Michigan Life Accident & Health Exam All Possible Questions and Answers with complete

What is considered to be the primary reason for buying life insurance? - Answer-Provide death benefits Karen is a producer who has obtained personal information about a client without having a legitimate reason to do so. Under the McCarran-Feguson Act, what is the minimum penalty for this? - Answer- $10,000 or up to 1 year in jail A nonparticipating company is sometimes called a(n) - Answer-Stock insurer, because policyholders do not participate in dividends resulting from stock ownership. The Fair Credit and Reporting Act's main purpose is to - Answer-Protect Consumers with guidelines regarding credit reporting and distribution What is the primary purpose of a rating service such as A.M Best? - Answer-Determine financial strength of an insurance company Fraternal Benefit Society has each of the following characteristics EXCEPT? - Incorporated - Without capital stock - exist for profit - exist for the benefit of its members - Answer-Exist for profit, FBS are not for profit and exist for the benefit of its members. An insurer's ability to make unpredictable payouts to policyowners is called - Answer-Liquidity The Do Not Call Registry offers exemptions for calls placed from all of the following EXCEPT - Charities - Political Organizations - Insurance Sales Calls - Surveys - Answer-Insurance Sales CallsA plan in which an employer pays insurance benefits from a fund derived from the employer's current revenues is called? - Answer-A self-funded plan An insurer's claim settlement practices are regulated by the - Answer-State Insurance Departments What is known as the immediate specific event causing loss and giving risk to risk? - Answer-Peril When a house burns down what would the Peril be? When someone dies what would the peril be? - Answer-Fire, Death How do insurers predict the increase of individual risks? - Answer-Law of Large Numbers Insurance companies determine risk exposure by which of the following? - Answer-Law of Large Numbers and Risk Pooling Insurance represents the process of risk ________________. - Answer-Transference All of the following are examples of pure risk EXCEPT -Losing Money at a Casino -Injured while playing football -Falling at a casino and breaking a hip -Jewelry stolen during a home robbery - Answer-Losing Money at a Casino, because that is speculative risk. Pure risk means loss is the only possible outcome. Insurable interest does NOT occur in which of the following relationships? - Answer-Business owner and business client