Free General Insurance Concepts Practice Questions
West Virginia Life exam — 81 practice questions.
Subtopics: Insurable interest, Utmost good faith, Adhesion, Aleatory, Valued contract, Law of large numbers, Representation, Concealment, Risk management, Hazard, Definition of risk, Peril, Handling risk, Retention, Insurable risk, Stock insurer, Mutual insurer, Admitted insurer, Domestic foreign alien, Consideration, Legal purpose, Competent parties, Offer and acceptance, Express authority, Apparent authority, Indemnity, Representations, Pure vs speculative risk, Adverse selection, Moral hazard, Morale hazard, Physical hazard, Implied authority, Fiduciary duty, Aleatory contract, Contract of adhesion, Unilateral contract, Conditional contract, Warranty, Waiver, 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
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Sample questions & answers
1. For a valid life insurance policy, insurable interest in the insured must generally exist:
At the time the contract is made
West Virginia law requires the beneficiary of insurance on another person's life to have an insurable interest at the time the contract was made; it need not exist at death.
2. The principle that both the applicant and insurer must deal honestly and disclose material facts is called:
Utmost good faith
Insurance contracts rest on utmost good faith, requiring honesty and full disclosure by both parties.
3. An insurance policy is called a contract of adhesion because:
The insurer drafts it and the applicant accepts it as written
A contract of adhesion is drafted by one party (the insurer) and offered to the other on a take-it-or-leave-it basis.
4. Insurance contracts are described as aleatory because:
The values exchanged may be unequal and depend on chance
An aleatory contract involves an unequal exchange of value that depends on an uncertain future event.
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.
