Chapter Quiz- BASIC INSURANCE CONCEPTS AND PRINCIPLES
Q:3 When must insurable interest exist in life insurance?
Date of application
Q:8 Which of the following is NOT a type of hazard?
Exposure
Q:2 Conditions that increase the chances of an insured loss occuring are referred to as
HAZARDS
Q:7 Which provision states that if a POLICY allows for GREATER COMPENSATION than the FINANCIAL LOSS incurred, the insured may ONLY receive benefits for the amount lost?
NO LOSS NO GAIN
Q:5 All of the following are examples of risk retention EXCEPT
Premiums
Q:6 Which method of dealing with risk is applied when a person purchases insurance?
SHARING
Q:9 Which of the following would NOT be eligible for coverage under key person insurance?
The OWNER OF A SHOP
Q:10 Which of the following methods of calculating the amount of life insurance needed takes into account the insureds salary and years until retirement?
The human life value approach
Q:1 Risk in insurance terminology refers to
The uncertainty of financial loss
Q:4 The insurer must be able to rely on the statements in the application, and the insured must be able to rely on the insurer to pay valid claims. In the forming of an insurance contract, this is referred to as
Utmost good faith