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1
A contract for insurance eliminates the risk of liability.
A)True
B)False
2
Courts strictly construe insurance contracts against the insured.
A)True
B)False
3
Punitive damages are not available for an insurer's good faith, though erroneous, denial of the insured claims.
A)True
B)False
4
Property insurance policies are indemnity contracts.
A)True
B)False
5
In most cases, the insured cannot recover more than the amount of the actual loss under the insurance policy.
A)True
B)False
6
Under the right of subrogation in a property insurance contract, the insurer may obtain all of the insured rights to pursue legal remedies against those who wrongfully caused the harm to the property.
A)True
B)False
7
The requirement that a person who purchases an insurance policy has an economic stake in the insured property is known as:
A)property insurance.
B)coverage.
C)insurable interest.
D)None of the above
8
Property insurance polices obligate the insurer to reimburse the insured for certain losses. This is known as:
A)peril.
B)legal liability.
C)indemnity.
D)None of the above
9
An insurer who obtains all of the insured's rights to pursue legal remedies against anyone who negligently or intentionally caused the harm to the property is known as:
A)a right of subrogation.
B)a right to insurable interests.
C)a right of cancellation.
D)None of the above
10
Which of the following are examples of insurable interest?
A)mortgagees' interest in the property on which they hold liens
B)lessees' of real property in the property they lease
C)both A and B
D)None of the above





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