ЁЯЯеA) General Insurance тЫСя╕П
4 elements of an insurance contract?
1) Agreement (offer + acceptance) 2) Consideration ЁЯТ░ 3) Competent Parties ЁЯОЙ 4) Legal PurposeтнРя╕П
Documentation that grants Express Authority to an agent?
AGENT'S CONTRACTЁЯУЭ W THE PRINCIPAL
when risks with higher probability of loss are seeking insurance more often than other risks, this is known as what?
Adverse Selection
If an applicant does not receive their insurance policy, who is responsible?
Agent ЁЯСйтАНЁЯТ╝
According to the Law of Agency, a Principal is represented by whom?
Agent ЁЯСйтАНЁЯТ╝ or Producer
A producer, who fails to separate premium monies from his own personal funds, is guilty of...
COMMINGLING
5 characteristics of an ideally insurable risk?
Loss must be... 1) due to chance 2) definite and measurable 3) statistically predictable 4) not тЭМ catastrophic 5) coverage cannot тЭМ be mandatory
Which of the following is NOT тЭМ the Consideration in a policy?
The application given to a prospective insured ЁЯС╡ Consideration is something of value that is transferred between the two parties to form a legal contract.
In forming an insurance contract, when does acceptance usually occur?
When an insurer's underwriter approves coverage
Best way to handle INCOMPLETE insurance applications
return the application to the applicant for completion
when is the offer usually made on a contract?
when the insurance application is submitted
In forming an insurance contract when does acceptance usually occur?
when the insurer approves a prepaid application
Two elements necessary for a life insurance contract to have a legal purpose?
Insurable INTEREST + Consent
Which statement regarding insurable risks is not тЭМ correct?
Insured ЁЯС╡ cannot be randomly selected.
In agent/insurer relationship, who is Principal?
InsurerЁЯТТ
When would a Misrepresentation on a insurance application be considered Fraud?
Intentional + MATERIAL
Which of the following is NOT тЭМ a goal of Risk Retention? Reduce expenses and improve, cash flow Minimize the insured's level of liability in the event of loss Increase control of claim, reserving and claims settlements Fund losses, that cannot be insured
Minimize the insured's level of liability in the event of loss
If a court ordered payment for a loss that was not covered in the policy, even if it was clearly worded, it would be an example of which legal concept?
REASONABLE EXPECTATIONS
Strategies are used by underwriters to prevent Adverse Selection?
Restriction of coverage Refusal to accept a risk Accepting a risk at a higher rate
when a CHANGE needs to be made on the application for Insurance, which is the best method for correcting information?
complete a new application or ask the applicant to initial the correction on the original application
