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XCEL Chapter 1 Exam Review Questions With Answers 2025.
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XCEL Chapter 1 Exam Review Questions With Answers 2025.
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XCEL Chapter 1 Exam Review QuestionsWith Answers 2025.
Stock insurer - ANSWER- A non-participating company is also called
Insurance policy - ANSWER- Contract that involves one party which indemnifies
another when a loss arises from an unknown event
Mutual - ANSWER- A type of insurer that is owned by its policy owners is called
Because dividends are considered to be a return of premium - ANSWER- Why are
dividends from a mutual insurer not subject to taxation?
Participating life insurance policy - ANSWER- Life insurance policy issued by a mutual
insurer provides a return of divisible surplus
Exist for profit - ANSWER- Fraternal Benefit Society does NOT
Reinsurance - ANSWER- Type of insurance where an insurer transfers loss exposures
from policies written for its insurers
It is the distribution of excess of funds accumulated by the insurer on participating
policies - ANSWER- What is a true statement regarding a life insurance policy dividend?
Mutual Insurer - ANSWER- Insurer owned by its policyholders
Reinsurer - ANSWER- A life insurance company has transferred some of its risk to
another insurer. The insurer assuming the risk is called the
Marketing - ANSWER- One important function of an insurance company is to identify
and sell to potential customers. Which of these BEST describes this function?
Participating policy - ANSWER- John owns an insurance policy that gives him the right
to share in the insurer's surplus. What kind of policy is this?
Non-participating policy - ANSWER- Does not participate in paying dividends
Participating life insurance policy - ANSWER- Contract that allows the policy owner to
receive a share of surplus in the form of policy dividends
$10,000 or up to 1 year in jail - ANSWER- Minimum penalty under the McCarran-
Ferguson Act
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