Free General Insurance Concepts Practice Questions
Idaho Property & Casualty exam — 47 practice questions.
Subtopics: Unilateral contract, Risk retention, Personal contract, Risk reduction, Representation, Ambiguity construed, 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, Reinsurance, Admitted vs nonadmitted, Domestic foreign alien, Aleatory contract, Contract of adhesion, Apparent authority, Rebating, Risk pooling, Pro-rata cancellation, Risk, Marketing systems, Concealment and fraud, Indemnity
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Sample questions & answers
1. An insurance policy is a unilateral contract because:
Only the insurer makes a legally enforceable promise
In a unilateral contract, only the insurer makes a legally enforceable promise to pay covered losses.
2. Choosing a high deductible so the insured pays more small losses themselves is an example of risk:
Retention
Accepting a higher deductible is a form of risk retention because the insured keeps more of the smaller losses.
3. An insurance policy is considered a personal contract because it:
Insures the person or interest rather than the property itself, and generally needs insurer consent to assign
An insurance contract is personal: it insures a person's interest and generally cannot be assigned to another without the insurer's consent.
4. Installing a sprinkler system to lessen fire damage is an example of risk:
Reduction
Risk reduction (loss control) uses measures such as sprinklers to lower the frequency or severity of losses.
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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.
