Louisiana Property and Casualty Insurance Exam/ 2025-2026
Verified Questions With Answers.
Terms in this set (369)
This package is known as open peril coverage (sometimes called
Special cause of loss/open perils
all risk). With Special you are covered for EVERYTHING
except what is excluded.
This type of insurance covers more than one item of property at a
Blanket insurance
single location or one more items of property at multiple
locations.
Speculative possibility of both gain and loss. Not insurable.
Pure only the possibility of loss. Insurable.
What are the 5 methods of managing avoid, control, retain, and transfer risk.
or handling risk?
Hazard A condition or situation which increases the chance for loss
a hazard that arises from the condition, occupancy, or use of the property itself.
Physical Hazards
ex: skateboard left on the steps
when an individual through carelessness or by irresponsible actions
can increase the possibly for a loss.
Moral Hazards
ex: person who drives carelessly just because they know they are insured.
when a person might create a loss situation on purpose just to
collect from the insurance company.
Morale Hazards
ex: Prearranged, faked theft of someone's old vehicle so they can get
an insurance payout to buy a new vehicle.
The amount of money it would take to replace a damaged or destroyed item with
Replacement Cost
one of like kind and quality AT THE TIME OF LOSS. No deduction for
depreciation.
, Actual Cash Value (ACV) Replacement Cost, minus depreciation.
Pair and Set Clause Loss to one item of a pair or set does not constitute loss to the entire pair or
set.
A method of resolving disputes between insurers and insureds
over the amount owed on a covered loss.
Appraisal -both parties select an appraiser
-the two appraisers select an umpire
-if the appraisers do not agree, the umpire is consulted
-the amount agreed on by 2 out of 3 is the amount that will be paid
An insurer's right to recover the amount of its loss payment from
Subrogation
the third party who is legally responsible for the loss.
this condition is similar to the Appraisal Condition but it is not
Arbitration limited to disputes over the value of the loss. It may also be used
to resolve other areas of disagreement between the insured and
the insurance company.
Windstorm, Civil commotion, Smoke, Hail, Aircraft, Vehicles,
What does WC SHAVVER stand
for? Volcanic eruption, Explosion, Riot
Insolvency A financial state that occurs if liabilities are greater than assets.
Law of Agency Knowledge of the Agents is Knowledge of the Principal (Insurance
Company)
Principal Insurance Company
Insurance Services Office which is an organization established
for the benefit of its member insurance companies. This
What is the ISO?
organization gathers statistics, provides loss costs, drafts policy
forms and coverage provisions and conducts inspections for rate
making purposes.
Requires the insured to carry a minimum specified amount (generally 80%) of
Coinsurance Clause the
replacement cost value of the insured property in order for partial
losses to be paid in full.
A legal bar to changing or denying a fact because of one's own
previous actions or words to the contrary.
Estoppel
ex: If an insurance company representative intentionally or
unintentionally gives the impression that a specific fact exists
when it does not and a client relies on that
impression and is damaged a result.
Verified Questions With Answers.
Terms in this set (369)
This package is known as open peril coverage (sometimes called
Special cause of loss/open perils
all risk). With Special you are covered for EVERYTHING
except what is excluded.
This type of insurance covers more than one item of property at a
Blanket insurance
single location or one more items of property at multiple
locations.
Speculative possibility of both gain and loss. Not insurable.
Pure only the possibility of loss. Insurable.
What are the 5 methods of managing avoid, control, retain, and transfer risk.
or handling risk?
Hazard A condition or situation which increases the chance for loss
a hazard that arises from the condition, occupancy, or use of the property itself.
Physical Hazards
ex: skateboard left on the steps
when an individual through carelessness or by irresponsible actions
can increase the possibly for a loss.
Moral Hazards
ex: person who drives carelessly just because they know they are insured.
when a person might create a loss situation on purpose just to
collect from the insurance company.
Morale Hazards
ex: Prearranged, faked theft of someone's old vehicle so they can get
an insurance payout to buy a new vehicle.
The amount of money it would take to replace a damaged or destroyed item with
Replacement Cost
one of like kind and quality AT THE TIME OF LOSS. No deduction for
depreciation.
, Actual Cash Value (ACV) Replacement Cost, minus depreciation.
Pair and Set Clause Loss to one item of a pair or set does not constitute loss to the entire pair or
set.
A method of resolving disputes between insurers and insureds
over the amount owed on a covered loss.
Appraisal -both parties select an appraiser
-the two appraisers select an umpire
-if the appraisers do not agree, the umpire is consulted
-the amount agreed on by 2 out of 3 is the amount that will be paid
An insurer's right to recover the amount of its loss payment from
Subrogation
the third party who is legally responsible for the loss.
this condition is similar to the Appraisal Condition but it is not
Arbitration limited to disputes over the value of the loss. It may also be used
to resolve other areas of disagreement between the insured and
the insurance company.
Windstorm, Civil commotion, Smoke, Hail, Aircraft, Vehicles,
What does WC SHAVVER stand
for? Volcanic eruption, Explosion, Riot
Insolvency A financial state that occurs if liabilities are greater than assets.
Law of Agency Knowledge of the Agents is Knowledge of the Principal (Insurance
Company)
Principal Insurance Company
Insurance Services Office which is an organization established
for the benefit of its member insurance companies. This
What is the ISO?
organization gathers statistics, provides loss costs, drafts policy
forms and coverage provisions and conducts inspections for rate
making purposes.
Requires the insured to carry a minimum specified amount (generally 80%) of
Coinsurance Clause the
replacement cost value of the insured property in order for partial
losses to be paid in full.
A legal bar to changing or denying a fact because of one's own
previous actions or words to the contrary.
Estoppel
ex: If an insurance company representative intentionally or
unintentionally gives the impression that a specific fact exists
when it does not and a client relies on that
impression and is damaged a result.
