PSI Property and Casualty Exam ACTUAL
QUESTIONS AND CORRECT ANSWERS
Property Insurance Basics
All of the following may be listed as an insured on a property policy, except:
A . mortgagee listed as an additional insured
B. The policyowner
C. A business with temporary custody of the insured property
D. A named insured's legal representative - CORRECT ANSWERS✅✅C
under no benefit to bailee remember 3 C's, care,custody, control of an insured's property does
NOT benefit from claim, payment and cannot be named on policy
Property Insurance Basics-
listed on a property policy - CORRECT ANSWERS✅✅-mortgagees
-loss payees
-legal insured
Property Insurance Basics-
when property is valued on a replacement cost basis losses are paid:
A
At the cost to replace with functionally equivalent property
B
At today's costs, without any deduction for depreciation
C
At market value of the damaged property
D
At an amount previously agreed upon by the insured and insurer - CORRECT
ANSWERS✅✅B
remember functional replacement cost is for materials or techniques that are outdated or too
expensive
,Property Insurance Basics-
Which construction classification uses materials that can withstand fire for at least 2 hours?
A
Frame
B
Noncombustible
C
Fire-Resistive
D
Masonry - CORRECT ANSWERS✅✅Fire-Resistive
The pair and set clause found in property policies states that in the event of a loss to only part
of pair or set, losses will be settled
either by
A. repairing or replacing the damaged part or by paying the difference between the actual
cash value before and after the loss
B. deny coverage
C. Replace entire set with equal value
D. Pay the appraised value - CORRECT ANSWERS✅✅Repairing or replacing the damaged
part
OR
paying the difference of ACV before and after loss
Property Insurance Basics-
when filing a property insurance claim, the insured is required to do all of the following
except
A
Hire an appraiser
B
Give notice of loss as soon as possible
C
,Protect property from further damage
D
Submit to an examination under oath at the insurer's request - CORRECT ANSWERS✅✅A
Insured's duties after a loss
-furnishing inventory
-submitting to examination
-giving prompt notice of loss
-protect property from further damage
Does fire insurance insure against
A-friendly fires (confined to their intended place)
B- accidental fires
C-Hostile fires - CORRECT ANSWERS✅✅C
Fire insurance insures against uncontrolled or hostile fires
Property Insurance Basics-
The standard fire policy requires that all property insurance policies provide coverage for all
of the following perils, except:
A
Fire
B
Lightning
C
Theft
D
Removal of property - CORRECT ANSWERS✅✅theft
FIRE THINK (RFL)
, ROLL (removal of property)
FLOOR (fire)
LAUGHING (lightning)
when you think of liability think of money going to the - CORRECT ANSWERS✅✅third
party
Casualty (liability) insurance basics
Property damage covered by a liability policy includes which of the following?
A
Damage to property owned by, or leased to, the insured
B
Damage to tangible property belonging to a third party, including loss of use of that property,
caused by the insured's negligence
C
Damage to the insured's products arising out of the products
D
Damage to property of others in the insured's care, custody, or control that results from a
criminal wrong - CORRECT ANSWERS✅✅B
Casualty Basics
what does a liability policy cover - CORRECT ANSWERS✅✅medical and legal fees if
you're held legally responsible for someone else's injury, or damage to someone else's
property.--including loss of use of that property caused by acts of the insured
casualty basics
what are supplementary payments - CORRECT ANSWERS✅✅payments that the insurer
makes to the insured for costs to resolve claims or investigate
casualty basics:
QUESTIONS AND CORRECT ANSWERS
Property Insurance Basics
All of the following may be listed as an insured on a property policy, except:
A . mortgagee listed as an additional insured
B. The policyowner
C. A business with temporary custody of the insured property
D. A named insured's legal representative - CORRECT ANSWERS✅✅C
under no benefit to bailee remember 3 C's, care,custody, control of an insured's property does
NOT benefit from claim, payment and cannot be named on policy
Property Insurance Basics-
listed on a property policy - CORRECT ANSWERS✅✅-mortgagees
-loss payees
-legal insured
Property Insurance Basics-
when property is valued on a replacement cost basis losses are paid:
A
At the cost to replace with functionally equivalent property
B
At today's costs, without any deduction for depreciation
C
At market value of the damaged property
D
At an amount previously agreed upon by the insured and insurer - CORRECT
ANSWERS✅✅B
remember functional replacement cost is for materials or techniques that are outdated or too
expensive
,Property Insurance Basics-
Which construction classification uses materials that can withstand fire for at least 2 hours?
A
Frame
B
Noncombustible
C
Fire-Resistive
D
Masonry - CORRECT ANSWERS✅✅Fire-Resistive
The pair and set clause found in property policies states that in the event of a loss to only part
of pair or set, losses will be settled
either by
A. repairing or replacing the damaged part or by paying the difference between the actual
cash value before and after the loss
B. deny coverage
C. Replace entire set with equal value
D. Pay the appraised value - CORRECT ANSWERS✅✅Repairing or replacing the damaged
part
OR
paying the difference of ACV before and after loss
Property Insurance Basics-
when filing a property insurance claim, the insured is required to do all of the following
except
A
Hire an appraiser
B
Give notice of loss as soon as possible
C
,Protect property from further damage
D
Submit to an examination under oath at the insurer's request - CORRECT ANSWERS✅✅A
Insured's duties after a loss
-furnishing inventory
-submitting to examination
-giving prompt notice of loss
-protect property from further damage
Does fire insurance insure against
A-friendly fires (confined to their intended place)
B- accidental fires
C-Hostile fires - CORRECT ANSWERS✅✅C
Fire insurance insures against uncontrolled or hostile fires
Property Insurance Basics-
The standard fire policy requires that all property insurance policies provide coverage for all
of the following perils, except:
A
Fire
B
Lightning
C
Theft
D
Removal of property - CORRECT ANSWERS✅✅theft
FIRE THINK (RFL)
, ROLL (removal of property)
FLOOR (fire)
LAUGHING (lightning)
when you think of liability think of money going to the - CORRECT ANSWERS✅✅third
party
Casualty (liability) insurance basics
Property damage covered by a liability policy includes which of the following?
A
Damage to property owned by, or leased to, the insured
B
Damage to tangible property belonging to a third party, including loss of use of that property,
caused by the insured's negligence
C
Damage to the insured's products arising out of the products
D
Damage to property of others in the insured's care, custody, or control that results from a
criminal wrong - CORRECT ANSWERS✅✅B
Casualty Basics
what does a liability policy cover - CORRECT ANSWERS✅✅medical and legal fees if
you're held legally responsible for someone else's injury, or damage to someone else's
property.--including loss of use of that property caused by acts of the insured
casualty basics
what are supplementary payments - CORRECT ANSWERS✅✅payments that the insurer
makes to the insured for costs to resolve claims or investigate
casualty basics:
