A person who does not lock the doors to his or her house shows an indifferent attitude. This person presents what type of hazard?
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Terms in this set (44)
Wagering on a sporting event is known as what type of risk?speculativeWhat are the five characteristics of an ideally insurable risk?Loss must be 1) due to chance, 2) definite and measurable, 3) statistically predictable, 4) not catastrophic, and 5) Coverage cannot be mandatory.If an agent fails to obtain the applicants signature on the insurance application what must the insurer do?Return the application to the applicant for signatureWhat type of risk is insurable?pureWhen would a misrepresentation on an insurance application be considered fraud?When it is intentional and materialWhen risks with higher probability of loss are seeking insurance more often than other risks, this is known as what?adverse selectionWhen agents act within the scope of their contract, their actions will be assumed to be the acts of whom?InsurerIf an applicant does not receive his or her insurance policy, who would be held responsible?agentWhat are the strategies used by underwriters to prevent adverse selection?1. Restriction of coverage, 2. Refusal to accept a risk, 3. Accepting a risk at a higher rateThe reduction, decrease, or disappearance of value of the person of property in a policy is known as what?LossThe requirements that agents must account for and promptly remit all insurance funds collected is known as what type of agent responsibility?FiduciaryWhen does an insurance policy go into effect?When the policy is delivered and the premium is paidIn the agent/insurer relationship, who is considered the principal?insurerWhat are the three types of agent authority?Express, apparent, and implied.According to the Law of Agency, a principal is represented by whom?Agent or producerWhose responsibility is it to determine that all the questions on an insurance application are answered?AgentWhat is the term of the causes of loss insured against in an insurance policy?PerilIn forming an insurance contract, when does acceptance usually occur?When the insurer approves a prepaid applicationWhat are the four elements of an insurance contract?Agreement (offer and acceptance), consideration, competent parties, and legal purposeAn insurance company is domiciled in California and transacts insurance in Nevada. What is the insurers classification in Nevada?ForeignWhat do we individuals use to transfer their risk of loss to a larger group?InsuranceWhat type of insurer is formed under the laws of another country?alienFor the purpose of insurance, what is risk?Uncertainty of lossWhen a change needs to be made on the application for insurance, which is the best method for correcting the info?Complete a new application or ask the applicant to initial the correction on the original applicationIf an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered what type of insurer?Authorized or admittedWhat is a warranty in an insurance contract?An absolutely true statement upon which the validity of the policy dependsThe insurer organized to return a profit to the stockholders is what type of insurer?stock companyThe type of insurance company organized to return any surplus money to its policyholders is known as what?Mutual companyWhat type of document is required for an insurance company to transact insurance?Certificate of authorityIn insurance, when is the offer is usually made in a contract?When application is submittedInsurers are classified according to their domicile. What are the three types of insurers?domestic, foreign, alienA situation in which a person can only experience a loss and no gain presents what type of risk?pure riskWho owns stock companies?stockholdersWhat entities make up the Medical Information Bureau?Insurers