CAIB 1 CHAPTER 1 WITH CORRECT
ANSWERS
RISK - CORRECT ANSWER-Chance of financial loss to which
an object of insurance is exposed
SPECULATIVE RISK - CORRECT ANSWER-the chance of
financial loss or gain
PURE RISK - CORRECT ANSWER-the chance of financia...
RISK - CORRECT ANSWER-Chance of financial loss to which
an object of insurance is exposed
SPECULATIVE RISK - CORRECT ANSWER-the chance of
financial loss or gain
PURE RISK - CORRECT ANSWER-the chance of financial
loss but no chance of financial gain
INSURANCE - CORRECT ANSWER-the undertaking by one
person to indemnify another person against loss or liability for
loss in respect of a certain risk or peril to which the object of the
insurance may be exposed...or to pay a sum of money or other
thing of value upon the happening of a certain event
CONTRACT - CORRECT ANSWER-an agreement between
two or more persons which creates an obligation to do or not to
do a particular thing
CONSIDERATION - CORRECT ANSWER-an exchange or
something of value between parties
, INSURABLE INTEREST - CORRECT ANSWER-onr has an
insurable interest in the subject matter of the insurance when
they will suffer financially by a loss
UTMOST GOOD FAITH - CORRECT ANSWER-the law
requires insurance contracts maintain a higher standard of
honesty than is needed of other contracts. The duty applies to
the insured, the insurer and the broker
INDEMNITY - CORRECT ANSWER-application of the principle
of indemnity ensures people receive the actual amount of their
loss no more and no less
INSURANCE BINDER - CORRECT ANSWER-a temporary
agreement in which the insurer agrees to provide certain
coverages pending the issuance of the policy
AGENCY AGREEMENT - CORRECT ANSWER-a written
agreeement or contract between the insurer and the brokerage
which acknowledges their relationship
VOID CONTRACT - CORRECT ANSWER-one which is unable
in law to support the purpose for which it was intended. Such
contracts are deemed never to have existed
VOIDABLE CONTRACT - CORRECT ANSWER-a contract that
may be voided at the option of the wronged party only and not
the wrongdoer
PERIL - CORRECT ANSWER-the cause of loss
DIRECT LOSS - CORRECT ANSWER-occurs when the peril
insured actualy attacks the object of insurance
INDIRECT LOSS - CORRECT ANSWER-losses which arise as
a consequence of a direct loss
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