LIFE AND HEALTH INSURANCE - OHIO
LICENSING EXAM QUESTIONS &
DETAILED CORRECT ANSWERS
PASSED
Absolute Assignment - CORRECT ANSWER The assignment by the policy owner of all
control and rights to a third party. This differs from collateral assignment, which allows
all the rights and control to revert to the owner once a loan is paid off
Accident - CORRECT ANSWER A fortuitous event; unforeseen and unintended
Accidental Death Insurance - CORRECT ANSWER A form of health insurance that
provides payment if death of the insured results from accident. Accidental death
insurance is often combined with dismemberment insurance in a form called accidental
death and dismemberment (AD&D)
Accident and Sickness - CORRECT ANSWER Insurance against bodily injury,
disability, or death by accident or accidental means, or expense thereof, or against
disability or expense resulting from sickness and the insurance relating thereto
Accident means - CORRECT ANSWER The unexpected cause of an accidental bodily
injury. Under an accidental means definition, the mishap itself must be accidental. If a
person does something to contribute to the accident, the claim would not be paid under
this restrictive definition
Accelerated benefit - CORRECT ANSWER Available only if the benefits are available
during the insured's lifetime, benefit amounts are fixed when accelerated, and the
benefits, when paid, reduces the death benefit
Accumulation at interest option - CORRECT ANSWER A dividend option under which
the policy owner allows dividends to accumulate at interest with the company. Only the
interest on the dividends is taxable as income (participating policies only).
Actuary - CORRECT ANSWER Once concerned with the application of probability and
statistical theory to insurance. This person sets expenses, and interest assumptions.
ADB - CORRECT ANSWER Accidental death benefit, also known as double indemnity.
There is another variation called triple indemnity.
AD&D - CORRECT ANSWER Accidental death and dismemberment insurance.
,Administrator - CORRECT ANSWER The person appointed by a court to settle a
deceased's estate, sometimes called and executor.
Adverse selection - CORRECT ANSWER Selection against the insurance company.
The tendency of poorer risks to want insurance more often than standard risks.
Agent - CORRECT ANSWER The individual appointed by an insurance company to
solicit, negotiate, effect, or countersign insurance contracts on its behalf.
Aleatory - CORRECT ANSWER Something that depends upon chance or is random. It
is derived from the Latin idea of "rolling the dice."
Aleatory contract - CORRECT ANSWER A contract in which both parties know that one
or the other may receive more than paid in. This payment is dependent upon a
fortuitous event. For example. a person pays the premium for a term policy for many
years and does not die, thus, a claim is never filed.
Alien company - CORRECT ANSWER An insured organized and domiciled in a country
other than the United States
Annuitant - CORRECT ANSWER The one receiving the Annuity and on whose life
expectancy the rates are figured.
Annuity - CORRECT ANSWER 1. An amount of money, payable monthly or yearly,
which liquidates a financial asset. 2. An agreement by an insurer to make periodic
payments that continue during the survival of the annuitant(s) or for a specified period.
Annuities are also accumulations vehicles that function much like savings accounts.
Applicant - CORRECT ANSWER The party making application to the insurance
company for the policy
Application - CORRECT ANSWER A form on which the prospective insured states
facts requested by the insurer and on the basis of which the insurer decides whether to
accept the risk, modify the coverage offered, or decline the risk.
Assignee - CORRECT ANSWER The person to whom policy rights are assigned in
whole or in part by the policy owner.
Assignment - CORRECT ANSWER The transfer of rights in a policy to someone other
than the policy owner.
Attained age - CORRECT ANSWER The present age of the insured. This is a factor
when a person converts term insurance to whole life insurance or buys added disability
under a GIR provision
, Attorney-in-fact - CORRECT ANSWER A person to whom authorization is given by an
individual to exchange insurance with other persons. Always present in a reciprocal
insurance company.
Authorized company - CORRECT ANSWER An insurer permitted to sell insurance
within a state, evidenced by a certificate of authority from the insurance commissioner,
also called ADMITTED
Automatic premium loan - CORRECT ANSWER A provision in a life policy authorizing
the insurance company to use the loan value to pay premiums not paid by the end of
the grace period. May be present in whole life or other traditional cash value policies
only, but never in term policies
Aviation clause - CORRECT ANSWER Limits or excludes coverage when the insured
is participating in specified types of air travel, cush as private planes. Coverage is
usually fully in force for people on regularly scheduled commercial flights. The limit or
exclusion often applies to student pilots
Beneficiary - CORRECT ANSWER A person who may become eligible to receive, or is
receiving, benefits under an insurance plan, other than as a participant.
Blanket Insurance Contract - CORRECT ANSWER A contract of Health Insurance that
covers all of a class of persons not individually identified. No certificates are issued and
people covered may not be aware that the coverage is in place.
Blue Plan - CORRECT ANSWER The generic term for those insurers (usually on a
service rather than a reimbursement bases) who are authorized to use the designation
Blue Cross or Blue Shield and the insignia of either.
Broker - CORRECT ANSWER One who represents an insured in the solicitation,
negotiation, or procurement of contracts of insurance, functions. This person is also
called an independent agent.
Business Insurance - CORRECT ANSWER Life or Health insurance written to vober
business situations, such as key person, sole proprietor, partnership, corporations, ect.
Cancelable - CORRECT ANSWER A contract of Insurance that may be terminated by
the insurance company or insured at any time. Virtually every form of insurance is
cancelable except Life insurance and those health policies designated as guaranteed
renewable, or non-cancelable and guaranteed renewable.
Cancellation - CORRECT ANSWER The termination of a contract of insurance in force
by voluntary act of the insurance company or insured, effected in accordance with
provisions in the contract or by mutual agreement.
LICENSING EXAM QUESTIONS &
DETAILED CORRECT ANSWERS
PASSED
Absolute Assignment - CORRECT ANSWER The assignment by the policy owner of all
control and rights to a third party. This differs from collateral assignment, which allows
all the rights and control to revert to the owner once a loan is paid off
Accident - CORRECT ANSWER A fortuitous event; unforeseen and unintended
Accidental Death Insurance - CORRECT ANSWER A form of health insurance that
provides payment if death of the insured results from accident. Accidental death
insurance is often combined with dismemberment insurance in a form called accidental
death and dismemberment (AD&D)
Accident and Sickness - CORRECT ANSWER Insurance against bodily injury,
disability, or death by accident or accidental means, or expense thereof, or against
disability or expense resulting from sickness and the insurance relating thereto
Accident means - CORRECT ANSWER The unexpected cause of an accidental bodily
injury. Under an accidental means definition, the mishap itself must be accidental. If a
person does something to contribute to the accident, the claim would not be paid under
this restrictive definition
Accelerated benefit - CORRECT ANSWER Available only if the benefits are available
during the insured's lifetime, benefit amounts are fixed when accelerated, and the
benefits, when paid, reduces the death benefit
Accumulation at interest option - CORRECT ANSWER A dividend option under which
the policy owner allows dividends to accumulate at interest with the company. Only the
interest on the dividends is taxable as income (participating policies only).
Actuary - CORRECT ANSWER Once concerned with the application of probability and
statistical theory to insurance. This person sets expenses, and interest assumptions.
ADB - CORRECT ANSWER Accidental death benefit, also known as double indemnity.
There is another variation called triple indemnity.
AD&D - CORRECT ANSWER Accidental death and dismemberment insurance.
,Administrator - CORRECT ANSWER The person appointed by a court to settle a
deceased's estate, sometimes called and executor.
Adverse selection - CORRECT ANSWER Selection against the insurance company.
The tendency of poorer risks to want insurance more often than standard risks.
Agent - CORRECT ANSWER The individual appointed by an insurance company to
solicit, negotiate, effect, or countersign insurance contracts on its behalf.
Aleatory - CORRECT ANSWER Something that depends upon chance or is random. It
is derived from the Latin idea of "rolling the dice."
Aleatory contract - CORRECT ANSWER A contract in which both parties know that one
or the other may receive more than paid in. This payment is dependent upon a
fortuitous event. For example. a person pays the premium for a term policy for many
years and does not die, thus, a claim is never filed.
Alien company - CORRECT ANSWER An insured organized and domiciled in a country
other than the United States
Annuitant - CORRECT ANSWER The one receiving the Annuity and on whose life
expectancy the rates are figured.
Annuity - CORRECT ANSWER 1. An amount of money, payable monthly or yearly,
which liquidates a financial asset. 2. An agreement by an insurer to make periodic
payments that continue during the survival of the annuitant(s) or for a specified period.
Annuities are also accumulations vehicles that function much like savings accounts.
Applicant - CORRECT ANSWER The party making application to the insurance
company for the policy
Application - CORRECT ANSWER A form on which the prospective insured states
facts requested by the insurer and on the basis of which the insurer decides whether to
accept the risk, modify the coverage offered, or decline the risk.
Assignee - CORRECT ANSWER The person to whom policy rights are assigned in
whole or in part by the policy owner.
Assignment - CORRECT ANSWER The transfer of rights in a policy to someone other
than the policy owner.
Attained age - CORRECT ANSWER The present age of the insured. This is a factor
when a person converts term insurance to whole life insurance or buys added disability
under a GIR provision
, Attorney-in-fact - CORRECT ANSWER A person to whom authorization is given by an
individual to exchange insurance with other persons. Always present in a reciprocal
insurance company.
Authorized company - CORRECT ANSWER An insurer permitted to sell insurance
within a state, evidenced by a certificate of authority from the insurance commissioner,
also called ADMITTED
Automatic premium loan - CORRECT ANSWER A provision in a life policy authorizing
the insurance company to use the loan value to pay premiums not paid by the end of
the grace period. May be present in whole life or other traditional cash value policies
only, but never in term policies
Aviation clause - CORRECT ANSWER Limits or excludes coverage when the insured
is participating in specified types of air travel, cush as private planes. Coverage is
usually fully in force for people on regularly scheduled commercial flights. The limit or
exclusion often applies to student pilots
Beneficiary - CORRECT ANSWER A person who may become eligible to receive, or is
receiving, benefits under an insurance plan, other than as a participant.
Blanket Insurance Contract - CORRECT ANSWER A contract of Health Insurance that
covers all of a class of persons not individually identified. No certificates are issued and
people covered may not be aware that the coverage is in place.
Blue Plan - CORRECT ANSWER The generic term for those insurers (usually on a
service rather than a reimbursement bases) who are authorized to use the designation
Blue Cross or Blue Shield and the insignia of either.
Broker - CORRECT ANSWER One who represents an insured in the solicitation,
negotiation, or procurement of contracts of insurance, functions. This person is also
called an independent agent.
Business Insurance - CORRECT ANSWER Life or Health insurance written to vober
business situations, such as key person, sole proprietor, partnership, corporations, ect.
Cancelable - CORRECT ANSWER A contract of Insurance that may be terminated by
the insurance company or insured at any time. Virtually every form of insurance is
cancelable except Life insurance and those health policies designated as guaranteed
renewable, or non-cancelable and guaranteed renewable.
Cancellation - CORRECT ANSWER The termination of a contract of insurance in force
by voluntary act of the insurance company or insured, effected in accordance with
provisions in the contract or by mutual agreement.
