Georgia Life, Accident, & Sickness Exam
Insurance Correct answers A social device for spreading the chance of
financial loss among a large number of people. A method of transferring
risks to the insurance company.
Risk Correct answers Shared by all those people buying like
coverage's Types of Risk? Correct answers Speculative and
Pure
Speculative Risk Correct answers Gambling. Insurance DOES NOT
cover this. Insurance is not meant to provide the opportunity for a
gain.
Pure Risk Correct answers The type of loss insurance covers
Valued Contract Correct answers Pays stated amount in the event of the
occurrence. EX: Life Insurance
Reimbursement Contract Correct answers Based on the loss you will be
paid back a certain amount. EX: Health Insurance, Disability Insurance,
Auto Insurance
Description of Insurance Correct answers A large uncertain loss (death,
disability) is exchanged for a small certain loss (premium). The agreement is
between the insurer (the company) and the policy owner (may or may not
be the insured) is established in a legal contract, called a policy. The
contract promises to pay a claim if a loss occurs. If a loss occurs the
beneficiary will file a claim.
Who is involved with a Policy? Correct answers Applicant, Policy Owner,
Insured, Beneficiary, Insurer, Third party contract
Applicant Correct answers Person applying for insurance
Policy Owner Correct answers Pays the bill. Has all ownership
of rights Insured Correct answers Person whose life is covered
in the policy
Beneficiary Correct answers The person named to receive the proceeds upon
the death of the insured. (THIS CAN BE ANYONE YOU WANT)
Insurer Correct answers The company
, Third Party Contract Correct answers A policy that is owned by someone
other than the insured. EX: a husband buys insurance on his wife or a parent
buys insurance on a child.
What creates risk? Correct answers Peril and
Hazard Peril Correct answers Is the cause of
the loss.
EX: fire, flood, accident
Hazard Correct answers Anything that
increases the chance of loss
Moral Hazard Correct answers liar,
misrepresents oneself (Ends in an L for LIAR)
Morale Hazard Correct answers bad attitude, careless, a risk taker
(ends in an E attitude ends in an E)
EX: speeding ticket, DUI, bad credit
Method of Managing Risks Correct answers Transfer
Buying Insurance Correct answers The risk of the loss is transferred to the
insurer and it is shared by other insured's that have similar characteristics,
like age, sex, occupation
Two basic concepts of insurance? Correct answers Pooling Concept and Law
of Large Numbers
Pooling Concept Correct answers Looking at a group of people who
share similar characteristics to make predictions
Law of Large Numbers Correct answers the larger the group, the more
accurate the prediction.
The Mortality Table Correct answers In use is The Commissioners Standard
Ordinary Table. Tracks life expectancy to age 120.
Exposure Unit Correct answers The person or property being considered
Indemnify Correct answers Returns one to the economic position enjoyed
prior to the loss, but restricts one from making a profit from the loss
Contestable Clause Correct answers Suicide in the first two years is not
covered. The insurer will return premium only, with no interest.
Incontestable Correct answers After two years the life insurance contract for
suicide and for fraud is over and the claim will be paid.
In Health Insurance, Fraud is Correct answers FOREVER
Insurance Correct answers A social device for spreading the chance of
financial loss among a large number of people. A method of transferring
risks to the insurance company.
Risk Correct answers Shared by all those people buying like
coverage's Types of Risk? Correct answers Speculative and
Pure
Speculative Risk Correct answers Gambling. Insurance DOES NOT
cover this. Insurance is not meant to provide the opportunity for a
gain.
Pure Risk Correct answers The type of loss insurance covers
Valued Contract Correct answers Pays stated amount in the event of the
occurrence. EX: Life Insurance
Reimbursement Contract Correct answers Based on the loss you will be
paid back a certain amount. EX: Health Insurance, Disability Insurance,
Auto Insurance
Description of Insurance Correct answers A large uncertain loss (death,
disability) is exchanged for a small certain loss (premium). The agreement is
between the insurer (the company) and the policy owner (may or may not
be the insured) is established in a legal contract, called a policy. The
contract promises to pay a claim if a loss occurs. If a loss occurs the
beneficiary will file a claim.
Who is involved with a Policy? Correct answers Applicant, Policy Owner,
Insured, Beneficiary, Insurer, Third party contract
Applicant Correct answers Person applying for insurance
Policy Owner Correct answers Pays the bill. Has all ownership
of rights Insured Correct answers Person whose life is covered
in the policy
Beneficiary Correct answers The person named to receive the proceeds upon
the death of the insured. (THIS CAN BE ANYONE YOU WANT)
Insurer Correct answers The company
, Third Party Contract Correct answers A policy that is owned by someone
other than the insured. EX: a husband buys insurance on his wife or a parent
buys insurance on a child.
What creates risk? Correct answers Peril and
Hazard Peril Correct answers Is the cause of
the loss.
EX: fire, flood, accident
Hazard Correct answers Anything that
increases the chance of loss
Moral Hazard Correct answers liar,
misrepresents oneself (Ends in an L for LIAR)
Morale Hazard Correct answers bad attitude, careless, a risk taker
(ends in an E attitude ends in an E)
EX: speeding ticket, DUI, bad credit
Method of Managing Risks Correct answers Transfer
Buying Insurance Correct answers The risk of the loss is transferred to the
insurer and it is shared by other insured's that have similar characteristics,
like age, sex, occupation
Two basic concepts of insurance? Correct answers Pooling Concept and Law
of Large Numbers
Pooling Concept Correct answers Looking at a group of people who
share similar characteristics to make predictions
Law of Large Numbers Correct answers the larger the group, the more
accurate the prediction.
The Mortality Table Correct answers In use is The Commissioners Standard
Ordinary Table. Tracks life expectancy to age 120.
Exposure Unit Correct answers The person or property being considered
Indemnify Correct answers Returns one to the economic position enjoyed
prior to the loss, but restricts one from making a profit from the loss
Contestable Clause Correct answers Suicide in the first two years is not
covered. The insurer will return premium only, with no interest.
Incontestable Correct answers After two years the life insurance contract for
suicide and for fraud is over and the claim will be paid.
In Health Insurance, Fraud is Correct answers FOREVER
