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state farm Questions and Correct
Answers/ Latest Update / Already Graded
which of the following refers to being restored to the financial
condition you were in before a loss?
Ans: indemnification
mark incurred 8000$ damage to his car in an accident. he received
8000$ from his insurance company and 4000$ from the other driver. by
receiving a profit from the loss, Mark is in violation of..
Ans: principle of indemnity
the transfer of risk from one party to another is called
Ans: insurance
the principle of indemnity is designed to prevent
Ans: keeps the insured from making a profit from an insured
loss.
the fee paid by the insured in exchange for an insurance policy is called
a
Ans: premium
All rights reserved © 2025/ 2026 |
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insurance
Ans: transfers risk of financial losses from one party to another
insured
Ans: individual or organization that pays premiums in
exchange for protection
insurer
Ans: company group or government agency offering financial
protection
insurance policy
Ans: a legally binding contract in which the insurer agrees to
take on specified risks in exchange for the insured's premiums
principle of indemnity
Ans: restoration to previous financial condition; no more, no
less.
All rights reserved © 2025/ 2026 |
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what are the four qualifications of a contract
Ans: agreement, consideration, competent parties, and legal
purpose. must be 18 years of age
what is not a requirement for a legally binding contract
Ans: notarization
when an insurer issues an insurance policy, the actual item, person or
organization that is being insured is called the
Ans: the risk
what is a reserve, in insurance terms
Ans: a pool of collected premiums that the insurer sets aside to
pay claims
aleatory
Ans: of or pertaining to accidental causes; of luck or chance;
unpredictable
unilateral
All rights reserved © 2025/ 2026 |
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Ans: one-sided
utmost good faith
Ans: both parties must act honestly and openly in order for the
contract to be valid
adhesion
Ans: one party sets the terms of the contract; the other may
simply agree or not agree
unilateral
Ans: only the insurer makes a promise to act; the insured can
void contract at any time
personal
Ans: the insured person is protected from losses, not the
covered property.
conditional
Ans: the insurer must only honor the contract if the insured
meets certain conditions.
All rights reserved © 2025/ 2026 |
state farm Questions and Correct
Answers/ Latest Update / Already Graded
which of the following refers to being restored to the financial
condition you were in before a loss?
Ans: indemnification
mark incurred 8000$ damage to his car in an accident. he received
8000$ from his insurance company and 4000$ from the other driver. by
receiving a profit from the loss, Mark is in violation of..
Ans: principle of indemnity
the transfer of risk from one party to another is called
Ans: insurance
the principle of indemnity is designed to prevent
Ans: keeps the insured from making a profit from an insured
loss.
the fee paid by the insured in exchange for an insurance policy is called
a
Ans: premium
All rights reserved © 2025/ 2026 |
, Page |2
insurance
Ans: transfers risk of financial losses from one party to another
insured
Ans: individual or organization that pays premiums in
exchange for protection
insurer
Ans: company group or government agency offering financial
protection
insurance policy
Ans: a legally binding contract in which the insurer agrees to
take on specified risks in exchange for the insured's premiums
principle of indemnity
Ans: restoration to previous financial condition; no more, no
less.
All rights reserved © 2025/ 2026 |
, Page |3
what are the four qualifications of a contract
Ans: agreement, consideration, competent parties, and legal
purpose. must be 18 years of age
what is not a requirement for a legally binding contract
Ans: notarization
when an insurer issues an insurance policy, the actual item, person or
organization that is being insured is called the
Ans: the risk
what is a reserve, in insurance terms
Ans: a pool of collected premiums that the insurer sets aside to
pay claims
aleatory
Ans: of or pertaining to accidental causes; of luck or chance;
unpredictable
unilateral
All rights reserved © 2025/ 2026 |
, Page |4
Ans: one-sided
utmost good faith
Ans: both parties must act honestly and openly in order for the
contract to be valid
adhesion
Ans: one party sets the terms of the contract; the other may
simply agree or not agree
unilateral
Ans: only the insurer makes a promise to act; the insured can
void contract at any time
personal
Ans: the insured person is protected from losses, not the
covered property.
conditional
Ans: the insurer must only honor the contract if the insured
meets certain conditions.
All rights reserved © 2025/ 2026 |
