UCanPass Primerica VA Questions and Answers 100% Correct

Agent/Producer - ANSWER-a legal representative of an insurance company; the classification of producer usually includes agents and brokers; agents are the agents of the insurer Applicant or purposed insured - ANSWER-A person applying for insurance Broker - ANSWER-An insurance producer not appointed by and insurer and is deemed to represent a client Insurance policy - ANSWER-A contract between a policyowner (and/or insured) and insurance company which agrees to pay e insured or the beneficiary for loss caused by specific events Insured - ANSWER-The person covered by the insurance policy. This person may or may not be the policyowner Insurer(principal) - ANSWER-The company who issues an insurance policy Policyowner - ANSWER-The person entitled to exercise the rights and privileges in the policy Premium - ANSWER-The money paid to the insurance company for the insurance policy Reciprocity/Reciprocal - ANSWER-A mutual interchange of right and privileges Insurance is the _______ of risk. Insureds' losses are transferred over to the insurer - ANSWER-Transfer Risk - ANSWER-Uncertainty or or chance of a loss occurring Pure risk - ANSWER-Refers to situations that can only result in loss or no change Speculative risk - ANSWER-Involves the opportunity for either loss or gain Only _______ risks are insurable - ANSWER-Pure Exposure - ANSWER-Unit of measure used to determine rates charged for insurance coverage Homogeneous - ANSWER-A large number of units having the same or similar exposure to loss Hazard - ANSWER-Condition or situations that increase the probability of an insured loss occurring Physical hazard - ANSWER-Individual characteristics that increase the chances of the cause of loss Moral hazard - ANSWER-Tendencies towards increased risk Morale hazard - ANSWER-Similar to moral hazards, except that they arise from a state of mind that causes indifference to loss, suck as carelessness Perils - ANSWER-Causes of loss insured against in an insurance policy Loss - ANSWER-The reduction, decrease, or disappearance of value of the person or property insured in a policy, caused by a named peril A risk is a _______ that a loss will occur; a hazard increases the ________; a period is the ______ of loss - ANSWER-Chance, probability, cause Avoidance - ANSWER-Eliminating exposure to a loss Risk retention - ANSWER-Planned assumption of risk by an insured through the use of deductibles, co-payments, or self-insurance Sharing - ANSWER-Method of dealing with risk for a group of individual persons or businesses with the same or similar exposure to loss to share the losses that occur within that group Reciprocal insurance exchange - ANSWER-Formal risk-sharing arrangement Reduction - ANSWER-Lessening the possibility or severity of loss Adverse selection - ANSWER-Insuring of risks that are more prone to losses than the average risk