NC HEALTH INSURANCE EXAM PEARSON VUE
EXAM QUESTIONS AND CORRECT VERIFIED
ANSWERS/ ALREADY GRADED A+
Pure Risk - CORRECT ANSWER ✔✔- chance of loss or no loss but not gain
insurable
Speculative Risk - CORRECT ANSWER ✔✔- there is possibility of loss but of
gain no insurablility
exposure unit - CORRECT ANSWER ✔✔- subject to loss
peril - CORRECT ANSWER ✔✔- cause of loss
life insurance - CORRECT ANSWER ✔✔- death
Health insurance - CORRECT ANSWER ✔✔- accident and sickness
hazard - CORRECT ANSWER ✔✔- increases the likelihood or severity of loss
Three types of hazard - CORRECT ANSWER ✔✔- physical, moral, morale
physical hazard - CORRECT ANSWER ✔✔- arise from the inherent characteristic
of the exposure unit
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,Moral Hazard - CORRECT ANSWER ✔✔- lifestyle of the insured person
Morale hazard - CORRECT ANSWER ✔✔- arise more from an outlook on life
risk avoidance - CORRECT ANSWER ✔✔- eliminating all risk altogether
risk retention - CORRECT ANSWER ✔✔- manage risk Deduction
self-insurance - CORRECT ANSWER ✔✔- instead of buying health insurance and
saving $ in the bank
Pure risk that are not insurable - CORRECT ANSWER ✔✔- Flood, War,
Catastrophic losses
Intentional losses - CORRECT ANSWER ✔✔- not insurable
Adverse selection - CORRECT ANSWER ✔✔- bad for insurance
insurance actuary - CORRECT ANSWER ✔✔- a specially trained mathematician
who calculates premiums
underwriter - CORRECT ANSWER ✔✔- checks out the medical history of the
proposed insured and other factors to eliminate adverse selection against the
insurance company, issue policy premium restrictions
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, Days for applicant to requests an explanantion - CORRECT ANSWER ✔✔- 90
days
Days insurance company must furnish an explanation - CORRECT ANSWER
✔✔- 21 days
A dispute must begin within in - CORRECT ANSWER ✔✔- 30 days
Law of Large numbers - CORRECT ANSWER ✔✔- the larger the number the
easier it is to predict losses
how much $ must a insurance company have in reserve at all times - CORRECT
ANSWER ✔✔- 4 million
Reinsurance agreements - CORRECT ANSWER ✔✔- enable an insurance
company the ceding company to transfer risk to the reinsurer (seller)
Capital Stock companies are owned by - CORRECT ANSWER ✔✔- stock holders
and most common
Main purpose of the stock company - CORRECT ANSWER ✔✔- make a profit
for its investors
Mutual companies are owned by - CORRECT ANSWER ✔✔- policy holders
Assessment insurers - CORRECT ANSWER ✔✔- charge additional premiums at
the end of the specified time period
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EXAM QUESTIONS AND CORRECT VERIFIED
ANSWERS/ ALREADY GRADED A+
Pure Risk - CORRECT ANSWER ✔✔- chance of loss or no loss but not gain
insurable
Speculative Risk - CORRECT ANSWER ✔✔- there is possibility of loss but of
gain no insurablility
exposure unit - CORRECT ANSWER ✔✔- subject to loss
peril - CORRECT ANSWER ✔✔- cause of loss
life insurance - CORRECT ANSWER ✔✔- death
Health insurance - CORRECT ANSWER ✔✔- accident and sickness
hazard - CORRECT ANSWER ✔✔- increases the likelihood or severity of loss
Three types of hazard - CORRECT ANSWER ✔✔- physical, moral, morale
physical hazard - CORRECT ANSWER ✔✔- arise from the inherent characteristic
of the exposure unit
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,Moral Hazard - CORRECT ANSWER ✔✔- lifestyle of the insured person
Morale hazard - CORRECT ANSWER ✔✔- arise more from an outlook on life
risk avoidance - CORRECT ANSWER ✔✔- eliminating all risk altogether
risk retention - CORRECT ANSWER ✔✔- manage risk Deduction
self-insurance - CORRECT ANSWER ✔✔- instead of buying health insurance and
saving $ in the bank
Pure risk that are not insurable - CORRECT ANSWER ✔✔- Flood, War,
Catastrophic losses
Intentional losses - CORRECT ANSWER ✔✔- not insurable
Adverse selection - CORRECT ANSWER ✔✔- bad for insurance
insurance actuary - CORRECT ANSWER ✔✔- a specially trained mathematician
who calculates premiums
underwriter - CORRECT ANSWER ✔✔- checks out the medical history of the
proposed insured and other factors to eliminate adverse selection against the
insurance company, issue policy premium restrictions
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, Days for applicant to requests an explanantion - CORRECT ANSWER ✔✔- 90
days
Days insurance company must furnish an explanation - CORRECT ANSWER
✔✔- 21 days
A dispute must begin within in - CORRECT ANSWER ✔✔- 30 days
Law of Large numbers - CORRECT ANSWER ✔✔- the larger the number the
easier it is to predict losses
how much $ must a insurance company have in reserve at all times - CORRECT
ANSWER ✔✔- 4 million
Reinsurance agreements - CORRECT ANSWER ✔✔- enable an insurance
company the ceding company to transfer risk to the reinsurer (seller)
Capital Stock companies are owned by - CORRECT ANSWER ✔✔- stock holders
and most common
Main purpose of the stock company - CORRECT ANSWER ✔✔- make a profit
for its investors
Mutual companies are owned by - CORRECT ANSWER ✔✔- policy holders
Assessment insurers - CORRECT ANSWER ✔✔- charge additional premiums at
the end of the specified time period
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