Chapter 1- Application, Underwriting, and Delivering Policy
Events in which a person has both the chance of winning or losing are classified as a. retained risk b. speculative risk c. pure risk d. hazard
b. speculative risk
Courts will interpret any ambiguity in an insurance contract
in favor of the insured
insurance is a contract one seeks to protect another from
loss
Describe an independent producer
sells many types of insurance for one company
What document grants express authority to an agent?
Agent's contract with the principal
For the reported losses of an insured group to become more likely to equal the statistical probability of loss for that particular class, the insured group must become
larger
to legally transact insurance in this state, an insurer must obtain what?
Certificate of Authority
What insurance concept is associated with the names Weiss and Fitch?
Guidelines describing company financial integrity
Fiduciary Responsibility
Handling insurer funds in a trust capacity
Transfer of risk of loss to a larger group
Insurance
A situation in which a person can only lose or have no change represents
Pure Risk
what method do insurers use to protect themselves against catastrophic losses?
Reinsurance
Must be held between Insured and beneficiary; risk of a financial loss if insured dies
Insurable Interest
Which of the following statements is an accurate comparison between private and government insurers? a. private insurers may be authorized to transact insurance by state insurance departments b. insurance provided by the government is called federal insurance c. private insurers offer fewer lines of insurance than government insurers d. private insurers provide insurance in areas where the government will not
a. private insurers may be authorized to transact insurance by state insurance departments