TEXAS SURPLUS LINES CERTIFICATION
EVALUATION EXAM 2026 COMPLETE
QUESTIONS AND SOLUTIONS
◉ Risk. Answer: The chance of loss and uncertainty. The term "risk"
also refers to the insured person, property, or activity. A insured person,
property, or activity is also known as a "subject."
◉ Loss. Answer: A loss is an unwelcome and unplanned reduction in
economic value.
◉ Direct Loss. Answer: The immediate result of an event caused by a
covered peril.
◉ Indirect Loss. Answer: Loss that is a result or consequence of a direct
loss.
◉ Exposure. Answer: The state of being subject to a possible loss
◉ Peril. Answer: Destructive events that Insurance guards against.
Examples include:
Fire
, Explosion
Windstorm (NS, W/H)
Flood
Theft
Collision
◉ Hazard. Answer: A hazard is a condition that increases the likely
occurrence of a peril or the likely severity of a loss. There are 3 types of
hazards (MMP): Moral, Morale, and Physical.
◉ Moral (Bad Habits). Answer: Moral hazards are the tendencies or
traits of an individual that increase the chance of a loss. Alcoholism,
smoking, and bad credit are examples of moral hazards.
◉ Morale (Carelessness). Answer: Morale hazards are also individual
tendencies, but they arise from a state of mind, attitude, or indifference
to loss. Not locking one's car or driving recklessly are examples of
morale hazards.
◉ Physical Hazards (Objects). Answer: Physical hazards are physical
conditions that increase the chance of loss. For example, potholes on
freeways and streets, slippery floors, unsanitary conditions, congested
traffic, and unguarded premises.
EVALUATION EXAM 2026 COMPLETE
QUESTIONS AND SOLUTIONS
◉ Risk. Answer: The chance of loss and uncertainty. The term "risk"
also refers to the insured person, property, or activity. A insured person,
property, or activity is also known as a "subject."
◉ Loss. Answer: A loss is an unwelcome and unplanned reduction in
economic value.
◉ Direct Loss. Answer: The immediate result of an event caused by a
covered peril.
◉ Indirect Loss. Answer: Loss that is a result or consequence of a direct
loss.
◉ Exposure. Answer: The state of being subject to a possible loss
◉ Peril. Answer: Destructive events that Insurance guards against.
Examples include:
Fire
, Explosion
Windstorm (NS, W/H)
Flood
Theft
Collision
◉ Hazard. Answer: A hazard is a condition that increases the likely
occurrence of a peril or the likely severity of a loss. There are 3 types of
hazards (MMP): Moral, Morale, and Physical.
◉ Moral (Bad Habits). Answer: Moral hazards are the tendencies or
traits of an individual that increase the chance of a loss. Alcoholism,
smoking, and bad credit are examples of moral hazards.
◉ Morale (Carelessness). Answer: Morale hazards are also individual
tendencies, but they arise from a state of mind, attitude, or indifference
to loss. Not locking one's car or driving recklessly are examples of
morale hazards.
◉ Physical Hazards (Objects). Answer: Physical hazards are physical
conditions that increase the chance of loss. For example, potholes on
freeways and streets, slippery floors, unsanitary conditions, congested
traffic, and unguarded premises.
