Property and Casualty Insurance Practice Exam

What type of insurance designates a particular item to be insured?

1. Blanket insurance

2. Specific insurance

3. Comprehensive insurance

4. All-risk insurance

The correct answer is: Specific insurance

The correct answer is specific insurance because this type of insurance policy is designed to cover a particular item or an identified item outlined in the policy. Specific insurance policies are helpful when the insured wants coverage for a distinct asset, such as a vehicle, a piece of jewelry, or a work of art. In this way, both the coverage and the value of the specific item are specified in the policy, which provides clarity about what is insured and the limits of that coverage. In contrast, blanket insurance covers multiple items or a group of items under one policy without listing each item individually. This approach is generally more flexible, as it can adjust the coverage limits automatically based on the total value of assets in the group. Comprehensive insurance refers typically to broader coverage that includes various incidents or risks, which is not limited to a single item. All-risk insurance is a type of policy that protects against a wide array of risks but does not define coverage for specific items. Hence, the specific designation of an item is what distinguishes specific insurance from other forms of coverage.