.Ohio life/health insurance study guide FINAL EXAM
NEWEST 2026/2027 COMPLETE 1000+ QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED
ANSWERS) |ALREADY GRADED A+||BRAND NEW!!
Insurance:
A contract in which the insurance company agrees to indemnify the insured party against loss, damage
or liability arising from an unknown event.
Insurance Transfers:
The risk of loss from an individual or business entity to an insurance company, which in turn spreads
costs of unexpected losses to many individuals.
,Direct response marketing:
A direct response marketing system effectively bypasses the insurance agent. Business is conducted
over the phone, through the mail, or online. This is a perfectly legal approach to selling insurance. It is
not mandatory in all situations for the insured to physically sign any documents in order for coverage to
go into effect.
Insurance Transaction: (4)
Solicitation, Negotiations, Sale (effectuation of a contract of insurance, and Advising an individual
concerning coverage of claims.
Risk: (Two Types)
The uncertainty or chance of a loss occurring.
Pure Risk:
-Situations that can only result in a loss or no change. There is no opportunity for financial gain. This is
the only type that insurance companies will accept.
Speculative Risk:
-Involves the opportunity for either loss or gain. Ex: Risk of gambling. These are not insurable risks.
Concealment:
,The withholding of information that will result in an imprecise underwriting decision.
Exposure:
A unit of measure used to determine rates charged for insurance coverage.
EX of Life insurance factors:
-Age, medical history, occupation, and sex.
Homogenous:
A large number of units having the same or similar exposure to loss.
Hazards: (3 types)
Conditions or situations that increase the probability of an insured loss occurring.
Physical hazards:
-Individual characteristics that increase the chances of the cause of loss. Ex: past medical history,
condition at birth (blindness).
Moral Hazards:
-Tendencies towards increased risk. Involves evaluating the character and reputation of a proposed
insured. Ex: When an applicant lies on the application for insurance.
Morale Hazards:
, -Arise from a state of mind that causes indifference to loss, such as carelessness. Ex: Not spending
money on a flu shot because if you get the flu your insurance company will pay for it.
Perils:
The causes of loss insured against in an insurance policy.
-Life insurance
-Health insurance
-Property insurance
-Casualty insurance
Loss:
The reduction, decrease, or disappearance of the value of the person or property insured in a policy,
caused by a named peril.
Look at transfer stuff pg 7
Avoidance: (Method of handling risk)
Eliminating exposure to a loss. Ex: If a person wanted to avoid the risk of being killed in an airplane
crash, he/she might choose never to fly in an airplane. It is effective but not practical.
Risk Retention: (Method of handling risk)
NEWEST 2026/2027 COMPLETE 1000+ QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED
ANSWERS) |ALREADY GRADED A+||BRAND NEW!!
Insurance:
A contract in which the insurance company agrees to indemnify the insured party against loss, damage
or liability arising from an unknown event.
Insurance Transfers:
The risk of loss from an individual or business entity to an insurance company, which in turn spreads
costs of unexpected losses to many individuals.
,Direct response marketing:
A direct response marketing system effectively bypasses the insurance agent. Business is conducted
over the phone, through the mail, or online. This is a perfectly legal approach to selling insurance. It is
not mandatory in all situations for the insured to physically sign any documents in order for coverage to
go into effect.
Insurance Transaction: (4)
Solicitation, Negotiations, Sale (effectuation of a contract of insurance, and Advising an individual
concerning coverage of claims.
Risk: (Two Types)
The uncertainty or chance of a loss occurring.
Pure Risk:
-Situations that can only result in a loss or no change. There is no opportunity for financial gain. This is
the only type that insurance companies will accept.
Speculative Risk:
-Involves the opportunity for either loss or gain. Ex: Risk of gambling. These are not insurable risks.
Concealment:
,The withholding of information that will result in an imprecise underwriting decision.
Exposure:
A unit of measure used to determine rates charged for insurance coverage.
EX of Life insurance factors:
-Age, medical history, occupation, and sex.
Homogenous:
A large number of units having the same or similar exposure to loss.
Hazards: (3 types)
Conditions or situations that increase the probability of an insured loss occurring.
Physical hazards:
-Individual characteristics that increase the chances of the cause of loss. Ex: past medical history,
condition at birth (blindness).
Moral Hazards:
-Tendencies towards increased risk. Involves evaluating the character and reputation of a proposed
insured. Ex: When an applicant lies on the application for insurance.
Morale Hazards:
, -Arise from a state of mind that causes indifference to loss, such as carelessness. Ex: Not spending
money on a flu shot because if you get the flu your insurance company will pay for it.
Perils:
The causes of loss insured against in an insurance policy.
-Life insurance
-Health insurance
-Property insurance
-Casualty insurance
Loss:
The reduction, decrease, or disappearance of the value of the person or property insured in a policy,
caused by a named peril.
Look at transfer stuff pg 7
Avoidance: (Method of handling risk)
Eliminating exposure to a loss. Ex: If a person wanted to avoid the risk of being killed in an airplane
crash, he/she might choose never to fly in an airplane. It is effective but not practical.
Risk Retention: (Method of handling risk)
