General Insurance Questions And Answers

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What is used to divide an insurer's loss ratio?

Correct! Wrong!

Explanation:
The loss ratio is used to evaluate the consistency of the company's loss experience over time. It is figured by subtracting the earned premium from the total amount of underwriting losses. It can be computed separately for particular insurance lines or the business as a whole.

Which of the following perils is excluded from a commercial property coverage component that has the basic causes of loss form attached?

Correct! Wrong!

Explanation:
Since volcanic eruptions are a frequently covered peril, any harm done to your home and property due to one erupting nearby will probably be covered by a typical home insurance policy. This includes any resulting harm from fire, smoke, ash, dust, or other debris.

In terms of law, one party's actions could have the effect of waiving a recognized right. Which of the following has the party generated when this happens?

Correct! Wrong!

Explanation:
A waiver is a formal statement or document that exempts a person or business from responsibility. In order to prove that a person has been denied a specific form of insurance, organizations or businesses frequently provide or ask for signatures on insurance waivers from individuals.

How long will the time for reporting claims under the policy be prolonged if general liability "claims-made" coverage is renewed by "occurrence" coverage and the insured purchases a supplemental extended reporting period (ERP)?

Correct! Wrong!

Explanation:
A supplemental extended reporting period gives the deadline for filing covered claims an indefinite extension. But for a claim to be covered, it must not have happened after the policy's expiration date or before the retroactive date.

Which of the following describes the policy territory under the majority of property insurance policies?

Correct! Wrong!

Explanation:
The United States, all of its territories, and Canada make up the policy territory. Europe and Mexico are left out.

What kind of marketing system allows agents or agencies to operate independently while agreeing to exclusively promote one insurance provider?

Correct! Wrong!

Explanation:
The insurance firm enters into agreements with agencies, who are independent companies, to represent and sell insurance only on its behalf in the exclusive captive agency system.

A personal auto policy will pay transportation costs at the rate of $20 per day up to how much in the event of a physical damage loss that renders a covered auto unusable for a period of time?

Correct! Wrong!

Explanation:
A personal auto policy will cover transportation costs up to $20 per day, with a maximum payment of $600, in addition to collision and other than collision coverage, if a covered loss renders an insured auto immobile.

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