Free General Insurance Concepts Practice Questions
Arkansas Property & Casualty exam — 47 practice questions.
Subtopics: Reinsurance, Coinsurance, Risk pooling, Personal contract, Rate and premium, Catastrophe, Handling risk, Insurer classifications, Adverse selection, Elements of a contract, Insurable risk, Hazards, Definitions, Authority of producers, Legal interpretations, Law of large numbers, Principle of indemnity, Utmost good faith, Concealment, Warranty, Waiver and estoppel, Subrogation, Admitted vs nonadmitted, Domestic foreign alien, Aleatory contract, Contract of adhesion, Unilateral contract, Apparent authority, Rebating, Pro-rata cancellation, Risk, Marketing systems, Concealment and fraud, Indemnity
Read the General Insurance Concepts study guide
Sample questions & answers
1. Which statement best describes reinsurance?
An insurer transferring risk to another insurer
Reinsurance is a transaction in which a reinsurer agrees to cover all or part of the losses of a primary insurer.
2. A coinsurance clause in a property policy encourages the insured to:
Carry insurance close to the property's value
A coinsurance clause encourages policyholders to carry a reasonable amount of insurance relative to value, with a penalty on partial losses if underinsured.
3. The sharing of losses by many insureds so that the cost falls on the group is the principle of:
Risk pooling (loss sharing)
Risk pooling spreads the cost of losses across many insureds so that each bears only a small share.
4. An insurance policy is generally a personal contract, which means it:
Insures a particular person and generally cannot be transferred without the insurer's consent
As a personal contract, a policy insures a specific person and generally cannot be transferred without the insurer's consent.
All Property & Casualty topics
Practice: General Insurance Concepts
Answer choices are shuffled every time, and every question comes with an explanation.
Practice questions are study aids generated for exam preparation and are not actual exam questions. Content is provided for educational purposes and is not legal advice. Verify current statutes, rules, and exam specifications with the Insurance Department and the exam administrator before relying on it.
