Medical Insurance Final Exam Practice
B - questions and answersUNIT 1: The term used to describe the individual who is
covered by the insurance is
A. insurer
B. insured
C. policyowner
D. risk
B - questions and answersWhich of the following is a risk?
A. A car may need to have new brakes installed after several years of regular driving.
B. An individual may need medical attention after slipping on the ice and falling.
C. Both are examples of risk.
D. Neither is an example of risk.
A - questions and answersThe estimation of future losses is more accurate when
information is from
A. a small select group
B. a large group
C. a medium-sized group
D. any size group; group size does not matter
B - questions and answersThe application of the law of large numbers enables insurers
to
A. estimate the future losses of a class or group of people
B. predict the future losses of speci c individuals
C. charge higher premiums for insurance
D. calculate mortality charges
C - questions and answersWhich type of policy is designed to protect against the risk of
living too long?
A. Casualty
B. Life
C. Annuity
D. Medical expense
,B - questions and answersWhich of the following is a type of insurance company owned
by its shareholders?
A. Mutual B. Stock
C. Lloyd's D. Reinsurer
B - questions and answersThe ZYX Insurance Company is incorporated in Alabama.
While doing business in Texas, it is
A. adomesticinsurer B. a foreign insurer C. an alien insurer D. an export insurer
C - questions and answersThe ZYX Insurance Company is incorporated in Mexico.
While doing business in Texas, it is
A. adomesticinsurer B. a foreign insurer C. an alien insurer D. an export insurer
A - questions and answersSelf-insurance is an example of which method of handling
risk?
A. Acceptance B. Transference C. Avoidance D. Reduction
D - questions and answersWhich of the following terms is used to denote insurance
companies?
A. Broker
B. Exchange C. Corporation D. Insurer
C - questions and answersA social device for spreading the chance of financial loss
among a large number of people is the definition of
A. hazard
B. risk
C. insurance
D. peril
A - questions and answersWhich of the following risks is most likely to be
insurable?
A. George is concerned about the financial impact his premature death would have on
his family.
B. Talyn is concerned about the financial impact large betting losses at the horse track
will have on his retirement savings.
C. John is concerned about the financial impact on his savings when his car eventually
becomes worn enough to need to be replaced.
, D. Jewel is concerned about the nancial effect losing her hat would have on her weekly
spending money.
B - questions and answersRoger refuses to travel by airplane. Roger is managing the
risk of being in a plane crash by
A. reduction B. avoidance C. transference D. retention
C - questions and answersChianna becomes injured in a car accident caused when she
took her eyes off the road to answer her cell phone. This is an example of
A. a physical hazard
B. a moral hazard
C. a morale hazard
D. a legal hazard
D - questions and answersAn arrangement in which an insurer transfers part of the
insurance risk to another insurance company is known as
A. avoidance
B. fraud
C. Lloyd's associations
D. reinsurance
C - questions and answersWhich of the following is NOT an example of insurable
interest?
A. Jose wishes to take out a life insurance policy on his own life to provide for his family
in the event of his death.
B. Ana wishes to take out a life insurance policy on her mother to ensure that funeral
costs will be covered when the time comes.
C. Juan wishes to take out a life insurance policy on his neighbor because his neighbor
is a careless driver and Juan thinks his neighbor is likely to die in a car accident.
D. Carla wishes to take out a life insurance policy on her best salesperson to protect the
business from lost sales in the event of the salesperson's death.
A - questions and answersKim is injured in a house fire. When the bills come, the
insurance company pays 80% of the cost, and Kim pays the rest. This is an example of
A. coinsurance
B. a deductible
C. extraneous insurance D. policy limits
B - questions and answersUNIT 1: The term used to describe the individual who is
covered by the insurance is
A. insurer
B. insured
C. policyowner
D. risk
B - questions and answersWhich of the following is a risk?
A. A car may need to have new brakes installed after several years of regular driving.
B. An individual may need medical attention after slipping on the ice and falling.
C. Both are examples of risk.
D. Neither is an example of risk.
A - questions and answersThe estimation of future losses is more accurate when
information is from
A. a small select group
B. a large group
C. a medium-sized group
D. any size group; group size does not matter
B - questions and answersThe application of the law of large numbers enables insurers
to
A. estimate the future losses of a class or group of people
B. predict the future losses of speci c individuals
C. charge higher premiums for insurance
D. calculate mortality charges
C - questions and answersWhich type of policy is designed to protect against the risk of
living too long?
A. Casualty
B. Life
C. Annuity
D. Medical expense
,B - questions and answersWhich of the following is a type of insurance company owned
by its shareholders?
A. Mutual B. Stock
C. Lloyd's D. Reinsurer
B - questions and answersThe ZYX Insurance Company is incorporated in Alabama.
While doing business in Texas, it is
A. adomesticinsurer B. a foreign insurer C. an alien insurer D. an export insurer
C - questions and answersThe ZYX Insurance Company is incorporated in Mexico.
While doing business in Texas, it is
A. adomesticinsurer B. a foreign insurer C. an alien insurer D. an export insurer
A - questions and answersSelf-insurance is an example of which method of handling
risk?
A. Acceptance B. Transference C. Avoidance D. Reduction
D - questions and answersWhich of the following terms is used to denote insurance
companies?
A. Broker
B. Exchange C. Corporation D. Insurer
C - questions and answersA social device for spreading the chance of financial loss
among a large number of people is the definition of
A. hazard
B. risk
C. insurance
D. peril
A - questions and answersWhich of the following risks is most likely to be
insurable?
A. George is concerned about the financial impact his premature death would have on
his family.
B. Talyn is concerned about the financial impact large betting losses at the horse track
will have on his retirement savings.
C. John is concerned about the financial impact on his savings when his car eventually
becomes worn enough to need to be replaced.
, D. Jewel is concerned about the nancial effect losing her hat would have on her weekly
spending money.
B - questions and answersRoger refuses to travel by airplane. Roger is managing the
risk of being in a plane crash by
A. reduction B. avoidance C. transference D. retention
C - questions and answersChianna becomes injured in a car accident caused when she
took her eyes off the road to answer her cell phone. This is an example of
A. a physical hazard
B. a moral hazard
C. a morale hazard
D. a legal hazard
D - questions and answersAn arrangement in which an insurer transfers part of the
insurance risk to another insurance company is known as
A. avoidance
B. fraud
C. Lloyd's associations
D. reinsurance
C - questions and answersWhich of the following is NOT an example of insurable
interest?
A. Jose wishes to take out a life insurance policy on his own life to provide for his family
in the event of his death.
B. Ana wishes to take out a life insurance policy on her mother to ensure that funeral
costs will be covered when the time comes.
C. Juan wishes to take out a life insurance policy on his neighbor because his neighbor
is a careless driver and Juan thinks his neighbor is likely to die in a car accident.
D. Carla wishes to take out a life insurance policy on her best salesperson to protect the
business from lost sales in the event of the salesperson's death.
A - questions and answersKim is injured in a house fire. When the bills come, the
insurance company pays 80% of the cost, and Kim pays the rest. This is an example of
A. coinsurance
B. a deductible
C. extraneous insurance D. policy limits
