Exam Fx Ca life and Health Insurance - Answer- Contract whereby one undertakes to indemnify another against loss, damage, or liabilty arising from a unknown event.
Insurer - Answer- Any person capable of making a contract; subject to restrictions imposed by the CA insurance code.
Speculative risk - Answer- Chance of loss and potential for gain. This risk is not insurable.
Hazard - Answer- Increase the risk.
Law of Large numbers - Answer- The more similar risks the better they can guess approx. how many losses they have in a given time period.
Loss exposure - Answer- Situation the presents the possibility of a loss
Doctrine of upmost good faith states - Answer- That all parities to the contract can rely upon statements of other parties.
Policy - Answer- Written instrument in witch a contract is set forth
Premium - Answer- Amount insured paid to the insurer for coverage.
Rate - Answer- Price of insurance for each exposure unit
Rate - Answer- Cost per exposure unit
How to determine the amount the insured will pay - Answer- Multiply the rate by the number of exposure units purchased.
express warranty - Answer- Statement of fact in a policy of a matter relating to the person/thing insured
Warranty - Answer- May be expressed or applied
Implied warranty - Answer- Representation in an insurance contract Representation pt1 - Answer- May be oral /written may be made @ time of/before the insurance policy
Representation is false when - Answer- Facts fail to correspond with its stipulations
False representation on a signed claim - Answer- May subject the insured to perjury
Concealment - Answer- Party fails to communicate that witch a party knows and ought to communicate so the other party can make a sound decision
Concealment intentional / unintentional - Answer- Entitles the injured party to rescind the contract.
Rescind a policy - Answer- Void or cancel policy flat by returning all premiums to the insured. It is as if the policy never existed no coverage applies.
Insurance applicant - Answer- Individual who is applying to purchase insurance
Life insurance creates a - Answer- Immediate estate upon death of insured in that the death benefit will be paid to the beneficiary
Insurable Interest - Answer- Must exist @ time if application
Key person life insurance - Answer- Is used by a business to protect itself on case a valued employee dies. Death Benefit is paid to the company to hire and train replacement.
Key person life insurance is tax - Answer- Deductible but benefits are not taxable
Purchasing life insurance to fund a buy/sell agreement - Answer- Is a business use not personal use
Under CIC all ads, policies for certificates of term life sold to those 55 yrs + must include
a - Answer- Term life insurance monetary value index
In event of an adverse underwriting decision the insurer or agent must - Answer- Provide a individual with the specific reason for the decision and a summary of his/her rights.
Preferred Risk - Answer- Exceptional body no health issues. Lowest risk
Preferred risk provides the lowest premium - Answer- As they pose the least risk to insurer
MIB (medical info bureau) - Answer- Is a source that gives past medical history of clients as reference to agent/underwriter Medical info bureau required to report - Answer- Medical impairments found during underwriting process
HIPPA rules establish - Answer- National standards for the use and disclosure of protected health information
Life insurance policies do not contain a probationary period for - Answer- Pre existing conditions
Applicant reveals medical conditions that require more info insurer will require - Answer-
attending physician report
Must have signed authorization to - Answer- Request attending physician report
Agents commission - Answer- Comes from the insurer expenses portion of premium charges
Employees covered by group policy - Answer- Receive certificates of insurance as their proff of coverage
WET - Answer- Whole , endowment , term insurance
Whole Life Insurance aka - Answer- Continuous premium whole life insurance
Variable life - Answer- A life insurance policy that allows the policy owner to self direct cash values into different sub accounts
Variable life - Answer- Regulated by the state department of insurance and ( SEC) securities and exchange commission since they meet the definition of a securities product
Variable / universal life - Answer- No fixed guaranteed rate of return
Family life policy - Answer- Provides life insurance for an entire family and allows the children to convert from term to whole life w/out a physical
Family life insurance - Answer- Consists of whole life coverage on one spouse and level
convertible term on other spouse and children
Payor benefit rider - Answer- Is added to a juvenile life policy it will waive the premium if
guardian dies until a certain age ( usually 21)
Joint life policy - Answer- Covers multiple lives and pays out when the first insured dies
Insurer - Answer- Any person capable of making a contract; subject to restrictions imposed by the CA insurance code.
Speculative risk - Answer- Chance of loss and potential for gain. This risk is not insurable.
Hazard - Answer- Increase the risk.
Law of Large numbers - Answer- The more similar risks the better they can guess approx. how many losses they have in a given time period.
Loss exposure - Answer- Situation the presents the possibility of a loss
Doctrine of upmost good faith states - Answer- That all parities to the contract can rely upon statements of other parties.
Policy - Answer- Written instrument in witch a contract is set forth
Premium - Answer- Amount insured paid to the insurer for coverage.
Rate - Answer- Price of insurance for each exposure unit
Rate - Answer- Cost per exposure unit
How to determine the amount the insured will pay - Answer- Multiply the rate by the number of exposure units purchased.
express warranty - Answer- Statement of fact in a policy of a matter relating to the person/thing insured
Warranty - Answer- May be expressed or applied
Implied warranty - Answer- Representation in an insurance contract Representation pt1 - Answer- May be oral /written may be made @ time of/before the insurance policy
Representation is false when - Answer- Facts fail to correspond with its stipulations
False representation on a signed claim - Answer- May subject the insured to perjury
Concealment - Answer- Party fails to communicate that witch a party knows and ought to communicate so the other party can make a sound decision
Concealment intentional / unintentional - Answer- Entitles the injured party to rescind the contract.
Rescind a policy - Answer- Void or cancel policy flat by returning all premiums to the insured. It is as if the policy never existed no coverage applies.
Insurance applicant - Answer- Individual who is applying to purchase insurance
Life insurance creates a - Answer- Immediate estate upon death of insured in that the death benefit will be paid to the beneficiary
Insurable Interest - Answer- Must exist @ time if application
Key person life insurance - Answer- Is used by a business to protect itself on case a valued employee dies. Death Benefit is paid to the company to hire and train replacement.
Key person life insurance is tax - Answer- Deductible but benefits are not taxable
Purchasing life insurance to fund a buy/sell agreement - Answer- Is a business use not personal use
Under CIC all ads, policies for certificates of term life sold to those 55 yrs + must include
a - Answer- Term life insurance monetary value index
In event of an adverse underwriting decision the insurer or agent must - Answer- Provide a individual with the specific reason for the decision and a summary of his/her rights.
Preferred Risk - Answer- Exceptional body no health issues. Lowest risk
Preferred risk provides the lowest premium - Answer- As they pose the least risk to insurer
MIB (medical info bureau) - Answer- Is a source that gives past medical history of clients as reference to agent/underwriter Medical info bureau required to report - Answer- Medical impairments found during underwriting process
HIPPA rules establish - Answer- National standards for the use and disclosure of protected health information
Life insurance policies do not contain a probationary period for - Answer- Pre existing conditions
Applicant reveals medical conditions that require more info insurer will require - Answer-
attending physician report
Must have signed authorization to - Answer- Request attending physician report
Agents commission - Answer- Comes from the insurer expenses portion of premium charges
Employees covered by group policy - Answer- Receive certificates of insurance as their proff of coverage
WET - Answer- Whole , endowment , term insurance
Whole Life Insurance aka - Answer- Continuous premium whole life insurance
Variable life - Answer- A life insurance policy that allows the policy owner to self direct cash values into different sub accounts
Variable life - Answer- Regulated by the state department of insurance and ( SEC) securities and exchange commission since they meet the definition of a securities product
Variable / universal life - Answer- No fixed guaranteed rate of return
Family life policy - Answer- Provides life insurance for an entire family and allows the children to convert from term to whole life w/out a physical
Family life insurance - Answer- Consists of whole life coverage on one spouse and level
convertible term on other spouse and children
Payor benefit rider - Answer- Is added to a juvenile life policy it will waive the premium if
guardian dies until a certain age ( usually 21)
Joint life policy - Answer- Covers multiple lives and pays out when the first insured dies
