General Insurance Concepts - Pa Property & Casualty

Front 1

What is a statement that is guaranteed to be true, and if not true may breach a contract?

Back 1

a warranty

Front 2

To enter into a contract both parties must be ____ ________ ______ and ___________ _____________.

Back 2

of legal age/ mentally competent

Front 3

Insurers who meet the state's financial requirements and are approved to transact business in the state are considered?

Back 3

Authorized

Front 4

If an insured could reasonably expect coverage under their policy (even if specifically excluded) the court may hold the insurer responsible; citing ______________ ________________.

Back 4

reasonable expectations

Front 5

A person who acts with indifference toward protecting things because they are insured is said to be what kind of hazard?

Back 5

a morale hazard

Front 6

If you are a part of this kind of insurance company you may receive a dividend check if all funds are not paid out to cover claims.

Back 6

mutual insurer

Front 7

What four things are needed in order for an insurance contract to be legally binding?

Back 7

-agreement

-consideration

-competent parties

-legal purpose

Front 8

What is a statement made by the applicant that is considered to be true to the best of the applicant's knowledge?

Back 8

a representation

Front 9

What is the priority of a highly ethical agent?

Back 9

the needs of the client

Front 10

What is concealment?

Back 10

An intentional act of the insured to leave out a material fact from their application.

Front 11

What must an insurer obtain in order to legally transact insurance?

Back 11

A Certificate of Authority

Front 12

What is an insurer called if they were formed outside the USA but transacting business in Pa?

Back 12

an Alien insurer

Front 13

An agent who promptly forwards premiums to the insurer is showing an example of what type of responsibility?

Back 13

fiduciary responsibility

Front 14

If an insurer from New York is doing business in Pa they are called a __________ insurer.

Back 14

foreign

Front 15

What is the most common/ effective way to transfer risk?

Back 15

purchasing insurance

Front 16

The person/property subject to insurance and the uncertainty of loss are examples of _________.

Back 16

risk

Front 17

What is a hazard?

Back 17

A specified condition or situation that increases the probability of loss or the severity of loss.

Front 18

Which method of handling risk involves accepting/ assuming risk and intending to pay it out of pocket?

Back 18

retention

Front 19

What is the transfer of risk from one party to another, who for a fee agrees to compensate for certain losses?

Back 19

insurance

Front 20

What is an insurance company that is owned by its policyholders?

Back 20

a mutual insurance company

Front 21

What is implied authority?

Back 21

Authority given by the insurance company to the agent that is not specific of communicated but necessary for the agent to conduct business.

Front 22

A stock insurance company is owned by?

Back 22

Stockholders