LOMA 281 Module 1 Questions with Correct Answers

LOMA 281 Module 1 Questions with Correct Answers Risk - Answer-the possibility of an unexpected result. Premium - Answer-A specified amount of money an insurer charges in exchange for its agreement to pay a policy benefit when a specific loss occurs. Insurance company - Answer-A company that provides protection against the risk of financial loss caused by specific events. Life insurance - Answer-A type of insurance under which the insurer promises to pay a death benefit upon the death of a named person. Annuity - Answer-A financial product by which an insurer, in return for receiving a premium, promises to make periodic payments to a named person or entity. Applicant - Answer-The person or entity that applies for an insurance policy. Policyowner - Answer-The person or entity that owns the issued policy. Insured - Answer-The person whose life or health the policy insures. Beneficiary - Answer-The person named to receive the policy benefit if the insured event occurs. Third party policy - Answer-A policy one person purchases that insures the life of another person. Speculative risks - Answer-A risk that involves three possible outcomes: loss, gain, or no change. Pure risk - Answer-A risk that involves no possibility of gain; either a loss occurs or no loss occurs. Contracts of indemnity - Answer-Health insurance; An insurance policy under which the amount of the policy benefit payable for a covered loss is based on the actual amount of financial loss that results from the loss, as determined at the time of the loss. Valued contract - Answer-Life insurance; An insurance policy that specifies the amount of the policy benefit that will be payable when a covered loss occurs, regardless of the actual amount of the loss the was incurred.