Louisiana Life, Health, and Accident Insurance Licensing Exam questions and 100% correct answers

Insurance - correct answer the transfer of Pure risk to the insurance company in consideration for a premium must be pure risk and calculable. Pure Risk - correct answer the chance of loss without any chance of gain; insurable Speculative Risk - correct answer possibility for gain or loss; not insurable Risk - correct answer Chance of loss Exposure - correct answer a condition that could result in loss hazard - correct answer something that increases the chance of loss eg. presence of physical hazard increases the chance of a loss occuring peril - correct answer cause of loss eg. fire law of large number - correct answer allows insurers to predict claims more accuratley; applies to grops of people not individuals. The more people in the group, the more accurate the predictions are Reinsurance - correct answer A form of insurance whereby one insurance company (the reinsurer) in consideration of a premium paid to it, agrees to indemnify another insurance company (the ceding company) for part or all of its liabilities from insurance policies it has issued.