XCEL Solutions Exam Study Guide with Complete Solutions

XCEL Solutions Exam Study Guide with Complete Solutions a nonparticipating company is sometimes called a - Answer️️ -stock insurer Fraternal Benefit Society has each other the following characteristics except - Answer️️ -exist for profit The Fair Credit and Reporting Act's main purpose is to - Answer️️ - protect consumers with guidelines regarding credit reporting and distribution A life insurance company has transferred some of its risk to another insurer. The insurer assuming the risk is called the - Answer️️ -reinsurer What kind of life insurance policy issued by a mutual insurer provides a return of divisible surplus? - Answer️️ -participating life insurance policy What is considered to be the primary reason for buying life insurance? - Answer️️ -provide death benefits An insurer's ability to make unpredictable payouts to policyowners is called - Answer️️ -liquidity The Do Not Call Registry offers exemptions for calls placed from all of the following except - Answer️️ -insurance sales calls ©SOPHIABENNETT@ Monday, August 26, 2024 6:09 AM 2 Why are dividends from a mutual insurer not subject to taxation? - Answer️️ -Because dividends are considered to be a return of premium An insurer's claim settlement practices are regulated by the - Answer️️ - State Insurance Departments All of the following are examples of pure risk EXCEPT - Answer️️ -losing money at a casino Which of the following is considered to be an event or condition that increases the probability of an insured's loss? - Answer️️ -Hazard An individual who removes the risk of losing money in the stock market by never purchasing stocks is said to be engaging in - Answer️️ -Risk avoidance The cause of a loss is referred to as - Answer️️ -peril Insurance represents the process of risk - Answer️️ -transference What is known as the immediate specific event causing loss and giving rise to risk - Answer️️ -Peril An example of risk sharing would be - Answer️️ -Doctors pooling their money to cover malpractice exposures Insurance companies determine risk exposure by which of the following? - Answer️️ -Law of large numbers and risk pooling ©SOPHIABENNETT@ Monday, August 26, 2024 6:09 AM 3 How do insurers predict the increase of individual risks? - Answer️️ -law of large numbers People with higher loss exposure have the tendency to purchase insurance more often than those at average risk. This is called - Answer️️ -Adverse selection Who is responsible for assembling the policy forms for insureds? - Answer️️ -Insurance carriers The authority granted to a licensed producer is provided via the - Answer️️ -Law of Agency What makes an insurance policy a unilateral contract? - Answer️️ -Only the insurer is legally bound All of the following are elements of an insurance policy EXCEPT - Answer️️ -claim forms Insurable interest does NOT occur in which of the fo