Fundamentals to Insurance COMPREHENSIVE
QUESTIONS AND VERIFIED ANSWERS (DETAILED &
ELABORATED) ACTUAL EXAM 2025 TEST 100%
SOLVED 2025!!
RISK - (ANSWER)IS THE CHANCE OF FINANCIAL LOSS
PERIL - (ANSWER)IS THE CAISE OF FINANCIAL LOSS FOR EXAMPLE- FIRE WATER
AND EARTHQUAKE
WHAT IS THE MAIN PURPOSE OF INSURANCE - (ANSWER)IS TO ALLOW THE
SPREAD OF RISK
INDEMNITY - (ANSWER)MEANS RESTORING THE INSUREDS TO THE SAM
FINANCIAL POSITION AS THEY WERE IN IMMEDIATELY PRIOR TO THE LOSS.
WHOSE OPTION IS TO OF HOW THEY WANT TO SETTLE A CLAIM? - (ANSWER)THE
INSURER
INSURANCE INDEMNIFIES - (ANSWER)FUTURE AND ACCIDENTAL LOSSES ONLY,
NOT THE PLANNED LOSSES
DIRECT WRITERS - (ANSWER)IN THIS METHOD PRODUCERS ARE EMPLOYEES OF
THE INSURER. THEY ARE PAID REMUNERIATION BY THE WAY OF SALARY. INSURER
OWNS CUSTOMER FILES
,INDEPENDANT BROKERAGES - (ANSWER)THEY ARE SELF EMPLOYED, THEY ARE
NOT EMPLOYEES OF THE INSURANCE COMPANY THEY REPRESENT. THEY ARE PAID
COMMISSION. THE CUSTOMER FILES ARE OWNED BY THE BROKERAGE
PURE RISK - (ANSWER)THERE IS ONY A CHANDE OF FINANCIAL LOSS WITH NO
CHANCE OF PROFITING FROM IT FOR EXAMPLE, FIRE LOSS
SPECULATIVE RISK - (ANSWER)THERE IS A CHANCE OF FINANCIAL LOSS AS WEL AS
A CHANCE OF FINANCIAL GAIN
WHAT ARE THE 4 WAYS OF LIVING WITH RISK - (ANSWER)AVOIDANCE OF RISK-
ACTING LIKE ITS NOT THERE
CONTROLLING OF RISK- GETTING THINGS INSTALLED TO LESSON THE RISK
RETENTION OF RISK- SAVING MONEY TO DEAL WITH RISKS AS THEY COME
TRANSFER OF RISK- PURCHASING INSURANCE
CONTRACT - (ANSWER)IS A LEGAL PROMISE MADE BY TWO OR MORE PARTIES
WHICH CAN BE ENFORCED THROUGH THE COURT OF LAW
WHAT ARE THE FIVE ELEMENT OF A CONTRACT - (ANSWER)AGREEMENT
CONSIDERATION
LEGALITY OF OBJECT
LEGAL CAPACITY OF PARTIES
GENUINE INTENTION
,THE AGREEMENT OF AN INSURANCE CONTRACT - (ANSWER)WHEN BOTH
PARTIES AGREE ON PARTICULAR POINT
CONSIDERATION OF AN INSURANCE CONTRACT - (ANSWER)AN EXCHANGE OF
SOMETHING OF VALUE BETWEEN THE PARTIES TO A CONTRACT
LEGALITY OF OBJECT - (ANSWER)FOR WHICH A CONTRACT IS WRITTEN SHOULD
BE LEGAL OBJECT
LEGAL CAPACITY OF PARTIES - (ANSWER)ALL PARTIES TO CONTRACT SHOULD
HAVE LEGAL CAPACITY TO ENTER INTO A CONTRACT
GENUINE INTENTION - (ANSWER)NO INFLUENCE OR VIOLENCE IS USED ON
EITHER PARTY TO ENTER INTO A CONTRACT
BINDER - (ANSWER)THE BROKER HAS COMMITTED AN INSURER TO A CONTRACT
OF INSURANCE ON ANY RISK
ENDORSEMENT - (ANSWER)IT MEANS TO CHANGE THE TERMS AND CONDITIONS
OF AN EXISTING INSURANCE POLICY
RIDER - (ANSWER)THE COVERAGE OF AN ADDITIONAL PERIL OVER AND ABOVE
THE EXISTING PERILS COVERED IN THE POLICY
, WHAT DOES THE FEDERAL GOVERNMENT DO - (ANSWER)IT MONITORS THE
FINANCIAL HEALTH OF FEDERALLY LICENSED INSURERS
WHAT DOES INSOLVENT MEAN - (ANSWER)THOSE WHO ARE NOT ABLE TO PAY
ALL INSURED LOSSES
WHAT DOES SOLVENT MEAN - (ANSWER)THOSE WHO ARE ABLE TO PAY ALL
INSURED LOSSES
WHAT HAPPENS WHNE AN INSURED BECOMES INSOLVENT - (ANSWER)THE
PROPERTY AND CAUSALITY INSURANCE COMPENSATION CORPORATION TAKES
OVER THE BUSINESS AND PAYS THE LOSSES
WHAT DOES THE PROVINCIAL GOVERNMENT DO - (ANSWER)THRY APPROVE THE
CONTENT OF INSURANCE CONTRACTS
IT LICENSES THE INSURERS OPERATING WITHIN THE PROVINCE INCLUDING
FEDERALLY LICENSED INSURER
IT ALSO MONITORS THE FINANCIAL HEALTH OF THE INSURERS WHICH OPERATE
IN THE PROVINCE ONLY
WHAT IS A FIDUCIARY - (ANSWER)SOMEONE THATNHANDELS SOMEONE ELSES
MONEY
WHO ARE FIDUCIARIES - (ANSWER)INSURERS AND BROKERS
QUESTIONS AND VERIFIED ANSWERS (DETAILED &
ELABORATED) ACTUAL EXAM 2025 TEST 100%
SOLVED 2025!!
RISK - (ANSWER)IS THE CHANCE OF FINANCIAL LOSS
PERIL - (ANSWER)IS THE CAISE OF FINANCIAL LOSS FOR EXAMPLE- FIRE WATER
AND EARTHQUAKE
WHAT IS THE MAIN PURPOSE OF INSURANCE - (ANSWER)IS TO ALLOW THE
SPREAD OF RISK
INDEMNITY - (ANSWER)MEANS RESTORING THE INSUREDS TO THE SAM
FINANCIAL POSITION AS THEY WERE IN IMMEDIATELY PRIOR TO THE LOSS.
WHOSE OPTION IS TO OF HOW THEY WANT TO SETTLE A CLAIM? - (ANSWER)THE
INSURER
INSURANCE INDEMNIFIES - (ANSWER)FUTURE AND ACCIDENTAL LOSSES ONLY,
NOT THE PLANNED LOSSES
DIRECT WRITERS - (ANSWER)IN THIS METHOD PRODUCERS ARE EMPLOYEES OF
THE INSURER. THEY ARE PAID REMUNERIATION BY THE WAY OF SALARY. INSURER
OWNS CUSTOMER FILES
,INDEPENDANT BROKERAGES - (ANSWER)THEY ARE SELF EMPLOYED, THEY ARE
NOT EMPLOYEES OF THE INSURANCE COMPANY THEY REPRESENT. THEY ARE PAID
COMMISSION. THE CUSTOMER FILES ARE OWNED BY THE BROKERAGE
PURE RISK - (ANSWER)THERE IS ONY A CHANDE OF FINANCIAL LOSS WITH NO
CHANCE OF PROFITING FROM IT FOR EXAMPLE, FIRE LOSS
SPECULATIVE RISK - (ANSWER)THERE IS A CHANCE OF FINANCIAL LOSS AS WEL AS
A CHANCE OF FINANCIAL GAIN
WHAT ARE THE 4 WAYS OF LIVING WITH RISK - (ANSWER)AVOIDANCE OF RISK-
ACTING LIKE ITS NOT THERE
CONTROLLING OF RISK- GETTING THINGS INSTALLED TO LESSON THE RISK
RETENTION OF RISK- SAVING MONEY TO DEAL WITH RISKS AS THEY COME
TRANSFER OF RISK- PURCHASING INSURANCE
CONTRACT - (ANSWER)IS A LEGAL PROMISE MADE BY TWO OR MORE PARTIES
WHICH CAN BE ENFORCED THROUGH THE COURT OF LAW
WHAT ARE THE FIVE ELEMENT OF A CONTRACT - (ANSWER)AGREEMENT
CONSIDERATION
LEGALITY OF OBJECT
LEGAL CAPACITY OF PARTIES
GENUINE INTENTION
,THE AGREEMENT OF AN INSURANCE CONTRACT - (ANSWER)WHEN BOTH
PARTIES AGREE ON PARTICULAR POINT
CONSIDERATION OF AN INSURANCE CONTRACT - (ANSWER)AN EXCHANGE OF
SOMETHING OF VALUE BETWEEN THE PARTIES TO A CONTRACT
LEGALITY OF OBJECT - (ANSWER)FOR WHICH A CONTRACT IS WRITTEN SHOULD
BE LEGAL OBJECT
LEGAL CAPACITY OF PARTIES - (ANSWER)ALL PARTIES TO CONTRACT SHOULD
HAVE LEGAL CAPACITY TO ENTER INTO A CONTRACT
GENUINE INTENTION - (ANSWER)NO INFLUENCE OR VIOLENCE IS USED ON
EITHER PARTY TO ENTER INTO A CONTRACT
BINDER - (ANSWER)THE BROKER HAS COMMITTED AN INSURER TO A CONTRACT
OF INSURANCE ON ANY RISK
ENDORSEMENT - (ANSWER)IT MEANS TO CHANGE THE TERMS AND CONDITIONS
OF AN EXISTING INSURANCE POLICY
RIDER - (ANSWER)THE COVERAGE OF AN ADDITIONAL PERIL OVER AND ABOVE
THE EXISTING PERILS COVERED IN THE POLICY
, WHAT DOES THE FEDERAL GOVERNMENT DO - (ANSWER)IT MONITORS THE
FINANCIAL HEALTH OF FEDERALLY LICENSED INSURERS
WHAT DOES INSOLVENT MEAN - (ANSWER)THOSE WHO ARE NOT ABLE TO PAY
ALL INSURED LOSSES
WHAT DOES SOLVENT MEAN - (ANSWER)THOSE WHO ARE ABLE TO PAY ALL
INSURED LOSSES
WHAT HAPPENS WHNE AN INSURED BECOMES INSOLVENT - (ANSWER)THE
PROPERTY AND CAUSALITY INSURANCE COMPENSATION CORPORATION TAKES
OVER THE BUSINESS AND PAYS THE LOSSES
WHAT DOES THE PROVINCIAL GOVERNMENT DO - (ANSWER)THRY APPROVE THE
CONTENT OF INSURANCE CONTRACTS
IT LICENSES THE INSURERS OPERATING WITHIN THE PROVINCE INCLUDING
FEDERALLY LICENSED INSURER
IT ALSO MONITORS THE FINANCIAL HEALTH OF THE INSURERS WHICH OPERATE
IN THE PROVINCE ONLY
WHAT IS A FIDUCIARY - (ANSWER)SOMEONE THATNHANDELS SOMEONE ELSES
MONEY
WHO ARE FIDUCIARIES - (ANSWER)INSURERS AND BROKERS
