Washington Life & Health Insurance Exam/ 303 Questions with Definitive Solutions/ .
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Course
Washington Life & Health Insurance
Institution
Washington Life & Health Insurance
Washington Life & Health Insurance Exam/ 303 Questions with Definitive Solutions/ . Terms like:
policy owner - Answer: usually, but not always the person covered by the policy
beneficiary - Answer: the person who is paid when a claim
is submitted
agent/producer - Answer: acts as a legal...
Washington Life & Health Insurance Exam/ 303
Questions with Definitive Solutions/ 2024-
2025.
policy owner - Answer: usually, but not always the person covered by the policy
beneficiary - Answer: the person who is paid when a claim
is submitted
agent/producer - Answer: acts as a legal representative
of the insurance company
broker - Answer: representative of the Insured, not the insurance company
risk - Answer: The chance or uncertainty of loss
Pure risk - Answer: the chance of experiencing a loss (without the possibility of gain). Only
downside, no upside.
Page 1 of 41
,Speculative risk - Answer: s the chance of loss one accepts in the hope of realizing a gain
Risk avoidance - Answer: staying away from risky activities altogether
Risk reduction - Answer: reduce the chance of something bad happening
Risk shifting - Answer: Get someone else to accept the risk
Buying insurance - Answer: transfer a portion of your risk to the Insurer
Risk Retention - Answer: the individual or business that opts not to buy insurance retains the
entire risk
Indemnification - Answer: an insurance concept that states that some portions of the insurance
industry prefer that we be made only whole after a loss rather than coming out ahead (Only
getting back what you are owed, not getting more than what you had to start with)
Subrogation - Answer: the transfer to the Insurer of the Insured's rights to recover damages
from a responsible third party
Peril - Answer: the cause of loss
Law of Large numbers - Answer: the mathematical concept that makes it easier to predict losses
if we have a large number of Insureds
,non-participating companies - Answer: Stock companies that exist for the sole purpose of
generating profits
for their stockholders
participating companies - Answer: A company owned by its policy holders where the profits are
distributed among policy holders
Social Security act - Answer: a guarantee that government
would never again allow workers (and their families) to become
destitute
OASDI (Social Security) - Answer: Old Age, Survivors, and Disability Insurance...Federal
Government law
FICA - Answer: Federal Insurance Contributions Act
or FICA, payroll taxes levied on employees, employers, and the self-employed.
Not covered by social security - Answer: payroll taxes levied on employees, employers,
and the self-employed.
FICA Fully Insured - Answer: (Worked for 10 years) payroll taxes levied on employees,
employers,
and the self-employed.
Retirement Benefits;
Disability Income Benefits; and
Survivor Benefits.
Currently Insured - Answer: Worked less than ten years. Only eligeable for Survivor Benefits
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, Average Indexed Monthly
Earnings - Answer: Averages earnings over time period. Either way, the more a worker
has paid into Social Security, the more the worker (or dependents)
will get out of it. (What you get at age 65)
Primary Insurance Amount (PIA). - Answer: Full retirement benefit someone is entitled to at age
65 (some cases, 66-67)
elimination period (Disability) - Answer: the person must be
disabled for 5 months before starting to receive Disability
Benefits
underwriting - Answer: the selection and classification of risks.
actuary - Answer: A person who tracks the lifespan and chance of illness or accident based on
specific factors
Mortality table - Answer: predict the age at which
people in a given group are likely to die (Used by life insurers)
Morbidity table - Answer: predict how often
people in a given group are likely to get sick or have an
accident. (Used by health insurers)
field underwriters - Answer: Insurance agents
declined risks - Answer: Applicants who are too risky are declined
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