5/30/26, 9:51 AM EXAM - Property and Casualty Insurance EXAM )2026 (Questions + Answers) Flashcards | Quizlet
EXAM - Property and Casualty Insurance EXAM
)2026 (Questions + Answers)
Save Groups
Terms in this set (301)
Specific insurance This type of insurance designates a particular item
to be insured
Blanket insurance This type of insurance covers more than one item
of property at a single location or one more items
of property at multiple locations.
Speculative possibility of both gain and loss. Not insurable.
Pure only the possibility of loss. Insurable.
What are the 5 methods of managing avoid, control, retain, and transfer risk.
or handling risk?
Hazard A condition or situation which increases the chance
for loss
Physical Hazards a hazard that arises from the condition, occupancy,
or use of the property itself.
ex: skateboard left on the steps
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Moral Hazards when an individual through carelessness or by
irresponsible actions can increase the possibly for
a loss.
ex: person who drives carelessly just because they
know they are insured.
Morale Hazards when a person might create a loss situation on
purpose just to collect from the insurance
company.
ex: Prearranged, faked theft of someone's old
vehicle so they can get an insurance payout to buy
a new vehicle.
Replacement Cost The amount of money it would take to replace a
damaged or destroyed item with one of like kind
and quality AT THE TIME OF LOSS. No deduction
for depreciation.
Actual Cash Value (ACV) Replacement Cost, minus depreciation.
Pair and Set Clause Loss to one item of a pair or set does not
constitute loss to the entire pair or set.
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Appraisal A method of resolving disputes between insurers
and insureds over the amount owed on a covered
loss.
-both parties select an appraiser
-the two appraisers select an umpire
-if the appraisers do not agree, the umpire is
consulted
-the amount agreed on by 2 out of 3 is the amount
that will be paid
Subrogation An insurer's right to recover the amount of its loss
payment from the third party who is legally
responsible for the loss.
Arbitration this condition is similar to the Appraisal Condition
but it is not limited to disputes over the value of the
loss. It may also be used to resolve other areas of
disagreement between the insured and the
insurance company.
What does WC SHAVVER stand for? Windstorm, Civil commotion, Smoke, Hail, Aircraft,
Vehicles, Volcanic eruption, Explosion, Riot
What does BIG AFFECT stand for? Burglar damage, Ice & snow weight, Glass
breakage, Accidental discharge, Falling objects,
Freezing of pipes, Electrical damage, Collapse,
Tearing apart.
Insolvency A financial state that occurs if liabilities are greater
than assets.
Law of Agency Knowledge of the Agents is Knowledge of the
Principal (Insurance Company)
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Principal Insurance Company
What is the ISO? Insurance Services Office which is an organization
established for the benefit of its member insurance
companies. This organization gathers statistics,
provides loss costs, drafts policy forms and
coverage provisions and conducts inspections for
rate making purposes.
Coinsurance Clause Requires the insured to carry a minimum specified
amount (generally 80%) of the replacement cost
value of the insured property in order for partial
losses to be paid in full.
Estoppel A legal bar to changing or denying a fact because
of one's own previous actions or words to the
contrary.
ex: If an insurance company representative
intentionally or unintentionally gives the impression
that a specific fact exists when it does not and a
client relies on that impression and is damaged a
result.
Binder A temporary contract of insurance, oral or written,
offered by an insurer pending issuance of the
policy. Usually written for a period of 30-60 days
and remains in force for that period or until a
permanent policy is either issued or denied by the
insurer.
Warranty A provision in a policy that pledges that a condition
does exist or will exist at some time in the future.
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EXAM - Property and Casualty Insurance EXAM
)2026 (Questions + Answers)
Save Groups
Terms in this set (301)
Specific insurance This type of insurance designates a particular item
to be insured
Blanket insurance This type of insurance covers more than one item
of property at a single location or one more items
of property at multiple locations.
Speculative possibility of both gain and loss. Not insurable.
Pure only the possibility of loss. Insurable.
What are the 5 methods of managing avoid, control, retain, and transfer risk.
or handling risk?
Hazard A condition or situation which increases the chance
for loss
Physical Hazards a hazard that arises from the condition, occupancy,
or use of the property itself.
ex: skateboard left on the steps
https://quizlet.com/1185210044/exam-property-and-casualty-insurance-exam-2026-questions-answers-flash-cards/?new 1/48
,5/30/26, 9:51 AM EXAM - Property and Casualty Insurance EXAM )2026 (Questions + Answers) Flashcards | Quizlet
Moral Hazards when an individual through carelessness or by
irresponsible actions can increase the possibly for
a loss.
ex: person who drives carelessly just because they
know they are insured.
Morale Hazards when a person might create a loss situation on
purpose just to collect from the insurance
company.
ex: Prearranged, faked theft of someone's old
vehicle so they can get an insurance payout to buy
a new vehicle.
Replacement Cost The amount of money it would take to replace a
damaged or destroyed item with one of like kind
and quality AT THE TIME OF LOSS. No deduction
for depreciation.
Actual Cash Value (ACV) Replacement Cost, minus depreciation.
Pair and Set Clause Loss to one item of a pair or set does not
constitute loss to the entire pair or set.
https://quizlet.com/1185210044/exam-property-and-casualty-insurance-exam-2026-questions-answers-flash-cards/?new 2/48
,5/30/26, 9:51 AM EXAM - Property and Casualty Insurance EXAM )2026 (Questions + Answers) Flashcards | Quizlet
Appraisal A method of resolving disputes between insurers
and insureds over the amount owed on a covered
loss.
-both parties select an appraiser
-the two appraisers select an umpire
-if the appraisers do not agree, the umpire is
consulted
-the amount agreed on by 2 out of 3 is the amount
that will be paid
Subrogation An insurer's right to recover the amount of its loss
payment from the third party who is legally
responsible for the loss.
Arbitration this condition is similar to the Appraisal Condition
but it is not limited to disputes over the value of the
loss. It may also be used to resolve other areas of
disagreement between the insured and the
insurance company.
What does WC SHAVVER stand for? Windstorm, Civil commotion, Smoke, Hail, Aircraft,
Vehicles, Volcanic eruption, Explosion, Riot
What does BIG AFFECT stand for? Burglar damage, Ice & snow weight, Glass
breakage, Accidental discharge, Falling objects,
Freezing of pipes, Electrical damage, Collapse,
Tearing apart.
Insolvency A financial state that occurs if liabilities are greater
than assets.
Law of Agency Knowledge of the Agents is Knowledge of the
Principal (Insurance Company)
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, 5/30/26, 9:51 AM EXAM - Property and Casualty Insurance EXAM )2026 (Questions + Answers) Flashcards | Quizlet
Principal Insurance Company
What is the ISO? Insurance Services Office which is an organization
established for the benefit of its member insurance
companies. This organization gathers statistics,
provides loss costs, drafts policy forms and
coverage provisions and conducts inspections for
rate making purposes.
Coinsurance Clause Requires the insured to carry a minimum specified
amount (generally 80%) of the replacement cost
value of the insured property in order for partial
losses to be paid in full.
Estoppel A legal bar to changing or denying a fact because
of one's own previous actions or words to the
contrary.
ex: If an insurance company representative
intentionally or unintentionally gives the impression
that a specific fact exists when it does not and a
client relies on that impression and is damaged a
result.
Binder A temporary contract of insurance, oral or written,
offered by an insurer pending issuance of the
policy. Usually written for a period of 30-60 days
and remains in force for that period or until a
permanent policy is either issued or denied by the
insurer.
Warranty A provision in a policy that pledges that a condition
does exist or will exist at some time in the future.
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