General Insurance

Which of the following is NOT a goal of risk retention?

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

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 authority is not

implied

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

A pure risk

What documentation grants express authority to an agent ?

Agent's contract with the principal

If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered what type of insurer?

Authorized

Insurance policies are not drawn up through negotiations, and an insured has little to say about its provisions. What contract characteristic does this describe?

adhesion

When an insured makes truthful statements on the application for insurance and pays the required premium, it is known as which of the following?

consideration

Which of the following best describes the aleatory nature of an insurance contract?

Exchange of unequal values

An authority granted to an agent through the agent's contract is referred to as

Express authority

Which of the following is not true regarding Certificate of Authority?

It is issued to group insured participants

A hazard is best defined as:

Something that increases the risk of loss

What is the major difference between a stock company and a mutual company?

Ownership

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 not drive or ride in a car ever again. Which method risk management does this describe?

avoidance

Which of the following is not a characteristic of an insurable risk?

Catastrophic