Exam (elaborations)
STATE FARM EXAM QUESTIONS AND ANSWERS
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STATE FARM EXAM QUESTIONS AND ANSWERS
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STATE FARM EXAM QUESTIONS ANDANSWERS
Which statement describes a peril? - Answers -a tornado damaged the insured's home
a flood is an example of - Answers -A peril
Tiffany leaves her car unlocked when she goes shopping. - Answers -Morale
Insurance company incorporated in Wisconsin and conducting business in Wisconsin is
known as a domestic company. What kind of company are they considered if they do
business in Minnesota? - Answers -Foreign
what is a contractor device for transferring risk from a person, business or organization
to an insurance company? - Answers -Insurance
which of the following represents a pure risk? - Answers -The chance your house may
burn down
What is a contractor device for transferring risk from a person, business, or organization
to an insurance company? - Answers -Insurance
which of the following represents a pure risk? - Answers -the chance at your house may
burn down
Suzanne regularly leaves her side door unlocked when she leaves for work period one
afternoon a thief entered her apartment and stole all of her jewelry. What was the
hazard in this example. - Answers -the door being unlocked
sometimes an individual or business has an exceptionally large or specialized risk that
no authorized insurers can or will cover. In this case the individual or business may call?
- Answers -a non admitted insurance company.
The ABC insurance company is incorporated in Mexico. While doing business in Texas
it is - Answers -a alien insurer
the potential for accidents and other losses is called - Answers -an exposure
Jennifer and Randy place a bet on the outcome of a basketball game period this is an
example of. - Answers -A speculative Risk
,An insurance company licensed to do business in a particular state is called - Answers -
A certificate of authority
a loss that occurs as a consequence of a direct loss is called - Answers -An Indirect
Loss
which of the following is not a type of hazard - Answers -Pure Hazard
An insurance contract is prepared by one party (the insurance company) with little or no
opportunity for the other party (the insured) to bargain. This this characteristic is called -
Answers -Adhesion
In insurance, an insured may pay premium for many years without having a loss, or an
insured may suffer a loss and get a larger amount of money from the insurance
company than he has paid in premiums. For this reason, an insurance contract is -
Answers -Aleatory
In an insurance contract, the consideration that the insured gives is called - Answers -
the premium payment
An agreement between two parties is also called - Answers -offer and acceptance
the failure to disclose known facts is - Answers -concealment
a statement that is guaranteed to be true is a - Answers -Warranty
Allison's auto insurance policy is due on the 10th of each month period ever since she
has had the policy, she has sent the premium in on the 16th of the month period the
insurer has been accepting the premium this way for the past five years period a new
CEO takes over and decides to cancel Allison's policy for a non-payment of premium.
Allison contests this decision and legally gets the policy reinstated. The decision to
reinstate the policy is an example of. - Answers -Estoppel
Misrepresentations do not necessarily void insurance contracts period to do so they
must be - Answers -Material
Which of the following would not be included on the declarations page of the policy? -
Answers -The exclusions in the policy
What type of insurance policy protects the insured from loss caused by damage to
covered property by a covered peril? - Answers -Property insurance policy
Which of the following is not a part of the structure of a property or casualty - Answers -
Explanations
, Which of the following terms describes the person listed first on the declarations page of
a policy when there is more than one named insured? - Answers -First Name Insured
Greg's policy states that a loss will not be covered unless it occurs within the United
states or Canada. What is the name of this provision in his policy? - Answers -the policy
territory provision
when an insured decides to cancel an insurance policy before the expiration date the
unlearned premium is returned on - Answers -A short rate basis
Todd and Mary have insurance protection for their home with a policy deductible of
$500. One night the thunderstorm knocks the tree onto their roof and causes $2500 in
damage. How much money will the insurance company pay to Todd and Mary to fix
their roof? - Answers -$2000
Marcus has two policies that will cover his $20,000 loss period company A will pay the
first $15,000, and Company B pays the remainder. In this example, company A's policy
is considered. - Answers -Primary insurance
which provision specifies that an insurance policy may not be transferred to anyone else
without the written consent of the insurer unless the name insured dies. - Answers -
Assignment provision
A financial loss resulting directly from a loss to property, such as a house fire or a
diamond ring being stolen, is called. - Answers -A direct loss
an insured owns a $200,000 home and ensures it for $100,000. If the insurance home
was completely destroyed by a fire, how much money would the insurance company
pay if the insured has a policy that requires a minimum of 80% coverage? - Answers -
$100,000
Which policy ensures a property against all perils specifically listed in the policy? -
Answers -named peril policy
when a semi truck hit gregg's house, he and his family had to stay in a nearby hotel for
two weeks while repairs were made. The hotel bill came to $1000 and the cost of food
came to $415 what was the indirect loss? - Answers -the hotel bill and cost of food
the term that describes the absences of both people and property from the premises is.
- Answers -vacant
which of the following coverages ensures against all risks of direct physical loss that are
not specifically excluded in the policy? - Answers -Special perils
Timothy has an antique boat, and it was recently damaged while on a fishing trip. The
insurance company agreed to repair the boat with less expensive, working materials.
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