California Property and Casualty Licensing Exam – Insurance Agent Certification Guide
The process where by a mutul insurer becomes a stock company is called - (ANSWER)Demutalization
The process whereby a stock company a mutal insurer is called - (ANSWER)Mutalization
The provision in a property policy which states that the insured has been paid up to their insurable
interest is - (ANSWER)Valuation clause
The part of the policy that states the amout of coverage the insured property policy period is -
(ANSWER)Declaration
Part of the policy that establishes limits upon the insurer and the insured with the insuance policy -
(ANSWER)Conditions
Which are the characterics of negligence - (ANSWER)Duty,breach,proximate cause, damages
Which of the following is not a federal program - (ANSWER)Worker' compensation
Absolute risk(liability) is imposed - (ANSWER)When there is negligence whether proven or not
X is in an accident with Y. X suffers $5000 of damage but it is determined that X is 60% responsible for
the accident. How much would X receive under CONTRIBUTORY negligence rules? - (ANSWER)$0
what is the main purpose of tort law - (ANSWER)to determine financial responsibillty for damage
what of the following is not considered an intentional tort? - (ANSWER)Auto accident
Which of the following statements is true regarding compensatory damages? - (ANSWER)There is
usually no direct correlation between the amount of general and special damages awarded to the victim
,California Property and Casualty Licensing Exam – Insurance Agent Certification Guide
The insurer decides not to renewan insured's personal auto policy. How much notice must the insurer
provide to the insured - (ANSWER)30 days
an insured's loss reserve for a claim isan estimate of the amount insurer will pay for present and future
loss, which of the following is an example of loss prevention - (ANSWER)a homeowner decides not to
install a pool in the backyard
which of the following describes the act of making a false entry in any book statement of report of any
insurer with the intent to device any examiner lawfully appointed to examine the insured's -
(ANSWER)an unfair practice
a person can base his/her claim for liability on the basis of all of the following EXCEPT - (ANSWER)breach
of liability
the term "assignment"refers to - (ANSWER)the transfer of the insured's interest in a policy to another
party
the term "subrogation" refers to - (ANSWER)the insured's right to recover payment from a responsible
3rd party
insur's right to recover the payment of the claim after they paid the insured for their property losses a
negligent 3rd party is know as, - (ANSWER)subrogation
an insurance deductible is - (ANSWER)the amount of covered expense that the insured pays before the
insurer pays,
all of the following are requirements for a notice by mail to an insured by insurer except -
(ANSWER)notice must be sent with return receipt required
which of the following is considered special damages - (ANSWER)Compensation for time away from
work
,California Property and Casualty Licensing Exam – Insurance Agent Certification Guide
Which advisory organization(s) develop forms for the standard market? - (ANSWER)Insurane service
office and American association of insurances
Which of the following would be considered special dmamges? - (ANSWER)Lost wages
What do the initials S.tA.R.R reperesent? - (ANSWER)Methods of risk mamagement
All of the following would be considered benfits of insurance except - (ANSWER)Retention of loss by the
insured
What gives an insured party the right to seek compensation if it is proven that another person with
negligence contributed to the injury - (ANSWER)Tort law
What of the following is NOT one the three main types of insurance losses - (ANSWER)Financial loss
Under a special cause of loss form if a landslide is caused by an unnatural flow of water due to improper
grading, the loss is, - (ANSWER)Excluded under the concurrent causation
An open peril policy protects agaginst the loss from - (ANSWER)Any peril, other than those specifically
excluded
What factor supportd the principle of indemnity? - (ANSWER)Insurable interest
All of the following are characteristics of an ideally insurable loss exposure"except" - (ANSWER)Losses
that are catastrophic
The amount to replace property with " like property of the same quality and construction" is the
properties - (ANSWER)Replacement value
All of the following are considered intentional torts - (ANSWER)except, Assult
, California Property and Casualty Licensing Exam – Insurance Agent Certification Guide
What is the difference between per accident limit in a split limit policy and single limits - (ANSWER)There
is no difference
The intentional relinquishment of known right is - (ANSWER)Waivier
Which type of loss is a business retirement or disability of key employee, exposed to death retirement or
disability of key employee, - (ANSWER)Personnel loss exposure
The amount to replace an insured's damaged property - (ANSWER)less depreciation, is know as the,
Actual cash value
The commercial property conditions included a condition called " liberalization". The effect of this
condition is - (ANSWER)To automatically apply broader coverage to the commercial property coverage
part if a policy form revision would broaden coverage without an addition premium
In a commercial lines program policycommon policy condition do not include which of the following as a
condition?, - (ANSWER)Perils insured
A possibility of financially loss resulting from the ownership of property is know as - (ANSWER)insurable
interest
laura is driving her own car on behalf of her employer laura's negligent operation of her car injures a
member of public. The employer may be held liable because of what is called., - (ANSWER)Vicarious
liability
Type of exposure can be best defined as a condition or situation where the exposure to financial loss is
presented to a business owner by the injury - (ANSWER)disability, death, sickness, of valuable employee,
Personnel loss exposure
Which of the following is also know as a human loss exposure - (ANSWER)Personal loss exposure
The process where by a mutul insurer becomes a stock company is called - (ANSWER)Demutalization
The process whereby a stock company a mutal insurer is called - (ANSWER)Mutalization
The provision in a property policy which states that the insured has been paid up to their insurable
interest is - (ANSWER)Valuation clause
The part of the policy that states the amout of coverage the insured property policy period is -
(ANSWER)Declaration
Part of the policy that establishes limits upon the insurer and the insured with the insuance policy -
(ANSWER)Conditions
Which are the characterics of negligence - (ANSWER)Duty,breach,proximate cause, damages
Which of the following is not a federal program - (ANSWER)Worker' compensation
Absolute risk(liability) is imposed - (ANSWER)When there is negligence whether proven or not
X is in an accident with Y. X suffers $5000 of damage but it is determined that X is 60% responsible for
the accident. How much would X receive under CONTRIBUTORY negligence rules? - (ANSWER)$0
what is the main purpose of tort law - (ANSWER)to determine financial responsibillty for damage
what of the following is not considered an intentional tort? - (ANSWER)Auto accident
Which of the following statements is true regarding compensatory damages? - (ANSWER)There is
usually no direct correlation between the amount of general and special damages awarded to the victim
,California Property and Casualty Licensing Exam – Insurance Agent Certification Guide
The insurer decides not to renewan insured's personal auto policy. How much notice must the insurer
provide to the insured - (ANSWER)30 days
an insured's loss reserve for a claim isan estimate of the amount insurer will pay for present and future
loss, which of the following is an example of loss prevention - (ANSWER)a homeowner decides not to
install a pool in the backyard
which of the following describes the act of making a false entry in any book statement of report of any
insurer with the intent to device any examiner lawfully appointed to examine the insured's -
(ANSWER)an unfair practice
a person can base his/her claim for liability on the basis of all of the following EXCEPT - (ANSWER)breach
of liability
the term "assignment"refers to - (ANSWER)the transfer of the insured's interest in a policy to another
party
the term "subrogation" refers to - (ANSWER)the insured's right to recover payment from a responsible
3rd party
insur's right to recover the payment of the claim after they paid the insured for their property losses a
negligent 3rd party is know as, - (ANSWER)subrogation
an insurance deductible is - (ANSWER)the amount of covered expense that the insured pays before the
insurer pays,
all of the following are requirements for a notice by mail to an insured by insurer except -
(ANSWER)notice must be sent with return receipt required
which of the following is considered special damages - (ANSWER)Compensation for time away from
work
,California Property and Casualty Licensing Exam – Insurance Agent Certification Guide
Which advisory organization(s) develop forms for the standard market? - (ANSWER)Insurane service
office and American association of insurances
Which of the following would be considered special dmamges? - (ANSWER)Lost wages
What do the initials S.tA.R.R reperesent? - (ANSWER)Methods of risk mamagement
All of the following would be considered benfits of insurance except - (ANSWER)Retention of loss by the
insured
What gives an insured party the right to seek compensation if it is proven that another person with
negligence contributed to the injury - (ANSWER)Tort law
What of the following is NOT one the three main types of insurance losses - (ANSWER)Financial loss
Under a special cause of loss form if a landslide is caused by an unnatural flow of water due to improper
grading, the loss is, - (ANSWER)Excluded under the concurrent causation
An open peril policy protects agaginst the loss from - (ANSWER)Any peril, other than those specifically
excluded
What factor supportd the principle of indemnity? - (ANSWER)Insurable interest
All of the following are characteristics of an ideally insurable loss exposure"except" - (ANSWER)Losses
that are catastrophic
The amount to replace property with " like property of the same quality and construction" is the
properties - (ANSWER)Replacement value
All of the following are considered intentional torts - (ANSWER)except, Assult
, California Property and Casualty Licensing Exam – Insurance Agent Certification Guide
What is the difference between per accident limit in a split limit policy and single limits - (ANSWER)There
is no difference
The intentional relinquishment of known right is - (ANSWER)Waivier
Which type of loss is a business retirement or disability of key employee, exposed to death retirement or
disability of key employee, - (ANSWER)Personnel loss exposure
The amount to replace an insured's damaged property - (ANSWER)less depreciation, is know as the,
Actual cash value
The commercial property conditions included a condition called " liberalization". The effect of this
condition is - (ANSWER)To automatically apply broader coverage to the commercial property coverage
part if a policy form revision would broaden coverage without an addition premium
In a commercial lines program policycommon policy condition do not include which of the following as a
condition?, - (ANSWER)Perils insured
A possibility of financially loss resulting from the ownership of property is know as - (ANSWER)insurable
interest
laura is driving her own car on behalf of her employer laura's negligent operation of her car injures a
member of public. The employer may be held liable because of what is called., - (ANSWER)Vicarious
liability
Type of exposure can be best defined as a condition or situation where the exposure to financial loss is
presented to a business owner by the injury - (ANSWER)disability, death, sickness, of valuable employee,
Personnel loss exposure
Which of the following is also know as a human loss exposure - (ANSWER)Personal loss exposure
