Free Property and Casualty Insurance Basics Practice Questions
Maine Property & Casualty exam (series 12-ME-03) — 121 practice questions.
Subtopics: Appraisal provision, Reinsurance, Certificate of insurance, Insuring agreement, Conditions, Binder, Coinsurance, Occurrence policy, Claims-made policy, Mortgagee clause, Limit of insurance, Pro rata, Replacement cost, Vacancy, Standard fire policy, Appraisal, Comparative negligence, Insurable interest, Loss valuation, Negligence, Damages, Types of loss, Insurer provisions, Other insurance, Liability, Limits of liability, Deductibles, Policy structure, Policy conditions, Actual cash value, Pair and set clause, Vacancy provision, Mortgagee rights, Appraisal condition, Proof of loss, Salvage and abandonment, Liberalization clause, Assignment condition, Sublimit, Named perils vs open perils, Burden of proof, Direct vs indirect loss, Strict liability, Vicarious liability, Punitive damages, Special vs general damages, Proximate cause, Absolute liability, Hold harmless, Bailee liability, Attractive nuisance, Res ipsa loquitur, Coinsurance calculation, Actual cash value calculation, Split limits application, Underwriting, Credit-based insurance scores, Loss ratio, Insureds, Cancellation, Policy territory, No benefit to bailee, Duty to defend, Premium audit, Claim settlement, Duties after loss, Abandonment, Retrospective rating, Class rating, Judgment rating
Read the Property and Casualty Insurance Basics study guide
Sample questions & answers
1. When an insurer and insured disagree on the amount of a covered property loss, the appraisal provision allows:
Each side to pick an appraiser, plus an umpire
Under the appraisal condition of the Maine standard fire policy, on written demand each party selects a competent, disinterested appraiser; the appraisers pick an umpire, and an award by any two sets the loss.
2. An insurer that cedes part of a large commercial risk to another insurer is using:
Reinsurance
Ceding part of a risk to another insurer is reinsurance; the Maine Code recognizes cession and assumption of reinsurance (though reinsurance may not be placed under the surplus lines law).
3. A document a commercial insured gives a third party as evidence that coverage is in force is a:
Certificate of insurance
A certificate of insurance is evidence given to a third party showing that specified coverage is in force.
4. The part of a property policy that states the insurer's basic promise to pay for covered losses is the:
Insuring agreement
The insuring agreement sets out the insurer's core promise to pay for losses the policy covers.
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Practice: Property and Casualty Insurance Basics
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.
