Chapter 1

A person who deos not lock there doors to his or house . this person presents what type of hazard?

Morale

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

When it is intentional and material

insurance is used to transfer what to the insurance company?

Financial responsibiltys of loss

What type of insurer is a voluntarilt formed organization that provides insurance benefits for members of an affiliated lodege or religous organization?

fraternal insurer

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

perl

what are the three types of agent authority?

express, implied, and apparent

Ifa n insurer needs to obtain information about the applicant from investigators, what is theinsurer required to do?

provide the applicant a disclosure athorization notice

what are the most common penalites fro violations of insurance statutes?

A cease and desist order, a fine, and license suspension or revocation.

what document is required for an insruacne company to transact insurance?

Certificate of authority

conditiosn that increase the chance of a loss are known as waht?

Hazards

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

insurer

when risks with higher probabolity of loss are seeking insurance mroe often than other risks, this is knows as what?

adverse selection.

what two elemtsn are necessary for a life insurance contact to have a legal purpose?

insurable interest and consent.

what si the best way to handel incomlete insurance applications?

return the application to the applicatn for completion.

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

send the applicaiton back to the applicant for signature.

in order to transact insurance within a given state, an alien insured must first obtain what?

certificate of authority.

what type of report provides information about the applicants hobbies habits and financial status ?

inspection report

An insurance policy paid a nontaxable dividend to the insured on year and nothing the next. From what type of insurer did the insured purchase the policy?

mutual.

What law is the foundation of the statistical prediction of loss upon which rates for insurance are calculated?

law of large numbers

what is the name of process that insurance companies use to determine whether or not a napplicant is insurable?

underwriting.

for the purpsoe of insurance, what is risk?

uncertainty of loss

in forming an insurance contract, when does an acceptance usually occur?

the insurer approves a prepaid application.

what are the three types of hazards?

physical, moral, and morale.

what are the strategies used by underwriteres to prevent adverse selection?

restriction of converage, refusal to accept a risk, and accepting a risk at a higher rate.

acccording to the law of agenct a principal is represented by whom?

agent of producer.

what type of risk is insurable?

pure

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

insurance.

what law protect consumers from the cirulation of inaccurate or obsolete information?

the fair credit reporting act

what are the four elements of an insurance contract?

agreement, consideration, competent parties, and legal purpose.

if an applicant does not receive his or her insurance policy, who would be held responsible?

the agent

insuance is a contact that protect the insured from what

loss

a state issued document empowering an insruance company to become an admitted insurer is called what

certiciate of authoruty

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

insurer

whom does an insurance agent represent

insurance company

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

complete a new application or ask the applicant to inital the correction on the original application.

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

when the insurance application is submitted.

the insured organized to return profit to the sotckholders is hwat type of insurer?

stock company

an insurance company that is formed undert the laws of another state is knwon as what type of insured?

foreign

an insruance company is domiciled in california and transacts insurancein nevada. What is this insures classificaitons nevada?

foreign

what type of insured is formed under the laws of another country?

alien.

what entities make up medical information bureau?

insurers.

wagering on a sporting event is known as what tpye of risk?

speculative.

an applicant conceals relevant health information on the application. The aplpicant presents what tpe of hazard?

moral.

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

loss.

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

pure risk.

whose responibility is it to determine that all the questions on an insuacne application are answered?

the agents.

when does an insurance policy go into effect?

when the policy is delivered and the premium is paid

insurers are classidied according to their domicile. What rare the three types of insurers?

domestic, foreign, and alien.

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

mutual company.

who owns stock companies?

stockholders.

A person who deos not lock there doors to his or house . this person presents what type of hazard?

Morale

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

When it is intentional and material

insurance is used to transfer what to the insurance company?

Financial responsibiltys of loss

What type of insurer is a voluntarilt formed organization that provides insurance benefits for members of an affiliated lodege or religous organization?

fraternal insurer

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

perl

what are the three types of agent authority?

express, implied, and apparent

Ifa n insurer needs to obtain information about the applicant from investigators, what is theinsurer required to do?

provide the applicant a disclosure athorization notice

what are the most common penalites fro violations of insurance statutes?

A cease and desist order, a fine, and license suspension or revocation.

what document is required for an insruacne company to transact insurance?

Certificate of authority

conditiosn that increase the chance of a loss are known as waht?

Hazards

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

insurer

when risks with higher probabolity of loss are seeking insurance mroe often than other risks, this is knows as what?

adverse selection.

what two elemtsn are necessary for a life insurance contact to have a legal purpose?

insurable interest and consent.

what si the best way to handel incomlete insurance applications?

return the application to the applicatn for completion.

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

send the applicaiton back to the applicant for signature.

in order to transact insurance within a given state, an alien insured must first obtain what?

certificate of authority.

what type of report provides information about the applicants hobbies habits and financial status ?

inspection report

An insurance policy paid a nontaxable dividend to the insured on year and nothing the next. From what type of insurer did the insured purchase the policy?

mutual.

What law is the foundation of the statistical prediction of loss upon which rates for insurance are calculated?

law of large numbers

what is the name of process that insurance companies use to determine whether or not a napplicant is insurable?

underwriting.

for the purpsoe of insurance, what is risk?

uncertainty of loss

in forming an insurance contract, when does an acceptance usually occur?

the insurer approves a prepaid application.

what are the three types of hazards?

physical, moral, and morale.

what are the strategies used by underwriteres to prevent adverse selection?

restriction of converage, refusal to accept a risk, and accepting a risk at a higher rate.

acccording to the law of agenct a principal is represented by whom?

agent of producer.

what type of risk is insurable?

pure

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

insurance.

what law protect consumers from the cirulation of inaccurate or obsolete information?

the fair credit reporting act

what are the four elements of an insurance contract?

agreement, consideration, competent parties, and legal purpose.

if an applicant does not receive his or her insurance policy, who would be held responsible?

the agent

insuance is a contact that protect the insured from what

loss

a state issued document empowering an insruance company to become an admitted insurer is called what

certiciate of authoruty

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

insurer

whom does an insurance agent represent

insurance company

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

complete a new application or ask the applicant to inital the correction on the original application.

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

when the insurance application is submitted.

the insured organized to return profit to the sotckholders is hwat type of insurer?

stock company

an insurance company that is formed undert the laws of another state is knwon as what type of insured?

foreign

an insruance company is domiciled in california and transacts insurancein nevada. What is this insures classificaitons nevada?

foreign

what type of insured is formed under the laws of another country?

alien.

what entities make up medical information bureau?

insurers.

wagering on a sporting event is known as what tpye of risk?

speculative.

an applicant conceals relevant health information on the application. The aplpicant presents what tpe of hazard?

moral.

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

loss.

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

pure risk.

whose responibility is it to determine that all the questions on an insuacne application are answered?

the agents.

when does an insurance policy go into effect?

when the policy is delivered and the premium is paid

insurers are classidied according to their domicile. What rare the three types of insurers?

domestic, foreign, and alien.

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

mutual company.

who owns stock companies?

stockholders.