Texas Property & Casualty License Exam
Questions and Answers (Solved Papers)
Property vs Casualty: What is considered property? - Correct
Answers ✅Structure & Personal Property
Property vs Casualty: What is considered casualty? - Correct
Answers ✅Non-property losses. Legal liability to others. 3rd
Party
Risk - Correct Answers ✅uncertainty of financial loss
Pure Risk - Correct Answers ✅Chance of Loss
Speculative Risk - Correct Answers ✅Chance of Loss or
Gain (Gamble)
Insurance (covers which type of risk?) - Correct Answers
✅Pure Risk Only
How does the law of large numbers apply in insurance? -
Correct Answers ✅Actuaries use the law of large numbers
to estimate claims
What is the law of large numbers? - Correct Answers ✅as
the number of a similar loss exposure increases, the more
accurate claims can be predicted from the group.
,Texas Property & Casualty License Exam
Questions and Answers (Solved Papers)
What is a peril? - Correct Answers ✅cause of loss
What is a hazard? - Correct Answers ✅things that increase
the chance of a peril happening
Three types of hazards - Correct Answers ✅Physical:
visible characteristic (dead tree)
Moral: Dishonest tendencies
Morale: Attitude of carelessness
Proximate Cause - Correct Answers ✅First cause in an
unbroken chain of events
Elements of a legal contract (CALC) - Correct Answers ✅C -
Competent parties (18/Right frame of mind)
A - Agreement (Both parties agree)
L - Legal Purpose (The risk is LEGAL)
C - Consideration (It has to be fair)
What is representation? - Correct Answers ✅Information
believed to be true.
What is misrepresentation? - Correct Answers
✅Information that is not true. False information.
, Texas Property & Casualty License Exam
Questions and Answers (Solved Papers)
What is material misrepresentation? - Correct Answers
✅Information that is not true but would have caused the
insurer not to issue the policy. (4 prev spd tix)
What is fraud? - Correct Answers ✅An all out effort by one
party to deceive and cheat the other.
What is warranty? - Correct Answers ✅Guarantee that an
insured will or will not do something
What are the four major parts to an insurance policy
structure? (DICE) - Correct Answers ✅D - Declarations
Page (First Page)
I - Insuring Agreement (Insurers promise to pay)
C - Conditions (Rules)
E - Exclusions (Not covered)
What information is on the declarations page? (Remember 6
Ps) - Correct Answers ✅Policy Number
Parties
Property Description/Location
Policy Term
Policy Limits/Deductibles
Premium
Questions and Answers (Solved Papers)
Property vs Casualty: What is considered property? - Correct
Answers ✅Structure & Personal Property
Property vs Casualty: What is considered casualty? - Correct
Answers ✅Non-property losses. Legal liability to others. 3rd
Party
Risk - Correct Answers ✅uncertainty of financial loss
Pure Risk - Correct Answers ✅Chance of Loss
Speculative Risk - Correct Answers ✅Chance of Loss or
Gain (Gamble)
Insurance (covers which type of risk?) - Correct Answers
✅Pure Risk Only
How does the law of large numbers apply in insurance? -
Correct Answers ✅Actuaries use the law of large numbers
to estimate claims
What is the law of large numbers? - Correct Answers ✅as
the number of a similar loss exposure increases, the more
accurate claims can be predicted from the group.
,Texas Property & Casualty License Exam
Questions and Answers (Solved Papers)
What is a peril? - Correct Answers ✅cause of loss
What is a hazard? - Correct Answers ✅things that increase
the chance of a peril happening
Three types of hazards - Correct Answers ✅Physical:
visible characteristic (dead tree)
Moral: Dishonest tendencies
Morale: Attitude of carelessness
Proximate Cause - Correct Answers ✅First cause in an
unbroken chain of events
Elements of a legal contract (CALC) - Correct Answers ✅C -
Competent parties (18/Right frame of mind)
A - Agreement (Both parties agree)
L - Legal Purpose (The risk is LEGAL)
C - Consideration (It has to be fair)
What is representation? - Correct Answers ✅Information
believed to be true.
What is misrepresentation? - Correct Answers
✅Information that is not true. False information.
, Texas Property & Casualty License Exam
Questions and Answers (Solved Papers)
What is material misrepresentation? - Correct Answers
✅Information that is not true but would have caused the
insurer not to issue the policy. (4 prev spd tix)
What is fraud? - Correct Answers ✅An all out effort by one
party to deceive and cheat the other.
What is warranty? - Correct Answers ✅Guarantee that an
insured will or will not do something
What are the four major parts to an insurance policy
structure? (DICE) - Correct Answers ✅D - Declarations
Page (First Page)
I - Insuring Agreement (Insurers promise to pay)
C - Conditions (Rules)
E - Exclusions (Not covered)
What information is on the declarations page? (Remember 6
Ps) - Correct Answers ✅Policy Number
Parties
Property Description/Location
Policy Term
Policy Limits/Deductibles
Premium
