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Primerica Life Insurance Exam Prep~ Chapter 1: Intro to Life Insurance
Questions and Answers with Complete Solutions UPDATED!!!
3 Types of Hazards - ANSWER Physical, Moral, Morale
4 Elements of a Contract - ANSWER 1.) Agreement
2.) Consideration
3.) Competent Parties
4.) Legal Purpose
ACCL - ANSWER The 4 Elements of a contract: Agreement,
Consideration, Competent Parties, & Legal Purpose
Agreement - ANSWER offer and acceptance
Are insurance contracts considered aleatory? - ANSWER Yes,
insurance contracts are considered aleatory.
Are representations guaranteed to be true? - ANSWER No, they
are not guaranteed to be true.
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Avoidance - ANSWER A method of dealing with risk by
eliminating the loss exposure. (ex: avoiding planes due to fear
of dying from a plane crash)
Can the insured be changed in a personal contract without
consent? - ANSWER No, the insured cannot be changed without
consent.
Competent Parties - ANSWER Those entering into the contract
must be of legal age and must be mentally competent and not
under any outside influence
Concealment - ANSWER Legal term for the intentional
withholding of information. Concealment may void a policy.
Consideration - ANSWER A promise to pay for losses; insured's
consideration is the payment of premium + settlements on the
application.
Definite & Measurable - ANSWER A risk that is defined as a loss
that is specific as to the cause, time, place, and amount. An
Primerica Life Insurance Exam Prep~ Chapter 1: Intro to Life Insurance
Questions and Answers with Complete Solutions UPDATED!!!
3 Types of Hazards - ANSWER Physical, Moral, Morale
4 Elements of a Contract - ANSWER 1.) Agreement
2.) Consideration
3.) Competent Parties
4.) Legal Purpose
ACCL - ANSWER The 4 Elements of a contract: Agreement,
Consideration, Competent Parties, & Legal Purpose
Agreement - ANSWER offer and acceptance
Are insurance contracts considered aleatory? - ANSWER Yes,
insurance contracts are considered aleatory.
Are representations guaranteed to be true? - ANSWER No, they
are not guaranteed to be true.
, 2|Page
Avoidance - ANSWER A method of dealing with risk by
eliminating the loss exposure. (ex: avoiding planes due to fear
of dying from a plane crash)
Can the insured be changed in a personal contract without
consent? - ANSWER No, the insured cannot be changed without
consent.
Competent Parties - ANSWER Those entering into the contract
must be of legal age and must be mentally competent and not
under any outside influence
Concealment - ANSWER Legal term for the intentional
withholding of information. Concealment may void a policy.
Consideration - ANSWER A promise to pay for losses; insured's
consideration is the payment of premium + settlements on the
application.
Definite & Measurable - ANSWER A risk that is defined as a loss
that is specific as to the cause, time, place, and amount. An
