al life insurance

A(n) ___________ has the right to review the consumer report used in the underwriting process. A Applicant B Producer C Beneficiary D Spouse

A Applicant

Which of the following is an insurance company that is organized under the laws of a different state within the United States? A. Foreign B. Alien C. Authorized D. Domestic

A. Foreign

Which of the following type of authority does the public assume an agent has when quoting insurance? A Implied B Express C Apparent D Authorized

A. Implied

Which insurance company department accepts the insurance risk? A. Underwriting B. Claims C. Actuarial D. Executive

A. Underwriting

Before an insurer can operate in this state, it must have which of the following? A Approval of the National Association of Insurance Commissioners (NAIC) B Articles of Incorporation filed with the Secretary of State C Certificate of Authority issued by the state Insurance Department D State Governor's approval

C Certificate of Authority issued by the state Insurance Department

Dishonest tendencies that increase the probability of loss are what types of hazard? A Legal B Physical C Moral D Emotional

C Moral

If an insurance company wants to transfer all or part of the risk it has accepted, it would buy which of the following types of insurance? A. Residual B. Reciprocal C. Reinsurance D. Insurer

C. Reinsurance

Why is a policy considered to be a contract of adhesion? A One party prepares the contract with little or no input or negotiation from the other party B Only the insured is bound to live up to its side of the agreement C It is a contract of unequal value D Only the insurance company is bound to live up to its side of the agreement

A One party prepares the contract with little or no input or negotiation from the other party

One characteristic of life insurance is that the insurer is obligated to pay a claim in the event of the death of the insured, however, the insured is not contractually obligated to do anything other than keep the policy in force. This is a: A Unilateral Contract B Conditional Contract C Contract of Adhesion D Aleatory Contract

A Unilateral Contract

If a policy is written with unclear definitions, conditions and provisions which are hidden in the contract, and the insured files a law suit. In the court of law, the contract would be construed in favor of the insured because it is a: A Contract of indemnity B Contract of adhesion C Contract of utmost good faith D Unilateral contract

B Contract of adhesion

The McCarran-Ferguson Act of 1945: A Established the Federal Insurance Office B Gave states the authority to regulate insurance C Established the Interstate Commerce Commission as the primary regulator of insurance D Reinforced violations of the Sherman Antitrust Act

B Gave states the authority to regulate insurance

The ___________ branch writes and passes state insurance laws, or statutes, to protect the insuring public. A Executive B Legislative C Judicial D Electoral

B Legislative

Each of the following is a factor considered by an underwriter, except: A Gender B Marital status C Hazardous occupation D Age

B Marital status

A company owned by stockholders that does NOT pay dividends to policyholders is considered: A Participating B Nonparticipating C Contributory D Noncontributory

B Nonparticipating

The ____________ has the power to issue rules and regulations to help enforce insurance statutes A Executive branch B Judicial branch C Commissioner D Legislative branch

C Commissioner

Each of the following is an element of a legal contract, except: A Legal Purpose B Consideration C Indemnity D Agreement

C Idemnity

Which principle of insurance restores the insured to the same economic condition that existed before the loss? A Insurability B Underwriting C Indemnity D Adhesion

C Idemnity

Being restored to the same financial situation or economic condition that existed prior to a loss and not profiting from an insurance transaction is considered: A Underwriting B Insurable interest C Indemnification D Reimbursement

C Indemnification

. Each of the following must be included in an insurable risk, except: A Excluded catastrophic perils B Calculable chance of loss C Large group with different risks D Accidental losses

C Large group with different risks

Which of the following is considered a field underwriter? A Medical doctor B Department examiner C Producer D Actuary

C Producer

A ______________ insurance company is owned by its policyholders. A. stock B. fraternal benefits society C. mutual D. reciprocal

C. Mutual insurance

To engage or participate in the insurance business, a prohibited person must first apply for a(n): A Waiver of felony conviction B Producer's license C Insurance consultant's license D 1033 waiver for consent to work

D 1033 waiver for consent to work

The three types of hazards are: A Reduction, avoidance, and risk B Known, seen, and unknown C Direct, indirect, and undecided D Physical, moral, and morale

D Physical, moral, and morale

An unincorporated organization that is formed by individuals, firms, and business corporations that exchange insurance on one another and whose members are known as subscribers is called a: A Fraternal Benefit Society B Risk Retention Group C Mutual Insurance Company D Reciprocal Insurance Company

D Reciprocal Insurance Company

When an insurer cedes part of an insured's coverage to another insurance company, retaining only part of the risk for itself, the insurer is engaging in: A Speculative risk B Adverse selection C Risk avoidance D Reinsurance

D Reinsurance

A warranty is defined as which of the following? A A false statement in the application B What a reasonable and prudent buyer can expect C Intentional misrepresentation on the application D Statement in the application that is guaranteed to be true

D Statement in the application that is guaranteed to be true

A producer has each of the following responsibilities to the Insurer, except: A Reporting material facts that may affect underwriting B A fiduciary duty C Forwarding premiums to the insurer on a timely basis D A duty to recommend only high premium policies

D. A duty to recommend only high premium policies

A person with a legal or ethical relationship of trust with another party is a: A Beneficiary B Adjuster C Principal D Fiduciary

D. Fiduciary

The Financial Privacy rule requires insurers to provide consumers with a privacy notice: A At the time the consumer relationship is established and annually thereafter B At time of application and monthly thereafter C At the time of policy delivery and quarterly thereafter D With each billing statement

A At the time the consumer relationship is established and annually thereafter