Insurance License

Front 1

Who owns stock companies

Back 1

Stockholders

Front 2

An applicant conceals relevant health information on the application. The applicant presents what type of hazard?

Back 2

Moral

Front 3

Conditions that increase the chance of a loss are known as what?

Back 3

Hazards

Front 4

What is the term for the causes of loss insured against in an insurance policy.?

Back 4

Peril

Front 5

What are the strategies used by underwriters to prevent adverse selection?

Back 5

Restriction of coverage, refusal to accept risk, and accepting a risk at a higher rate.

Front 6

Insurers are classified according to their domicile. What are the three types of insurers?

Back 6

Domestic, foreign, and alien

Front 7

The reduction, decrease, or disappearance of value of the person or property insured in a policy is known as what?

Back 7

Loss

Front 8

What are the 5 characteristics of an ideally insurable risk?

Back 8

1. Due to chance

2. Definite and measurable

3. Statistically predictable

4. Not catastrophic

5. Coverage cannot be mandatory

Front 9

An insurance policy paid a non-taxable dividend to the insured one year, and nothing the next. From what type of insurer did the insured purchase the policy?

Back 9

Mutual

Front 10

For the purpose of insurance, what is risk?

Back 10

Uncertainty of loss

Front 11

If an insurer meets the states financial requirements and is approved to transact business in the state, it is considered what type of insurer?

Back 11

Authorized or admitted

Front 12

In the agent/insurer relationship, who is considered the principal?

Back 12

Insurer..(company)

Front 13

I'm forming an insurance contract, when does an acceptance usually occur?

Back 13

When the insurer approves a prepaid application

Front 14

A person who doesn't lock the doors to his or her house shows an indifferent attitude. This person presents what type of hazard?

Back 14

Morale

Front 15

When risks with higher probability of loss are seeking insurance more often than other risks, this is known as what?

Back 15

Adverse selection

Front 16

When does an insurance policy go into effect?

Back 16

When the policy is delivered and the premium is paid

Front 17

Wagering on a sporting event is known as what type of risk?

Back 17

Speculative

Front 18

A situation in which a person can only experience a loss and no gain presents what type of risk?

Back 18

Pure risk

Front 19

When a change needs to be made on the application for insurance, which is the best method for correcting the information?

Back 19

Complete a new application or ask the applicant to initial the correction on the original application

Front 20

Whom does an insurance agent represent?

Back 20

Insurance Company

Front 21

When would a misrepresentation on an insurance application be considered fraud?

Back 21

When it is intentional and material

Front 22

The insurer organized to return a profit to the stockholders is what type of insurer

Back 22

Stock Company

Front 23

The requirement that agents must account for and promptly remit all insurance funds collected is known as what type of agent responsibility?

Back 23

Fiduciary

Front 24

When agents act within the scope of their contract, their actions will be assumed to be the acts of whom?

Back 24

Insurer

Front 25

The type of insurance company organized to return any surplus money to its policyholders is known as what?

Back 25

Mutual company

Front 26

What are the three types of agent authority?

Back 26

1. Express

2. Implied

3. Apparent

Front 27

If an agent fails to obtain the applicants signature on the insurance application, what must the insurer do?

Back 27

Send the application back to the applicant for signature

Front 28

An insurance company is domiciled in California and transactions insurance in Nevada. What is this insurer's classification in Nevada?

Back 28

Foreign

Front 29

What do individuals use to transfer their risk of loss to a larger group?

Back 29

Insurance

Front 30

What entities make up the Medical information Bureau?

Back 30

Insurers

Front 31

What document is requires for an insurance company to transact insurance?

Back 31

Certificate of Authority

Front 32

In insurance, when is the offer usually made on a contract?

Back 32

When the insurance application is submitted

Front 33

According to the Law of Agency, a principal is represented by whom?

Back 33

Agent or Producer

Front 34

What are the three types of hazards?

Back 34

Physical, moral, morale

Front 35

What is the warranty on an insurance contract?

Back 35

An absolute true statement upon which the validity of the insurance contract is based

Front 36

Insurance is a contract that protects the insured from what?

Back 36

Loss

Front 37

What are the 4 elements of an insurance contract?

Back 37

1. Agreement ( offer and acceptance)

2. Consideration

3. Competent parties

4. Legal purpose

Front 38

What is the best way to handle incomplete insurance application?

Back 38

Return the application to the applicant for completion

Front 39

What two elements are necessary for a life insurance contract to have a legal purpose?

Back 39

Insurable interest and consent

Front 40

What type of risk is insurable?

Back 40

Pure

Front 41

An insurance company that is formed under the laws of another state is known as what type of insurer?

Back 41

Foreign