Alaska Property and Casualty Insurance Flashcard

Front

What is the primary purpose of surety insurance?

Back

To protect the obligee if the principal fails to fulfill a duty

Answer explanation

The primary purpose of surety insurance is to protect the obligee if the principal fails to fulfill a duty, ensuring that the obligee is compensated for any losses incurred due to the principal's non-performance.

Front

Which type of insurance is placed with non-admitted insurers when coverage is unavailable from authorized Alaska insurers?

Back

Surplus lines insurance

Answer explanation

Surplus lines insurance is used when coverage is not available from authorized insurers in Alaska, allowing businesses to obtain necessary insurance from non-admitted insurers.

Front

What does marine insurance typically cover?

Back

Vessels, cargo, and related interests against perils of navigation and transit

Answer explanation

Marine insurance typically covers vessels, cargo, and related interests against perils of navigation and transit, protecting them from risks associated with maritime activities.

Front

What is a valid reason for the cancellation of an insurance policy due to nonpayment?

Back

Failure to pay any part of the premium when due

Answer explanation

The correct reason for cancellation is 'Failure to pay any part of the premium when due.' Nonpayment directly violates the terms of the policy, leading to cancellation, unlike the other options which do not justify cancellation.

Front

What type of vehicles does personal auto insurance cover?

Back

Private passenger vehicles not used for hire

Answer explanation

Personal auto insurance primarily covers private passenger vehicles that are not used for hire, such as personal cars. It does not typically cover motorcycles, boats, or commercial trucks.

Front

Which of the following is NOT included in personal insurance? Renters insurance, Personal liability insurance, Life insurance, Homeowners insurance

Back

Life insurance

Answer explanation

Life insurance is not considered personal insurance like renters, personal liability, or homeowners insurance, which cover property and liability risks. Life insurance provides financial support upon death, not property protection.

Front

What is the purpose of a binder in insurance?

Back

To provide temporary coverage until a formal policy is issued

Answer explanation

A binder in insurance serves to provide temporary coverage until a formal policy is issued, ensuring that the insured is protected during the interim period.

Front

What must insurers disclose in policies according to Civil Rule 82?

Back

How attorney’s fee awards are handled under liability coverage

Answer explanation

According to Civil Rule 82, insurers must disclose how attorney’s fee awards are handled under liability coverage, ensuring policyholders understand their rights and obligations regarding legal costs.

Front

What is required under Alaska's Motor Vehicle Safety Responsibility Act?

Back

Proof of financial responsibility

Answer explanation

Under Alaska's Motor Vehicle Safety Responsibility Act, drivers must provide proof of financial responsibility, ensuring they can cover costs related to accidents. This is essential for legal driving in the state.

Front

Minimum liability coverage required per person for bodily injury in Alaska?

Back

$50,000

Answer explanation

In Alaska, the minimum liability coverage required for bodily injury per person is $50,000. This means that if an accident occurs, the insurance must cover at least this amount for each injured person.