Free General Insurance Concepts Practice Questions
Connecticut Personal Lines exam (series 12-CT-18) — 72 practice questions.
Subtopics: Peril, Hazard, Risk transfer, Law of large numbers, Adverse selection, Representations, Pure vs speculative risk, Moral hazard, Morale hazard, Physical hazard, Risk avoidance, Risk retention, Insurable interest, Indemnity, Elements of a contract, Contract of adhesion, Aleatory contract, Utmost good faith, Representation, Concealment, Warranty, Express authority, Apparent authority, Implied authority, Stock vs mutual insurer, Domestic foreign alien, Admitted insurer, Estoppel, Reinsurance, Underwriting, Loss ratio, Rate regulation goals, Reciprocal insurer, Lloyds of London, Risk retention group, Self-insurance, Surplus lines, Catastrophic risk, Loss exposure, Frequency vs severity, Unilateral contract, Conditional contract, Personal contract, Waiver, Material misrepresentation, Fiduciary duty, Commingling, Agent vs broker, Rebating, Twisting, Coercion, Defamation, Unfair claims settlement, Indemnity and subrogation, Distribution systems, Insurer types, Insurer ratios, Loss reserves, Rate regulation, Earned and unearned premium, Lapse
Read the General Insurance Concepts study guide
Sample questions & answers
1. In insurance, a peril is:
The cause of a loss, such as fire or windstorm
A peril is the cause of a loss, such as fire, windstorm, or theft.
2. A hazard differs from a peril because a hazard:
Increases the likelihood or severity of a loss
A hazard increases the chance or severity of a loss, while a peril is the actual cause.
3. Buying a homeowners policy is an example of risk:
Transfer
Purchasing insurance transfers the financial consequences of a risk to the insurer.
4. Insurers rely on the law of large numbers because it lets them:
Predict losses more accurately as the group of insureds grows
As the number of similar exposures increases, the law of large numbers improves the accuracy of loss predictions.
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.
