State Farm Property Test
1. In property insurance actual cash value is defined as which of the follow-
ing
Answer Replacement cost at the time of the loss, less depreciation
2. Peril is most easily defined as
Answer the cause of loss insured against
3. What is a leading factor in the determination of actual cash value
Answer replace- ment cost
4. Replacement cost is defined as
Answer full replacement of property at its current cost, new and without reduction
for depreciation
5. Property insurance that provides 100k coverage for a building and 50k
coverage for personal property at a single location is called
Answer Specific coverage
6. Which of the following is used in the formula for calculating the actual cash
value of a property
Answer replacement cost
7. What is the purpose of the coinsurance clause found in property insurance
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, policies?
Answer Encourage the insured to insure the property closer to its full value
8. 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?
Answer per occurrence
9. 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
Answer stated amount
10. What is stated amount coverage
Answer 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 insure
having first right of refusal of the salvage.
11. What type of liability would a person who owns a swimming pool have?
Answer -
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1. In property insurance actual cash value is defined as which of the follow-
ing
Answer Replacement cost at the time of the loss, less depreciation
2. Peril is most easily defined as
Answer the cause of loss insured against
3. What is a leading factor in the determination of actual cash value
Answer replace- ment cost
4. Replacement cost is defined as
Answer full replacement of property at its current cost, new and without reduction
for depreciation
5. Property insurance that provides 100k coverage for a building and 50k
coverage for personal property at a single location is called
Answer Specific coverage
6. Which of the following is used in the formula for calculating the actual cash
value of a property
Answer replacement cost
7. What is the purpose of the coinsurance clause found in property insurance
1/8
, policies?
Answer Encourage the insured to insure the property closer to its full value
8. 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?
Answer per occurrence
9. 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
Answer stated amount
10. What is stated amount coverage
Answer 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 insure
having first right of refusal of the salvage.
11. What type of liability would a person who owns a swimming pool have?
Answer -
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