STATE FARM PROPERTY EXAM
QUESTIONS AND ANSWERS. VERIFIED
2026.
In property insurance actual cash value is defined as which of the following -
ANS Replacement cost at the time of the loss, less depreciation
Peril is most easily defined as - ANS the cause of loss insured against
What is a leading factor in the determination of actual cash value - ANS replacement cost
Replacement cost is defined as - ANS full replacement of property at its current cost, new
and without reduction for depreciation
Property insurance that provides 100k coverage for a building and 50k coverage for personal
property at a single location is called - ANS Specific coverage
Which of the following is used in the formula for calculating the actual cash value of a property -
ANS replacement cost
What is the purpose of the coinsurance clause found in property insurance policies? -
ANS Encourage the insured to insure the property closer to its full value
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, An insured has a liability policy that sets the amount at 50k for all claims that arise from a single
incident. which type of limit of liability does this insured's policy have? - ANS per occurrence
When the amount of insurance written in a property policy is not subject to any coinsurance
provision and that amount is paid in the event of a covered loss, the coverage is said to be
written as - ANS stated amount
What is stated amount coverage - ANS In stated amt coverage the value of the insured
property is determined at the time the policy is written.
in the event of a loss, that amount is paid without regard to any coinsurance provision.
However, if the loss is less than the total, the insurer has salvage rights with the insured having
first right of refusal of the salvage.
What type of liability would a person who owns a swimming pool have? - ANS Absolute
What is absolute liability - ANS Any conduct that is inherently dangerous imposes absolute
liability. the claimant does not have to prove anything
Insurable interest in the property covered in a policy must be proven - ANS at the time of loss
Which of the following is NOT an element of negligence
breach, unbroken chain, libel, duty - ANS libel
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
QUESTIONS AND ANSWERS. VERIFIED
2026.
In property insurance actual cash value is defined as which of the following -
ANS Replacement cost at the time of the loss, less depreciation
Peril is most easily defined as - ANS the cause of loss insured against
What is a leading factor in the determination of actual cash value - ANS replacement cost
Replacement cost is defined as - ANS full replacement of property at its current cost, new
and without reduction for depreciation
Property insurance that provides 100k coverage for a building and 50k coverage for personal
property at a single location is called - ANS Specific coverage
Which of the following is used in the formula for calculating the actual cash value of a property -
ANS replacement cost
What is the purpose of the coinsurance clause found in property insurance policies? -
ANS Encourage the insured to insure the property closer to its full value
1 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
, An insured has a liability policy that sets the amount at 50k for all claims that arise from a single
incident. which type of limit of liability does this insured's policy have? - ANS per occurrence
When the amount of insurance written in a property policy is not subject to any coinsurance
provision and that amount is paid in the event of a covered loss, the coverage is said to be
written as - ANS stated amount
What is stated amount coverage - ANS In stated amt coverage the value of the insured
property is determined at the time the policy is written.
in the event of a loss, that amount is paid without regard to any coinsurance provision.
However, if the loss is less than the total, the insurer has salvage rights with the insured having
first right of refusal of the salvage.
What type of liability would a person who owns a swimming pool have? - ANS Absolute
What is absolute liability - ANS Any conduct that is inherently dangerous imposes absolute
liability. the claimant does not have to prove anything
Insurable interest in the property covered in a policy must be proven - ANS at the time of loss
Which of the following is NOT an element of negligence
breach, unbroken chain, libel, duty - ANS libel
2 @COPYRIGHT 2025/2026 ALLRIGHTS RESERVED.
