Fred Loya Insurance Exam Questions And Answers (Verified And Updated)

Fred Loya Insurance Exam Questions And Answers (Verified And Updated) risk - answerUncertainty concerning the occurrence of a loss Exposure - answerwhat the insured is exposing to the insurer to premium calculations - answerthe higher the risk is, the greater the premium Speculative Risk - answera risk in which there is a chance of either loss or gain pure risk - answeris insurable. it is when you can only lose, not win. ARRTS - answerAvoid, Reduce, Retain, Transfer, share Deductible - answerAn amount the insured must pay before benefits become payable by the insurance company. hazard - answerrisk, peril; to expose to danger or harm; to gamble peril - answerthe cause of a possible loss loss - answerphysical destruction or reduction in vale of an item Direct loss - answerdamage to the item itself, like wrecking your car indirect loss - answerloss of use of the item , a consequence of the direct loss. ex: if you wrecked your car, you would have to rent one. indemnity - answerwhat insurance does... it puts you back where you were before the loss. indemnify means to pay you back. underwriters - answerthey are the "risk selectors". they choose who to insure based on the qualities of the risk. adverse selection - answerwhat the underwriters want to avoid. they only want the best risks to insure, not ones that would be guaranteed to have a loss Law of Large Numbers - answerused by actuaries to determine statistics and then rates for insurance. it takes money of the many to pay the losses of the few limits on auto policies can be split limits - answerwhen the limits available are split between paying one limit for bodily injury claims and a separate limit for property damage claims.