Alabama Health Insurance Exam| 274 Questions With Correct Answers 100% Verified

Insurance is defined as the transfer of ______________ risk to the insurance company in consideration for a premium. - Correct Answer Pure The chance of loss without any chance of gain is called ___________ - Correct Answer Pure Risk has the possibility for gain or loss and is not insurable. - Correct Answer Speculative Risk is defined as the chance of loss. - Correct Answer Risk A condition that could result in a loss is known as - Correct Answer Exposure is something that increases the chance of loss. - Correct Answer Hazard The presence of a _____________ increases the chance of a loss occurring. - Correct Answer Physical Hazard defined as a cause of loss, such as fire. - Correct Answer Peril To be insurable, losses must be ___________. - Correct Answer Calculable allows insurers to predict claims more accurately. - Correct Answer Law of Large Numbers The law of large numbers applies to ___________. - Correct Answer Groups of people, not individuals The law of large numbers applies to groups of people, not to individuals. The more people in the group ______________. - Correct Answer the more accurate the predictions are Most insurers buy_____________ to protect themselves in the event of a_______________. - Correct Answer reinsurance , catastrophic loss are not required to be uniform from one state to another. - Correct Answer Insurance laws dividends to its shareholders (stockholders), but they may not be guaranteed. - Correct Answer Stock insurer may pay Stock insurers pay the dividends to its shareholders (stockholders), are they guaranteed. - Correct Answer No