Texas Property and Casualty practice exam
Latest Update 2025-2026 50 Questions and 100%
Verified Correct Answers Guaranteed A+
#28.
When applying for an individual life insurance policy, an applicant states that he went to
the doctor for nausea, but fails to mention that he was also having severe chest pains.
This is an example of - CORRECT ANSWER: concealment
A homeowner sells his house to a friend. The friend wants to keep the homeowner's
current policy in effect. Under the assignment provision, which of the following is most
likely? - CORRECT ANSWER: The homeowner will need to get written consent from the
insurer before the policy can be reassigned.
A premium discount is the term that describes when an insured owes a total standard
premium greater than - CORRECT ANSWER: $5,000
All of the following are considered parts of the policy structure EXCEPT - CORRECT
ANSWER: Provisions
All of the following are true regarding deposit premium - CORRECT ANSWER: It must
be paid in advance.
It is an estimated premium paid at the policy issue.
It could be adjusted by the audit.
, Deposit premium is an estimated premium paid in advance at the time the policy is
issued that may be adjusted by the audit based on actual exposures.
All of the following statements describe the concept of strict liability EXCEPT -
CORRECT ANSWER: It is imposed on defendants engaged in hazardous activities
An insured is applying for a casualty insurance policy. One of the conditions of the
policy allows the insurance company to inspect the insured's books at the end of the
policy term to make sure sufficient premium has been collected for the exposure she
plans to insure. Which condition is part of the insured's policy? - CORRECT ANSWER:
Deposit premium audit
Deposit premium audit is a condition that allows an insurer to inspect the insured's
books at the end of the policy term to make sure sufficient payment has been collected
for the exposure.
An insured owns a building that is valued at $400,000. To comply with the 80%
coinsurance provision of his insurance policy, how much should he insure the property
for? - CORRECT ANSWER: 80% of the property's replacement cost or more
The coinsurance clause states that in consideration of a reduced rate, the insured
agrees to maintain a certain minimum amount of insurance on the insured property. In
the event of a covered loss, insurance is designed to pay replacement cost minus
depreciation.
An insured relocated to another state for work. However, she still owns and insures a
house in this state, but has had no one living in it for 3 months. She is also storing some
furniture and clothes in the house. From an insurance standpoint, the insured's house is
considered - CORRECT ANSWER: Unoccupied
Latest Update 2025-2026 50 Questions and 100%
Verified Correct Answers Guaranteed A+
#28.
When applying for an individual life insurance policy, an applicant states that he went to
the doctor for nausea, but fails to mention that he was also having severe chest pains.
This is an example of - CORRECT ANSWER: concealment
A homeowner sells his house to a friend. The friend wants to keep the homeowner's
current policy in effect. Under the assignment provision, which of the following is most
likely? - CORRECT ANSWER: The homeowner will need to get written consent from the
insurer before the policy can be reassigned.
A premium discount is the term that describes when an insured owes a total standard
premium greater than - CORRECT ANSWER: $5,000
All of the following are considered parts of the policy structure EXCEPT - CORRECT
ANSWER: Provisions
All of the following are true regarding deposit premium - CORRECT ANSWER: It must
be paid in advance.
It is an estimated premium paid at the policy issue.
It could be adjusted by the audit.
, Deposit premium is an estimated premium paid in advance at the time the policy is
issued that may be adjusted by the audit based on actual exposures.
All of the following statements describe the concept of strict liability EXCEPT -
CORRECT ANSWER: It is imposed on defendants engaged in hazardous activities
An insured is applying for a casualty insurance policy. One of the conditions of the
policy allows the insurance company to inspect the insured's books at the end of the
policy term to make sure sufficient premium has been collected for the exposure she
plans to insure. Which condition is part of the insured's policy? - CORRECT ANSWER:
Deposit premium audit
Deposit premium audit is a condition that allows an insurer to inspect the insured's
books at the end of the policy term to make sure sufficient payment has been collected
for the exposure.
An insured owns a building that is valued at $400,000. To comply with the 80%
coinsurance provision of his insurance policy, how much should he insure the property
for? - CORRECT ANSWER: 80% of the property's replacement cost or more
The coinsurance clause states that in consideration of a reduced rate, the insured
agrees to maintain a certain minimum amount of insurance on the insured property. In
the event of a covered loss, insurance is designed to pay replacement cost minus
depreciation.
An insured relocated to another state for work. However, she still owns and insures a
house in this state, but has had no one living in it for 3 months. She is also storing some
furniture and clothes in the house. From an insurance standpoint, the insured's house is
considered - CORRECT ANSWER: Unoccupied
