Exam Fx-Property and Casualty
Questions and Answers (2026) |
Guaranteed Success | 100% Correct
Question: Absolute Liability -✓✓A type of liability that occurs due to
extremely dangerous operations, such as the use of explosives or
working at extreme heights.
Question: Accident -✓✓An unplanned, unforeseen event which occurs
suddenly and at a specific place.
Question: Actual Cash Value (ACV) -✓✓The required amount to pay
damages or for property loss, which is calculated based on the property's
current replacement value minus depreciation.
Question: Additional Coverage -✓✓A provision in an insurance policy
that allows for more coverage for specific loss expense without increase
in premium.
Question: Additional Insureds -✓✓Individuals or business that are not
named as insured on the declaration page, but are protected by the
policy, usually in regard to a specific interest.
Question: Adhesion -✓✓A contract offered on a "take-it-or-leave-it"
basis by an insurer, in which the insured's only option is to accept or
reject the contract. Any ambiguities in the contract will be settled in
favor of the insured.
Question: Admitted Insurer -✓✓An insurance company authorized and
licensed to transact business in a particular state.
,Question: Adverse Selection -✓✓The tendency of risks with higher
probability of loss to purchase and maintain insurance more often than
the risks who present lower probability.
Question: Agent -✓✓An individual who is licensed to sell, negotiate, or
effect insurance contracts on behalf of an insurer.
Question: Aggregate Limit -✓✓The maximum limit of coverage
available under a liability policy during a policy year regardless of the
number of claims that may be made or the number of accidents that may
occur.
Question: Agreed Value -✓✓A property policy with a provision agreed
upon by the insurer and insured as to the amount of insurance that
represents a fair valuation for property at the time the insurance is
written.
Question: Aleatory -✓✓A contract in which the participating parties
agree to exchange unequal amounts. Insurance contracts are ________
in that the amount the insured will pay in premiums is unequal to the
amount the insurer will pay in the event of a loss.
Question: Alien Insurer -✓✓An insurance company that is incorporated
outside of the United States.
Question: Apparent Authority -✓✓The appearance or the assumption of
authority based on the actions, words, or deeds of the principal or
because of circumstances the principal created.
Question: Appraisal -✓✓An assessment of property to determine either
the correct amount of insurance to be written or the amount of loss to
paid.
, Question: Arbitration -✓✓Method of claim settlement used when the
insured and insurer cannot agree upon the amount of the loss.
Question: Assignment -✓✓The transfer of a legal right or interest in an
insurance policy. In property and Casualty insurance, ________ of
policies are usually valid only with the prior written consent of the
insurer.
Question: Authorized Insurer -✓✓An insurance company that has
qualified and received a Certificate of Authority from the Department of
Insurance to transact insurance in the state.
Question: Auto -✓✓A land motor vehicle, trailer or semi-trailer
designed for use on public roads, including attached machinery or
equipment; does not include mobile equipment.
Question: Avoidance -✓✓A method of dealing with risk by deliberately
keeping away from it (e.g. if a person wanted to avoid the risk of being
killed in an airplane crash, he/she might choose never to fly in a plane.)
Question: Bailee -✓✓A person or entity that has possession of personal
property entrusted to him/her by the owner. For example, a television
repair person that has possession of a customer;s television would be a
________.
Question: Beneficiary -✓✓The person who receives the proceeds from
the insurance policy.
Question: Binder -✓✓A temporary contract that puts an insurance policy
into force before the premium has been paid.
Question: Blanket Insurance -✓✓A single property insurance policy that
provides coverage for multiple classes of property at one location, or
Questions and Answers (2026) |
Guaranteed Success | 100% Correct
Question: Absolute Liability -✓✓A type of liability that occurs due to
extremely dangerous operations, such as the use of explosives or
working at extreme heights.
Question: Accident -✓✓An unplanned, unforeseen event which occurs
suddenly and at a specific place.
Question: Actual Cash Value (ACV) -✓✓The required amount to pay
damages or for property loss, which is calculated based on the property's
current replacement value minus depreciation.
Question: Additional Coverage -✓✓A provision in an insurance policy
that allows for more coverage for specific loss expense without increase
in premium.
Question: Additional Insureds -✓✓Individuals or business that are not
named as insured on the declaration page, but are protected by the
policy, usually in regard to a specific interest.
Question: Adhesion -✓✓A contract offered on a "take-it-or-leave-it"
basis by an insurer, in which the insured's only option is to accept or
reject the contract. Any ambiguities in the contract will be settled in
favor of the insured.
Question: Admitted Insurer -✓✓An insurance company authorized and
licensed to transact business in a particular state.
,Question: Adverse Selection -✓✓The tendency of risks with higher
probability of loss to purchase and maintain insurance more often than
the risks who present lower probability.
Question: Agent -✓✓An individual who is licensed to sell, negotiate, or
effect insurance contracts on behalf of an insurer.
Question: Aggregate Limit -✓✓The maximum limit of coverage
available under a liability policy during a policy year regardless of the
number of claims that may be made or the number of accidents that may
occur.
Question: Agreed Value -✓✓A property policy with a provision agreed
upon by the insurer and insured as to the amount of insurance that
represents a fair valuation for property at the time the insurance is
written.
Question: Aleatory -✓✓A contract in which the participating parties
agree to exchange unequal amounts. Insurance contracts are ________
in that the amount the insured will pay in premiums is unequal to the
amount the insurer will pay in the event of a loss.
Question: Alien Insurer -✓✓An insurance company that is incorporated
outside of the United States.
Question: Apparent Authority -✓✓The appearance or the assumption of
authority based on the actions, words, or deeds of the principal or
because of circumstances the principal created.
Question: Appraisal -✓✓An assessment of property to determine either
the correct amount of insurance to be written or the amount of loss to
paid.
, Question: Arbitration -✓✓Method of claim settlement used when the
insured and insurer cannot agree upon the amount of the loss.
Question: Assignment -✓✓The transfer of a legal right or interest in an
insurance policy. In property and Casualty insurance, ________ of
policies are usually valid only with the prior written consent of the
insurer.
Question: Authorized Insurer -✓✓An insurance company that has
qualified and received a Certificate of Authority from the Department of
Insurance to transact insurance in the state.
Question: Auto -✓✓A land motor vehicle, trailer or semi-trailer
designed for use on public roads, including attached machinery or
equipment; does not include mobile equipment.
Question: Avoidance -✓✓A method of dealing with risk by deliberately
keeping away from it (e.g. if a person wanted to avoid the risk of being
killed in an airplane crash, he/she might choose never to fly in a plane.)
Question: Bailee -✓✓A person or entity that has possession of personal
property entrusted to him/her by the owner. For example, a television
repair person that has possession of a customer;s television would be a
________.
Question: Beneficiary -✓✓The person who receives the proceeds from
the insurance policy.
Question: Binder -✓✓A temporary contract that puts an insurance policy
into force before the premium has been paid.
Question: Blanket Insurance -✓✓A single property insurance policy that
provides coverage for multiple classes of property at one location, or
