Insurance Law Final Exam Questions with Complete Solutions (Latest 2025) The three types of insurance are - Correct Answers ✅property, casualty, and life insurance.Often on policy will include property and casualty insurance (P & C insurance) Property insurance is - Correct Answers ✅first party insurance.First Party Insurance is for - Correct Answers ✅VICTIMS.Therefore, when you are the victim of an accident, you go to your first party insurer.
There are three types of Property insurance: - Correct
Answers ✅(1) Commercial: The insurance here will cover
real property, personal property, and interruption of the business.
(2) Homeowners: The insurance here will cover real property,
personal property, and additional living expenses. The ALE are those expenses such as meals away from home, hotel, etc.
(3) Auto: This may be used for individuals or businesses.
There are legislative mandates that require insurance companies to cover all drivers of a specific car.Casualty - Correct Answers ✅Casualty insurance is Third Party Insurance for TORTFEASORS. 1 / 4
Insurance Law Final Exam Questions with Complete Solutions (Latest 2025)
There are again three types of Casualty insurance: - Correct
Answers ✅Commercial, homeowners, and auto.(1) Commercial - Correct Answers ✅The insurance here will cover real property, personal property, and interruption of the business.
(2) Homeowners: - Correct Answers ✅The insurance here
will cover real property, personal property, and additional living expenses. The ALE are those expenses such as meals away from home, hotel, etc.
(3) Auto: - Correct Answers ✅This may be used for
individuals or businesses. There are legislative mandates that require insurance companies to cover all drivers of a specific car.Homeowners - Correct Answers ✅This includes a slip and fall on your front porch as well as an accident that did not occur at your home.Role of Intermediaries
Types: - Correct Answers ✅- Agents
- Captives
- Independents
- Broker 2 / 4
Insurance Law Final Exam Questions with Complete Solutions (Latest 2025)
- Wholesaler
- Insurance policies act through intermediaries
- Intermediary takes and processes with insurance company.
Want to buy insurance? - Correct Answers ✅- Go to the Producer/Intermediary
Agents = - Correct Answers ✅a person or organization that is authorized to bind coverage for the carrier.Agent can ACTUALLY issue the policy.
Binding coverage: - Correct Answers ✅The coverage is in
place as soon as the policy holder and the intermediary make their deal. The policy must be pursuant to his authorization agreement.
Agent Types:
Captive - Correct Answers ✅an agent that works for only one insurance company.State farm, Allstate, USAA, etc.Could have Vicarious Liability
Agent Types:
Independent = - Correct Answers ✅May have binding authority for a multiple insurance companies. However, this 3 / 4
Insurance Law Final Exam Questions with Complete Solutions (Latest 2025) person may start out as a broker, but due to the length of time working with specific companies and the relationship acquired, the broker may become an independent agent.Could go either way for Vicarious Liability also state that it depends on the jurisdiction When the agent is negligent, the insured will sue the agent.For example, if X think he bought insurance from Y, but Y did not actually get it approved by the insurer, when X has an accident he will not be covered. - Correct Answers ✅Therefore, the agent will be liable to the extent of what the policy should have covered. There are policy debates about whether the agent can then seek indemnification from the insurer. If the carrier always has to pay, then there is no incentive for the agent to act carefully; however, for the carrier no to pay would be an unjust enrichment.Broker = has no - Correct Answers ✅binding authority from the insurance company because they work for the inured.Therefore, you don't get the policy until it is issued by the insurance agency.Broker acts as agent for policyholder/insured.No Vicarious Liability Duty of broker or agent, the BOTH must possess - Correct Answers ✅1. Reasonable knowledge of the type of insurance,
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