General Insurance

A person who does not lock the doors or repairs leaks. This person creates what type of hazard? 1.Legal 2. Physical 3. Morale 4. Moral

When an insured makes truthful statements on a application for insurance and pays the required premium , it is known as which of the following? 1. Legal Purpose 2. Contract of Adhesion 3. Acceptance 4. Consideration

Which of the following is NOT the consideration in a policy? 1. The application given to a prospect insured. 2. Something of value exchanged between 2 parties 3. Premium amount paid during application. 4. The promise to pay covered losses.

Which statement regarding insurable risk is NOT correct? 1. Insurance cannot be mandatory. 2. The insurable needs to be statistically predictable. 3. An insurable risk must involve a loss that is definite as to cause, time, and place. 4. Insureds cannot be randomly selected.

In insurance, an offer is usually made when? 1. The agent hands the policy to the policy holder. 2. An agent explains a policy to a potential insurer. 3. The application is submitted.

Because an insurance policy is a legal contract, it must conform to the state laws governing contracts which require all of the following elements except? 1. Legal Purpose 2. Offer and acceptance 3. Conditions 4. Considerations

What is the term used for the entity that a agent represents regarding contractual agreements with third parties? 1. Principal 2. Client 3. Designee 4. Insured

An agent accepts the premium payment 30 days after its due, telling the insured that there will not be a problem keeping the policy in force. This is an example of what agent authority? 1. Express 2. Implied 3. Assumed 4. Apparent

All of the following are examples of risk retention EXCEPT? 1. Co payments 2 Self- Insurance 3. Premiums 4. Deductibles

A participating insurance policy may do which of the following? 1. Pay dividend to the policy holder. 2. Provide group coverage. 3. Pay dividend to the stockholder. 4. Require 80% participation.

An applicant knowingly fails to commute information that would help an underwriter make a sound decision regarding coverage. This is an example of? 1. Fraud 2. Breach of Warranty 3. Concealment 4. Waiver