Life insurance and Annuities Exam Questions With Accurate
Answers.
Mixed Insurer - accurate answers-A company that operates as both a
participating and nonparticipating insurer
Independent Agency System - accurate answers-Independent agents
represent a number of insurance companies under separate contractual
agreements.
unfair trade practice acts - accurate answers-gives chief financial officer the
power to investigate insurance companies and producers to impose penalties
NAIFA and NAHU - accurate answers-These organizations created a Code of
Ethics detailing the expectations of agents in their duties toward clients.
Reserves - accurate answers-Reserves are set aside by an insurance company,
and designated for the payment of future claims
Independent rating service - accurate answers-credit rating agencies that rate
or--grade--the financial strength and stability of insurers based on claims,
reserves, and company profits.
Peril - accurate answers-An mediate, specific event, which causes loss. Perils
can also be referred to as accident itself.
Pure Risk - accurate answers-Is the only triple risk represents a potential for
loss only, I such as injury
Homogeneous Exposure Units - accurate answers-Similar objects of insurance
that are exposed to the same group of perils.
Risk Pooling - accurate answers-When a large group of people spread risk for
small certain cost
Human Life Value Approach - accurate answers-A method of determining the
financial value of a person's life. It is based on computing the current value of
a person's future earnings for a certain period of time.
, Competent Parties - accurate answers-All parties must be of legal competence,
meaning they must be of legal age, mentally capable of understanding the
terms, and not influenced by drugs or alcohol.
Contract of Adhesion - accurate answers-Because an insurance contract has
been prepared by an insurance company with no negotiation, it is considered
a contract of adhesion. In a contract of adhesion there is only one author - the
insurance company. If there is an ambiguity in the contract, the courts always
favor the insured over the insurer.
Unilateral Contract - accurate answers-One sided agreement, where only the
insurer is legally bound. In an insurance contract only the insurance company
is legally bound to do anything.
Principle of Indemnity - accurate answers-Is to restore the insured, the same
financial condition as that which existed prior to the loss
Health insurance contracts - accurate answers-indemnity contracts and will
only reimburse the actual cost of the loss (pay medical bills, etc.) You cannot
profit from an indemnity contract
Insurable Interest - accurate answers-Insurable interest only needs to exist
the time of the application
Reasonable expectation - accurate answers-A concept which states that
insured the entitled to coverage under the policy that is sensible and prudent
person would expect to provide
STOLI - accurate answers-- Stranger-Orignated Life Insurance
- Consumer purchase of life insurance policy with agreement that a third-
party agent/broker or investor will purchase the consumer policy and Bruce
and receive the proceeds as a profit upon consumers death
Authority - accurate answers-Agents are granted authority by the insurer
through the agencies contract to transact insurance, or just claims on their
behalf
Waiver - accurate answers-is the voluntary giving up of a legal, given right.
Answers.
Mixed Insurer - accurate answers-A company that operates as both a
participating and nonparticipating insurer
Independent Agency System - accurate answers-Independent agents
represent a number of insurance companies under separate contractual
agreements.
unfair trade practice acts - accurate answers-gives chief financial officer the
power to investigate insurance companies and producers to impose penalties
NAIFA and NAHU - accurate answers-These organizations created a Code of
Ethics detailing the expectations of agents in their duties toward clients.
Reserves - accurate answers-Reserves are set aside by an insurance company,
and designated for the payment of future claims
Independent rating service - accurate answers-credit rating agencies that rate
or--grade--the financial strength and stability of insurers based on claims,
reserves, and company profits.
Peril - accurate answers-An mediate, specific event, which causes loss. Perils
can also be referred to as accident itself.
Pure Risk - accurate answers-Is the only triple risk represents a potential for
loss only, I such as injury
Homogeneous Exposure Units - accurate answers-Similar objects of insurance
that are exposed to the same group of perils.
Risk Pooling - accurate answers-When a large group of people spread risk for
small certain cost
Human Life Value Approach - accurate answers-A method of determining the
financial value of a person's life. It is based on computing the current value of
a person's future earnings for a certain period of time.
, Competent Parties - accurate answers-All parties must be of legal competence,
meaning they must be of legal age, mentally capable of understanding the
terms, and not influenced by drugs or alcohol.
Contract of Adhesion - accurate answers-Because an insurance contract has
been prepared by an insurance company with no negotiation, it is considered
a contract of adhesion. In a contract of adhesion there is only one author - the
insurance company. If there is an ambiguity in the contract, the courts always
favor the insured over the insurer.
Unilateral Contract - accurate answers-One sided agreement, where only the
insurer is legally bound. In an insurance contract only the insurance company
is legally bound to do anything.
Principle of Indemnity - accurate answers-Is to restore the insured, the same
financial condition as that which existed prior to the loss
Health insurance contracts - accurate answers-indemnity contracts and will
only reimburse the actual cost of the loss (pay medical bills, etc.) You cannot
profit from an indemnity contract
Insurable Interest - accurate answers-Insurable interest only needs to exist
the time of the application
Reasonable expectation - accurate answers-A concept which states that
insured the entitled to coverage under the policy that is sensible and prudent
person would expect to provide
STOLI - accurate answers-- Stranger-Orignated Life Insurance
- Consumer purchase of life insurance policy with agreement that a third-
party agent/broker or investor will purchase the consumer policy and Bruce
and receive the proceeds as a profit upon consumers death
Authority - accurate answers-Agents are granted authority by the insurer
through the agencies contract to transact insurance, or just claims on their
behalf
Waiver - accurate answers-is the voluntary giving up of a legal, given right.
