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16 Cards in this Set
- Front
- Back
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A person who does not lock the doors or does not repair leaks shows an indifferent attitude. This person presents what type of hazard? |
Morale |
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Which of the following is NOT a characteristic of an insurable risk? |
The loss must be catastrophic. |
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Which of the following is an example of a producer's fiduciary duty? |
The trust that a client places in the producer in regard to handling premiums. |
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An agent tries to sell insurance over the phone to an applicant who appears to be confused, but is eventually able to give enough information for the application to be completed. After the policy was issued, the agent talked to the insured's family, and they explained that the insured was recovering from a surgery and might have been under the influence of medication at the time of application. Which of the following is true? |
The policy may be voided if it can be proven that the applicant was not capable of making a buying decision at the time of application. |
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In insurance transactions, fiduciary responsibility means |
Handling insurer funds in a trust capacity. |
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Which of the following is NOT a goal of risk retention? |
To minimize the insured's level of liability in the event of loss |
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When would a misrepresentation on the insurance application be considered fraud?
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If it is intentional and material |
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Which of the following is an example of apparent authority of an agent appointed by an insurer?
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The agent accepts a premium payment after the end of the grace period. |
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Which of the following is an example of apparent authority of an agent appointed by an insurer? |
The agent accepts a premium payment after the end of the grace period. |
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If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered to be |
Authorized. |
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In order for an insurer to legally transact insurance, it must obtain which of the following? |
Certificate of Authority |
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Which statement regarding insurable risks is NOT correct? |
Insureds cannot be randomly selected. |
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Which of the following is a statement that is guaranteed to be true, and if untrue, may breach an insurance contract? |
Warranty |
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An insurance policy specifies that it will pay $600 for a specific loss. The policyowner suffers a loss of $535. How much will the policy pay?
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$535 |
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When an individual purchases insurance, what risk management technique is he or she practicing? |
Transfer |
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Which of the following best describes an insurance company that has been formed under the laws of this state? |
Domestic |
