RMIN 4000 Edmunds Exam 3 Questions and Answers 100% Verified
Question : What are the basic parts of an insurance contract?
Correct answer: declarations, definitions, insuring agreement,
exclusions, conditions, and miscellaneous provisions
Question : What are declarations in an insurance contract?
Correct answer: statements that provide information about the
particular property or activity to be insured
Question : What does the declarations page usually contain?
Correct answer: name and address, policy dates, amount of
insurance, premium and deductible, and other relevant info
Question : What are definitions in an insurance contract?
Correct answer: key words or phrases are defined so that
coverage under the policy can be determined more easily (insurer-"we,us,out" vs. insured-"you,your")
Question : What is the insuring agreement?
Correct answer: summary of the major promises of the insurer
(what is covered)
Question : What are named perils?
Correct answer: only perils specifically named in the policy
are covered
Question : What are open perils (All Risk, Special Coverage)?
Correct answer: all perils are covered except for those that are
specifically excluded
Question : What are exclusions in an insurance policy?
Correct answer: perils or property that are not covered under
the policy
Question : Why are exclusions necessary?
Correct answer: certain perils are considered uninsurable like
war and wear and tear
Question : What are some reasons to have insurance contract
exclusions?
Correct answer: presence of extraordinary hazards, coverage
provided by other contracts, moral or morale hazard, or coverage not needed by typical insureds
Question : What are conditions in an insurance contract?
Correct answer: provisions in the policy that qualify or place
limitations on the insurer's promise to perform (prompt notification of loss, no concealment or fraud, etc.)
Question : What are some miscellaneous provisions?
Correct answer: state mandatory provisions, notice of
cancellation, loss, nonrenewal, and mortgagee clause (mortgagee has right to be protected and must prove loss to get paid back)
Question : Who is the named insured?
Correct answer: person or party named on the declarations
page of policy
Question : Who is the first named insured?
Correct answer: has additional rights and responsibilities that
do not apply to other named insureds
Question : Who are other insureds?
Correct answer: persons or parties who are insured under
policy even though they are not specifically named
Question : Who are additional insureds?
Correct answer: person or party added to the policy by an
endorsement (lenders and mortgagors)
Question : What are Endorsements and Riders?
Correct answer: provisions that add to, delete from, or modify
the original policy terms (negotiated contract enhancements, state law provisions, etc.)