Florida ACA Claims Licensing Exam (A+ GRADED)

Insurance correct answers transfer of risk by contract to insurers who agree to indemnify insureds for losses Risk correct answers chance of loss pure risk correct answers only outcomes are loss or no loss personal risk correct answers premature death, insufficient income, poor health, unemployment property risk correct answers loss of real property or personal property (on the land not the land itself) Liability risk correct answers something that results in loss to another (3rd party buyout) Controlling risk correct answers risk management; minimal loss speculative risk correct answers either profit or loss is possible (NOT insurable) indemnify correct answers compensate for loss, damage, or injury; reimburse; repay Law of Large Numbers correct answers must have a large pool of insureds to be able to predict losses so that the outcomes will reflect the probability of the results Direct loss correct answers Results from the damage, destruction, or theft of property by a covered peril indirect loss correct answers a financial loss that results from the occurrence of a direct physical damage or theft loss When can there be a pay out on liability risk correct answers negligence is proven negligence correct answers failure to use due care; otherwise known as the prudent person rule Strict or Absolute Liability correct answers Liability assigned by statute without regard for negligence (set by the state or industry, no allowable defense) Indemnity Principle correct answers one should be in approximately the same position after a loss as he was before the loss Insurer correct answers A person or company that underwrites an insurance risk; the party in an insurance contract undertaking to pay compensation. Insured correct answers one who is named or covered by insurance