Nebraska Life and Health Insurance Exam Practice Questions and Answers
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Course
Nebraska
Institution
Nebraska
Nebraska Life and Health Insurance Exam
Practice Questions and Answers
What is Insurance? - Answer️️ -a contract in which 1 party (insurance
company) agrees to indemnify (make whole) the insured party against loss,
damage, or a liability arising from an unknown event.
What is life insuranc...
Nebraska Life and Health Insurance Exam
Practice Questions and Answers
What is Insurance? - Answer✔️✔️-a contract in which 1 party (insurance
company) agrees to indemnify (make whole) the insured party against loss,
damage, or a liability arising from an unknown event.
What is life insurance? - Answer✔️✔️-a policy that protects survivors from
losses suffered after an insured's death
What does insurance do? - Answer✔️✔️-transfers the risk of loss from an
individual or business entity to an insurance company which spreads out
costs of unexpected losses to many individuals
What is risk? - Answer✔️✔️-uncertainty or chance of a loss occurring
Pure risk - Answer✔️✔️-refers to sutuations that can only result in a loss or
no change, no opportunity for financial gain
What type of risk do insurance companies accept? - Answer✔️✔️-pure risk
Speculative risk - Answer✔️✔️-involves opportunity for loss or gain
Hazard - Answer✔️✔️-conditions or situation that increase probability of an
insured loss occurring
Physical hazard - Answer✔️✔️-individual characteristics that increase the
chances of the cause of loss
Example of a physical hazard - Answer✔️✔️-past medical history, existing
conditions, (blindness)
Moral hazard - Answer✔️✔️-tendencise towards increased risk. moral
hazards inclove evaluating character of insured
example of moral hazard - Answer✔️✔️-applicants who may lie on an
application for insurance or in the past have submitted fraudulent claims
against an insurer
Morale hazard - Answer✔️✔️-similar to moral hazards, except that they
arise from a state of mind that causes indifference to loss, such as
carelessness
example of morale hazard - Answer✔️✔️-actions taken without forethought
may cause physical injuries
Peril - Answer✔️✔️-perils are causes of loss insured against in an insurance
policy
Life Insurance - Answer✔️✔️-insures against the financial loss caused by the
premature death of the insured
Health Insurance - Answer✔️✔️-insures against mediacal expenses and/or
loss of income caused by the insured's sickness or accidental injury
Property Insurance - Answer✔️✔️-insures against the loss and/or damage of
property and resulting in liabilities
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