Ch.1 Exam Questions (Life/Health) - Basic Principles of Life and Health Insurance and Annuities
What is the accounting measurement of an insurance company's future obligations to its policyowners?
Reserves
A group-owned insurance company that is formed to assume and spread the liability risks of its members is known as a
Risk Retention Group
Insurance is NOT characterized as which of the following?
As the number of insureds increase the number of losses decrease
A reciprocal insurer typically has an administrator who manages the premiums collected from the group's members. This administrator is called a(n)
Attorney-In-Fact
Which of the following types of insurers limits the exposures it writes to those of it owners?
Captive insurer
When a ceding insurer transfers a portion of its risk to an assuming insurer on a case by case basis, this process is referred to as
Facultative reinsurance
Which of the following financial products creates an instant estate, no matter when the date of death?
Life insurance
Which of the following is a syndicate established by a group of insurers to share underwriting duties?
Lloyd's Organization
Dividends from a mutual insurance company are paid to whom?
Policyholders
Which of the following accurately describes a participating insurance policy?
Policyowners may be entitled to receive dividends
Which of the following outlines the authority given to the producer on behalf of the insurer?
Producer Contract
A stock insurance company is owned by its
Shareholders
Dividends from a stock insurance company are normally sent to
Shareholders
Who regulates an insurer's claim settlement practices?
State insurance departments
Which group is the Do Not Call Registry designed to protect against?
Telemarketers
Which reinsurance contract between two insurers involves an automatic sharing of the risks assumed?
Treaty Insurance
An agent's authority to bind an insurer to an insurance contract may be granted in the
agent's contract and the insurance company's appointment
