Virginia Health, Life Insurance and Annuities
Exam Study 2025\2026 A+ Grade
Methods of Handling Risk (STARR)
- accurate answers-1. Sharing (each member of group pays portion of loss)
2. Transfer (spreading risk among customers)
3. Avoidance (not engaging in certain activity)
4. Reduction (lessening chance)
5. Retention (indiv pays for loss)
Elements of Insurable Risk (CANHAM)
- accurate answers-1. Calculable (based on prior loss stats)
2. Affordable (for avg consumer)
3. Non-catastrophic (no widespread loss events)
4. Homogeneous (similar indiv risks)
5. Accidental
6. Measurable ($ amt)
Types of Insurers (7)
- accurate answers-1. Stock insurer
2. Mutual insurer
3. Fraternal benefit societies
4. Reciprocal insurers
5. Risk retention groups
6. Lloyd's Associations
7. Self-insurers
,Classification of Insurers: Private v. Gov't
- accurate answers--Gov't includes SS, military life insurance, residual market
insurance
-Subsidize insurance programs to cover for catastrophic risk
Classification of Insurers: Domestic, Foreign, and Alien
- accurate answers-1. Domestic: insurer located in state where they are
incorporated
2. Foreign: insurer sells in states other than where they are incorporated
3. Insurer formed under laws of country outside of US
Classification of Insurers: Authorized v. Unauthorized
- accurate answers-1. Authorized: company is licensed (has Cert of Authority)
to sell insurance in that state
2. Unauthorized: sell certain types of insurance (surplus) w/o having license
Classification of Insurers: Surplus Lines Insurers
- accurate answers-unauthorized insurers that provide insurance for indivs
with large risk that no other authorized insurer will cover
Types of Agents (4)
- accurate answers-1. Independent Insurance Agents (represent the insured of
several companies)
, 2. Exclusive/captive Agents (represent 1 insurer)
3. General Agents/Managing General Agents: hire/train/supervise other
agents
4. Direct-writing Companies: no independent agents, they all work for the
insurer
Agent Authority
- accurate answers-1. Express
2. Implied: not written, but actions agent normally do to sell insurance
3. Apparent: actions by agent that a reasonable person would assume as
authority
Elements of a Legal Contract (CLOAC)
- accurate answers--Consideration
-Legal Purpose
-Offer
-Acceptance
-Competent Parties
Characteristics of Insurance Contracts (12)
- accurate answers-1. Adhesion
2. Aleatory
3. Utmost Good Faith, Reasonable Expectation
Exam Study 2025\2026 A+ Grade
Methods of Handling Risk (STARR)
- accurate answers-1. Sharing (each member of group pays portion of loss)
2. Transfer (spreading risk among customers)
3. Avoidance (not engaging in certain activity)
4. Reduction (lessening chance)
5. Retention (indiv pays for loss)
Elements of Insurable Risk (CANHAM)
- accurate answers-1. Calculable (based on prior loss stats)
2. Affordable (for avg consumer)
3. Non-catastrophic (no widespread loss events)
4. Homogeneous (similar indiv risks)
5. Accidental
6. Measurable ($ amt)
Types of Insurers (7)
- accurate answers-1. Stock insurer
2. Mutual insurer
3. Fraternal benefit societies
4. Reciprocal insurers
5. Risk retention groups
6. Lloyd's Associations
7. Self-insurers
,Classification of Insurers: Private v. Gov't
- accurate answers--Gov't includes SS, military life insurance, residual market
insurance
-Subsidize insurance programs to cover for catastrophic risk
Classification of Insurers: Domestic, Foreign, and Alien
- accurate answers-1. Domestic: insurer located in state where they are
incorporated
2. Foreign: insurer sells in states other than where they are incorporated
3. Insurer formed under laws of country outside of US
Classification of Insurers: Authorized v. Unauthorized
- accurate answers-1. Authorized: company is licensed (has Cert of Authority)
to sell insurance in that state
2. Unauthorized: sell certain types of insurance (surplus) w/o having license
Classification of Insurers: Surplus Lines Insurers
- accurate answers-unauthorized insurers that provide insurance for indivs
with large risk that no other authorized insurer will cover
Types of Agents (4)
- accurate answers-1. Independent Insurance Agents (represent the insured of
several companies)
, 2. Exclusive/captive Agents (represent 1 insurer)
3. General Agents/Managing General Agents: hire/train/supervise other
agents
4. Direct-writing Companies: no independent agents, they all work for the
insurer
Agent Authority
- accurate answers-1. Express
2. Implied: not written, but actions agent normally do to sell insurance
3. Apparent: actions by agent that a reasonable person would assume as
authority
Elements of a Legal Contract (CLOAC)
- accurate answers--Consideration
-Legal Purpose
-Offer
-Acceptance
-Competent Parties
Characteristics of Insurance Contracts (12)
- accurate answers-1. Adhesion
2. Aleatory
3. Utmost Good Faith, Reasonable Expectation
