Indiana Life & Health Insurance Exam (2023/2024) Rated A+

Indiana Life & Health Insurance Exam (2023/2024) Rated A+ Participating Insurance Policy may pay dividends to the policyowner Material Misrepresentation misstatement to a question asked in the application process; death benefit claim will likely be denied Law of Large Numbers the larger a group becomes, the easier it is to predict losses; used to predict certain types of losses and set appropriate premiums Substandard Risk results in higher premium Standard Risk results in standard premium Preferred Risk results in lower premium Expense Loading combined with premiums to spread the operating costs of a business to all insureds Net Premium premiums without expense loading Concealment occurs when a person withholds a material fact that is crucial to making a decision; in insurance, this involves withholding information that would be crucial to underwriting decisions Warranty a statement guaranteed to be true Representation a statement true to the best of an applicant's knowledge 3 Basic Types of Term Life Insurance level, increasing, and decreasing Level Term death benefit doesn't change throughout the life of the policy Annually Renewable Term (ART) premium increases annually according to attained age; policy may be guaranteed to be renewable each without proof of insurability Re-entry Option the insured, upon the end of a term policy with guaranteed renewable option, may qualify for a discounted premium rate with proof of insurability Decreasing Term death benefit decreases each year over duration of the policy term; typically used when the amount of needed protection is time sensitive, or decreases over time Increasing Term death benefit increases each year over duration of the policy term (usually by specific amount or percentage of original amount); often used by insurance companies to fund certain riders that provide a refund of premiums of a gradual increase in total coverage, such as the cost of living or return of premium riders Convertible Term provides the policy owner with the ri