Arkansas Property & Casualty
Insurance Exam Questions with
Revised Answers () 100%
Guarantee Pass
A hazard is best defined as: - CORRECT ANSWERS Something that increases the chance of loss
What is the term for a cause of loss, such as theft of a car? - CORRECT ANSWERS A Peril
A state requiring that the commissioner agree that a company's rates are appropriate before they are
made effective used which type of rating approval? - CORRECT ANSWERS Prior approval
The following are all true regarding risk management , except: - CORRECT ANSWERS
Insurance is designed to cover both intentional & unintentional losses
Which type of risk involves the possibility of loss or gain? - CORRECT ANSWERS Speculative
A fire sprinkler system installed in a factory is considered which of the following methods of managing
risk? - CORRECT ANSWERS Reduction
Which of the following statements is not correct regarding rates and premiums? - CORRECT ANSWERS
Rates may only be excessive if the inside is making up for lossy reserves
An agent for ABC Insurance company is representing an insured in an insurance transaction. The
principal in the agency relationship is: - CORRECT ANSWERS ABC Insurance Company
The Terrorism Insurance Program created by the TRIA is administered by which of the following federal
entities? - CORRECT ANSWERS Department of the Treasury
, Dividends issued by Stock insurers are paid to: - CORRECT ANSWERS stockholders
Which of the following is not an element of an insurable risk? - CORRECT ANSWERS The loss
must be catastrophic
Which of the following has the primary responsibility of determining acceptable risks? - CORRECT
ANSWERS Underwriter
Which of the following places insurance with a non-admitted insurer when insurance cannot be placed
with an admitted insurer? - CORRECT ANSWERS Surplus lines producer
Because only the insurance company makes a promise to pay a future claim, the insurance contract is: -
CORRECT ANSWERS Unilateral
In property insurance, which clause prevents the insured from relinquishing ownership and leaving
damaged property to the insurer and claiming a total loss? - CORRECT ANSWERS
Abandonment
The loss of property when the cause of loss is not known is considered: - CORRECT ANSWERS
Mysterious disappearance
When the insurer elects to end coverage at the end of the policy period, the policy is said to be ? -
CORRECT ANSWERS Nonrenewed
When coverage applies to losses from all perils except those specifically excluded, the policy is said to be
written on which of the following basis? - CORRECT ANSWERS Open Perils
Insurance Exam Questions with
Revised Answers () 100%
Guarantee Pass
A hazard is best defined as: - CORRECT ANSWERS Something that increases the chance of loss
What is the term for a cause of loss, such as theft of a car? - CORRECT ANSWERS A Peril
A state requiring that the commissioner agree that a company's rates are appropriate before they are
made effective used which type of rating approval? - CORRECT ANSWERS Prior approval
The following are all true regarding risk management , except: - CORRECT ANSWERS
Insurance is designed to cover both intentional & unintentional losses
Which type of risk involves the possibility of loss or gain? - CORRECT ANSWERS Speculative
A fire sprinkler system installed in a factory is considered which of the following methods of managing
risk? - CORRECT ANSWERS Reduction
Which of the following statements is not correct regarding rates and premiums? - CORRECT ANSWERS
Rates may only be excessive if the inside is making up for lossy reserves
An agent for ABC Insurance company is representing an insured in an insurance transaction. The
principal in the agency relationship is: - CORRECT ANSWERS ABC Insurance Company
The Terrorism Insurance Program created by the TRIA is administered by which of the following federal
entities? - CORRECT ANSWERS Department of the Treasury
, Dividends issued by Stock insurers are paid to: - CORRECT ANSWERS stockholders
Which of the following is not an element of an insurable risk? - CORRECT ANSWERS The loss
must be catastrophic
Which of the following has the primary responsibility of determining acceptable risks? - CORRECT
ANSWERS Underwriter
Which of the following places insurance with a non-admitted insurer when insurance cannot be placed
with an admitted insurer? - CORRECT ANSWERS Surplus lines producer
Because only the insurance company makes a promise to pay a future claim, the insurance contract is: -
CORRECT ANSWERS Unilateral
In property insurance, which clause prevents the insured from relinquishing ownership and leaving
damaged property to the insurer and claiming a total loss? - CORRECT ANSWERS
Abandonment
The loss of property when the cause of loss is not known is considered: - CORRECT ANSWERS
Mysterious disappearance
When the insurer elects to end coverage at the end of the policy period, the policy is said to be ? -
CORRECT ANSWERS Nonrenewed
When coverage applies to losses from all perils except those specifically excluded, the policy is said to be
written on which of the following basis? - CORRECT ANSWERS Open Perils
