chapter 1 uCanPass life insurance

A tornado that destroys property would be an example of which of the following?

A Peril .. A peril is the cause off loss insured against in an insurance policy

A situation in which a person can only lose or have no change represents

A Pure risk Pure risk ... refers to situations that can only result in a loss or no change. Pure risk is the only type insurance companies are willing to accept.

An individual was involved in a head-on collision while driving home one day. His injuries were not serious, and he recovered. however he decided that in order to never be involved in another accident, he would never drive or ride in a car again. which method of risk management does this describe

Avoidance risk management by which a person tries to eliminate risk of loss by avoiding any exposure

which of the following is NOT an example of a valid insurable interest

Debtor in the life of the creditors

To achieve the profitable distribution of exposures

Preferred risks and poor risks are balanced, with average risks in the middle

Peril is most easily defined as

The cause of loss insured against

which of the following is not a goal of risk retention?

To minimize the insured's level of liability in the event of loss1

all of the following are insurable events as defined in the insurance code except

an insured loses sum in a poker game

the legal definition of person would not include which of the following?

family A person is a legal entity which acts on behalf of itself, accepting legal and civil responsibility of the actions in performs and making contracts in its own name.

Which insurance principle states that if a policy allows for greater compensation than the financial loss incurred, the insured may only receive benefits for the amount lost?

indemnity insured can only collect the amount loss even if policy is written with greater benefits limits

which of the following is NOT a characteristics of pure risk.

A: The loss must be a catastrophic B: The Loss must be due to change C:The loss must be measurable in dollars. D:The loss exposure must be Large Answer: A: The loss must be Catastrophic

The insurer may suspect that a moral hazard exists if the policy holder

is not honest about his health on an application for insurance