PSI PA PROPERTY CASUALITY
EXAM GUIDE (RATED A+) VERIFIED
QUESTIONS AND ANSWERS
insuring risks that are more prone to losses
than average risk (poorer risks tend to seek
insurance or file claims to a greater extent than
better risks) companies can refuse or restrict
coverage for bad risks or charge them a higher
rate - ANSWER-Adverse Selection
protects insurance agencies from catastrophic
risks (war/nuclear events) - ANSWERReinsurance
Within how many days from date of injury do
employees have to notify the employer of the
injury ?? - ANSWER-120 days
the reduction, decrease, or disappearance of
value of the person or property insured in a
policy, caused by a named peril - ANSWER-Loss
Methods of Handling Risk include... - ANSWERAvoidance, retention (reduce premiums),
sharing, reduction, and transfer
eliminating exposure for loss (ex. avoid airplane
crash by not getting in airplane) - ANSWERAvoidance
planned assumption of risk by an insured
through the use of deductibles, co-payments,
or self insurance
Purposes are: 1) reduce expenses, improve
cash flow 2) increase control of claim reserving
and claim settlements 3) fund for losses that
cannot be insured - ANSWER-Retention
owned by stockholders, right of voting and
incurring profits or losses - ANSWER-Stock
companies
According to the insurance law, who is the
principal? - ANSWER-Broker
An application as a resident agent must be
made in how many days if an individual
establishes a principal place of residence within
Pa from another state? - ANSWER-90 days