Exam Fx Life and Health Tip Sheet Questions With Complete Solutions

Perils correct answer: the cause of loss Policy Owner correct answer: the person who has the rights and privileges in the policy Risk correct answer: Uncertainty or chance of loss -Pure Risk(Insurable) -Speculative(Uninsurable) Insured correct answer: the person covered by the insurance policy insurer correct answer: a company that issues an insurance policy Law of large numbers correct answer: the larger the number of people with the same exposure to loss, the more predictable the actual loss will be. Insurance Transaction correct answer: solicitation, negotiation, or effectuation of a contract. Insurance correct answer: transfer of risk of loss from an individual to an insurer Indeminity correct answer: restoring the insured to the condition that existed before loss. Agent/Producer correct answer: A legal representative of an insurance company, Applicant/Proposed insured correct answer: a person applying for insurance Hazard correct answer: conditions that increase the probaility of a loss -Physical (physical conditions) -Moral (tendency toward increase risk) -Morale (indifference to loss)