One reason catastrophes are difficult to insure is because the damage is so unpredictable.

Principles of Insurance

Quiz
•
Arts
•
University
•
Hard

NAZLIATUL ANIZA ABDUL AZIZ
Used 28+ times
FREE Resource
12 questions
Show all answers
1.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
True
False
2.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
Which of the following is a fundamental purpose of the principle of indemnity?
to reduce moral hazard
to minimize physical hazards
to settle property insurance losses on a replacement cost basis
to require deductibles in all property insurance policies
3.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
The principle of indemnity reduces morale hazard.
True
False
4.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
Under which of the following rules is actual cash value determined by taking into consideration all
relevant factors an expert would use to determine the value of the property?
the circumstantial evidence rule
the broad evidence rule
the property indemnity rule
the objective value rule
5.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
All of the following are exceptions to the principle of indemnity EXCEPT
life insurance.
valued policies.
replacement cost property insurance.
actual cash value property insurance.
6.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
Samʹs stereo was destroyed by a fire. The stereo cost $1200 when it was purchased, but a similar new stereo now costs $1800. Assuming the stereo was 50 percent depreciated, what is the actual cash value of Samʹs loss?
$600
$900
$1200
$1800
7.
MULTIPLE CHOICE QUESTION
5 mins • 1 pt
When must an insurable interest legally exist in life insurance?
only at the time of the insuredʹs death
only at the inception of the policy
only at the time the beneficiary is paid
both at the time of the insuredʹs death and at the inception of the policy
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