General Insurance Practice Questions
490 free general insurance questions for the California Life & Health insurance license exam. Pick any question — answer it and get the full 3-part explanation, no signup required.
- 1.In insurance terminology, the definition of risk is best expressed as:Difficulty 1/5
- 2.In insurance terminology, risk is best defined as:Difficulty 1/5
- 3.In the context of insurance, the term "risk" is most accurately defined as:Difficulty 1/5
- 4.What is the fundamental difference between insurance and gambling?Difficulty 2/5
- 5.In insurance terminology, risk is best defined as:Difficulty 1/5
- 6.The chance or probability that a loss will occur is known as the:Difficulty 1/5
- 7.In insurance terminology, risk is best defined as:Difficulty 1/5
- 8.Fire, lightning, windstorm, and theft are all examples of:Difficulty 1/5
- 9.Several small businesses form a pool, each contributing to a common fund used to pay members' losses. This …Difficulty 1/5
- 10.Fire, windstorm, theft, and illness are best classified in insurance terminology as:Difficulty 1/5
- 11.Which statement correctly distinguishes a pure risk from a speculative risk?Difficulty 1/5
- 12.In insurance terminology, a peril is:Difficulty 1/5
- 13.A fire destroys an insured's home. For purposes of risk analysis, the fire is best described as:Difficulty 1/5
- 14.In life insurance, which statement correctly distinguishes the subject of the insurance from the risk?Difficulty 2/5
- 15.A bank lends $50,000 to a business owner and purchases life insurance on the borrower. The bank's insurable…Difficulty 2/5
- 16.In insurance terminology, risk is best defined as:Difficulty 1/5
- 17.Which of the following is an example of a peril?Difficulty 1/5
- 18.Because an insurance policy is a contract of adhesion, any genuine ambiguity in the policy language is gene…Difficulty 2/5
- 19.Which statement correctly distinguishes a hazard from a peril?Difficulty 2/5
- 20.An insured may need emergency surgery that could produce a $60,000 hospital bill. The possibility of this b…Difficulty 1/5
- 21.A warehouse has exposed electrical wiring and an accumulation of oily rags near a furnace. For purposes of …Difficulty 1/5
- 22.Several small business owners contribute to a joint fund designed to pay the losses of whichever member suf…Difficulty 1/5
- 23.A hazard, in insurance terminology, is best described as:Difficulty 1/5
- 24.An insured stores a gasoline can next to an open-flame water heater. For purposes of risk classification, t…Difficulty 1/5
- 25.A condition or circumstance that increases the likelihood or severity of a loss is called a:Difficulty 1/5
- 26.The term "loss exposure" refers to:Difficulty 1/5
- 27.A disability insurer prices its policies based on risk. Which of the following best describes what the insu…Difficulty 2/5
- 28.An insurer uses claim statistics to calculate that the probability of a disabling injury in a certain occup…Difficulty 2/5
- 29.An underwriting report notes that a building has outdated wiring and that its owner is careless about maint…Difficulty 2/5
- 30.Which of the following involves insurable risk rather than a certain, scheduled expense?Difficulty 1/5
- 31.In insurance terminology, 'risk' is best defined as:Difficulty 1/5
- 32.An individual pays premiums to an insurer that agrees to bear the financial burden of certain losses. This …Difficulty 2/5
- 33.Which option correctly pairs each insurance term with its meaning, in the order risk, peril, hazard?Difficulty 2/5
- 34.The term 'loss exposure' refers to:Difficulty 2/5
- 35.Why does the law of large numbers make insurance possible?Difficulty 1/5
- 36.The term "loss exposure" refers to:Difficulty 2/5
- 37.A bank employee embezzles funds from one customer's account, causing a loss to that customer alone. This ty…Difficulty 2/5
- 38.Which statement best distinguishes a warranty from a representation in insurance law?Difficulty 2/5
- 39.A business owner installs automatic fire sprinklers in a warehouse to reduce the chance that a fire will ca…Difficulty 2/5
- 40.In insurance, a 'loss exposure' is best described as:Difficulty 1/5
- 41.In the context of a medical expense policy, which of the following is the 'risk' the policy is designed to …Difficulty 1/5
- 42.Why are speculative risks, such as the risk of losing money in a business venture, generally not insurable?Difficulty 2/5
- 43.Two applicants of the same age apply for the same disability policy; one is a nonsmoking office worker and …Difficulty 1/5
- 44.An applicant for life insurance truthfully states that he is terminally ill and expects to die within six m…Difficulty 3/5
- 45.Which characteristic is generally required for a risk to be considered ideally insurable?Difficulty 2/5
- 46.An actuary calculates that a 40-year-old applicant has a 0.3 percent chance of becoming disabled within the…Difficulty 2/5
- 47.A term in an insurance policy is genuinely ambiguous and can be read two reasonable ways. Because an insura…Difficulty 1/5
- 48.A homeowner installs a fire alarm, self-funds minor repairs out of pocket, and purchases a homeowners polic…Difficulty 2/5
- 49.Which of the following is an example of a pure risk?Difficulty 1/5
- 50.Which of the following is NOT one of the basic techniques used to manage risk?Difficulty 1/5