General Life Insurance Latest 2023 Graded A

General Life Insurance Latest 2023 Graded A insurance transfer of responsibility in exchange for premium risk the possibility or chance something could happen exposure the amount of loss hazard situation that increases the possibility of the loss occurring peril cause of the loss loss reduction in the value of an asset which type of risk to insurers accept? pure risk what is the purpose of insurance to restore the insured to the insured's original position Which type of risk is NOT covered by insurance? speculative (gambling) moral hazard fraud physical hazard tangible (ice on a sidewalk) morale hazard you are careless, irresponsible goal of risk management insuring client's economic survival how does one manage risk? Control--motorcycle riding without a helmet Avoid--smoking Retain--how to pay for the loss Transfer--insurance adverse selection buying insurance because they think something is going to happen law of large numbers allows an insurance company to predict a group's expected losses mortality table for any age, a guess how many people will not make it to their next bday reinsurance form of insurance between insurers principle of indemnity to make someonen financially whole again insurable interest indicate relationship between parties AT TIME OF APP (not at death) --financial relationship w/ someone if someone passes away you will suffer financial loss 5 characteristics of insurability 1. there must be a large number of homogeneous, similar units 2. a loss must be ascertainable (measurable) 3. the timing of the loss must be uncertain 4. a loss must include an economic hardship 5. the loss must exclude catastrophic perils 8 types of insurers stock mutual fraternal reciprocal surplus lines lloyds associations government insurers risk retention groups key insurers who usually start an insurance co stock mutual fraternal reciprocal insurer that pays out dividends--are they taxable? stock, yes who acts as the owner in a mutual insurer co. the policy owners does a mutal pay out dividends? yes, not taxable which type of insurer acts as the insured and insurer reciprocal org. what are the members and owners called in a reciprocal org. members= suscribers owners=ATTORNEY IN FACT which of the following is offered by a fraternal org. LIFE which type of insurers complete state reg. (standard)? admitted what is a non-admitted insurer? FREE of state reg. but still has right to sell a non-admitted insurer usually sells which type of insurance? what is an ex. high risk-lloyds of London surplus lines high risk insurers type of government insurance medicare independent agent sells ins. of several co's exclusive/captive agent represents only 1 co. agency legal, contractual relationship agency is the relationship btwn ____ &______ principal, agent implied authority not expressly granted, but is actual authority (i.e. quoting) apparent/perceived authority authority a person seems to have (btwn you & customer) 4 elements of a contract agreement consideration legal purpose legally competant parties 4 characteristics of a contract unilateral conditional aleatory adhesion unilateral one party makes a contractual promise conditional if...then... aleatory unequal exhange of value adhesion no negotiation --insured is protected from any ambiguity what is a representation regarding insurance application-the facts the applicant represents to be true misrep false anwer (have right to believe its true until proven guilty) concealment delibrately lying material what did someone choose to lie about on their application --truth would have affected coverage an example of non-material lie lying of age--policy would still be issued -lying of a condition=material lie waiver voluntarily giving up a known right estoppel cannot demand your rights back