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Mass State Life Insurance Exam Questions With Correct Answers
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Mass State Life Insurance Exam Questions With Correct Answers
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Mass State Life Insurance ExamQuestions With Correct Answers
Which cof cthe cfollowing cdescribes ca cparticipating clife cinsurance cpolicy? c- ccorrect
canswers✔✔A cparticipating clife cpolicy cis cone cin cwhich cthe cpolicyowner creceives
cdividends cderiving cfrom cthe ccompany's cdivisible csurplus
What ctype cof creinsurance ccontract cbetween ctwo cinsurers cinvolves can cautomatic
csharing cof cthe crisks cassumed? c- ccorrect canswers✔✔Under ctreaty creinsurance,
ceach cparty cautomatically caccepts cspecific cpercentages cof cthe cinsurer's cbusiness.
At cwhat cpoint cmust ca clife cinsurance capplicant cbe cinformed cof ctheir crights cthat cfall
cunder cthe cFair cCredit cReporting cAct? c- ccorrect canswers✔✔Upon ccompletion cof cthe
capplication
The cState cGuaranty cAssociation cguarantees c- ccorrect canswers✔✔that ca cclaim cwill
cbe cpaid cif can cadmitted cinsurer cbecomes cinsolvent
Dividends cfrom ca cmutual cinsurance ccompany care cpaid cto cwhom? c- ccorrect
canswers✔✔Policyholders
What cis cconsidered cthe caccounting cmeasurement cof can cinsurance ccompany's
cfuture cobligations cto cits cpolicyowners? c- ccorrect canswers✔✔reserves
A cgroup-owned cinsurance ccompany cthat cis cformed cto cassume cand cspread cthe
cliability crisks cof cits cmembers cis cknown cas ca c- ccorrect canswers✔✔risk cretention
cgroup
Which cof cthe cfollowing cis ca csyndicate cestablished cby ca cgroup cof cinsurers cto cshare
cunderwriting cduties? c- ccorrect canswers✔✔Lloyd's corganization
An cagent's cauthority cto cbind can cinsurer cto can cinsurance ccontract cmay cbe cgranted
cin cthe c- ccorrect canswers✔✔agent's ccontract cand cthe cinsurance ccompany's
cappointment
Dividends cfrom ca cstock cinsurance ccompany care cnormally csent cto c- ccorrect
canswers✔✔shareholders
Law cof cLarge cnumbers c- ccorrect canswers✔✔-insurance cis cbased con cthe csharing cof
crisks camong ca clarge cgroup cof cpeople
,-states cthat cthe clarger cthe cnumber cof cpeople, cthe cmore cpredictable cthe cactual
closses cwill cbe c
-companies cuse cthis cdata cto ccalculate crates
Speculative crisk c- ccorrect canswers✔✔-involves copportunity cfor ceither closs cor cgain
-not ccovered cby cinsurance ccompanies
pure crisk c- ccorrect canswers✔✔-a csituation cthat ccan conly cresult cin ca closs, cthere cis
cno copportunity cfor cfinancial cgain c
-only ctype cof crisk cthat cis cinsurable
treatment cof crisk cthrough: cavoidance c- ccorrect canswers✔✔simply cavoiding cas cmany
crisks cas cpossible
-effective cbut cnot calways cpractical
treatment cof crisk cthrough- creduction c- ccorrect canswers✔✔since cwe ccannot cavoid
crisk centirely cwe coften cattempt cto clessen cthe cpossibility cof ca closs cby ctaking cacting
cto creduce cthe crisk
-
treatment cof crisk cthrough- csharing c- ccorrect canswers✔✔when ca cgroup cof
cindividuals cor cbusinesses cwith csimilar cexposures cshare cthe closses cthat coccur
cwithin cthat cgroup c
-reciprocal cinsurance cexchange cis ca cformal crisk csharing carrangement
treatment cof crisk cthrough- cretention c- ccorrect canswers✔✔also cknown cas cself-
insurance: cwhen cindividuals chave cthe cfinancial cability cto cfund closses cby cthemselves
cwhen cthey coccur
treatment cof crisk cthrough- ctransfer c- ccorrect canswers✔✔the cmost ceffective cway cto
chandle crisk
- crisk cis ctransferred cto canother cparty c- cinsurance cis cthe cmost ccommon cmethod cof
ctransferring crisk cfrom can cindividual cor cgroup cto can cinsurance ccompany
elements cof cinsurable crisk c- ccorrect canswers✔✔-must cbe cdue cto cchance
-cannot cbe ccatastrophic
-must cbe crandomly cselected
• cLoss cexposure cto cbe cinsured cmust cbe clarge c- cInsurance ccompany cmust cbe cable
cto cpredict
loss c( cbased con claw cof clarge cnumbers)
- cLoss cmust cbe cdefinite cand cmeasurable c- cTime, cplace, camount, cand cwhen
cpayable
nature cof cinsurance c- ccorrect canswers✔✔-to cprovide cfinancial cprotection cagainst
closses cthat cmay cbe cincurred cdue cto ca cchance chappening cor cevent csuch cas cdeath,
cillness, cor caccident
,-protection cis cprovided cthrough can cinsurance cpolicy cwhich cis ca csimple cdevice cfor
caccumulating cfunds cto cmeet cthese cuncertain closses
ABC cCompany cis cattempting cto cminimize cthe cseverity cof cpotential closses cwithin cits
ccompany. cThe ccompany cis cengaged cin crisk c- ccorrect canswers✔✔Risk creduction
ccan creduce cthe cchance cthat ca cparticular closs cwill coccur, cor cit ccan creduce cthe
camount cof ca cpotential closs cif cit coccurs.
How ccan can cinsurance ccompany cminimize cexposure cto closs? c- ccorrect
canswers✔✔Many cinsurers care cable cto cminimize cexposure cto closs cby creinsuring
crisks.
For cinsurance cpurposes, csimilar cobjects cwhich care cexposed cto cthe csame cgroup cof
cperils care creferred cto cas c- ccorrect canswers✔✔Similar cobjects cof cinsurance cthat
care cexposed cto cthe csame cgroup cof cperils care ccalled chomogeneous cexposure
cunits.
Which cof cthe cfollowing ccan cbe cdefined cas c"the cpotential cfor closs"? c- ccorrect
canswers✔✔risk
An cinsurer chas ca ccontractual cagreement cwhich ctransfers ca cportion cof cits crisk
cexposure cto canother cinsurer. cWhat ctype cof ccontractual carrangement cis cthis? c-
ccorrect canswers✔✔Reinsurance ccontracts caccept ca cportion cof cthe crisk cunderwritten
cby canother cinsurer cwho chas ccontracted cfor cthe centire ccoverage camount.
Which cof cthe cfollowing ccan cbe cdefined cas ca ccause cof ca closs? c- ccorrect
canswers✔✔peril
What ctype cof crisk cinvolves cthe cpotential cfor closs cand cthe cpossibility cfor cgain? c-
ccorrect canswers✔✔speculative
Purchasing cinsurance cis can cexample cof crisk c- ccorrect canswers✔✔transference
A cbusiness cbecoming cincorporated cis can cexample cof crisk c____. c- ccorrect
canswers✔✔transfer
Which cof cthe cfollowing cis cNOT can cexample cof crisk cretention? c- ccorrect
canswers✔✔Not cdoing ca cbusiness cdeal cafter cdeciding cit cwould cbe ctoo crisky
legal ccontract cmust chave: coffer cand cacceptance c- ccorrect canswers✔✔-an coffer cis
cmade cwhen cthe capplicant csubmits can capplication cfor cinsurance cto cthe cinsurance
ccompany
-the coffer cis caccepted cafter cit chas cbeen capproved cby cthe cinsurance ccompany's
cunderwriters
, legal ccontract cmust chave: cconsideration c- ccorrect canswers✔✔something cof cvalue
cthat ceach cparty cgives cto cthe cother
-on cpart cof cinsured: cpayment cof cpremium
-on cpart cof cinsurance ccompany: cpromise cto cpay cin cevent cof closs
legal ccontract cmust chave: clegal cpurpose c- ccorrect canswers✔✔-must cbe clegal cand
cnot cagainst cpublic cpolicy
-has clegal cpurpose cif ccontract chas ca cinsurable cinterests cand cthe cinsured chas
cprovided cwritten cconsent
legal ccontract cmust chave: ccompetent cparties c- ccorrect canswers✔✔-all cparties cmust
cbe cof clegal ccompetence
-must cbe cof clegal cage, cmentally ccapable cof cunderstanding cthe cterms, cand cnot
cunder cthe cinfluence cof cdrugs cor calcohol
specifal cfeatures cof cinsurance ccontracts: caleatory c- ccorrect canswers✔✔there cis cnot
can cequal cexchange cof cvalue
-premiums cpaid cby cthe cinsured care csmall cin crelation cto cthe camount cthat cwill cbe
cpaid cby cthe cinsurance ccompany, cin cthe cevent cof ca closs
specifal cfeatures cof cinsurance ccontracts: cadhesion c- ccorrect canswers✔✔also cknown
cas c"take cit cor cleave cit cagreements" cbecause cthey're cprepared cby conly cone cparty,
cthe cinsurance ccompany c
-accepted cor crejected cby cthe cother cparty c(the capplicant) cwith cno cnegotiations cor
cchanges
specifal cfeatures cof cinsurance ccontracts: cunilateral c- ccorrect canswers✔✔one csided
cagreement cin cwhich conly cone cparty c(the cinsurance ccompany) cis clegally cbound cto
cdo canything c
-policy cowner cis cunder cno clegally cbinding cpromise cto cpay cpremiums, chowever cthe
cinsurance ccompany cis clegally cbound cto cpay closses ccovered cby cthe cpolicy
-if cthe cpolicy cowner cdoes cnot cpay ctheir cpremiums, cthe cinsurance ccompany cdoes
chave cthe cright cto cterminate cthe cinsurance cpolicy
personal ccontract c- ccorrect canswers✔✔insurance ccontracts care cpersonal ccontracts
cbetween can cindividual cand cthe cinsurance ccompany, cand ccannot ctransfer cowner
cship cwithout cthe cinsurance ccompany's cwritten cconsent
conditional c- ccorrect canswers✔✔insurance ccontracts care cconditional cbecause
ccertain ccontracts cmust cbe cmet cby call cparties cwhen ca closs coccurs, cotherwise cthe
ccontract cwould cnot cbe clegally cenforceable c
-if cthe cpolicy cowner cis cpast cdue con chis cpayments cand cthe cinsured cdies, cthe
cinsurance ccompany cdoes cnot chave cto cpay cthe cdeath cbenefit cbecause ca ccondition
cwas cnot cmet
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