LOMA 281 Module 1 Questions and Answers(A+ Solution guide)

Risk - the possibility of an unexpected result. Premium - A specified amount of money an insurer charges in exchange for its agreement to pay a policy benefit when a specific loss occurs. Insurance company - A company that provides protection against the risk of financial loss caused by specific events. Life insurance - A type of insurance under which the insurer promises to pay a death benefit upon the death of a named person. Annuity - A financial product by which an insurer, in return for receiving a premium, promises to make periodic payments to a named person or entity. Applicant - The person or entity that applies for an insurance policy. Policyowner - The person or entity that owns the issued policy. Insured - The person whose life or health the policy insures. Beneficiary - The person named to receive the policy benefit if the insured event occurs. Third party policy - A policy one person purchases that insures the life of another person. Speculative risks - A risk that involves three possible outcomes: loss, gain, or no change. Pure risk - A risk that involves no possibility of gain; either a loss occurs or no loss occurs.Contracts of indemnity - Health insurance; An insurance policy under which the amount of the policy benefit payable for a covered loss is based on the actual amount of financial loss that results from the loss, as determined at the time of the loss.