AINS 101 Exam Questions With 100% Correct Answers

AINS 101 Exam Questions With 100% Correct Answers Loss exposure - answerany condition or situation that presents a possibility of loss, whether or not an actual loss occurs Premium - answerthe price of the insurance coverage provided for a specified period Indemnify - answerto restore a party who has sustained a loss to the same financial position that party held before the loss occurred Insured - answerany person or organization who is insured under an insurance policy Property-casualty insurance - answerone of the two main sectors of the insurance industry encompassing numerous types of insurance, most of which cover the financial consequences of damage to one's own property or legal liability to others Life-health insurance - answerone of the two main sectors of the insurance industry encompassing numerous types of insurance that cover the financial Stock insurer - answeran insurer that is owned by its stockholders and formed as a corporation for the purpose of earning a profit for the stockholders Mutual insurer - answeran insurer that is owned by its policyholders and formed as a corporation for the purpose of providing insurance to them Surplus-lines insurer - answera non-admitted insurer that is eligible to insure risks that have been exported by a surplus lines licensee in accordance with a surplus lines law Reinsurance - answerthe transfer of insurance risk from one insurer to another through a contractual agreement under which one insurer (the reinsurer) agrees, in return for a reinsurance premium, to indemnify another insurer (the primary insurer) for some or all of the financial consequences of certain loss exposures covered by the primary's insurance policies Pure risk - answera chance of loss or no loss, but no chance of gain Speculative risk - answera chance of loss, no loss, or gain Solvency - answerthe ability of an insurer to meet its financial obligations as they become due, even those resulting from insured losses that may be claimed several years in the future Income statement - answerthe financial statement that reports an organization's profit or loss for a specific period by comparing the revenues generated with the expenses incurred to produce those revenues Earned premiums - answerthe portion of the written premiums that apply to the part of the policy period that has already occurred Underwriting income - answerincome an insurer earns from premiums paid by policyholders minus incurred losses and underwriting expenses Balance sheet - answerthe financial statement that reports the assets, liabilities, and owner's equity of an organization as of a specific date Policyholder's surplus - answeran insurer's assets minus its liabilities, which represents its net worth Loss adjustment expenses - answerthe expense that an insurer incurs to investigate, defend, and settle claims according to the terms specified in the insurance policy Assets - answertypes of property, both tangible and intangible, owned by an entity Liabilities - answerfinancial obligations, or debts, owned by a company to another entity usually the policyholder in the case of an insurer Investment income - answerinterest, dividends, and net capital gains received by an insurer from the insurer's financial assets,