Arizona Life Insurance Exam - General Insurance Questions Fully Answered.
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Course
Arizona Life and Health Insurance
Institution
Arizona Life And Health Insurance
Agent/Producer - Answer Legal representative of an insurance company (classification of producer usually includes agents and brokers, agents are the agents of the insurer)
Applicant (proposed insured) - Answer Person applying for insurance
Broker - Answer Insurance producer not appointe...
Arizona Life Insurance Exam - General
Insurance Questions Fully Answered.
Agent/Producer - Answer Legal representative of an insurance company (classification of producer
usually includes agents and brokers, agents are the agents of the insurer)
Applicant (proposed insured) - Answer Person applying for insurance
Broker - Answer Insurance producer not appointed by an insurer and is deemed to represent the client
Insurance Policy - Answer Contract between a policyowner (and/or insured) and an insurance company
which agrees to pay the insured or the beneficiary for loss caused by specific events
Insured - Answer Person covered by the insurance policy (this person may or may not the policy owner)
Insurer (principal) - Answer Company who issues an insurance policy
Policyowner - Answer Person entitled to exercise the rights and privileges in the policy
Premium - Answer Money paid to the insurance company for the insurance policy
Reciprocity/Reciprocal - Answer Mutual interchange of rights and privileges
Insurance - Answer Transfers the risk of loss from an individual or business entity to an insurance
company, which in turn spreads the costs of unexpected losses to many individuals
Risk - Answer Uncertainty or chance of loss occuring
Pure Risk - Answer Situations that can only result in a loss or no change (no opportunity for financial
gain) (insurable)
, Speculative Risk - Answer Situations with opportunity for either loss or gain (noninsurable)
Exposure - Answer Unit of measure used to determine rates charged for insurance coverage
Factors of Exposure - Answer 1. Age of Insured
2. Medical History
3. Occupation
4. Sex
Homogenous - Answer A large number of units having the same or similar exposure to loss
Hazard - Answer Condition or situation that increases the probability of an insured loss occuring
Physical Hazard - Answer Individual characteristics that increase the chances of the cause of loss
Moral Hazard - Answer Tendencies toward increased risk (applicants who lie on an application for
insurance or have committed fraud)
Morale Hazard - Answer Hazards that arise from a state of mind that causes indifference to loss, such as
carelessness
Peril - Answer Cause of loss insured against in an insurance policy
Loss - Answer The reduction, decrease, or disappearance of value of the person or property insured in a
policy, caused by a named peril
Life Insurance - Answer Insures against the financial loss caused by the premature death of the insured
Avoidance - Answer Eliminating exposure to a loss
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