Download GA Personal Lines Insurance Exam Questions + Verified Answers 100% correct, Update 2026 and more Exams Insurance Economics in PDF only on Docsity!
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The abdication of insured property into the hands of another or into the possession of no one in particular - correct answer ✅Abandonment A sudden unplanned and unexpected event not under the control of the insured resulting in injury or damage that is neither expected or intended - correct answer ✅Accident The replacement cost of lost or damaged property minus depreciation - correct answer ✅Actual Cash Value A provision in an insurance policy that provides additional amounts of coverage for a specific loss expense at no additional premium - correct answer ✅Additional coverage Individuals or business that are not named as insureds on the declaration page but are protected by the policy usually in regard to a specific interest - correct answer ✅Additional Insureds
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A contract which is offered on a take it or leave it basis. The insured's only option is to either accept or reject the contract; he/she has no input concerning its terms - correct answer ✅Adhesion An insurance company that has qualified and received a certificate of authority from the department of insurance to transact insurance in the state - correct answer ✅Admitted Insurer The insuring of risks that are of a poorer class (more prone to losses) than the average risk - correct answer ✅Adverse Selection A person who acts on the behalf of the insurer to sell, negotiate, or effect insurance contracts; also known as a producer - correct answer ✅Agent
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The appearance of the assumption of authority based on the actions, words, or deed of the principal or because of circumstances the principal created - correct answer ✅Apparent Authority An assessment of property to determine either the correct amount of insurance to be written or the amount of loss to be paid - correct answer ✅Appraisal Method of claim settlement used when the insured and insurer cannot agree upon the amount of the loss
correct answer ✅Arbitration The transfer of a legal right or interest in an insurance policy - correct answer ✅Assignment An insurance company that has qualified and received a certificate of authority from the department of insurance to transact insurance in the state - correct answer ✅Authorized Insurer
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A land motor vehicle, trailer, or semi-trailer designed for use on public roads, including attached machinery or equipment;auto does not include mobile equipment
correct answer ✅Auto A person or entity that has possession of personal property entrusted to him/her by the owner. - correct answer ✅Bailee The person who receives the benefits from the policy of insurance - correct answer ✅Beneficiary A temporary contract of insurance issued by an insurer or its agent that places insurance in effect prior to the policy being issued - correct answer ✅Binder
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The termination of an in-force insurance policy by either the insured or the insurer prior to the expiration date shown in the policy. Termination may be voluntary, involuntary, or in mutual accordance with provisions contained in the policy - correct answer ✅Cancellation A type of insurance that covers losses caused by injury to persons or damage to the property of others - correct answer ✅Casualty Insurance Requires a person to stop committing an action that is in violation of a provision - correct answer ✅Cease and Desist Order Authorizes a company to start conducting business and specifies the kind(s) of insurance a company can transact. It is illegal for an insurance company to transact insurance without this certificate - correct answer ✅Certificate of Authority
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The practice of computing a price per unit of insurance that applies to all applicants possessing a given set of characteristics - correct answer ✅Class Rating An unfair trade practice in which an insurer uses physical or mental force to persuade an applicant to buy insurance - correct answer ✅Coercion A clause in which the insured agrees to share in the loss to the extent that he/she is underinsured at the time of loss - correct answer ✅Coinsurance Clause A single dollar limit of liability applying to the total damages for bodily injury and property damaged combined, resulting from one accident or occurrence - correct answer ✅Combined Single The chief executive and administrative officer of the insurance department. The powers, duties, management, and control of the insurance
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The legal term for the intentional withholding of information of a material fact which is crucial in making a decision - correct answer ✅Concealment Certain conditions that must be met by the owner and the company in order for a contract to be executed - correct answer ✅Conditional Contract The section of an insurance policy that indicates the general rules or procedures that the insurer and insured agree to follow under the terms of the policy - correct answer ✅Conditions The binding force in any contract. The consideration on the part of the insured is the payment of premium and the representations made in the application. The consideration on the part of the insurer is the promise to pay in the event of loss - correct answer ✅Consideration A person who, for a fee, offers any advice, counsel, opinion, or service regarding the benefits, advantages,
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or disadvantages promised under a policy of insurance - correct answer ✅Consultant Include written and/or oral information regarding a consumer's credit, character, reputation, or habits collected by a reporting agency from employment records, credit reports, and other public sources - correct answer ✅Consumer Reports An agreement between two or more parties enforceable by law - correct answer ✅Contract Insurance procured or to be procured by, through, or upon licensee's own life, property or risks or those of his/her spouse, or the life, property or risks of his/her employer or his/her own business - correct answer ✅Controlled Business The amount payable upon the death of the person whose life is insured - correct answer ✅Death Benefit
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The lessening of value of real and personal property due to age and wear and tear - correct answer ✅Depreciation Direct, physical damage to building and/or personal property - correct answer ✅Direct Losses The chief executive and administrative officer of the insurance department. The powers, duties, management, and control of the insurance department are in the hands of the insurance director; sometimes known as superintendent or commissioner
correct answer ✅Director Identifying the name of the producer, representative or firm on any policy solicitation which involves an insurance producer, limited insurance representative, or temporary insurance provider - correct answer ✅Disclosure
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An insurance company that is incorporated in the state - correct answer ✅Domestic Insurer Insurers can be defined by their location of incorporation and whether or not they are authorized to write business in a state - correct answer ✅Domicile of Insurer The estimated total cost, both insured and uninsured, of an accident - correct answer ✅Economic Loss A printed addendum to a contract that is used to change the policy's original terms, conditions, or coverages - correct answer ✅Endorsement A legal process that can be used to prevent a party to a contract from re-asserting a right or privilege after that right or privilege has been waived - correct answer ✅Estoppel
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The authority a principal intends to grant to an agent by means of the agent's written contract - correct answer ✅Express Authority A provision in some property policies which allows the extension of a major coverage to apply to specific types of loss to property not specifically insured - correct answer ✅Extensions of Coverage Acronym for Fair Access to Insurance Requirements. This is a state run program that makes insurance obtainable to those in high risk areas who have been unable to acquire insurance through other channels - correct answer ✅FAIR Plan A person in the position of financial trust who must act in the best interest of all parties involved - correct answer ✅Fiduciary The individual whose name appears first on the policys declaration - correct answer ✅First Named Insured
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An insurance company that is incorporated in another state - correct answer ✅Foreign Insurer A life or health insurance company formed to provide insurance for members of an affiliated lodge, religious, or fraternal organization with a representative form of government - correct answer ✅Fraternal Benefit Society The intentional misrepresentation or intentional concealment of a material fact used to induce another party to make or refrain from making a contract or to deceive or cheat a party - correct answer ✅Fraud The cost to replace damaged property with less expensive and more modern construction or equipment - correct answer ✅Functional Replacement Cost
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Authority that is not expressed or written into the contract but which the agent is assumed to have in order to transact the business of insurance for the principal - correct answer ✅Implied Authority Compensation to an insured that restores them to the same financial position that they enjoyed prior to the loss occurring - correct answer ✅Indemnity Those that sell the insurance products of several companies and work for themselves or other agents - correct answer ✅Independent Agents Losses that are considered to be a result of the direct loss. They usually result because if the time it takes to repair or replace damaged property - correct answer ✅Indirect Losses A coverage extension that automatically increases the building amounts of insurance by an agreed upon
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percentage annually - correct answer ✅Inflation Guard Any interest an insured may have in property that is the subject of insurance so that damage or destruction of that property would cause the insured financial loss - correct answer ✅Insurable Interest The transfer of the possibility of a loss (risk) to an insurance company which in turn spreads the costs of unexpected losses to many individuals - correct answer ✅Insurance A contract between an insured and an insurance company which agrees to pay the insured for loss caused by specific events - correct answer ✅Insurance Policy The person covered by the policy of insurance. This means anyone that is covered under the policy whether named or not - correct answer ✅Insured
