Free General Insurance Concepts Practice Questions
Minnesota Property & Casualty exam — 47 practice questions.
Subtopics: Stock and mutual insurers, Insurer domicile, Reinsurance, Risk retention, Adverse selection, Utmost good faith, Handling risk, Insurer classifications, Elements of a contract, Insurable risk, Hazards, Definitions, Authority of producers, Legal interpretations, Law of large numbers, Principle of indemnity, Concealment, Warranty, Waiver and estoppel, Subrogation, Admitted vs nonadmitted, Domestic foreign alien, Aleatory contract, Contract of adhesion, Unilateral contract, Apparent authority, Rebating, Risk pooling, Pro-rata cancellation, Risk, Marketing systems, Concealment and fraud, Indemnity
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Sample questions & answers
1. A stock insurance company is generally owned by whom?
Its stockholders
A stock insurer is owned by its stockholders, while a mutual insurer is owned by its policyholders.
2. An insurer organized under the laws of Minnesota and operating in Minnesota is classified as what?
A domestic insurer
Minnesota law designates companies incorporated or organized in Minnesota as domestic; those organized in another state or country are foreign.
3. Reinsurance is best described as what?
Insurance an insurer buys from another insurer
Reinsurance is insurance purchased by an insurer to transfer part of its risk to another insurer, helping it manage large or concentrated exposures.
4. Choosing to pay for small losses out of pocket rather than insuring them is an example of which technique?
Risk retention
Risk retention means keeping the financial responsibility for certain losses, such as through a deductible or self-insurance, rather than transferring them.
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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.
