Exam (elaborations)
CA LIFE EXAM – PSI- QUESTIONS WITH COMPLETE ANSWERS
- Course
- Institution
CA LIFE EXAM – PSI- QUESTIONS WITH COMPLETE ANSWERS
[Show more]
Content preview
CA LIFE EXAM – PSI- QUESTIONS WITHCOMPLETE ANSWERS
A participating company is also referred to as which type of insurer? - Answer-Mutual
insurer
An insurer owned by its policyholders, is called a - Answer-Mutual insurer
What is a participating life insurance policy? - Answer-Contract that allows the
policyowner to receive a share of surplus in the form of policy dividends
An insurer enter into a contract with a third-party to ensure itself against losses from
insurance policies it issues. What is this agreement called? - Answer-Reinsurance
John owns an insurance company that gives him the right to share and then sure
surplus. What kind of policy is this? - Answer-Participating
Which of the following is not a characteristic of reinsurance? - Answer-Increases the
unearned premium reserved
Which of the following is not a benefit of insurance? - Answer-Losses due to fraud are
eliminated
When a mutual insurer becomes a stock company, the process is called - Answer-
Demutualization
Which of the following is a contract that involves one party which indemnifies another
one a loss arises from an unknown event? - Answer-Insurance policy
Which of the following is an insurer established by a parent company's loss exposure's?
- Answer-Captive insurers
Which of the following is not considered to be a definition for the term "loss"? - Answer-
Probability that an event will occur
Which of the following is not considered a definition of a risk? - Answer-The cause of
loss
Which of the following best describes the statement; " the more times, and event is
repeated, the more predictable the outcome becomes"? - Answer-Law of large numbers
Which of the following would not be accomplished with the purchase of an insurance
policy? - Answer-Risk is eliminated
, Which of the following is a situation where there is a possibility of either a loss or gain? -
Answer-Speculative risk
Which of the following is any situation that presents the possibility of a loss? - Answer-
Loss
An insurer having a large number of similar exposure units is considered important
because: - Answer-the greater the number insured, the more accurately that is her can
predict losses & set appropriate premiums
Which of these statements correctly describes risks? - Answer-Pure risk is the only
insurable risk
Which type of risk is gambling? - Answer-Speculative risk
Moral hazard is described as the: - Answer-increased chance of a loss because of an
insured's dishonest tendencies
All of the following circumstances must be met for los retention to be an effective, risk
management technique, except - Answer-Probability of loss is unknown
All of the following circumstances must be met for lost attention to be an effective risk
management technique, except - Answer-Probability of loss is unknown
After a policy has lapsed, which provision allows the insurer to continue coverage -
Answer-Reinstatement provision
In a life insurance policy, the entire contract consists of - Answer-policy and attached
application
Which policy provision protects the policy owner from unintentional lapse of the
contract? - Answer-Grace period
Which of the following is not a common life insurance policy later? - Answer-Extended
term
What an accidental death benefit is added to a whole life policy, how does this affect the
policies cash value? - Answer-Policies, cash value is not affected
A life insurance policy can be surrendered for its cash value under which policy
provision? - Answer-Nonforfeiture options
Which of the following does a policy owner not have the right to change? - Answer-
Dividend schedule
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller biggdreamer. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $15.49. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
72964 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now