Life and Health Insurance - Ohio
Licensing Exam Correct 100%
Absolute Assignment - ANSWER The assignment by the policy owner of all control and
rights to a third party. This differs from collateral assignment, which allows all the rights
and control to revert to the owner once a loan is paid off
Accident - ANSWER A fortuitous event; unforeseen and unintended
Accidental Death Insurance - ANSWER A form of health insurance that provides
payment if death of the insured results from accident. Accidental death insurance is
often combined with dismemberment insurance in a form called accidental death and
dismemberment (AD&D)
Accident and Sickness - ANSWER Insurance against bodily injury, disability, or death
by accident or accidental means, or expense thereof, or against disability or expense
resulting from sickness and the insurance relating thereto
Accident means - ANSWER The unexpected cause of an accidental bodily injury. Under
an accidental means definition, the mishap itself must be accidental. If a person does
something to contribute to the accident, the claim would not be paid under this
restrictive definition
Accelerated benefit - ANSWER Available only if the benefits are available during the
insured's lifetime, benefit amounts are fixed when accelerated, and the benefits, when
paid, reduces the death benefit
Accumulation at interest option - ANSWER A dividend option under which the policy
owner allows dividends to accumulate at interest with the company. Only the interest on
the dividends is taxable as income (participating policies only).
Actuary - ANSWER Once concerned with the application of probability and statistical
theory to insurance. This person sets expenses, and interest assumptions.
ADB - ANSWER Accidental death benefit, also known as double indemnity. There is
another variation called triple indemnity.
AD&D - ANSWER Accidental death and dismemberment insurance.
Administrator - ANSWER The person appointed by a court to settle a deceased's
estate, sometimes called and executor.
Adverse selection - ANSWER Selection against the insurance company. The tendency
of poorer risks to want insurance more often than standard risks.
,Agent - ANSWER The individual appointed by an insurance company to solicit,
negotiate, effect, or countersign insurance contracts on its behalf.
Aleatory - ANSWER Something that depends upon chance or is random. It is derived
from the Latin idea of "rolling the dice."
Aleatory contract - ANSWER A contract in which both parties know that one or the other
may receive more than paid in. This payment is dependent upon a fortuitous event. For
example. a person pays the premium for a term policy for many years and does not die,
thus, a claim is never filed.
Alien company - ANSWER An insured organized and domiciled in a country other than
the United States
Annuitant - ANSWER The one receiving the Annuity and on whose life expectancy the
rates are figured.
Annuity - ANSWER 1. An amount of money, payable monthly or yearly, which liquidates
a financial asset. 2. An agreement by an insurer to make periodic payments that
continue during the survival of the annuitant(s) or for a specified period. Annuities are
also accumulations vehicles that function much like savings accounts.
Applicant - ANSWER The party making application to the insurance company for the
policy
Application - ANSWER A form on which the prospective insured states facts requested
by the insurer and on the basis of which the insurer decides whether to accept the risk,
modify the coverage offered, or decline the risk.
Assignee - ANSWER The person to whom policy rights are assigned in whole or in part
by the policy owner.
Assignment - ANSWER The transfer of rights in a policy to someone other than the
policy owner.
Attained age - ANSWER The present age of the insured. This is a factor when a person
converts term insurance to whole life insurance or buys added disability under a GIR
provision
Business Insurance - ANSWER Life or Health insurance written to vober business
situations, such as key person, sole proprietor, partnership, corporations, ect.
Cancelable - ANSWER A contract of Insurance that may be terminated by the insurance
company or insured at any time. Virtually every form of insurance is cancelable except
, Life insurance and those health policies designated as guaranteed renewable, or non-
cancelable and guaranteed renewable.
Cancellation - ANSWER The termination of a contract of insurance in force by voluntary
act of the insurance company or insured, effected in accordance with provisions in the
contract or by mutual agreement.
Capital Sum - ANSWER The maximum amount payable in one sum in the event of
accidental dismemberment. It is typically half of the face amount of principal sum.
Cash Surrender Value - ANSWER The value reposing in a policy that is the legal
property of the policy owner and that may be expected should the policy be surrendered
for cash. Synonymous with cash value.
Certificate - ANSWER A statement Evidencing that a policy has been written and stating
the coverage in general. Often used with group coverage.
Claim - ANSWER A demand for payment under the insurance policy.
Classification - ANSWER The grouping of persons for the purpose of determining an
underwriting or rating group into which a particular risk must be placed.
Co-Insurance - ANSWER In Health Insurance, a provision that the insured and
insurance company will share covered losses in agreed proportion.
Collateral Assignment - ANSWER The assignment of part of the proceeds of an
insurance policy to a bank as collateral to settle the loan balance that may exist at the
insured's death. This agreement is temporary.
Common Disaster Provision - ANSWER A provision that can be included in a Life
contrat that pvoides that the primary beneficiary must outlive the insured by a specified
period of time in order to receive the proceeds. If not, the contingent beneficiary
receives that proceeds. The provision is designed to protect the rights of the contingent
beneficiary in the event of simultaneous death of the insured and the primary
beneficiary. The time limit is up to 90 days, depending on state law.
Comprehensive Health or Major Medical Insurance - ANSWER A form of Health
insurance that combines the coverage of major medical and basic medical exspenses
crontracts into one broad contract that provides coverage for almost all types of medical
expense with few internal limits. Usually subject to a corridor deductible for expenses
after the first dollar base plan limits are exceeded, and to a co-insurance clause
applicable to all or some of the remaining covered expenses.
Concealment - ANSWER The withholding of facts by an applicant for insurance that
materially affect an insurance risk or loss.
Licensing Exam Correct 100%
Absolute Assignment - ANSWER The assignment by the policy owner of all control and
rights to a third party. This differs from collateral assignment, which allows all the rights
and control to revert to the owner once a loan is paid off
Accident - ANSWER A fortuitous event; unforeseen and unintended
Accidental Death Insurance - ANSWER A form of health insurance that provides
payment if death of the insured results from accident. Accidental death insurance is
often combined with dismemberment insurance in a form called accidental death and
dismemberment (AD&D)
Accident and Sickness - ANSWER Insurance against bodily injury, disability, or death
by accident or accidental means, or expense thereof, or against disability or expense
resulting from sickness and the insurance relating thereto
Accident means - ANSWER The unexpected cause of an accidental bodily injury. Under
an accidental means definition, the mishap itself must be accidental. If a person does
something to contribute to the accident, the claim would not be paid under this
restrictive definition
Accelerated benefit - ANSWER Available only if the benefits are available during the
insured's lifetime, benefit amounts are fixed when accelerated, and the benefits, when
paid, reduces the death benefit
Accumulation at interest option - ANSWER A dividend option under which the policy
owner allows dividends to accumulate at interest with the company. Only the interest on
the dividends is taxable as income (participating policies only).
Actuary - ANSWER Once concerned with the application of probability and statistical
theory to insurance. This person sets expenses, and interest assumptions.
ADB - ANSWER Accidental death benefit, also known as double indemnity. There is
another variation called triple indemnity.
AD&D - ANSWER Accidental death and dismemberment insurance.
Administrator - ANSWER The person appointed by a court to settle a deceased's
estate, sometimes called and executor.
Adverse selection - ANSWER Selection against the insurance company. The tendency
of poorer risks to want insurance more often than standard risks.
,Agent - ANSWER The individual appointed by an insurance company to solicit,
negotiate, effect, or countersign insurance contracts on its behalf.
Aleatory - ANSWER Something that depends upon chance or is random. It is derived
from the Latin idea of "rolling the dice."
Aleatory contract - ANSWER A contract in which both parties know that one or the other
may receive more than paid in. This payment is dependent upon a fortuitous event. For
example. a person pays the premium for a term policy for many years and does not die,
thus, a claim is never filed.
Alien company - ANSWER An insured organized and domiciled in a country other than
the United States
Annuitant - ANSWER The one receiving the Annuity and on whose life expectancy the
rates are figured.
Annuity - ANSWER 1. An amount of money, payable monthly or yearly, which liquidates
a financial asset. 2. An agreement by an insurer to make periodic payments that
continue during the survival of the annuitant(s) or for a specified period. Annuities are
also accumulations vehicles that function much like savings accounts.
Applicant - ANSWER The party making application to the insurance company for the
policy
Application - ANSWER A form on which the prospective insured states facts requested
by the insurer and on the basis of which the insurer decides whether to accept the risk,
modify the coverage offered, or decline the risk.
Assignee - ANSWER The person to whom policy rights are assigned in whole or in part
by the policy owner.
Assignment - ANSWER The transfer of rights in a policy to someone other than the
policy owner.
Attained age - ANSWER The present age of the insured. This is a factor when a person
converts term insurance to whole life insurance or buys added disability under a GIR
provision
Business Insurance - ANSWER Life or Health insurance written to vober business
situations, such as key person, sole proprietor, partnership, corporations, ect.
Cancelable - ANSWER A contract of Insurance that may be terminated by the insurance
company or insured at any time. Virtually every form of insurance is cancelable except
, Life insurance and those health policies designated as guaranteed renewable, or non-
cancelable and guaranteed renewable.
Cancellation - ANSWER The termination of a contract of insurance in force by voluntary
act of the insurance company or insured, effected in accordance with provisions in the
contract or by mutual agreement.
Capital Sum - ANSWER The maximum amount payable in one sum in the event of
accidental dismemberment. It is typically half of the face amount of principal sum.
Cash Surrender Value - ANSWER The value reposing in a policy that is the legal
property of the policy owner and that may be expected should the policy be surrendered
for cash. Synonymous with cash value.
Certificate - ANSWER A statement Evidencing that a policy has been written and stating
the coverage in general. Often used with group coverage.
Claim - ANSWER A demand for payment under the insurance policy.
Classification - ANSWER The grouping of persons for the purpose of determining an
underwriting or rating group into which a particular risk must be placed.
Co-Insurance - ANSWER In Health Insurance, a provision that the insured and
insurance company will share covered losses in agreed proportion.
Collateral Assignment - ANSWER The assignment of part of the proceeds of an
insurance policy to a bank as collateral to settle the loan balance that may exist at the
insured's death. This agreement is temporary.
Common Disaster Provision - ANSWER A provision that can be included in a Life
contrat that pvoides that the primary beneficiary must outlive the insured by a specified
period of time in order to receive the proceeds. If not, the contingent beneficiary
receives that proceeds. The provision is designed to protect the rights of the contingent
beneficiary in the event of simultaneous death of the insured and the primary
beneficiary. The time limit is up to 90 days, depending on state law.
Comprehensive Health or Major Medical Insurance - ANSWER A form of Health
insurance that combines the coverage of major medical and basic medical exspenses
crontracts into one broad contract that provides coverage for almost all types of medical
expense with few internal limits. Usually subject to a corridor deductible for expenses
after the first dollar base plan limits are exceeded, and to a co-insurance clause
applicable to all or some of the remaining covered expenses.
Concealment - ANSWER The withholding of facts by an applicant for insurance that
materially affect an insurance risk or loss.
