ch1 quiz

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  1. Methods of risk management include:
    a) Transfer
    b) Sharing
    c) Avoidance
    d) All of the above
    d) All of the above
  2. An insured has suffered a fire loss to his/her dwelling. This insured is which party to the claim?
    A) Third party
    B) Loss payee
    C) First party
    D) Second party
    C) First party
    (this multiple choice question has been scrambled)
  3. Mr. Jones, a pedestrian, was injured by Mr. Smith while driving his vehicle. Mr. Smith is Insured by I Am Bogus Insurance Company. The insurance company would be which party to the claim?
    A) Second party
    B) Guarantor
    C) First party since they are the one that has to pay
    D) Third Party
    A) Second party
    (this multiple choice question has been scrambled)
  4. Which of the following is NOT included in the Declarations section of an insurance contract?
    A) The identity of the named insured
    B) The policy premium
    C) The covered perils
    D) The policy period
    C) The covered perils
    (this multiple choice question has been scrambled)
  5. Which of the following is the section of an insurance contract that contains the provisions, rules of conduct, duties, and obligations of the parties?
    A) The Limitations
    B) the Conditions
    C) The Exclusions
    D) The Insuring Agreement
    B) The Conditions
    (this multiple choice question has been scrambled)
  6. A loss that is a direct consequence of a perticular peril is called a(n):
    A) Direct loss
    B) Indirect loss
    C) Peril
    D) Hazard
    A) Direct loss
    (this multiple choice question has been scrambled)
  7. Which of the following is a clause in property and casualty contracts which states that if policy or endorsement forms are broadened and no additional premium is requred, then all existing similar policies or endorsements will be constructed to include the broadened coverage?
    A) Binder
    B) Coinsurance
    C) Assignment
    D) Liberalization
    D) Liberalization
    (this multiple choice question has been scrambled)
  8. Which of the following provides written evidence of coverage pending the issance of a policy?
    A) Assignment
    B) Cause of loss form
    C) Blanket coverage
    D) Binder
    D) Binder
    (this multiple choice question has been scrambled)
  9. Which of the following is an example of a Loss Evaluation Method?
    A) Liberalization
    B) Cause of loss form
    C) Conditions
    D) Stated amount
    D) Stated amount
    (this multiple choice question has been scrambled)
  10. The cost of replacement minus depreciation is the definition of:
    A) Replacement Cost
    B) Valued Policy
    C) Actual Cash Value
    D) Market Value
    C) Actual Cash Value
    (this multiple choice question has been scrambled)
  11. Which of the following is a method of requiring the insured to insure at least 80% of the value of the covered commercial property?
    A) Cause of loss form
    B) Standard Morgage clause
    C) Loss payable clause
    D) Coinsurance clause
    D) Coinsurance clause
    (this multiple choice question has been scrambled)
  12. Which of the following is a basis for insuring property that allows the insured to report the value of the building contents to the insurance company on a monthly basis?
    A) Reporting form
    B) Agreed value
    C) Blanket basis
    D) Specific basis
    A) Reporting form
    (this multiple choice question has been scrambled)
  13. Which of the following is NOT a factor in determine negligence on the part of the insured?
    A) Proximate cause
    B) Legal duty is owed
    C) There is a breach of protection
    D) Damage
    C) There is a breach of protection
    (this multiple choice question has been scrambled)
  14. In liability insurance, policy limits that apply to one limit to each person injured, another for bodily injury claims of all persons injured in a single accident, and a separate limit for all property damage arising out of a single accident is:
    A) total limits
    B) Single limits
    C) Split limits
    D) Aggregate limits
    C) Split limits
    (this multiple choice question has been scrambled)
  15. An insurance contract that is contingent on an uncertain event is referred to as?
    A) Executory
    B) Aleatory
    C) Contract of adhesion
    D) Conditional
    B) Aleatory
    (this multiple choice question has been scrambled)
  16. Mr. jones is involved in an at-fault accident. The other party was also at fault. The method to determine damages due each party based on a percentage of negligence is known as:
    A) Assumption of risk
    B) Intervening clause
    C) Contributory negligence
    D) Comparitive negligence
    D) Comparitive negligence
    (this multiple choice question has been scrambled)
  17. The insured owns a filling station and an employee causes bodily injury to a third party. The insured is held legally laible for the employee's acts. This is called:
    A) Contingent liability
    B) Vicarious liabiliry
    C) Contributory negligence
    D) Joint and several
    B) Vicarious liability
    (this multiple choice question has been scrambled)
  18. One characteristic of an insurance contract is that both parties must perform certain acts to make the contract legally enforceable. This is called:
    A) Utmost good faith
    B) Executory
    C) Aleatory
    D) Personal aspect
    B) Executory
    (this multiple choice question has been scrambled)
  19. A church has hired a painting contractor to stain and varnish the woodwork in the building. he leaves the rags and brushes used to apply the painting materials in a small storage area. This is an example of:
    A) Assumption of risk
    B) Direct loss
    C) A hazard
    D) A peril
    C) A hazard
    (this multiple choice question has been scrambled)
  20. The insurance company is the author of the insurance policy. The insurer buys what is offered by the company and accepts it as is. This is called:
    A) Conditional
    B) Executory
    C) Contract of adhesion
    D) Aleatory
    C) Contract of adhesion
    (this multiple choice question has been scrambled)
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89780
Card Set
ch1 quiz
Description
Chapter One Quiz
Updated
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