Not all losses are insurable, and there are
certain requirements that must be met before a risk is a proper subject for
insurance. These requirements include all of the following except
a. The loss produced by the risk must be definite.
b. The loss may be intentional. (correct)
c. The loss must not be catastrophic
d. There must be a sufficient number of homogeneous exposure units to make losses
An individual applies for a life policy. Two
years ago he suffered a head injury from an accident, so he cannot remember
parts of his past, but is otherwise competent. He has also been hospitalized for drug abuse, but doesn't remember this when applying for insurance. The insurer issues the policy and learns of his history 1 year later. What will probably happen?
The policy will not be affected
Which of the following is the basis for a claim against an insurance policy?
Loss
All of the following actions by a person could be described as a risk avoidance Except
a. taking a flu shot each year
b. Investing in the stock market
c. Refusing to scuba dive
d. Never flying in an airplance
investing in the stock market
The risk management technique that is used to prevent a specific loss by not exposing yourself to that activity is called?
Avoidance
Courts will interpret any ambiguity in an insurance contract
in favor of the insured
concerning insurance, the definition of a fiduciary responsibility is
Handling insurer funds in a trust capacity
under what conditions would a contract between an insurer and prospective insured be legal?
B. applicant has been convicted of felony.
When agents are acting within the scope of their contract their actions will be the acts of the
Insurer
Following a career change, an insured is no longer required to perform many physical activities, so he has implement a program where he walks and jogs for 45 minutes each morning. The insured has also eliminated most fatty foods from his diet. which method of dealing with risk does this scenario describe?
Reduction
which of the following must an insurer obtain in order to transact insurance within a given state.
Certificate of Authority
an insurance company is domiciled in Montana and transacts insurance in Wyoming. which term best describes the insure's classification in Wyoming.
Foreign
An agent accepts the premium payment 35 days after it is due, telling the insured that there will not be a problem keeping the policy in force. This is an example of what type of agent authority?
Apparent
An insurer neglects to pay a legitimate claim that is covered under the terms of the policy. which of the following terms best describes what the insurer has violated?
Consideration
Which of the following best describes the aleatory nature of an insurance contract?
Exchange of unequal values
according to the Law of Agency, a principal is represented by
an Agent.
What documentation grants express authority to an agent?
Agent's contract with the principal
which authority is NOT stated in an agent's contract but is required for the agent to conduct business?
Implied
which of the following insurance providers would be considered a risk sharing arrangement?
reciprocal
what is the term for the entity that an agent represents regarding contractual agreements with third parties?
