1
Texas Property & Casualty License EXAM Questions &
Answers | 100% Verified solutions |Questions with
Correct Answers 2025 latest update!!
Property vs Casualty: What is considered property? - (ANSWER)Structure &
Personal Property
Property vs Casualty: What is considered casualty? - (ANSWER)Non-property
losses. Legal liability to others. 3rd Party
Risk - (ANSWER)uncertainty of financial loss
Pure Risk - (ANSWER)Chance of Loss
Speculative Risk - (ANSWER)Chance of Loss or Gain (Gamble)
Insurance (covers which type of risk?) - (ANSWER)Pure Risk Only
How does the law of large numbers apply in insurance? - (ANSWER)Actuaries use
the law of large numbers to estimate claims
What is the law of large numbers? - (ANSWER)as the number of a similar loss
exposure increases, the more accurate claims can be predicted from the group.
What is a peril? - (ANSWER)cause of loss
, 2
What is a hazard? - (ANSWER)things that increase the chance of a peril
happening
Three types of hazards - (ANSWER)Physical: visible characteristic (dead tree)
Moral: Dishonest tendencies
Morale: Attitude of carelessness
Proximate Cause - (ANSWER)First cause in an unbroken chain of events
Elements of a legal contract (CALC) - (ANSWER)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? - (ANSWER)Information believed to be true.
What is misrepresentation? - (ANSWER)Information that is not true. False
information.
What is material misrepresentation? - (ANSWER)Information that is not true but
would have caused the insurer not to issue the policy. (4 prev spd tix)
, 3
What is fraud? - (ANSWER)An all out effort by one party to deceive and cheat the
other.
What is warranty? - (ANSWER)Guarantee that an insured will or will not do
something
What are the four major parts to an insurance policy structure? (DICE) -
(ANSWER)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) -
(ANSWER)Policy Number
Parties
Property Description/Location
Policy Term
Policy Limits/Deductibles
Premium
What is Limit of Liability? - (ANSWER)The max amount of coverage agreed to be
paid per loss
Texas Property & Casualty License EXAM Questions &
Answers | 100% Verified solutions |Questions with
Correct Answers 2025 latest update!!
Property vs Casualty: What is considered property? - (ANSWER)Structure &
Personal Property
Property vs Casualty: What is considered casualty? - (ANSWER)Non-property
losses. Legal liability to others. 3rd Party
Risk - (ANSWER)uncertainty of financial loss
Pure Risk - (ANSWER)Chance of Loss
Speculative Risk - (ANSWER)Chance of Loss or Gain (Gamble)
Insurance (covers which type of risk?) - (ANSWER)Pure Risk Only
How does the law of large numbers apply in insurance? - (ANSWER)Actuaries use
the law of large numbers to estimate claims
What is the law of large numbers? - (ANSWER)as the number of a similar loss
exposure increases, the more accurate claims can be predicted from the group.
What is a peril? - (ANSWER)cause of loss
, 2
What is a hazard? - (ANSWER)things that increase the chance of a peril
happening
Three types of hazards - (ANSWER)Physical: visible characteristic (dead tree)
Moral: Dishonest tendencies
Morale: Attitude of carelessness
Proximate Cause - (ANSWER)First cause in an unbroken chain of events
Elements of a legal contract (CALC) - (ANSWER)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? - (ANSWER)Information believed to be true.
What is misrepresentation? - (ANSWER)Information that is not true. False
information.
What is material misrepresentation? - (ANSWER)Information that is not true but
would have caused the insurer not to issue the policy. (4 prev spd tix)
, 3
What is fraud? - (ANSWER)An all out effort by one party to deceive and cheat the
other.
What is warranty? - (ANSWER)Guarantee that an insured will or will not do
something
What are the four major parts to an insurance policy structure? (DICE) -
(ANSWER)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) -
(ANSWER)Policy Number
Parties
Property Description/Location
Policy Term
Policy Limits/Deductibles
Premium
What is Limit of Liability? - (ANSWER)The max amount of coverage agreed to be
paid per loss
