Louisiana Insurance Exam Prep (Title), Louisiana Title Insurance EXAM (Guaranteed Pass!)

CONTRACTS - Aleatory Contract correct answers A contract in which the performance of either party's obligation depends on an uncertain event INSURANCE - Benchmark Rate(s) correct answers The rate set annually by the Commissioner of Insurance by line, relative to which the flexibility bands and statutory rate limitations apply. INSURANCE - Churning correct answers Can occur when an agent persuades a consumer to borrow against an existing life insurance policy to pay the premium on a new one. INSURANCE - Dividend correct answers The amount of money an insurance company may decide to distribute to policyholders. INSURANCE - Insurable Interest correct answers A financial interest in the property insured, prerequisite to a valid contract of insurance. In life insurance, a person's or party's interest, financial or emotional, in the continuing life of the insured. INSURANCE - Misrepresentation (Material) correct answers A significant misstatement in an application form. If a company had access to the correct information at the time of application, the company might not have agreed to accept the application. INSURANCE - Rated Policy correct answers A policy issued at a higher premium to cover a person classified as a greater-than-average risk, usually due to impaired health or a dangerous occupation. INSURANCE - Redlining correct answers Refusal by an insurance company to underwrite or to continue to underwrite questionable risks in a given geographical area. INSURANCE - Surplus Lines correct answers Insurance coverage not available from an admitted company in the regular market; thus a surplus lines broker/agent representing an applicant seeks coverage in the surplus lines market from a nonadmitted insurer according to the insurance regulations of a particular state. INSURANCE - Underwriting correct answers An insurance company issues a policy when it believes you have a certain level of "risk" or chance of a claim. Underwriting is the process the company uses to decide whether to accept or reject an application. Companies do not make their underwriting guidelines public because they are considered to be trade secrets. INSURANCE - Unearned Premium correct answers The insured's remaining premium equity in his policy; that part of the policy premium that has not been "used up."