RMIN 4000 UGA Test 3 Questions and Answers | Latest Update | 2024/2025 | 100% Pass
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Module
RMIN 4000 UGA
Institution
RMIN 4000 UGA
RMIN 4000 UGA Test 3 Questions and
Answers | Latest Update | 2024/2025 |
100% Pass
What is the primary purpose of insurance?
The primary purpose of insurance is to transfer risk from the insured to the insurer in
exchange for a premium.
What is a deductible in an insurance policy?
A ...
RMIN 4000 UGA Test 3 Questions and
Answers | Latest Update | 2024/2025 |
100% Pass
What is the primary purpose of insurance?
✔✔ The primary purpose of insurance is to transfer risk from the insured to the insurer in
exchange for a premium.
What is a deductible in an insurance policy?
✔✔ A deductible is the amount the insured must pay out of pocket before the insurance company
covers the remaining costs.
What is "underwriting"?
✔✔ Underwriting is the process by which an insurance company assesses risk and determines
whether to accept or reject an application for coverage.
What is a "premium" in the context of insurance?
✔✔ A premium is the payment made by the policyholder to the insurance company for coverage.
1
,What is the difference between "term life insurance" and "whole life insurance"?
✔✔ Term life insurance provides coverage for a specific period, while whole life insurance
offers coverage for the policyholder's entire life and includes a savings component.
What is "risk pooling" in insurance?
✔✔ Risk pooling involves spreading individual risks among a large group of people to reduce
the financial impact of losses on any one individual.
What is "moral hazard" in insurance?
✔✔ Moral hazard refers to the tendency of individuals to take greater risks when they are
protected from the consequences, often due to having insurance.
What is a "claim" in an insurance context?
✔✔ A claim is a formal request made by the insured to the insurance company for payment of
covered losses.
What is "reinsurance"?
✔✔ Reinsurance is insurance purchased by an insurance company from another insurer to limit
the risk of large claims.
2
,What is the purpose of an "actuary" in the insurance industry?
✔✔ An actuary is a professional who analyzes financial risks using mathematics and statistics to
help design and price insurance policies.
What is "coinsurance"?
✔✔ Coinsurance is a provision in an insurance policy where the insured shares a portion of the
costs after the deductible has been paid.
What is an "exclusion" in an insurance policy?
✔✔ An exclusion is a provision in an insurance policy that eliminates coverage for certain risks
or events.
What is "liability insurance"?
✔✔ Liability insurance provides coverage for damages or injuries the insured may cause to
others.
What is the role of a "beneficiary" in a life insurance policy?
3
, ✔✔ A beneficiary is the person or entity designated to receive the death benefit from a life
insurance policy when the insured passes away.
What is "indemnity" in insurance?
✔✔ Indemnity is the principle that insurance should restore the insured to the financial position
they were in before the loss occurred, without allowing them to profit from the loss.
What is "adverse selection" in insurance?
✔✔ Adverse selection occurs when individuals with higher-than-average risks are more likely to
purchase insurance, leading to potential losses for the insurer.
What is "personal injury protection" (PIP) in auto insurance?
✔✔ Personal injury protection (PIP) is a type of auto insurance coverage that pays for medical
expenses and lost wages for the insured and passengers, regardless of fault in an accident.
What is "whole life insurance"?
✔✔ Whole life insurance provides coverage for the policyholder's entire life and includes a
savings component that accumulates cash value over time.
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