RMIN 4000 EXAM PACKAGE DEAL WITH 100% CORRECT ANSWERS

mo physical hazard - a physical condition that increases the frequency or severity of loss ral hazard - the presence of insurance changes the behavior of the insured (sometimes involves dishonesty, but not always) risk management - a process that identifies loss exposures faced by an organization...

requirements of res ipsa loquitur - does not normally occur in absence of negligence, defendant has exclusive control over the instrumentality causing the accident, and injured party has not contributed to the accident assumption of risk - A person who understands and recognizes the danger inhere...

distribution- independent agency - usually represents several unrelated insurers agents are paid a commission which varies by the line of insurance the agency owns the expirations or renewal rights to the business agents may be authorized to adjust small claims and may provide loss control servic...

Defense Costs - •Defense costs can be huge. Good thing the Liability Section covers loss IN ADDITION to the policy limits. •This means that the costs of defense will not erode the coverage limits available for payment of claims. •But, the duty to defend ENDS when limits have been exhausted ...

How much life insurance is needed? - depends on family size, income levels, existing financial assets, and financial goals Costs of Premature Death - - future earnings are lost forever. - additional expenses incurred: funeral expenses, uninsured medical bills, higher childcare costs, estate sett...

Assessment Mutual Insurer - Has the right to assess policyowners an additional amount if the insurer's financial operations are unfavorable Retention - Firms retain part or all of the losses that can result from a given loss; Ex: Expense, set aside liquid, credit line Risk - Uncertainty about c...

Prospective Loss Costs (Pure Premium) - Amount needed to pay future claims and loss adjustment expenses. Class (Manual) Rating: Frequency*Severity Lloyd's of London - Specialized lines of business. Brokers - represent policyholders to arrange coverage with syndicates. Legally represents insure...

Pure Risk - A chance of loss or no loss, but no chance of gain. Insurance can be bought for this Exposures - things of value (assets) that could be lost Property Risk - a risk that can lead to destruction or theft and loss of personal or business property including money, vehicles, and buildings;...

hedging price risks - hedging is a technique for transferring the risk of unfavorable price fluctuations to a speculator by purchasing and selling futures contracts on an organized exchange, such as the chicago board of trade subjective probability - the individual's personal estimate of the cha...