Insurance Exam Questions and Answers Already Passed

Insurance Exam Questions and Answers Already Passed An insurer's ability to make unpredictable payouts to policyowners is called Liquidity A type of insurer that is owned by its policyowners is called Mutual Which of these are considered to be events or conditions that increase the chances of an insured's loss? Hazards An example of risk sharing would be Doctors pooling their money to cover malpractice exposures. How do insurers predict the increase of individual risks? Law of Large Numbers. What makes an insurance policy a unilateral contract? Only the insurer is legally bound. Legal purpose is a term used in contract law meaning There must be legal reasons for entering into the contract. What are an applicant's statements concerning occupation, hobbies, and personal health history regarded as? Representations. The term which describes the fact that both parties of a contract may NOT receive the same value is referred to as Aleatory Bob and Tom start a business. Since each partner contributes an important element to the success of the business, they decide to take life insurance policies out on each other, and name each other as beneficiaries. Eventually, they retire and dissolve the business. Bob dies 12 months later. The policies continue in force with no change. Both partners are still married at the time of Bob's death. In this situation, who will receive Bob's policy proceeds? Tom What is implied authority defined as? Authority that is not specifically given to an agent in the agency contract, but that an agent can reasonably assume to carry out his/her duties The coverage, conditions, and limitations in the master policy of a group contract can be found in which document? Certificate of coverage and benefits. Tim is covered under a group plan and would like to change his group coverage to an individual policy with the same insurer because of employment termination. Which of these describes the change that will take place? Conversion Under a group life policy, the insurer will issue an individual _____ to the policyowner for delivery to each person insured. Certificate A non-contributory health insurance plan helps the insurer avoid Adverse Selection What does the Group Life underwriting risk selection process help protect insurance companies from? Adverse Selection