Idaho Insurance Licensing Property and Casualty (With complete solution)

Insurance correct answers Is a contract win which one party agrees to indemnify the insured party against loss,damage, or liabilty. Insurance Transfers correct answers The risk of loss from an individual or business entity to an insurance company which in turn spreads the costs of unexpected losses to many individuals. Insurance Transaction correct answers Includes solicitation, negotiations, sale, and advising etc Risk correct answers the uncertainty or chance of loss Pure risk correct answers Refers to situations that can only result in a loss or no change. Always accepting in companies. Speculative Risk correct answers involves the opportunity for either loss or gain. Not Insurable. Hazard correct answers are conditions or situations that increase the probability of an insured loss occurring. Physical Hazard correct answers Are individual characteristics that increase the chances of the cause of loss. Exist because of physical conditions like medical history, birth conditions, or blindness Moral Hazard correct answers Tendencies towards increased risks based on character and reputation. Refers to applicants who lie on applications or have fraudulent insurance claims Morale Hazard correct answers Hazard arising out of an insured's indifference to loss because of the existence of insurance. Perils correct answers are the causes of loss insured against in an insurance policy. Loss correct answers Is defined as the reduction, decrease, or disappearance of value of the person or property. Insured in a policy, caused by a named peril. Sharing correct answers Is a 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 each group transfer correct answers Most effective way to handle risk so loss is borne by another party Avoidance correct answers Eliminating exposure to a loss