Insurance and Risk

If an insured sells his car to another person, the buyer may be prohibited from also receiving the insured's policy. This is because the insurance contract is a contract of: a. Personal nature b. Indemnity c. Adhesion d. Actual cash value

A. Personal Nature

Jack and Connie - both 50 years old and of sound mind - agree to have Jack burn down Connie's house for $10,000. What element of a valid contract is missing? a. Legal purpose b. Competent parties c. Consideration d. Agreement of the parties

A. legal purpose

Risks that are insurable are: a. Speculative risk b. Pure risk c. Both A & B d. None of the above

B. pure risk

The goal of insurance is to restore the insured to the same economic position as before the covered loss occurred, this is the principle of: a. Adhesion b. Actual Cash Value C. Indemnity d. Severability

C. Indemnity

An Insurance Policy is a contract with all of the following characteristics, EXCEPT: a. It is a personal contract. b. Parties are of unequal power with ambiguities or unclear wording resolved in favor of the insured because it is a contract of adhesion. checkmark c. Indemnity is not part of an insurance contract. checkmark d. There are conditions imposed upon both the insurer and insured.

C. Indemnity is not part of an insurance contract.

All of the following describe insurable interest EXCEPT: a. Insurable interest must exist at the time of loss b. Insurance interest must exist for insurance to respond c. Show a similarity between insurance and wagering d. The insured would suffer an economic loss

C. Show a similarity between insurance and wagering

At the end of this course, you must do which of the following? a. Pass the final course exam with a scored of 70% or higher b. Print your certificate from this website c. Apply for your Insurance Adjuster license at the Florida Department of Financial Services website at www.myfloridacfo.com/division/agents d. All of the above

D. All of the above

Insurance that covers the responsibility for loss arising out of policy holder's negligence - that results in payment to a party other than the insured is: a. Not available in Florida insurance policies b. Fourth party claims c. Standard property insurance d. Liability

D. Liability

Strict or absolute liability: a. applies to school systems. b. must have failure to use "due care." c. considers the actions of a prudent person. d. is assigned by law or statute.

D. is assigned by law or statute

An insurance contract may contain a "gray area" or an ambiguity, that is generally resolved in favor of the insured because insurance policies are contracts of: a. Indemnity b. Cohesion c. Adhesion d. Conditions

c. Adhesion