Exam Fx Ca life and Health Questions with Accurate solutions

nsurance - ANSWER-Contract whereby one undertakes to indemnify another against loss, damage, or liabilty arising from a unknown event. Insurer - ANSWER-Any person capable of making a contract; subject to restrictions imposed by the CA insurance code. Speculative risk - ANSWER-Chance of loss and potential for gain. This risk is not insurable. Hazard - ANSWER-Increase the risk. Law of Large numbers - ANSWER-The more similar risks the better they can guess approx. how many losses they have in a given time period. Loss exposure - ANSWER-Situation the presents the possibility of a loss Doctrine of upmost good faith states - ANSWER-That all parities to the contract can rely upon statements of other parties. Policy - ANSWER-Written instrument in witch a contract is set forth Premium - ANSWER-Amount insured paid to the insurer for coverage. Rate - ANSWER-Price of insurance for each exposure unit Rate - ANSWER-Cost per exposure unit How to determine the amount the insured will pay - ANSWER-Multiply the rate by the number of exposure units purchased.