TPCI - Tennessee Property and Casualty Insurance Exam

Question 1: An insurance producer explains that one line of coverage reimburses the policyowner directly for fire or theft damage to the owner's own buildings and belongings, which the industry labels first-party losses. Which branch of insurance operates this way?

Property insurance

Casualty insurance

Liability insurance

Surety insurance

Question 2: At a backyard gathering in Murfreesboro, a guest slips on the host's freshly waxed deck and breaks a wrist because of the host's carelessness. Which type of coverage would pay the injured guest's medical and legal costs rather than the host's own losses?

Property insurance

First-party coverage

Casualty insurance

Salvage coverage

Question 3: Study materials distinguish several risk terms an applicant should master. One term names the actual cause of a loss, such as fire, hail, or a tornado striking a home near Jackson. Which term describes that direct cause of loss?

Hazard

Exposure

Loss

Peril

Question 4: An underwriter reviewing a Knoxville dwelling notes that a homeowner stores gasoline and oily rags beside the furnace. This condition does not cause a fire by itself but makes one more likely and more severe. Which risk term fits this situation?

Peril

Physical hazard

Pure risk

Indirect loss

Question 5: A bank holds the mortgage on a Chattanooga house and would lose money if the home burned down before the loan is repaid. Property insurance requires this financial stake in the insured item at the time of loss. Which principle does this illustrate?

Insurable interest

Indemnity

Subrogation

Liberalization

Question 6: A homeowner's policy carries a five hundred dollar deductible. An ice storm near Johnson City causes seven hundred fifty dollars of roof damage. The purpose of this provision is to discourage very small claims. How much will the insurer pay?

Seven hundred fifty dollars

Five hundred dollars

Two hundred fifty dollars

Nothing is payable

Question 7: When comparing two otherwise identical dwelling quotes, a Clarksville applicant notices that choosing a larger amount she must pay before coverage responds lowers her annual cost. Which statement correctly describes the relationship between the deductible and the premium?

Higher deductible raises premium

Deductible does not affect premium

Lower deductible lowers premium

Higher deductible lowers premium

Question 8: A fire severely damages a Memphis rental duplex, and the owner loses several months of rental income while the building is repaired. The lost rent flows from the fire rather than the flames themselves. Which term best describes this loss of income?

Direct loss

Indirect loss

Insured peril

Pair or set loss

Question 9: Following a covered fire, an adjuster settles a five-year-old television by taking what a comparable new set costs today and subtracting for the years of use already consumed. Which loss valuation method is the adjuster applying to this claim?

Actual cash value

Replacement cost

Agreed value

Market value

Question 10: A Nashville homeowner wants roof damage settled so the insurer pays the full cost of new materials of similar kind and quality, with no reduction for the roof's age. Which valuation approach provides this treatment without any deduction for depreciation?

Actual cash value

Functional replacement cost

Replacement cost

Stated amount

Question 11: An older Knoxville home has plaster walls damaged by a covered fire. The insurer agrees to restore the walls using modern drywall, which performs the same function at lower cost, rather than matching the original plaster. Which valuation method does this describe?

Replacement cost

Actual cash value

Agreed value

Functional replacement cost

Question 12: A collector insures antique furniture that would be difficult to value after a loss, so the insurer and insured settle on a figure before the policy is issued and reset it each year. If a loss occurs, that figure is guaranteed. Which valuation method is this?

Stated amount

Agreed value

Actual cash value

Functional replacement cost

Question 13: An insured owns a pair of diamond earrings appraised together for thirty thousand dollars. One earring is stolen, and the single remaining earring is appraised at eight thousand dollars. Under the pair or set condition, how much should the insurer pay?

Twenty-two thousand dollars

Thirty thousand dollars

Eight thousand dollars

Fifteen thousand dollars

Question 14: A West Tennessee building has a replacement cost of two hundred thousand dollars, but the owner insures it for only one hundred thousand dollars under an eighty percent coinsurance clause. A fire causes ten thousand dollars of partial damage. How much will the insurer pay before any deductible?

Ten thousand dollars

Eight thousand dollars

Six thousand two hundred fifty dollars

One hundred thousand dollars

Question 15: A Middle Tennessee warehouse valued at four hundred thousand dollars carries three hundred twenty thousand dollars of coverage under an eighty percent coinsurance clause. A covered fire causes a twenty thousand dollar partial loss. Because the owner met the requirement, how is this partial loss paid?

Reduced by a penalty

Only eighty percent paid

Half the loss paid

Paid in full

Question 16: The coinsurance clause encourages property owners to buy coverage close to full value and to review limits periodically. The minimum amount an insurer expects an owner to carry to escape any penalty is usually expressed as a percentage of what figure?

Market value

Replacement cost

Original purchase price

Assessed tax value

Question 17: A property owner reads that her policy covers loss only from causes specifically listed in the contract, such as fire, windstorm, hail, and vandalism, and nothing else. Any cause not on the list is simply not covered. Which type of coverage is this?

Named peril coverage

Open peril coverage

Special form coverage

All-risk coverage

Question 18: One approach to insuring a dwelling covers all risks of direct physical loss except those the policy specifically excludes, shifting to the insurer the task of naming exclusions. This approach is broader and costs more than listing covered causes. What is it called?

Named peril coverage

Basic form coverage

Open peril coverage

Specified peril coverage

Question 19: A landlord buys an unendorsed DP-1 Basic Form on a rental house near Chattanooga and adds no extra perils. Only three causes of loss are automatically included in that base form. Which set of perils is automatically covered?

Wind, hail, and smoke

Theft, vandalism, and riot

Flood, earthquake, and collapse

Fire, lightning, internal explosion

Question 20: An insurance class learns the acronym WCSHAVVER for the nine extended coverage perils added beyond fire, lightning, and internal explosion. These include wind, civil commotion, smoke, hail, aircraft, vehicles, volcanic eruption, explosion, and one more. Which peril completes this group of nine?

Theft

Riot

Flood

Collapse

TPCI Tennessee Property and Casualty Insurance Exam - Set 2 - Part 1

Question 1: An insurance producer explains that one line of coverage reimburses the policyowner directly for fire or theft damage to the owner's own buildings and belongings, which the industry labels first-party losses. Which branch of insurance operates this way?

Question 2: At a backyard gathering in Murfreesboro, a guest slips on the host's freshly waxed deck and breaks a wrist because of the host's carelessness. Which type of coverage would pay the injured guest's medical and legal costs rather than the host's own losses?

Question 3: Study materials distinguish several risk terms an applicant should master. One term names the actual cause of a loss, such as fire, hail, or a tornado striking a home near Jackson. Which term describes that direct cause of loss?

Question 4: An underwriter reviewing a Knoxville dwelling notes that a homeowner stores gasoline and oily rags beside the furnace. This condition does not cause a fire by itself but makes one more likely and more severe. Which risk term fits this situation?

Question 5: A bank holds the mortgage on a Chattanooga house and would lose money if the home burned down before the loan is repaid. Property insurance requires this financial stake in the insured item at the time of loss. Which principle does this illustrate?

Question 6: A homeowner's policy carries a five hundred dollar deductible. An ice storm near Johnson City causes seven hundred fifty dollars of roof damage. The purpose of this provision is to discourage very small claims. How much will the insurer pay?

Question 7: When comparing two otherwise identical dwelling quotes, a Clarksville applicant notices that choosing a larger amount she must pay before coverage responds lowers her annual cost. Which statement correctly describes the relationship between the deductible and the premium?

Question 8: A fire severely damages a Memphis rental duplex, and the owner loses several months of rental income while the building is repaired. The lost rent flows from the fire rather than the flames themselves. Which term best describes this loss of income?

Question 9: Following a covered fire, an adjuster settles a five-year-old television by taking what a comparable new set costs today and subtracting for the years of use already consumed. Which loss valuation method is the adjuster applying to this claim?

Question 10: A Nashville homeowner wants roof damage settled so the insurer pays the full cost of new materials of similar kind and quality, with no reduction for the roof's age. Which valuation approach provides this treatment without any deduction for depreciation?

Question 11: An older Knoxville home has plaster walls damaged by a covered fire. The insurer agrees to restore the walls using modern drywall, which performs the same function at lower cost, rather than matching the original plaster. Which valuation method does this describe?

Question 12: A collector insures antique furniture that would be difficult to value after a loss, so the insurer and insured settle on a figure before the policy is issued and reset it each year. If a loss occurs, that figure is guaranteed. Which valuation method is this?

Question 13: An insured owns a pair of diamond earrings appraised together for thirty thousand dollars. One earring is stolen, and the single remaining earring is appraised at eight thousand dollars. Under the pair or set condition, how much should the insurer pay?

Question 16: The coinsurance clause encourages property owners to buy coverage close to full value and to review limits periodically. The minimum amount an insurer expects an owner to carry to escape any penalty is usually expressed as a percentage of what figure?

Question 17: A property owner reads that her policy covers loss only from causes specifically listed in the contract, such as fire, windstorm, hail, and vandalism, and nothing else. Any cause not on the list is simply not covered. Which type of coverage is this?

Question 18: One approach to insuring a dwelling covers all risks of direct physical loss except those the policy specifically excludes, shifting to the insurer the task of naming exclusions. This approach is broader and costs more than listing covered causes. What is it called?

Question 19: A landlord buys an unendorsed DP-1 Basic Form on a rental house near Chattanooga and adds no extra perils. Only three causes of loss are automatically included in that base form. Which set of perils is automatically covered?

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