Free Property and Casualty Insurance Basics Practice Questions
Michigan Property & Casualty exam (series 16-81) — 117 practice questions.
Subtopics: Indemnity, Insurable interest, Subrogation, Actual cash value, Coinsurance clause, Peril vs hazard, Minimum valuation, Minimum perils, Removal coverage, Insured cancellation, Fire policy cancellation, Unearned premium on cancellation, Mortgagee cancellation, Mortgagee proof of loss, Mortgagee subrogation, Other insurance, Appraisal demand, Appraiser selection, Umpire selection, Appraisal award, Appraisal costs, Abandonment, Insurer options, Loss payment, Suit limitation, Policy period time, Subrogation provision, Void for fraud, Breach of warranty, Fire withholding, Withholding notice, Withholding release, Casualty cancellation notice, Comparative fault, Insured bankruptcy, Late notice, Notice to agent, Insurer not a defendant, Loss valuation, Coinsurance, Negligence, Damages, Types of loss, Insurer provisions, Liability, Limits of liability, Deductibles, Policy structure, Policy conditions, Replacement cost, Pair and set clause, Vacancy provision, Mortgagee rights, Appraisal condition, Proof of loss, Salvage and abandonment, Liberalization clause, Assignment condition, Binder, Sublimit, Named perils vs open perils, Burden of proof, Direct vs indirect loss, Comparative negligence, 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, Appraisal, Duties after loss, Retrospective rating, Class rating, Judgment rating
Read the Property and Casualty Insurance Basics study guide
Sample questions & answers
1. The principle that an insured should be restored but not profit from a loss is:
Indemnity
Indemnity restores the insured to the pre-loss financial position without profit.
2. For property insurance, insurable interest must exist:
At the time of loss
For property insurance, insurable interest must exist at the time of the loss.
3. After paying a claim, an insurer's right to recover from a responsible third party is:
Subrogation
Subrogation lets the insurer pursue a negligent third party after paying the insured's claim.
4. Actual cash value is generally calculated as:
Replacement cost minus depreciation
Actual cash value generally equals replacement cost minus depreciation.
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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.
