Question 1

Insurance is defined as a contract in which the insured party makes payments to the insurer in exchange for the insurer's promise to make payment or transfer goods to another party in the event of injury or destruction to the insured party's property or life.

Accepted Answer

A) True 
 B)False

Question 2

Which of the following is a term used to define the payment made by an insured party in exchange for a later payment by an insurer in the event of damage or injury to insured property or person?

Accepted Answer

A)   Tag
B)   Bill
C)   Premium
D)   Assessment
E)   RequirementF) B) and E)
G) B) and D)

Question 3

A policy of title insurance is an example of which of the following types of insurance?

Accepted Answer

A)   Business loss
B)   Profit loss
C)   Commercial
D)   Economy
E)   EconomicF) A) and E)
G) B) and D)

Question 4

A[n] ______ is a term identifying the person who receives insurance proceeds in the event of injury or damage.

Accepted Answer

A)   Receiver
B)   Obtainer
C)   Insured
D)   Beneficiary
E)   IdentifiedF) A) and D)
G) B) and D)

Question 5

Which of the following is false regarding marine insurance in Scotland?

Accepted Answer

A)   Scotland has a Marine Insurance Act in its mercantile law that addresses insurance contracts.
B)   Marine insurance policies cover most marine activities including liability to third parties in the event of difficulties while at sea.
C)   Marine insurance policies are among the most simple and easy to understand insurance policies.
D)   Marine insurance policies tend to be exacting.
E)   Before an insurer will sign a policy, the value of the item insured must be specified in the contract.F) A) and E)
G) All of the above

Question 6

A[n] ______ clause states that after an insurance policy has existed for a specified period of time,the insurance company cannot contest any statements made in the insurance application.

Accepted Answer

A)   Antilapse
B)   Incontestability
C)   Assurance
D)   Approval
E)   WaiverF) A) and B)
G) A) and C)

Question 7

What is meant by an antilapse clause,and how do these usually work? Do you believe that all states and all types of policies should have antilapse clauses,and why or why not?

Accepted Answer

Some states require that insurance compa...

Question 8

What is the effect of an appraisal clause in a policy of insurance,and how do these usually work?

Accepted Answer

If the insured and the insurance company...

Question 9

Which of the following types of insurance protects members of specific professions from liability associated with their professional acts?

Accepted Answer

A)   Business liability
B)   Licensed
C)   Trained liability
D)   Professional liability
E)   ConsumerF) A) and E)
G) B) and C)

Question 10

Which of the following is true regarding whether the insureds in the "Case Opener" were entitled to insurance coverage for imported toxic Chinese drywall used in their home?

Accepted Answer

A)   The court ruled that the insureds were entitled to coverage for both property damage and personal injury based on their insurance company's warranties.
B)   The court ruled that the insureds were entitled to property damage coverage because of their insurance company's warranties, but not coverage for personal injuries.
C)   The court ruled that the insureds were entitled to coverage for personal injuries because of their insurance company's warranties, but not coverage for property damage.
D)   The court ruled that the insureds were entitled to full coverage only if they could establish that the insurer knew of the drywall problems when it issued the policy.
E)   The court ruled that the insureds were not entitled to coverage.F) B) and E)
G) C) and E)

Question 11

As a matter of federal law,arbitration clauses are illegal in policies of insurance.

Accepted Answer

A) True 
 B)False

Question 12

Which of the following is true regarding the assertion of Alice that vehicle insurance policies do not generally provide coverage for legal representation?

Accepted Answer

A)   She is incorrect.
B)   She is correct only in situations in which a student with a student policy is involved in an accident.
C)   She is correct only in situations in which an insured has had at least two previous accidents.
D)   She is correct only in situations in which a student is carried on a parent's insurance policy.
E)   She is correct because insureds are expected to shoulder some of the burden of accidents.F) A) and C)
G) None of the above

Question 13

Which of the following types of life insurance provides protection for the entire life of the insured and has a cash-surrender value?

Accepted Answer

A)   Whole-life
B)   Term-life
C)   Surrender-life
D)   Useful-life
E)   Entire-lifeF) A) and B)
G) C) and E)

Question 14

If the purpose of an insurance policy is to protect property from loss or damage,the insurance is ______ insurance.

Accepted Answer

A)   Material
B)   Loss
C)   Economic
D)   Business
E)   PropertyF) B) and D)
G) A) and C)

Question 15

If insurance covers some type of business risk,the insurance is called ______ insurance.

Accepted Answer

A)   Business loss
B)   Profit loss
C)   Commercial
D)   Economy
E)   EconomicF) C) and D)
G) B) and C)

Question 16

What is an incontestability clause in a policy of insurance,and what is its effect? Discuss whether you believe that ethically these clauses should be required of insurers.

Accepted Answer

The incontestability clause is a state-m...

Question 17

Which of the following is a term referencing the concept that a sufficient interest must exist on the part of an insured in order to take out a policy of insurance?

Accepted Answer

A)   Insurable interest
B)   Pecuniary interest
C)   Financial concern
D)   Financial effect
E)   Profit impactF) A) and C)
G) A) and B)

Question 18

A policy of fidelity insurance is an example of which of the following types of insurance?

Accepted Answer

A)   Business loss
B)   Profit loss
C)   Commercial
D)   Economy
E)   EconomicF) B) and E)
G) C) and D)

Question 19

The insured party in insurance law is the party who makes a payment to an insurance company,called a premium,in return for insurance coverage.

Accepted Answer

A) True 
 B)False

Question 20

Federal law is the primary law addressing when an insurance company can cancel a policy of insurance.

Accepted Answer

A) True 
 B)False

Exam 51: Insurance Law

A policy of title insurance is an example of which of the following types of insurance?

Correct AnswerverifiedShow Answer

Which of the following types of life insurance provides protection for the entire life of the insured and has a cash-surrender value?

Correct AnswerverifiedShow Answer

As a matter of federal law,arbitration clauses are illegal in policies of insurance.

Correct AnswerverifiedShow Answer

A policy of fidelity insurance is an example of which of the following types of insurance?

Correct AnswerverifiedShow Answer

A[n] ______ clause states that after an insurance policy has existed for a specified period of time,the insurance company cannot contest any statements made in the insurance application.

Correct AnswerverifiedShow Answer

If insurance covers some type of business risk,the insurance is called ______ insurance.

Correct AnswerverifiedShow Answer

Which of the following types of insurance protects members of specific professions from liability associated with their professional acts?

Correct AnswerverifiedShow Answer

What is meant by an antilapse clause,and how do these usually work? Do you believe that all states and all types of policies should have antilapse clauses,and why or why not?

Correct AnswerverifiedSome states require that insurance compa...View AnswerShow Answer

If the purpose of an insurance policy is to protect property from loss or damage,the insurance is ______ insurance.

Correct AnswerverifiedShow Answer

Which of the following is false regarding marine insurance in Scotland?

Correct AnswerverifiedShow Answer

Which of the following is true regarding whether the insureds in the "Case Opener" were entitled to insurance coverage for imported toxic Chinese drywall used in their home?

Correct AnswerverifiedShow Answer

A[n] ______ is a term identifying the person who receives insurance proceeds in the event of injury or damage.

Correct AnswerverifiedShow Answer

Which of the following is true regarding the assertion of Alice that vehicle insurance policies do not generally provide coverage for legal representation?

Correct AnswerverifiedShow Answer

Which of the following is a term referencing the concept that a sufficient interest must exist on the part of an insured in order to take out a policy of insurance?

Correct AnswerverifiedShow Answer

Insurance is defined as a contract in which the insured party makes payments to the insurer in exchange for the insurer's promise to make payment or transfer goods to another party in the event of injury or destruction to the insured party's property or life.

Correct AnswerverifiedShow Answer

Federal law is the primary law addressing when an insurance company can cancel a policy of insurance.

Correct AnswerverifiedShow Answer

The insured party in insurance law is the party who makes a payment to an insurance company,called a premium,in return for insurance coverage.

Correct AnswerverifiedShow Answer

What is the effect of an appraisal clause in a policy of insurance,and how do these usually work?

Correct AnswerverifiedIf the insured and the insurance company...View AnswerShow Answer

What is an incontestability clause in a policy of insurance,and what is its effect? Discuss whether you believe that ethically these clauses should be required of insurers.

Correct AnswerverifiedThe incontestability clause is a state-m...View AnswerShow Answer

Which of the following is a term used to define the payment made by an insured party in exchange for a later payment by an insurer in the event of damage or injury to insured property or person?

Correct AnswerverifiedShow Answer

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Some states require that insurance compa...
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If the insured and the insurance company...
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The incontestability clause is a state-m...
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Correct Answer
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