Free General Insurance Concepts Practice Questions
Tennessee Life exam — 78 practice questions.
Subtopics: Aleatory, Adhesion, Unilateral, Conditional, Express authority, Indemnity, Waiver, Definition of risk, Hazard, Peril, Handling risk, Retention, Insurable risk, Stock insurer, Mutual insurer, Admitted insurer, Domestic foreign alien, Consideration, Legal purpose, Competent parties, Offer and acceptance, Apparent authority, Utmost good faith, Representations, Concealment, Pure vs speculative risk, Law of large numbers, Adverse selection, Moral hazard, Morale hazard, Physical hazard, Implied authority, Fiduciary duty, Aleatory contract, Contract of adhesion, Unilateral contract, Conditional contract, Warranty, Estoppel, Reciprocal insurer, Fraternal benefit society, Reinsurance, Surplus lines insurer, Self-insurance, Exposure, Loss, Risk avoidance, Risk reduction, Risk sharing, Speculative risk, Homogeneous exposure units, Catastrophic loss, Domestic insurer, Alien insurer, Mutual dividends, Assessment mutual, Lloyd's, Government insurers, Insurer ratings, Captive agency system, Independent agency, Direct response, Managing general agent, Insurer as principal, Presumption of agency, Errors and omissions, Insurer consideration, Reasonable expectations, Fraud, Personal contract, Valued contract
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Sample questions & answers
1. A life insurance contract is described as aleatory, meaning:
Values exchanged may be unequal, based on chance
Aleatory contracts involve an unequal exchange of value that depends on an uncertain event.
2. Because the insurer writes the contract and the applicant accepts it as written, a life policy is a contract of:
Adhesion
A contract of adhesion is drafted by one party (the insurer) and accepted by the other as written; ambiguities are construed against the drafter.
3. A life insurance contract is unilateral because:
Only the insurer makes an enforceable promise
In a unilateral contract only one party (the insurer) makes a legally enforceable promise; the owner is not legally required to continue paying.
4. A life insurance contract is conditional because:
The insurer pays only if conditions are met
A conditional contract requires certain conditions (premium payment, proof of death) to be met before the insurer pays.
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.
