NC HEALTH INSURANCE|UPDATED&VERIFIED|GUARANTEED SUCCESS

risk avoidance occurs when individuals evade risk entirely risk reduction occurs when chances of risk are lessened risk retention is being aware of the risks involved and taking precautions for financial protection. risk transference is the act of shifting the responsibility of risk to another in the form of an insurance contract. physical A bodily disease of endangerment, such as cancer, presents a _____ hazard. morale A mental trait, such as road rage, presents a ____ hazard. moral An unhealthy habit, such as smoking, presents a _____ hazard. avoidance Risk ___________ occurs when an individual eludes risk entirely. reduction Risk _____________ is when the chances of loss are lessened. retention Risk _____________ occurs when an individual takes precautions for protection by allowing another party to maintain a portion of the risk. transference Risk _______________ occurs when an individual shifts the responsibility of covering the risk to another. a provider an individual who is licensed, certified, or otherwise authorized North Carolina General Statutes or under the laws of another state to provide health care services in the ordinary course of business or practice of a profession or in an approved education or training program. government insurers social security (OASDI), social security hospital insurance, supplemental medical insurance, medicaid, workers' compensation, US armed services and veterans private insurers stock insurers, mutual insurers, reciprocal insurers, lloyds of london, risk retention groups, reinsurers, fraternal benefits societies, service insurers, home service insurers mutual life insurance The operating objective of a ____________________ company is to provide insurance to its owners (the policyholders) at the lowest possible net cost. demutualization is the process of converting a mutual insurance company to a stock insurance company pure assessment mutual company A _____________________________ bases premium costs on the loss sharing method. Members do not pay premiums in advance and the total loss experience is divided among the members so each pays a portion of the total. advance premium assessment mutual The ____________________________________ charges specific premium amounts. If the actual loss is less than the total of the collected premiums, members receive a refund in the form of dividend payments. If the actual loss is more than the total premium amount collected, members' premium rates will be increased to adjust accordingly. lloyd's of london _____________ is actually not considered an insurer. Instead, it is an association of individuals and companies that individually underwrite insurance. reinsurance ____________ is an arrangement through which one insurance company transfers a portion of a risk it has assumed to another insurer risk retention groups (RRGs) _____________ are a form of mutual insurer as well. They provide liability coverage to insure groups of individuals who are of the same group (or class). service insurers _____________ contract for and sell medical and hospital care services. Medical care services are provided in exchange for premiums paid. health maintenance organizations (HMOs) is a health care delivery system which provides comprehensive health care services for its members. The members are typically enrolled on a group basis by their employer. self-insurers ________________ create their own reserves to provide coverage for future losses. Self-insurance is a risk management method whereby an eligible risk is retained, but a calculated amount of money is set aside to compensate for any potential future losses. True T/F: In a reciprocal insurer structure, each policyholder insures the risks of the other policyholders. independent An _______________ agent represents several insurers and their different insurance products. Fair Credit Reporting Act Through the ______________________, the federal government determined that consumers have a fundamental right to be informed when their credit will be checked. True T/F: There are two principles involved in the needs-based selling process: (1) Fact-finding and (2) Education. True T/F: There are two principles involved in the needs-based selling process: (1) Fact-finding and (2) Education. True T/F: Twisting is referred to as "external replacement" and is the practice of inducing a person to drop existing insurance to buy similar coverage with another producer or company. True T/F: Churning is also called "internal replacement" and is the practice of inducing a person to drop their existing policy to buy another policy with the same company. agent The __________ bears the burden of proving a policy replacement is in the client's best interest. misrepresentation overstating promises and guarantees is a form of ________________ False T/F: An agent may intermingle premium payments with the agent's personal funds only if the funds are collected at a time when the agency is closed.