Aflac Study Pre Cert. Practice Exam QUESTIONS WITH ANSWERS

Aflac Study Pre Cert. Practice |\ |\ |\ |\ |\




Exam QUESTIONS WITH |\ |\ |\




ANSWERS

ABC Company is attempting to minimize the severity of potential
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losses within its company. The company is engaged in risk
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A. transfer
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B. retention
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C. reduction
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D. avoidance - CORRECT ANSWERS ✔✔C. reduction
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"The potential for loss" is also known as a
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A. hazard
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B. risk
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C. transference
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D. peril - CORRECT ANSWERS ✔✔B. risk
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An insurance applicant MUST be informed of an investigation
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regarding his/her reputation and character according to the
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A. State Guaranty Association
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,B. Fair Labor Standards Board
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C. Fair Credit Reporting Act
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D. National Association of Insurance Commissioners - CORRECT
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ANSWERS ✔✔C. Fair Credit Reporting Act
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Which one of these is NOT considered to be an element of an
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insurable risk? |\




A. Speculative risk
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B. Pure risk
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C. Loss cannot be catastrophic
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D. Loss must be due to chance - CORRECT ANSWERS ✔✔A.
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Speculative risk |\




Who would be the most likely party for legally entering into a
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contract?


A. Mentally ill person
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B. Minor
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C. Person under the influence of alcohol
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D. Small employer - CORRECT ANSWERS ✔✔D. Small employer
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The powers directly given to an agent in an agency contract are
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called


A. express
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,B. apparent
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C. implied
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D. assumed - CORRECT ANSWERS ✔✔A. express
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An insurance company's voluntary refusal to enforce a contract's
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provision is called a(n) |\ |\ |\




A. waiver
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B. warranty
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C. assignment
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D. concealment - CORRECT ANSWERS ✔✔A. waiver
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What happens when an initial offer is answered with a
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counteroffer?


A. An arbitrator decides on a compromise
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B. The counteroffer is legally enforceable
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C. Initial offer is void
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D. Initial offer is automatically accepted - CORRECT ANSWERS
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✔✔C. Initial offer is void
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An insurance contract may be voided if a misrepresentation
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found on the application is determined to be
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A. conditional
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, B. aleatory
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C. material
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D. intentional - CORRECT ANSWERS ✔✔C. material
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Which of the following is NOT a function of accidental and health
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insurance?


A. Pays a death benefit as a result of an illness
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B. Covers the loss of income from a disability
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C. Covers the cost of medical care as a result of an accident
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D. Pays for hospice care in the event of a terminal illness -
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CORRECT ANSWERS ✔✔A. Pays a death benefit as a result of an
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illness


A disabled business owner who has payroll and business
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expenses paid for has what kind of insurance policy?
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A. Key person
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B. Franchise disability
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C. Business overhead expense
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D. Disability income - CORRECT ANSWERS ✔✔C. Business
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overhead expense |\




Which of the following statements BEST describes disability buy-
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sell insurance policies?
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