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CA Life and Health Exam Questions
with Detailed Verified Answers
Question: What is insurance?
Ans: Insurance is the legal contract where two parties agree that if something
will happen, a value will be exchanged.
Question: What's the difference between pure risk and speculative risk?
Ans: Pure risk is when you'll lose it all or there will be no change. Speculative
risk you can either win or lose.
Question: What is peril?
Ans: peril is the causes of loss insured against in an insurance policy
Question: What is hazard?
Ans: conditions that increase the probability of something bad happening
Question: What's the diff between moral, morale, and physical hazard?
Ans: physical is the hazard that results from physical body issues. Moral
hazard is the evaluation of character (lying) morale hazard is an indifference
which causes risk.
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Question: What is the law of large numbers?
Ans: the larger the number of people more exposed to risk, the more
predictable the risk outcome.
Question: What is an insurable event?
Ans: the more predictable an event, the more insurable it becomes
Question: What's the diff between contract and tort law
Ans: tort is non-contract and private
Question: Four major elements of a contract
Ans: agreement, consideration, competent parties, legal purpose
Question: contract of adhesion
Ans: prepared by insurer then accepted or rejected
Question: Conditional contract
Ans: conditions need to be met in order for contract to be executed
Question: aleatory contract
Ans: exchange of unequal amounts of value
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Question: unilateral contract
Ans: only one party is forced to do something
Question: personal contract
Ans: can't be transferred w/out notifying insurer
Question: When can you rescind a contract
Ans: intentional or unintentional concealment, violation of material warranty,
false material representation
Question: six specifications for insurance policies
Ans: parties contracted
person insured
statement of insurable interest
risks insured against
time period
stated premium
Question: 4 categories of info necessary for financial planning
CA Life and Health Exam Questions
with Detailed Verified Answers
Question: What is insurance?
Ans: Insurance is the legal contract where two parties agree that if something
will happen, a value will be exchanged.
Question: What's the difference between pure risk and speculative risk?
Ans: Pure risk is when you'll lose it all or there will be no change. Speculative
risk you can either win or lose.
Question: What is peril?
Ans: peril is the causes of loss insured against in an insurance policy
Question: What is hazard?
Ans: conditions that increase the probability of something bad happening
Question: What's the diff between moral, morale, and physical hazard?
Ans: physical is the hazard that results from physical body issues. Moral
hazard is the evaluation of character (lying) morale hazard is an indifference
which causes risk.
, Page | 2
Question: What is the law of large numbers?
Ans: the larger the number of people more exposed to risk, the more
predictable the risk outcome.
Question: What is an insurable event?
Ans: the more predictable an event, the more insurable it becomes
Question: What's the diff between contract and tort law
Ans: tort is non-contract and private
Question: Four major elements of a contract
Ans: agreement, consideration, competent parties, legal purpose
Question: contract of adhesion
Ans: prepared by insurer then accepted or rejected
Question: Conditional contract
Ans: conditions need to be met in order for contract to be executed
Question: aleatory contract
Ans: exchange of unequal amounts of value
, Page | 3
Question: unilateral contract
Ans: only one party is forced to do something
Question: personal contract
Ans: can't be transferred w/out notifying insurer
Question: When can you rescind a contract
Ans: intentional or unintentional concealment, violation of material warranty,
false material representation
Question: six specifications for insurance policies
Ans: parties contracted
person insured
statement of insurable interest
risks insured against
time period
stated premium
Question: 4 categories of info necessary for financial planning
