Life and Health Insurance
License 2026 | Exam Prep,
Questions & Study Guide
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Updated 2026 Questions and Answers
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Rationales
Included
, premium set cost of insurance coverage payed by policyholder
claim insureds notification to the insurer that a payment is requestedq
risk possibility of a loss occuring
law of large numbers States that as a group increases in size, the easier it is to predict the number of
future losses over a certain period of time
actuaries mathematicians employed by insurance companies who collect and analyze risk
data
Insurable Interest A party wishing to buy an insurance policy on another party- valid concern about
the health or well being of the party- business partner, blood relationship,
marriage etc. [[must show interest when the other person is applying for the
policy]]
risk pooling sharing possibility of loss over a large group of people
speculative risks not covered by insurance. ex gambling
pure risks insurable. accent, illness, death
peril cause of the loss and the event insured against. In life and health insurance, the
perils are premature death, dependency during old age, accident, and sickness.
exposure being subject to loss because of your surroundings. ex) living with a smoker
hazard anything that increases the chance of a loss occurring. icy roads, driving while
intoxicated
Adverse Selection tendency for poorer than average risks to seek out insurance (smokers). Insurers
must seek to minimize this.
reinsurance spreading risk from one insurer to one or more other insurers.
beneficiaries The named individuals or entities designated by the policyowner to receive the
policy proceeds/benefits
indemnity insurance insurance that compensates the beneficiaries of the policies for their actual
economic losses, up to the limiting amount of the insurance policy.
[INDEMNITY=TO MAKE WHOLE]
life insurance intended to ward off financial hardship that may result due to a person's
premature death. (burial costs, funeral cost, final expenses)
limit of liability total amount the insurer will pay for an insured risk
License 2026 | Exam Prep,
Questions & Study Guide
|Graded A+ | Guaranteed
success|
Updated 2026 Questions and Answers
100% Verified Exam Prep and Comprehensive
Rationales
Included
, premium set cost of insurance coverage payed by policyholder
claim insureds notification to the insurer that a payment is requestedq
risk possibility of a loss occuring
law of large numbers States that as a group increases in size, the easier it is to predict the number of
future losses over a certain period of time
actuaries mathematicians employed by insurance companies who collect and analyze risk
data
Insurable Interest A party wishing to buy an insurance policy on another party- valid concern about
the health or well being of the party- business partner, blood relationship,
marriage etc. [[must show interest when the other person is applying for the
policy]]
risk pooling sharing possibility of loss over a large group of people
speculative risks not covered by insurance. ex gambling
pure risks insurable. accent, illness, death
peril cause of the loss and the event insured against. In life and health insurance, the
perils are premature death, dependency during old age, accident, and sickness.
exposure being subject to loss because of your surroundings. ex) living with a smoker
hazard anything that increases the chance of a loss occurring. icy roads, driving while
intoxicated
Adverse Selection tendency for poorer than average risks to seek out insurance (smokers). Insurers
must seek to minimize this.
reinsurance spreading risk from one insurer to one or more other insurers.
beneficiaries The named individuals or entities designated by the policyowner to receive the
policy proceeds/benefits
indemnity insurance insurance that compensates the beneficiaries of the policies for their actual
economic losses, up to the limiting amount of the insurance policy.
[INDEMNITY=TO MAKE WHOLE]
life insurance intended to ward off financial hardship that may result due to a person's
premature death. (burial costs, funeral cost, final expenses)
limit of liability total amount the insurer will pay for an insured risk
