FUNDAMENTALS OF INSURANCE - PRACTICE EXAM 202526 |GUARANTEED ACCURATE ANSWERS

FUNDAMENTALS OF INSURANCE - PRACTICE EXAM
2025\26 |GUARANTEED ACCURATE ANSWERS



Terms in this set (97)


The major function of insurance b. To share the losses of the few among the many
is:


a.To reduce the cost of
the losses
b.To share the losses of the
few among the many
c.The safeguard the interest
of mortgages
d.To serve as a basis of existing
credit system

A peril if best defined as: c. The cause of a loss


a.The chance of a loss
b.The occurrence of a loss
c.The cause of a loss
d.The result of a loss

,Indemnify means: b. Restoring the insured's to the same financial position as they
were immediately prior to the loss
a. Returning the premium of
the insured
b. Restoring the insured's to
the same financial position as
they were in immediately prior
to the loss
c. Paying the insured's the
face amount of the policy
d. Restoring the insured's to
the same financial position as
they were

,Property insurance contracts are a. The event must be must be a future event and it must be
designed to pay for loss or accidental
damage arising out of the
happening of a specific event.
Only the following statement
regarding the events insured by
property insurance contract is
correct:


a.The event must be a
future event and it must be
accidental
b.The event may happen
with the co-operation of the
insured
c.The event may happen
with the intent of the
insured
d.The event may occur
accidentally or be caused
deliberately by the insured

, The following is the most d. Transfer of Risk
practical way in which to deal
with risk:


a.Avoidance of Risk
b. Retention of Risk
c. Controlling of Risk
d.Transfer of Risk