california property and casualty Exam
Questions with Revised Answers (2025 /
2026) 100% Guarantee Pass.
The process where by a mutul insurer becomes a stock company is called - CORRECT ANSWERS
Demutalization
The process whereby a stock company a mutal insurer is called - CORRECT ANSWERS
Mutalization
The provision in a property policy which states that the insured has been paid up to their insurable
interest is - CORRECT ANSWERS Valuation clause
The part of the policy that states the amout of coverage the insured property policy period is - CORRECT
ANSWERS Declaration
Part of the policy that establishes limits upon the insurer and the insured with the insuance policy -
CORRECT ANSWERS Conditions
Which are the characterics of negligence - CORRECT ANSWERS Duty,breach,proximate cause,
damages
Which of the following is not a federal program - CORRECT ANSWERS Worker' compensation
Absolute risk(liability) is imposed - CORRECT ANSWERS 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? - CORRECT ANSWERS
$0
what is the main purpose of tort law - CORRECT ANSWERS to determine financial responsibillty
for damage
what of the following is not considered an intentional tort? - CORRECT ANSWERS Auto
accident
Which of the following statements is true regarding compensatory damages? - CORRECT ANSWERS
There is usually no direct correlation between the amount of general and special damages awarded to
the victim
The insurer decides not to renewan insured's personal auto policy. How much notice must the insurer
provide to the insured - CORRECT ANSWERS 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 - CORRECT ANSWERS 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 - CORRECT
ANSWERS an unfair practice
a person can base his/her claim for liability on the basis of all of the following EXCEPT - CORRECT
ANSWERS breach of liability
the term "assignment"refers to - CORRECT ANSWERS the transfer of the insured's interest in a
policy to another party
the term "subrogation" refers to - CORRECT ANSWERS 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, - CORRECT ANSWERS subrogation
an insurance deductible is - CORRECT ANSWERS 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 - CORRECT
ANSWERS notice must be sent with return receipt required
which of the following is considered special damages - CORRECT ANSWERS Compensation for
time away from work
Which advisory organization(s) develop forms for the standard market? - CORRECT ANSWERS
Insurane service office and American association of insurances
Which of the following would be considered special dmamges? - CORRECT ANSWERS Lost
wages
What do the initials S.tA.R.R reperesent? - CORRECT ANSWERS Methods of risk mamagement
All of the following would be considered benfits of insurance except - CORRECT ANSWERS
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 - CORRECT ANSWERS Tort law
What of the following is NOT one the three main types of insurance losses - CORRECT ANSWERS
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, - CORRECT ANSWERS Excluded under the concurrent causation
,An open peril policy protects agaginst the loss from - CORRECT ANSWERS Any peril, other than
those specifically excluded
What factor supportd the principle of indemnity? - CORRECT ANSWERS Insurable interest
All of the following are characteristics of an ideally insurable loss exposure"except" - CORRECT
ANSWERS Losses that are catastrophic
The amount to replace property with " like property of the same quality and construction" is the
properties - CORRECT ANSWERS Replacement value
All of the following are considered intentional torts - CORRECT ANSWERS except, Assult
What is the difference between per accident limit in a split limit policy and single limits - CORRECT
ANSWERS There is no difference
The intentional relinquishment of known right is - CORRECT ANSWERS Waivier
Which type of loss is a business retirement or disability of key employee, exposed to death retirement or
disability of key employee, - CORRECT ANSWERS Personnel loss exposure
The amount to replace an insured's damaged property - CORRECT ANSWERS less depreciation,
is know as the, Actual cash value
The commercial property conditions included a condition called " liberalization". The effect of this
condition is - CORRECT ANSWERS 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?, - CORRECT ANSWERS Perils insured
A possibility of financially loss resulting from the ownership of property is know as - CORRECT ANSWERS
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., - CORRECT ANSWERS
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 - CORRECT ANSWERS disability, death, sickness, of
valuable employee, Personnel loss exposure
Which of the following is also know as a human loss exposure - CORRECT ANSWERS Personal
loss exposure
Which of the following best characterize a speculative risk? - CORRECT ANSWERS A situation
that offers the possibility for a loss or gain
, In the state of CA no rate will remain in effect if it is considered to be any of the following, EXCEPT, -
CORRECT ANSWERS Impartial
What course of action does a party to a contract have if the other party is found to be breach of that
contract - CORRECT ANSWERS Damage for breach, reasonable attorney fee and cost
Which part of the insurance contract summarize the major promises of the insurer - CORRECT ANSWERS
Insuring agreement
Under tort law a corporation can be subject to a claim for legal liability on the basis, - CORRECT
ANSWERS Absolute liability
Risk management technique that eliminates a loss exposure and reduces the chance of loss to zero is -
CORRECT ANSWERS Avoidance
A situation is which there only the possibility of loss or no loss is considered a - CORRECT ANSWERS
Pure risk
A reduction in value of property that results immediately from damage to the property is know as -
CORRECT ANSWERS Direct loss
Items that are paid on replacement cost is defined as the - CORRECT ANSWERS Amount to
replace the damage property without a deduction for depreciation
A wrongful act other than a crime or breach of contrat is law - CORRECT ANSWERS Tort law
The amount to replace property with like property of the same quality and construction is the -
CORRECT ANSWERS Replacement cost
Whatis the process whereby insurers decides which customers to insure and what coverage to offer -
CORRECT ANSWERS Underwriting
The amount paid for damaged propertywhich is equal to the price for which it could have been sold is
called - CORRECT ANSWERS Market value
A policy may not be transferred to another without - CORRECT ANSWERS Written consent of
the insured
An insured's loss reserve for a claim is - CORRECT ANSWERS An estimate or the amount that
the insurer will pay
What is the type of loss exposre that would include land and property attached to it - CORRECT
ANSWERS Liability loss exposure
What type of policy protect against loss from any peril except those that are specifally excluded -
CORRECT ANSWERS All-risk or open peril
Questions with Revised Answers (2025 /
2026) 100% Guarantee Pass.
The process where by a mutul insurer becomes a stock company is called - CORRECT ANSWERS
Demutalization
The process whereby a stock company a mutal insurer is called - CORRECT ANSWERS
Mutalization
The provision in a property policy which states that the insured has been paid up to their insurable
interest is - CORRECT ANSWERS Valuation clause
The part of the policy that states the amout of coverage the insured property policy period is - CORRECT
ANSWERS Declaration
Part of the policy that establishes limits upon the insurer and the insured with the insuance policy -
CORRECT ANSWERS Conditions
Which are the characterics of negligence - CORRECT ANSWERS Duty,breach,proximate cause,
damages
Which of the following is not a federal program - CORRECT ANSWERS Worker' compensation
Absolute risk(liability) is imposed - CORRECT ANSWERS 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? - CORRECT ANSWERS
$0
what is the main purpose of tort law - CORRECT ANSWERS to determine financial responsibillty
for damage
what of the following is not considered an intentional tort? - CORRECT ANSWERS Auto
accident
Which of the following statements is true regarding compensatory damages? - CORRECT ANSWERS
There is usually no direct correlation between the amount of general and special damages awarded to
the victim
The insurer decides not to renewan insured's personal auto policy. How much notice must the insurer
provide to the insured - CORRECT ANSWERS 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 - CORRECT ANSWERS 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 - CORRECT
ANSWERS an unfair practice
a person can base his/her claim for liability on the basis of all of the following EXCEPT - CORRECT
ANSWERS breach of liability
the term "assignment"refers to - CORRECT ANSWERS the transfer of the insured's interest in a
policy to another party
the term "subrogation" refers to - CORRECT ANSWERS 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, - CORRECT ANSWERS subrogation
an insurance deductible is - CORRECT ANSWERS 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 - CORRECT
ANSWERS notice must be sent with return receipt required
which of the following is considered special damages - CORRECT ANSWERS Compensation for
time away from work
Which advisory organization(s) develop forms for the standard market? - CORRECT ANSWERS
Insurane service office and American association of insurances
Which of the following would be considered special dmamges? - CORRECT ANSWERS Lost
wages
What do the initials S.tA.R.R reperesent? - CORRECT ANSWERS Methods of risk mamagement
All of the following would be considered benfits of insurance except - CORRECT ANSWERS
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 - CORRECT ANSWERS Tort law
What of the following is NOT one the three main types of insurance losses - CORRECT ANSWERS
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, - CORRECT ANSWERS Excluded under the concurrent causation
,An open peril policy protects agaginst the loss from - CORRECT ANSWERS Any peril, other than
those specifically excluded
What factor supportd the principle of indemnity? - CORRECT ANSWERS Insurable interest
All of the following are characteristics of an ideally insurable loss exposure"except" - CORRECT
ANSWERS Losses that are catastrophic
The amount to replace property with " like property of the same quality and construction" is the
properties - CORRECT ANSWERS Replacement value
All of the following are considered intentional torts - CORRECT ANSWERS except, Assult
What is the difference between per accident limit in a split limit policy and single limits - CORRECT
ANSWERS There is no difference
The intentional relinquishment of known right is - CORRECT ANSWERS Waivier
Which type of loss is a business retirement or disability of key employee, exposed to death retirement or
disability of key employee, - CORRECT ANSWERS Personnel loss exposure
The amount to replace an insured's damaged property - CORRECT ANSWERS less depreciation,
is know as the, Actual cash value
The commercial property conditions included a condition called " liberalization". The effect of this
condition is - CORRECT ANSWERS 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?, - CORRECT ANSWERS Perils insured
A possibility of financially loss resulting from the ownership of property is know as - CORRECT ANSWERS
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., - CORRECT ANSWERS
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 - CORRECT ANSWERS disability, death, sickness, of
valuable employee, Personnel loss exposure
Which of the following is also know as a human loss exposure - CORRECT ANSWERS Personal
loss exposure
Which of the following best characterize a speculative risk? - CORRECT ANSWERS A situation
that offers the possibility for a loss or gain
, In the state of CA no rate will remain in effect if it is considered to be any of the following, EXCEPT, -
CORRECT ANSWERS Impartial
What course of action does a party to a contract have if the other party is found to be breach of that
contract - CORRECT ANSWERS Damage for breach, reasonable attorney fee and cost
Which part of the insurance contract summarize the major promises of the insurer - CORRECT ANSWERS
Insuring agreement
Under tort law a corporation can be subject to a claim for legal liability on the basis, - CORRECT
ANSWERS Absolute liability
Risk management technique that eliminates a loss exposure and reduces the chance of loss to zero is -
CORRECT ANSWERS Avoidance
A situation is which there only the possibility of loss or no loss is considered a - CORRECT ANSWERS
Pure risk
A reduction in value of property that results immediately from damage to the property is know as -
CORRECT ANSWERS Direct loss
Items that are paid on replacement cost is defined as the - CORRECT ANSWERS Amount to
replace the damage property without a deduction for depreciation
A wrongful act other than a crime or breach of contrat is law - CORRECT ANSWERS Tort law
The amount to replace property with like property of the same quality and construction is the -
CORRECT ANSWERS Replacement cost
Whatis the process whereby insurers decides which customers to insure and what coverage to offer -
CORRECT ANSWERS Underwriting
The amount paid for damaged propertywhich is equal to the price for which it could have been sold is
called - CORRECT ANSWERS Market value
A policy may not be transferred to another without - CORRECT ANSWERS Written consent of
the insured
An insured's loss reserve for a claim is - CORRECT ANSWERS An estimate or the amount that
the insurer will pay
What is the type of loss exposre that would include land and property attached to it - CORRECT
ANSWERS Liability loss exposure
What type of policy protect against loss from any peril except those that are specifally excluded -
CORRECT ANSWERS All-risk or open peril
