Qbank 3 (general insurance)

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When Harry sells his car to his brother, Nate, he transfers his auto insurance policy to him as well. Harry's insurer will

disallow the process because auto insurance is a personal contract

When there is no coverage available through an authorized carrier in the state, this insurance is referred to as

excess and surplus lines

An insurance company that is owned by its policyowners is known as

A mutual life insurance company

Which of the following types of agent authority is specifically set forth in writing in the agent's contract?

Express

Self-insurance is an example of what kind of risk treatment?

Retention

Which kind of insurance company is owned by individuals who buy shares but are not entitled to receive policy dividends?

Stock insurance company

Hachiro, age 45, purchased a life insurance policy from AllPro Insurers and named his 8-year-old son, Takeshi, as a beneficiary. Which of the following statements regarding this situation is CORRECT?

Takeshi is not a party to the insurance contract

A contract in which one insurer cedes all or part of a risk to another is known as

reinsurance

All of the following are methods of handling risk EXCEPT

repetition

All statements made by an applicant in an application for life insurance are considered to be

representations

In order for any contract, including an insurance policy, to be legal it must contain all of the following elements EXCEPT

representations

All of the following are methods of handling risk EXCEPT

resistance

In insurance,

the insurer is the principal and the producer is the agent

A health insurance policy does NOT go into force if

the producer completes the application

Dying too soon is an example of

a peril

A producer who receives life insurance premiums holds the money in trust as a:

A fiduciary

Which of the following statements regarding Lloyd's associations is CORRECT?

Insurance is provided by individual underwriters.

Which of the following statements regarding fraternal benefit societies is NOT true?

Policies are called contracts

Which of the following is NOT a characteristic of fraternal benefit societies?

Profit-making organization with capital stock

Which of the following terms indicates that a life insurance contract contains the enforceable promises of only one party?

Unilateral


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