Principles and Concepts of Insurance Quiz
Explore insurance concepts with this quiz covering premiums, deductibles, perils, and more. Challenge yourself now!
#1
What does insurance provide protection against?
Financial loss
Physical injury
Emotional distress
All of the above
#2
Which of the following is not a type of insurance?
Life insurance
Car insurance
Loan insurance
Home insurance
#3
What is a premium in insurance?
A discount offered by insurance companies
The amount paid by the insured to the insurer for coverage
A type of insurance policy
The maximum coverage amount
#4
Which principle of insurance states that the insured should not profit from an insurance claim?
Utmost good faith
Subrogation
Indemnity
Contribution
#5
What is reinsurance?
Insurance for reins
Insurance purchased by insurance companies
Insurance for specific high-risk individuals
Insurance for government entities
#6
What is a deductible in insurance?
The maximum amount an insurer will pay for a claim
The initial amount the insured must pay before the insurer covers the rest
The premium paid monthly by the insured
The term for canceling an insurance policy
#7
Which type of insurance protects against legal claims resulting from negligence or wrongdoing?
Health insurance
Professional liability insurance
Property insurance
Travel insurance
#8
What is the purpose of an insurance policy's declarations page?
To list the names of beneficiaries
To provide a summary of coverage details
To outline the terms of the premium payment plan
To detail the process for filing a claim
#9
What is adverse selection in insurance?
The tendency for those most likely to need insurance to buy it
The process of evaluating risk factors before issuing a policy
The total amount of premiums collected by an insurance company
The period of time an insurance policy is active
#10
What is subrogation in insurance?
The transfer of an insurance policy to another person
The process of an insurance company suing a third party responsible for a loss
The amount of money an insured must pay out of pocket before coverage starts
The process of renewing an insurance policy
#11
What does 'underwriting' refer to in insurance?
The process of evaluating and classifying risks
The process of submitting a claim to the insurance company
The legal document outlining the terms of the insurance policy
The process of negotiating insurance rates
#12
Which of the following is an example of a hazard in insurance?
Poor lighting in a building
A sudden storm damaging property
An insured individual's age
An insurance company's financial stability
#13
What is a waiting period in insurance?
The time it takes for an insurance company to process a claim
The time between purchasing a policy and coverage taking effect
The time during which certain benefits are not payable after a policy is issued
The period of time an insurance policy remains active
#14
What is the purpose of coinsurance in property insurance?
To reduce the amount of coverage required
To share the risk between the insured and the insurer
To increase the deductible
To determine the premium amount
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