Ohio Personal Lines (Insurance Exam) UPDATED Actual Exam Questions and CORRECT Answers

Ohio Personal Lines (Insurance Exam)
UPDATED Actual Exam Questions and
CORRECT Answers
Stock Insurance Company - CORRECT ANSWER✔✔- Issues non-participating policies and
is owned by stockholders who received taxable corporate dividends as a return profit


Reinsurance - CORRECT ANSWER✔✔- The transfer of risk between insurance companies.
The reinsurer assumes some or all of the risks of the ceding, or primary, insurance company


Domestic - CORRECT ANSWER✔✔- Insurer organized under the laws of the resident state



Foreign - CORRECT ANSWER✔✔- Insurer organized under the laws of another state
within the United States


Alien - CORRECT ANSWER✔✔- Insurer oganized under the laws of a country outside of
the United States


Domicile - CORRECT ANSWER✔✔- Refers to the state in which an insurer is incorporated



Express - CORRECT ANSWER✔✔- Authority that is written into the producers agency
contract


Implied - CORRECT ANSWER✔✔- Authority that in which the public and the insurer
assumes the agent possesses


Apparent - CORRECT ANSWER✔✔- Authority created when the agent exceeds express
authority and the insurer does not respond


FCRA - CORRECT ANSWER✔✔- Protects consumer privacy by ensuring that any data
collected by an insurer remains confidential, and is accurate, relevant, and used for a proper
and specific purpose

,Risk - CORRECT ANSWER✔✔- The uncertainty of a loss



Peril - CORRECT ANSWER✔✔- The cause of a loss



Hazard - CORRECT ANSWER✔✔- Increases the possibility of a loss



Indemnity - CORRECT ANSWER✔✔- Does not allow the insured to profit from a loss;
instead, it restores the insured to the same financial or economic condition the existed prior to
loss


Adhesion - CORRECT ANSWER✔✔- One party (the insurer) prepares the contract and
presents it to the second party (the insured), who must accept it on a "take-it-or-leave-it" basis


Types Of Insurers - CORRECT ANSWER✔✔- Stock Insurers, Mutual Insurers, Reciprocal
Insurers, and Self-Insurer


Reduction - CORRECT ANSWER✔✔- Minimizing the chance of a loss without eliminating
the risk altogether


Retention - CORRECT ANSWER✔✔- Assuming responsibility for a loss



Conditional - CORRECT ANSWER✔✔- A contract that requires that both parties perform
certain duties


Acutuary - CORRECT ANSWER✔✔- Determines the probability of loss and sets premium
rates


Physical - CORRECT ANSWER✔✔- A hazard that occurs when a physical condition
increases the probability of loss; use, condition, or occupancy of property

, Moral - CORRECT ANSWER✔✔- A hazard that occurs when dishonest tendencies increase
the probability of a loss; certain characteristics and behaviors of people


Morale - CORRECT ANSWER✔✔- A hazard that occurs when a persons attitude increases
the probability of a loss


Speculative Risk - CORRECT ANSWER✔✔- Situations where there is a chance or
possibility for loss, no loss or gain


Pure Risk - CORRECT ANSWER✔✔- Situations where there is no chance for gain, only
loss. The only risk that can be insured


Misreprensentation - CORRECT ANSWER✔✔- False statement contained in the insured's
application and does not usually void coverage or the policy


Fraud - CORRECT ANSWER✔✔- An intentional deception of the truth in order to induce
another party with something of value or to surrender a legal right


Concealment - CORRECT ANSWER✔✔- The willful holding back or secretion of material
facts pertinent to the issuance of insurance or claim


Reinsurance - CORRECT ANSWER✔✔- A contract between the insuring company and the
reinsurer, and does not involve the insured


Underwriter - CORRECT ANSWER✔✔- Responsible for the selection of risks and rating
that determines actual policy premium


Underwriting - CORRECT ANSWER✔✔- The process of selecting, classifying, and rating a
risk for the purpose of insurance coverage


Waiver - CORRECT ANSWER✔✔- Voluntary surrender of a known right, claim or privilege