MISSISSIPPI INSURANCE FINAL EXAM 2026/2027
QUESTIONS AND SOLUTIONS RATED A+
✔✔Adult day care - ✔✔Type of care (usually custodial) designed for individuals who
require assistance with various
activities of daily living, while their primary caregivers are absent. Offered in care
centers.
✔✔Adverse selection - ✔✔Selection "against the company." Tendency of less favorable
insurance risks to seek or
continue insurance to a greater extent than others. Also, tendency of policy owners to
take advantage of favorable
options in insurance contracts.
✔✔Advertising Code - ✔✔Rules established by the National Association of Insurance
Commissioners (NAIC) to
regulate insurance advertising.
✔✔Agency - ✔✔Situation wherein one party (an agent) has the power to act for another
(the principal) i n dealing
with third parties.
✔✔Agent - ✔✔Anyone not a duly licensed broker who solicits insurance or aids in
placing risks, delivering policies, or
collecting premiums on behalf of an insurance company.
✔✔Agent's report - ✔✔The section of an insurance application where the agent reports
personal observations about the
applicant.
✔✔Aleatory - ✔✔Feature of insurance contracts in that there is an element of chance
for both parties and that the dollar
given by the policyholder (premiums) and the insurer (benefits) may not be equal.
✔✔Alien Insurer - ✔✔Company incorporated or organized under the laws of any foreign
nation, providence, or territory.
✔✔Ambulatory surgery - ✔✔Surgery performed on an outpatient basis
✔✔Amount at risk - ✔✔Difference between the face amount of the policy and the
reserve or policy value at a given
time. In other words, the dollar amount over what the policy owner has contributed of
cash value toward payment of
the policyowner's own claim. Because the cash value increases every year, the net
amount at risk naturally
,decreases until it finally reaches zero when the cash value or reserve become the face
amount.
✔✔Annually renewable term (ART - ✔✔A form of renewable term insurance that
provides coverage for one year and
allows the policy owner to renew coverage each year without evidence of insurability.
Also called yearly renewable
term (YRT)
✔✔Annuitant - ✔✔One to whom an annuity is payable, or a person upon the
continuance of whose life further
payment depends.
✔✔Annuity - ✔✔A contract that provides a stipulated sum payable at certain regular
intervals during the lifetime of one
or more persons, or payable for a specified period only.
✔✔Annuity unit - ✔✔The number of annuity units denotes the share of the funds an
annuitant will receive from a
variable annuity account after the accumulation period ends and benefits begin. A
formula is used to convert
accumulation units to annuity units.
✔✔Any occupation - ✔✔A definition of total disability that requires that for disability
income benefits to be payable,
the insured must be unable to perform any job for which the insured is "reasonably
suited by reason of education,
training, or experience."
✔✔Apparent authority - ✔✔The authority an agent appears to have, based on the
principal's (the insurer's) actions,
words, deeds, or because of circumstances the principal (the insurer) created.
✔✔Application - ✔✔Form supplied by the insurance company, usually filled in by the
agent and medical examiner (if
applicable) on the basis of information received from the applicant.It issigned by the
applicant and is part of the
insurance policy if it is issued. It gives information to the home office underwriting
department, so it may consider
whether an insurance policy will be issued and, if so, in what classification and at what
premium rate.
✔✔Appointment - ✔✔Authorization or certification of an agent to act for or represent an
insurance company
, ✔✔Approval receipt - ✔✔Rarely used today, a type of conditional receipt that provides
that coverage is effective as of
the date the application is approved (before the policy is delivered).
✔✔Assessment mutual insurer - ✔✔An insurance company characterized by member-
insureds who are assessed an
individual portion of each loss that occurs. No premium payment is payable in advance.
✔✔Assignee - ✔✔Person (including corporation, partnership, or other organization) to
whom a right or rights under a
policy are transferred by means of an assignment
✔✔Assignment provision (health contracts) - ✔✔Commercial health policy provision that
allows the policy owner to
assign benefit payments from the insurer directly to the health care provider.
✔✔Assignment - ✔✔Signed transfer of benefits of a policy by an insured to another
party. The company does not
guarantee the validity of an assignment.
✔✔Assignor - ✔✔Person (including corporation, partnership, or other organization or
entity) who transfers a right or
rights under an insurance policy to another by means of an assignment.
✔✔Authority - ✔✔The actions and deeds an agent is authorized to conduct on behalf of
an insurance company, as
specified in the agent's contract.
✔✔Attained age - ✔✔With reference to an insured, the current insurance age
✔✔Authorized company - ✔✔Company duly authorized by the insurance department to
operate in the state.
✔✔Automatic premium loan provision - ✔✔Authorizes insurer to automatically pay any
premium in default at the
end of the grace period and charge the amount so paid against the life insurance policy
as a policy loan
✔✔Average Indexed Monthly Earnings (AIME) - ✔✔The basis used for calculating the
primary insurance amount
(PIA) for Social Security benefits.
✔✔Average Monthly Wage (AMW) - ✔✔The average wage base for computing virtually
all Social Security benefits
prior to
QUESTIONS AND SOLUTIONS RATED A+
✔✔Adult day care - ✔✔Type of care (usually custodial) designed for individuals who
require assistance with various
activities of daily living, while their primary caregivers are absent. Offered in care
centers.
✔✔Adverse selection - ✔✔Selection "against the company." Tendency of less favorable
insurance risks to seek or
continue insurance to a greater extent than others. Also, tendency of policy owners to
take advantage of favorable
options in insurance contracts.
✔✔Advertising Code - ✔✔Rules established by the National Association of Insurance
Commissioners (NAIC) to
regulate insurance advertising.
✔✔Agency - ✔✔Situation wherein one party (an agent) has the power to act for another
(the principal) i n dealing
with third parties.
✔✔Agent - ✔✔Anyone not a duly licensed broker who solicits insurance or aids in
placing risks, delivering policies, or
collecting premiums on behalf of an insurance company.
✔✔Agent's report - ✔✔The section of an insurance application where the agent reports
personal observations about the
applicant.
✔✔Aleatory - ✔✔Feature of insurance contracts in that there is an element of chance
for both parties and that the dollar
given by the policyholder (premiums) and the insurer (benefits) may not be equal.
✔✔Alien Insurer - ✔✔Company incorporated or organized under the laws of any foreign
nation, providence, or territory.
✔✔Ambulatory surgery - ✔✔Surgery performed on an outpatient basis
✔✔Amount at risk - ✔✔Difference between the face amount of the policy and the
reserve or policy value at a given
time. In other words, the dollar amount over what the policy owner has contributed of
cash value toward payment of
the policyowner's own claim. Because the cash value increases every year, the net
amount at risk naturally
,decreases until it finally reaches zero when the cash value or reserve become the face
amount.
✔✔Annually renewable term (ART - ✔✔A form of renewable term insurance that
provides coverage for one year and
allows the policy owner to renew coverage each year without evidence of insurability.
Also called yearly renewable
term (YRT)
✔✔Annuitant - ✔✔One to whom an annuity is payable, or a person upon the
continuance of whose life further
payment depends.
✔✔Annuity - ✔✔A contract that provides a stipulated sum payable at certain regular
intervals during the lifetime of one
or more persons, or payable for a specified period only.
✔✔Annuity unit - ✔✔The number of annuity units denotes the share of the funds an
annuitant will receive from a
variable annuity account after the accumulation period ends and benefits begin. A
formula is used to convert
accumulation units to annuity units.
✔✔Any occupation - ✔✔A definition of total disability that requires that for disability
income benefits to be payable,
the insured must be unable to perform any job for which the insured is "reasonably
suited by reason of education,
training, or experience."
✔✔Apparent authority - ✔✔The authority an agent appears to have, based on the
principal's (the insurer's) actions,
words, deeds, or because of circumstances the principal (the insurer) created.
✔✔Application - ✔✔Form supplied by the insurance company, usually filled in by the
agent and medical examiner (if
applicable) on the basis of information received from the applicant.It issigned by the
applicant and is part of the
insurance policy if it is issued. It gives information to the home office underwriting
department, so it may consider
whether an insurance policy will be issued and, if so, in what classification and at what
premium rate.
✔✔Appointment - ✔✔Authorization or certification of an agent to act for or represent an
insurance company
, ✔✔Approval receipt - ✔✔Rarely used today, a type of conditional receipt that provides
that coverage is effective as of
the date the application is approved (before the policy is delivered).
✔✔Assessment mutual insurer - ✔✔An insurance company characterized by member-
insureds who are assessed an
individual portion of each loss that occurs. No premium payment is payable in advance.
✔✔Assignee - ✔✔Person (including corporation, partnership, or other organization) to
whom a right or rights under a
policy are transferred by means of an assignment
✔✔Assignment provision (health contracts) - ✔✔Commercial health policy provision that
allows the policy owner to
assign benefit payments from the insurer directly to the health care provider.
✔✔Assignment - ✔✔Signed transfer of benefits of a policy by an insured to another
party. The company does not
guarantee the validity of an assignment.
✔✔Assignor - ✔✔Person (including corporation, partnership, or other organization or
entity) who transfers a right or
rights under an insurance policy to another by means of an assignment.
✔✔Authority - ✔✔The actions and deeds an agent is authorized to conduct on behalf of
an insurance company, as
specified in the agent's contract.
✔✔Attained age - ✔✔With reference to an insured, the current insurance age
✔✔Authorized company - ✔✔Company duly authorized by the insurance department to
operate in the state.
✔✔Automatic premium loan provision - ✔✔Authorizes insurer to automatically pay any
premium in default at the
end of the grace period and charge the amount so paid against the life insurance policy
as a policy loan
✔✔Average Indexed Monthly Earnings (AIME) - ✔✔The basis used for calculating the
primary insurance amount
(PIA) for Social Security benefits.
✔✔Average Monthly Wage (AMW) - ✔✔The average wage base for computing virtually
all Social Security benefits
prior to
