Exam (elaborations)
PA LIFE, ACCIDENT, & HEALTH INSURANCE EXAM QUESTIONS WITH COMPLETE ANSWERS
- Course
- Institution
PA LIFE, ACCIDENT, & HEALTH INSURANCE EXAM QUESTIONS WITH COMPLETE ANSWERS
[Show more]
Content preview
PA LIFE, ACCIDENT, & HEALTHINSURANCE EXAM QUESTIONS WITH
COMPLETE ANSWERS
Insurance - Answer-defined as the transfer of PURE risk to the insurance company in
consideration for a premium.
The chance of loss without any chance of gain is called - Answer-pure risk
Speculative risk - Answer-has the possibility for gain or loss and is not insurable.
Risk is defined as the - Answer-chance of loss.
A condition that could result in a loss is known as an - Answer-exposure
A hazard is something that increases - Answer-the chance of loss.
The presence of a physical hazard - Answer-increases the chance of a loss occurring.
A peril is - Answer-defined as a cause of loss, such as fire.
To be insurable, - Answer-losses must be calculable.
The law of large numbers - Answer-allows insurers to predict claims more accurately.
The law of large numbers applies to - Answer-groups of people, not to individuals.
The more people in the group, - Answer-the more accurate the predictions are.
Most insurers buy reinsurance - Answer-to protect themselves in the event of a
catastrophic loss.
Insurance laws are not required - Answer-to be uniform from one state to another.
A stock insurer - Answer-may pay dividends to its shareholders (stockholders), but they
may not be guaranteed.
A reciprocal insurance company is managed by an - Answer-attorney-in-fact.
An unincorporated association of individuals who insure each other is known as -
Answer-a reciprocal insurer.
, The government offers insurance primarily based upon - Answer-social needs, such as
flood insurance and workers compensation, but does not offer insurance for the purpose
of preventing fraud.
A foreign company - Answer-has their home office in another state.
An insurer incorporated outside of the U.S. who sells in the U.S. is - Answer-an alien
company.
A producer may be personally liable when - Answer-violating the producer's contract.
Producers represent - Answer-the insurance company, not the insured.
Independent producers - Answer-own their own accounts and are not insurance
company employees.
Producers have - Answer-express, implied and apparent authority.
The authority a producer - Answer-has that is written in his or her contract is known as
express authority.
A producer's binding authority (if any) - Answer-is expressed (written down) in the
producer's contract with the insurer the producer represents.
The authority not expressly (written) granted, - Answer-but is actual authority the
producer has to transact normal business activities, is known as implied authority.
The elements of a legal contract may be remembered - Answer-by the acronym C-O-A-
L (consideration, offer, acceptance, legal purpose and legal capacity).
A requirement for a valid contract - Answer-is offer and acceptance, or mutual
agreement.
Advertising the availability of insurance is not - Answer-considered to be an offer.
A specific and definite proposal to enter into a contract is known as - Answer-an offer.
The consideration on a policy need - Answer-not be equal.
A policy may not be voided - Answer-due to unequal consideration.
Under the consideration clause, - Answer-something of value must be exchanged.
Because insurance contracts are contracts of adhesion, - Answer-policy ambiguities
always favor the insured.
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller biggdreamer. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $15.49. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
83100 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now