Exam (elaborations)
PRIMERICA LIFE INSURANCE EXAM WITH 100% CORRECT ANSWERS 2023/2024 WITH RATIONALES GUARANTEED PASS
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PRIMERICA LIFE INSURANCE EXAM WITH 100% CORRECT ANSWERS 2023/2024 WITH RATIONALES GUARANTEED PASS
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PRIMERICA LIFE INSURANCE EXAM WITH 100% CORRECT ANSWERS 2023 /2024 WITH RATIONALES GUARANTEED PASS Which of the following best describes an insurance company that has been fo rmed under the laws of this state? A. Domestic b. Sovereign c. Alien d. Foreign A. Domestic a company is domestic when doing business within the state in which it is incorporated Whic h of the following factors is NOT considered by an underwriter when det ermining the premium rates for an individual seeking insurance? A. Medical history b. Sex c. Age d. Race D. Race age, medical history, and sex provide sound statistical date for determining the probability of loss. Race, religion, sexual orientation, etc . Are the factors that cannot be used because there is not sound statistical data to show that they effect the probability of loss; therefore, they are considered to be discriminatory In insurance transactions, fiduciary responsibility means a. Handling insurer funds in a trust capacity b. Maintaining good credit record c. Being liable with respect to payment of claims d. Commingling premiums with agents personal funds A. Handling insurer funds in a trust capacity an agents fiduciary responsibility includ es handling insurer funds in a trust capacity The authority granted to an agent through the agent's contract is referred to as a. Absolute authority b. Express authority c. Apparent authority d. Implied authority B. Express authority express powers are w ritten into the contract between the insurer and the agent Insurance policies are not drawn up though negotiations, and an insured has little to say about its provisions. What contract characteristic does this describe? A. Unilateral b. Conditional c. Personal d. Adhesion D. Adhesion a contract of adhesion is prepared by only the insurer; the insured's only option is to accept or reject the policy as its written Which of the following insurers are owned by stockholders who have the usual rights of ownership, including the right of voting? A. Reciprocal b. Fraternal c. Stock d. Mutual C. Stock only stock insurance companies are owned and controlled by stockholder s Which of the following best describes the concept that the insured pays a small amount of premium for a large amount of risk on the part of the insurance company? A. Subrogation b. Warranty c. Aleato ry d. Adhesion C. Aleatory an insurance contract is an aleatory contract in that it requires a relatively small amount of premium for a large risk An in sured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the polic y? A. Mutual b. Reciprocal c. Nonprofit service organization d. Stock A. Mutual funds not paid out after paying claims and other operating costs are returned to the policy owners in the form of a dividend. If all funds are paid out, no dividends are paid Following a career change, an insured is no longer required to perform many physical activities, so he has implemented a program where he walks and jogs for 45 minutes each morning. The insured has also eliminated most fatty foods from his diet. Which met hod of dealing with risk does this scenario describe? A. Retention b. Reduction c. Transfer d. Avoidance B. Reduction the insured's change in lifestyle and habits would likely reduce the chances of health problems In insurance, an offer is usually made w hen a. An applicant submits an application to the insurer b. The insurer approves the application and receives the initial premium c. The agent hands the policy to the policyholder d. An agent explains a policy to a potential applicant A. An applicant sub mits an application to the insurer in insurance, the offer is usually made by the applicant in the form of an application. Acceptance takes place when an insurer's underwriter approves the application and issues a policy The causes of loss insured against in an insurance policy are known as a. Perils b. Losses c. Risks d. Hazards A. Perils perils are the causes of loss insured against in an insurance policy What documentation grants express authority to an agent? A. Agents contract with the principal b. Agents insurance license c. Fiduciary contract d. State provisions A. Agents contract with the principal the principal grants authority to an agent through the agent's contract When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the fo llowing? A. Legal purpose b. Contract of adhesion c. Acceptance d. Consideration D. Consideration consideration is something of value that each party gives to the other. The consideration on the part of the insured is the payment of premium and the repre sentations made in the application Which of the following would qualify as a competent party in an insurance contract? A. The applicant is intoxicated at the time of application b. The applicant is 12 year old student c. The applicant is under the influen ce of a mind -impairing medication at the time of application d. The applicant has a prior felony conviction D. The applicant has a prior felony conviction when an insurer and insured enter into a contract, both parties must be legal of age and mentally competent. It is legal for a person convicted of a felony to buy an insurance contract. An intoxicated person, however, may not be mentally competent, a 12 year old student is considered to be underage in most states and a person under mind -impairing medicat ion most likely would not be mentally competentThe benefits of buying summaries with Stuvia:
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