SURPLUS LINES EXAM 2025 QUESTIONS
AND CORRECT ANSWERS | A+ GRADE
2025-2026
Which of the following best describes a risk retention
group? Correct Answer A) Skateboard manufacturers or
boiler inspectors that do not buy insurance from the
insurers
What is the tax rate on surplus lines policies? Correct
Answer C) 4.85%
By what date does a surplus lines agent have to pay the
premium tax? Correct Answer B) January 31st
Risk can be: Correct Answer A) Avoided
The two types of risk are: Correct Answer C) Speculative
and Pure
When you can only lose and not win, you are referring to:
Correct Answer A) Pure Risk
All are ways to handle risk EXCEPT: Correct Answer A)
Indemnify Risk
A hazard includes all of the following EXCEPT: Correct
Answer B) Kids spray painting things on your garage
, A morale hazard is which of the following? Correct Answer
B) Leaving your keys in your car while you run into the
store
A hazard that arises from a condition of the property itself
is: Correct Answer D) A physical hazard
When you transfer risk to the carrier in exchange for a
premium this is: Correct Answer B) Insurance
The money the insured pays as a consideration is called:
Correct Answer D) Premium
Hazards are which of the following? Correct Answer B)
Increases the chance of having a peril
Proximate cause is which of the following? Correct Answer
B) an unbroken chain of events that caused the loss
Which of the following are perils? Correct Answer A)
Hurricane, hail and smoke
Policies pay for which of the following? Correct Answer A)
Perils
Premium calculations are based on: Correct Answer C)
the underwriters determination on the amount of risk
A direct loss is which of the following? Correct Answer D)
A reduction in value to the item itself
AND CORRECT ANSWERS | A+ GRADE
2025-2026
Which of the following best describes a risk retention
group? Correct Answer A) Skateboard manufacturers or
boiler inspectors that do not buy insurance from the
insurers
What is the tax rate on surplus lines policies? Correct
Answer C) 4.85%
By what date does a surplus lines agent have to pay the
premium tax? Correct Answer B) January 31st
Risk can be: Correct Answer A) Avoided
The two types of risk are: Correct Answer C) Speculative
and Pure
When you can only lose and not win, you are referring to:
Correct Answer A) Pure Risk
All are ways to handle risk EXCEPT: Correct Answer A)
Indemnify Risk
A hazard includes all of the following EXCEPT: Correct
Answer B) Kids spray painting things on your garage
, A morale hazard is which of the following? Correct Answer
B) Leaving your keys in your car while you run into the
store
A hazard that arises from a condition of the property itself
is: Correct Answer D) A physical hazard
When you transfer risk to the carrier in exchange for a
premium this is: Correct Answer B) Insurance
The money the insured pays as a consideration is called:
Correct Answer D) Premium
Hazards are which of the following? Correct Answer B)
Increases the chance of having a peril
Proximate cause is which of the following? Correct Answer
B) an unbroken chain of events that caused the loss
Which of the following are perils? Correct Answer A)
Hurricane, hail and smoke
Policies pay for which of the following? Correct Answer A)
Perils
Premium calculations are based on: Correct Answer C)
the underwriters determination on the amount of risk
A direct loss is which of the following? Correct Answer D)
A reduction in value to the item itself
