Colorado Health Insurance Pre-Licensing Exam
Preparation Guide (2026–2027): Comprehensive Review
with 350 Practice Questions and Verified Correct Answers
What is risk best defined as? - Answer - Uncertainty of financial loss
What type of authority is specifically written in an agent's contract? - Answer -
Express authority
What is a peril best described as? - Answer - The cause of a loss
What type of insurer is formed under the laws of another state? - Answer - Foreign
A stock insurer is owned by? - Answer - Shareholders
A mutual insurer typically returns unused premiums to policyholders as? - Answer
- Dividends
What is a contract drafted by the insurer and accepted without negotiation? -
Answer - Adhesion
What is a warranty considered? - Answer - A guaranteed true statement
What is the transfer of legal rights in a policy called? - Answer - Assignment
What is the chance of loss without gaining financially? - Answer - Pure risk
,Insurance is viable because of the law of? - Answer - Large numbers
What type of hazard results from an individual's careless attitude? - Answer -
Morale hazard
Consideration in an insurance contract refers to? - Answer - Premium payment and
statements on application
Which type of authority is perceived by the public? - Answer - Apparent
What does indemnity mean? - Answer - Restored to previous financial condition
What type of contract is where one party is legally bound to perform? - Answer -
Unilateral
If an applicant lies intentionally to secure lower rates, this is? - Answer - Fraud
Underwriting exists to? - Answer - Review risk and determine premium
What is the chance of loss shared by many an example of? - Answer - Risk pooling
Which is not an element of a legal contract? - Answer - Premium refund guarantee
A deductible is used to? - Answer - Reduce claim frequency and cost
What does a speculative risk involve? - Answer - Loss or gain
,An insurance company incorporated in another country is a/an? - Answer - Alien
insurer
The part of the policy stating who, what, and coverage limits is? - Answer -
Declarations
An intentional loss is? - Answer - Not insurable
What does a reinsurance agreement protect insurers from? - Answer - Catastrophic
losses
Which party pays premiums? - Answer - Owner
Adverse selection refers to? - Answer - High-risk individuals seeking coverage
Agency is created when? - Answer - Producer is appointed by insurer
A voidable contract becomes void when? - Answer - Fraud is discovered
Health insurance primarily covers? - Answer - Medical expense & disability loss
Accident-only coverage excludes? - Answer - Sickness
Disability income insurance pays? - Answer - Wage replacement
, A probationary period applies to? - Answer - Both
What does an elimination period function like? - Answer - A deductible in time
Coinsurance is? - Answer - Shared cost between insured and insurer
What does the stop-loss provision limit? - Answer - Insured out-of-pocket cost
COBRA provides continuation for groups with? - Answer - 20+ employees
What does HIPAA ensure? - Answer - Privacy and portability
Medicare eligibility usually begins at age? - Answer - 65
Medicare Part C is? - Answer - Medicare Advantage managed care option
Medicaid provides healthcare for? - Answer - Low-income individuals
Workers compensation covers injuries? - Answer - On the job
Coordination of Benefits (COB) prevents? - Answer - Over-insurance and double
payment
A major medical deductible resets? - Answer - Each calendar year
Preparation Guide (2026–2027): Comprehensive Review
with 350 Practice Questions and Verified Correct Answers
What is risk best defined as? - Answer - Uncertainty of financial loss
What type of authority is specifically written in an agent's contract? - Answer -
Express authority
What is a peril best described as? - Answer - The cause of a loss
What type of insurer is formed under the laws of another state? - Answer - Foreign
A stock insurer is owned by? - Answer - Shareholders
A mutual insurer typically returns unused premiums to policyholders as? - Answer
- Dividends
What is a contract drafted by the insurer and accepted without negotiation? -
Answer - Adhesion
What is a warranty considered? - Answer - A guaranteed true statement
What is the transfer of legal rights in a policy called? - Answer - Assignment
What is the chance of loss without gaining financially? - Answer - Pure risk
,Insurance is viable because of the law of? - Answer - Large numbers
What type of hazard results from an individual's careless attitude? - Answer -
Morale hazard
Consideration in an insurance contract refers to? - Answer - Premium payment and
statements on application
Which type of authority is perceived by the public? - Answer - Apparent
What does indemnity mean? - Answer - Restored to previous financial condition
What type of contract is where one party is legally bound to perform? - Answer -
Unilateral
If an applicant lies intentionally to secure lower rates, this is? - Answer - Fraud
Underwriting exists to? - Answer - Review risk and determine premium
What is the chance of loss shared by many an example of? - Answer - Risk pooling
Which is not an element of a legal contract? - Answer - Premium refund guarantee
A deductible is used to? - Answer - Reduce claim frequency and cost
What does a speculative risk involve? - Answer - Loss or gain
,An insurance company incorporated in another country is a/an? - Answer - Alien
insurer
The part of the policy stating who, what, and coverage limits is? - Answer -
Declarations
An intentional loss is? - Answer - Not insurable
What does a reinsurance agreement protect insurers from? - Answer - Catastrophic
losses
Which party pays premiums? - Answer - Owner
Adverse selection refers to? - Answer - High-risk individuals seeking coverage
Agency is created when? - Answer - Producer is appointed by insurer
A voidable contract becomes void when? - Answer - Fraud is discovered
Health insurance primarily covers? - Answer - Medical expense & disability loss
Accident-only coverage excludes? - Answer - Sickness
Disability income insurance pays? - Answer - Wage replacement
, A probationary period applies to? - Answer - Both
What does an elimination period function like? - Answer - A deductible in time
Coinsurance is? - Answer - Shared cost between insured and insurer
What does the stop-loss provision limit? - Answer - Insured out-of-pocket cost
COBRA provides continuation for groups with? - Answer - 20+ employees
What does HIPAA ensure? - Answer - Privacy and portability
Medicare eligibility usually begins at age? - Answer - 65
Medicare Part C is? - Answer - Medicare Advantage managed care option
Medicaid provides healthcare for? - Answer - Low-income individuals
Workers compensation covers injuries? - Answer - On the job
Coordination of Benefits (COB) prevents? - Answer - Over-insurance and double
payment
A major medical deductible resets? - Answer - Each calendar year
