Oklahoma Property and Casualty Exam
Questions and Answers| Latest Update
Representations
Statements made by the applicant on an insurance application.
Contract of Utmost Good Faith
An insurer must rely o the truthfulness and integrity of the applicant.
Contract of Adhesion
When one party constructs the contract and the other party has no input.
Elements of a Legally Binding Contract
1. Legal Purpose
2. Agreement (Offer and Acceptance)
3. Competent Parties
4. Consideration
,Special Peril
Type of policy that insures against open perils of loss that are not specifically
excluded.
Example of Consequential or Indirect Loss
Loss of income from a rental unit due to tornado damage to the roof.
Class 1 - Frame
Exterior walls, floors and roof are constructed with wood.
Class 2 - Joisted Masonry
Exterior walls constructed with masonry such as brick or rock. Floors and roof are
constructed with wood.
Class 3 - Noncombustible
Exterior walls, floors and roof are constructed with non-combustible materials
such as metal or asbestos.
, Class 4 - Masonry Noncombustible
Exterior walls are constructed with masonry such as brick or rock. Floors and roof
are constructed with metal or other non-combustible material.
Class 5 - Modified Fire Resistive
Exterior walls, floor and roof are constructed with fire resistive materials with a
fire resistive rating of less than 2 hours.
Class 6 - Fire Resistive
Exterior walls, floor and roof are constructed with fire resistive materials with a
fire resistive rating of 2 hours or more.
Aggregate Limit
A type of policy limit that does not restore the limits of liability after each
occurrence.
Coinsurance
A policy provision which requires the insured to carry an adequate amount of
insurance. Penalty applies when property is insured for an amount under the
market value of the dwelling.
Questions and Answers| Latest Update
Representations
Statements made by the applicant on an insurance application.
Contract of Utmost Good Faith
An insurer must rely o the truthfulness and integrity of the applicant.
Contract of Adhesion
When one party constructs the contract and the other party has no input.
Elements of a Legally Binding Contract
1. Legal Purpose
2. Agreement (Offer and Acceptance)
3. Competent Parties
4. Consideration
,Special Peril
Type of policy that insures against open perils of loss that are not specifically
excluded.
Example of Consequential or Indirect Loss
Loss of income from a rental unit due to tornado damage to the roof.
Class 1 - Frame
Exterior walls, floors and roof are constructed with wood.
Class 2 - Joisted Masonry
Exterior walls constructed with masonry such as brick or rock. Floors and roof are
constructed with wood.
Class 3 - Noncombustible
Exterior walls, floors and roof are constructed with non-combustible materials
such as metal or asbestos.
, Class 4 - Masonry Noncombustible
Exterior walls are constructed with masonry such as brick or rock. Floors and roof
are constructed with metal or other non-combustible material.
Class 5 - Modified Fire Resistive
Exterior walls, floor and roof are constructed with fire resistive materials with a
fire resistive rating of less than 2 hours.
Class 6 - Fire Resistive
Exterior walls, floor and roof are constructed with fire resistive materials with a
fire resistive rating of 2 hours or more.
Aggregate Limit
A type of policy limit that does not restore the limits of liability after each
occurrence.
Coinsurance
A policy provision which requires the insured to carry an adequate amount of
insurance. Penalty applies when property is insured for an amount under the
market value of the dwelling.
