USAA Licensing Exam Questions and Answers 2023/2024

USAA Licensing Exam Questions and Answers 2023/2024 Insurance - ️️ Transfer of risk from one person or organization to an insurance company Indemnity - ️️ The principle to restore the insured to the pre-loss economic or financial condition. Law of Large numbers - ️️ Mathematical principle used by insurers to predict losses to charge the appropriate premiums Insurable Interest - ️️ Proof that someone stands to lose financially if a loss occurs; must exist at the time of the loss in property and casualty insurance Binder - ️️ Temporary insurance contract; commits the company to act as if a policy has been issued Peril - ️️ Cause of loss Direct Loss - ️️ Immediate actual physical damage to tangible property Indirect loss - ️️ Inability to use property as a result of a direct loss Risk - ️️ Chance of loss; uncertainty of loss What are the two types of risk? - ️️ Speculative and Pure Speculative Risk - ️️ Involves the simultaneous chance of gain or loss: is not insurable Pure Risk - ️️ a risk that presents the chance of loss but no opportunity for gain (insurable) What are two examples of speculative risk? - ️️ Gambling