First 50% of WebCe, Life Exam Questions
and Answers with Verified Solutions | Latest
Updated 2026
Which of the following is NOT an The risk of one's home value decreasing
insurable risk? due to
a drop in market prices.
Only pure risks (representing the chance
of
loss but not gain) are insurable.
Speculative
risks are not. Premature death, illness, and
disability are insurable risks.
2. From an insurance perspective, Only speculative risk is insurable.
all the following statements Only pure risks (representing the chance
regarding risk and loss are correct of
EXCEPT: loss but not gain) are insurable.
Speculative
risks, which involve the chance of gain as
well
as loss, are not insurable.
,3. Which of the following is an the possibility of becoming disabled and
insurable risk? unable to earn an income
Only pure risks (representing the chance
of
loss but not gain) are insurable.
Speculative
risks, which involve the chance of gain as
well
as loss, are not insurable.
4. From an insurance perspective, the extent to which an insurer is subject to
the term "loss exposure" means: a
possible loss
Also called loss exposure, exposure is the
state
of being subject to a possible loss. The
extent
of loss exposure facing an insurer has a
direct
bearing on the premium it charges.
1. The Excalibur Insurance foreign insurance company
Company, domiciled in Iowa, A company that does business in states
transacts business legally in other
Nebraska. In Nebraska, Excalibur than the one in which it is domiciled is
is a(n): classified as a foreign company in those
states.
2. All of the following are They are owned by stockholders.
characteristics of a mutual Mutual insurance companies are owned by
insurance company EXCEPT: their policyowners.
,3. A not-for-profit insurance fraternal insurance company
provider operated by an Sponsored by fraternal societies, fraternal
organization that has a insurers are not-for-profit organizations
representative form of leadership, that
operates on a lodge system, and specialize primarily in life insurance and
exists solely for the benefit of its annuity
members and their beneficiaries is products that are usually available only to
called the
society's members.
4. Which of the following does each state's Department of Insurance
NOT provide independent ratings A.M. Best, Moody's, Duff and Phelps, and
of insurance companies' financial Standard & Poor's are all well-known
strength and claims-paying insurance
abilities? company rating organizations. State
insurance
departments regulate insurance, they do
not
rate insurance companies.
1. Steven is filling out an concealment
application for life insurance. The Concealment is deliberately withholding
application asked whether he had material facts when applying for insurance.
ever had heart problems. Steven If
intentionally skips this question the concealed facts would have changed
even though he had heart surgery the
three years ago because he is insurer's decision to offer the insurance
afraid his application will be policy,
denied. What is the term for then the insurer can void the insurance
Steven's failure to give his entire contract.
medical history?
, 2. Which of the following Both the insured and insurer must act in
statements about utmost good utmost
faith in insurance contracts is good faith.
correct? An insurance contract requires that both
the
insured and the insurer act in utmost good
faith. Under this concept, both parties can
expect complete, relevant, and accurate
information. If one party fails to disclose
critical
information, the other party usually can
void
the contract.
If the parties disagree over the policyowner
terms of an insurance contract, Because the insurer drafts the insurance
courts will typically interpret contract and offers it to the applicant "as
anything unclear in the contract in is,"
favor of which party? applicants have little or no ability to change
the terms of the policy. As a result, courts
typically rule in favor of a policyowner if
policy
provisions are not clear.
and Answers with Verified Solutions | Latest
Updated 2026
Which of the following is NOT an The risk of one's home value decreasing
insurable risk? due to
a drop in market prices.
Only pure risks (representing the chance
of
loss but not gain) are insurable.
Speculative
risks are not. Premature death, illness, and
disability are insurable risks.
2. From an insurance perspective, Only speculative risk is insurable.
all the following statements Only pure risks (representing the chance
regarding risk and loss are correct of
EXCEPT: loss but not gain) are insurable.
Speculative
risks, which involve the chance of gain as
well
as loss, are not insurable.
,3. Which of the following is an the possibility of becoming disabled and
insurable risk? unable to earn an income
Only pure risks (representing the chance
of
loss but not gain) are insurable.
Speculative
risks, which involve the chance of gain as
well
as loss, are not insurable.
4. From an insurance perspective, the extent to which an insurer is subject to
the term "loss exposure" means: a
possible loss
Also called loss exposure, exposure is the
state
of being subject to a possible loss. The
extent
of loss exposure facing an insurer has a
direct
bearing on the premium it charges.
1. The Excalibur Insurance foreign insurance company
Company, domiciled in Iowa, A company that does business in states
transacts business legally in other
Nebraska. In Nebraska, Excalibur than the one in which it is domiciled is
is a(n): classified as a foreign company in those
states.
2. All of the following are They are owned by stockholders.
characteristics of a mutual Mutual insurance companies are owned by
insurance company EXCEPT: their policyowners.
,3. A not-for-profit insurance fraternal insurance company
provider operated by an Sponsored by fraternal societies, fraternal
organization that has a insurers are not-for-profit organizations
representative form of leadership, that
operates on a lodge system, and specialize primarily in life insurance and
exists solely for the benefit of its annuity
members and their beneficiaries is products that are usually available only to
called the
society's members.
4. Which of the following does each state's Department of Insurance
NOT provide independent ratings A.M. Best, Moody's, Duff and Phelps, and
of insurance companies' financial Standard & Poor's are all well-known
strength and claims-paying insurance
abilities? company rating organizations. State
insurance
departments regulate insurance, they do
not
rate insurance companies.
1. Steven is filling out an concealment
application for life insurance. The Concealment is deliberately withholding
application asked whether he had material facts when applying for insurance.
ever had heart problems. Steven If
intentionally skips this question the concealed facts would have changed
even though he had heart surgery the
three years ago because he is insurer's decision to offer the insurance
afraid his application will be policy,
denied. What is the term for then the insurer can void the insurance
Steven's failure to give his entire contract.
medical history?
, 2. Which of the following Both the insured and insurer must act in
statements about utmost good utmost
faith in insurance contracts is good faith.
correct? An insurance contract requires that both
the
insured and the insurer act in utmost good
faith. Under this concept, both parties can
expect complete, relevant, and accurate
information. If one party fails to disclose
critical
information, the other party usually can
void
the contract.
If the parties disagree over the policyowner
terms of an insurance contract, Because the insurer drafts the insurance
courts will typically interpret contract and offers it to the applicant "as
anything unclear in the contract in is,"
favor of which party? applicants have little or no ability to change
the terms of the policy. As a result, courts
typically rule in favor of a policyowner if
policy
provisions are not clear.
