Texas Property and Casualty License Practice Exam

Which of the following is included as part of the '6 Ps' on the declarations page?

1. Policy limits

2. Payment history

3. Parties involved

4. Policy application details

The correct answer is: Policy limits

The correct choice is policy limits, which are a critical component found on the declarations page of an insurance policy. The declarations page serves as a summary of key aspects of the insurance coverage being provided. It typically includes essential information such as the name of the insured, the policy number, the coverage period, and the specific limits of liability or coverage amounts for various types of risks. Policy limits specifically refer to the maximum amount the insurer will pay for a covered loss. This is important for the insured to understand, as it dictates the extent of coverage provided under the policy and informs them of their financial exposure in case of a claim. In contrast, payment history and policy application details are not standard elements included in the declarations page. The payment history is typically part of the insured’s account records and not displayed directly on the declarations. Likewise, details from the policy application are generally referenced elsewhere in the policy documentation but do not form part of the summary section presented on the declarations page. Additionally, while the parties involved, such as the insurer and the insured, may indeed be noted, the critical focus in the context of the '6 Ps' emphasizes aspects like policy limits as key information that impacts coverage directly.