Alabama Health Insurance Exam

Pure - Insurance is defined as the transfer of ______________ risk to the insurance company in consideration for a premium. Pure Risk - The chance of loss without any chance of gain is called ___________ Speculative Risk - has the possibility for gain or loss and is not insurable. Risk - is defined as the chance of loss. Exposure - A condition that could result in a loss is known as Hazard - is something that increases the chance of loss. Physical Hazard - The presence of a _____________ increases the chance of a loss occurring. Peril - defined as a cause of loss, such as fire. Calculable - To be insurable, losses must be ___________. Law of Large Numbers - allows insurers to predict claims more accurately. Groups of people, not individuals - The law of large numbers applies to ___________. the more accurate the predictions are - The law of large numbers applies to groups of people, not to individuals. The more people in the group ______________. reinsurance , catastrophic loss - Most insurers buy_____________ to protect themselves in the event of a_______________. Insurance laws - are not required to be uniform from one state to another. Stock insurer may pay - dividends to its shareholders (stockholders), but they may not be guaranteed. No - Stock insurers pay the dividends to its shareholders (stockholders), are they guaranteed. attorney-in-fact - A reciprocal insurance company is managed by an Reciprocal Insurers - An unincorporated association of individuals who insure each other is known as a social needs, such as flood insurance and workers compensation - The government offers insurance primarily based upon preventing fraud - The government offers insurance primarily based upon social needs and not Foreign - company has their home office in another state Alien - company has their home office in another country Are made by the business and are not tax-deductible - Key Person disability income policy, premium payments insured or the insured's estate - Claims other than death benefits are to be paid to the_____________, unless otherwise assigned by the insured.