSWER The estimated value an asset will realize upon its sale
at the end of its useful life
Two Types of Liability - ANSWER_1. Absolute liability
Aggregate Limit – ANSWER The maximum limit of coverage available under a
liability policy during a policy year, regardless of the number of claims made or
the number of accidents that occur
Split Limits – ANSWER Separately stated limits of liability for different coverages
- may be stated on a per person, per occurrence, or per policy period basis, or can
be split between bodily injury and property damage
Combined Single - ANSWER_A single dollar limit of liability applying to the total
of damages for bodily injury and property damage combined, resulting from one
accident or occurrence
