Life and Health Insurance Exam WEBCE with Complete Solutions!

Risk - ANSWER-Chance of loss Loss - ANSWER-Unplanned reduction of economic value Peril - ANSWER-cause of loss Hazard - ANSWER-a condition that increases the chance of peril Risk Transfer - ANSWER-buying insurance to shift the risk to insurance company Underwriting - ANSWER-assessing applicant to determine insurability Adverse Selection - ANSWER-people with greater risk of loss trying to buy insurance Mutual Companies - ANSWER-owned by policyholders and issue participating polices dividends which aren't guaranteed or taxable Stock Companies - ANSWER-Owned by stockholders whose stock can be publicly traded and pay dividends that are taxable Federal Insurance Programs - ANSWER-Medicare and Social Security State Insurance Programs - ANSWER-Medicaid and Workers' comp Producers Authority - ANSWER-Expressed Implied Apparent Required Disclosures - ANSWER-Buyer's guide and policy summary Offer - ANSWER-signed application and initial premium Acceptance - ANSWER-issuing of policy as applied for by insurer Contract of Adhesion - ANSWER-ambiguities in the contract that are interpreted to the benefit of the policyowner Representations - ANSWER-applicants truthful statements on application Ways to manage risk - ANSWER-Transfer Avoid Retain Reduce Share with others Speculative Risk - ANSWER-result in loss or gain, noninsurable Moral Hazard - ANSWER-character weakness like habits or lifestyle Morale Hazard - ANSWER-State of mind or carless attitude Physical Hazard - ANSWER-physical condition that increases ones less like heavy drinking or smoking Managed Care Service Providers - ANSWER-blend of commercial and medical insurance like blue cross blue shield Fraternal benefit society - ANSWER-An organization formed to provide insurance benefits for affiliated members Self Insurer - ANSWER-large companies that can cover losses, must follow laws and pay for itself