Exam Code: C11
Exam Name: Principles and Practice of Insurance
Certification Provider: IIC
Corresponding Certification: Chartered Insurance Professional (CIP)
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IIC C11 Exam Syllabus Topics:

SectionObjectives
Legal Principles of Insurance- Contract Law Basics
  • 1. Utmost good faith principle
    • 2. Formation of insurance contracts
      - Insurable Interest and Indemnity
      • 1. Principle of indemnity and application
        • 2. Insurable interest requirements
          Insurance Principles- Insurance Market Structure
          • 1. Regulatory environment overview
            • 2. Roles of insurers, brokers, and intermediaries
              - Fundamentals of Insurance
              • 1. Risk concepts and risk pooling
                • 2. Nature and purpose of insurance
                  Insurance Practice- Claims Handling
                  • 1. Claims process stages
                    • 2. Fraud detection and prevention
                      - Underwriting and Pricing
                      • 1. Risk assessment methods
                        • 2. Premium calculation principles

                          IIC Principles and Practice of Insurance Sample Questions:

                          Question 1

                          Which statement best describes a valued contract?

                          A. The insured can reject settlement offers and force a higher payout
                          B. Settlements involve periodic payments due to the nature of valuation
                          C. The policy pays the full cost of replacing items even if this amount exceeds policy limits
                          D. Settlements are based on a predetermined amount agreed upon at contract formation


                          Question 2

                          Stuart sells his vehicle and cancels his auto policy. The insurer refunds the full unearned portion of the premium. What type of cancellation is this?

                          A. Fully fixed
                          B. Pro rata
                          C. Non-adjusted rate
                          D. Total rate


                          Question 3

                          Orianna is an insurance professional who acts on behalf of the insurerandthe insured. She owns her client list and is paid commission once policies are arranged. What is her profession?

                          A. Underwriter
                          B. Independent adjuster
                          C. Broker
                          D. Exclusive agent


                          Question 4

                          The risk manager of an oil refinery is seeking ways to transfer the pollution risk of a new drilling method.
                          What is the best option?

                          A. Retain the risk
                          B. Transfer the risk using a surety bond
                          C. Use a non-insurance loss-financing transfer agreement to insure the risk
                          D. Add the risk to the company's standard commercial property and liability policies


                          Question 5

                          A company suffers an $80,000 theft loss from its commercial property.
                          Insurer A covers the property for $300,000.
                          Insurer B covers the same property for $100,000.
                          Assuming both policies have identical terms, how is the $80,000 loss shared?

                          A. Insurer A pays $0; Insurer B pays $60,000
                          B. Insurer A pays $80,000; Insurer B pays $0
                          C. Insurer A pays $60,000; Insurer B pays $20,000
                          D. Insurer A pays $40,000; Insurer B pays $40,000


                          Solutions:

                          Question 1
                          Answer: D
                          Question 2
                          Answer: B
                          Question 3
                          Answer: C
                          Question 4
                          Answer: C
                          Question 5
                          Answer: C

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