Free General Insurance Concepts Practice Questions
Virginia Life, Accident & Health exam (series 11-01) — 61 practice questions.
Subtopics: Indemnity, Adverse selection, Utmost good faith, Adhesion, Risk management, Handling risk, Insurable risk, Hazards, Definitions, Insurer classifications, Elements of a contract, Legal interpretations, Law of large numbers, Aleatory contract, Contract of adhesion, Unilateral contract, Conditional contract, Express authority, Apparent authority, Fiduciary duty, Reinsurance, Reciprocal insurer, Estoppel, Insurable interest timing, Competent parties, Warranties, Material misrepresentation, Waiver, Parol evidence, Implied authority, Law of agency, Pure risk, Speculative risk, Risk sharing, Risk reduction, Fraternal benefit society, Insurer financial strength, Producers, Contract characteristics
Read the General Insurance Concepts study guide
Sample questions & answers
1. The principle of indemnity is best reflected in:
Expense coverage that restores without enriching
Indemnity restores the insured to the prior financial position; it applies to medical expense coverage, while life insurance is a valued contract.
2. Adverse selection describes the tendency of:
Higher-risk people to seek coverage more
Adverse selection is the tendency of higher-risk people to seek or keep insurance more than average risks.
3. Insurance contracts require utmost good faith, meaning:
Both parties deal honestly and disclose material facts
Utmost good faith requires honesty and full disclosure of material facts by both parties.
4. Because an insurance policy is a contract of adhesion, ambiguities are generally:
Construed against the insurer that drafted it
Because the insurer drafts a contract of adhesion, ambiguities are interpreted against the insurer.
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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.
