Lesson 1

Question 1

Reserve

Answer 1

Funds held by the company to help fulfill future claims. Minimum reserves are usually set by the state department of insurance.

Question 2

Multi-Line Insurer

Answer 2

An insurance company or independent agent that provides a one stop shop for businesses or individuals seeking coverage for all their insurance needs. For example many large insurers offer individual policies for automobile, homeowner, long-term care, life and health insurance needs.

Question 3

Stock Companies

Answer 3

Are insurance companies owned and controlled by a group of stockholders, whose investment in the company provides the safety margin necessary in issuance of guaranteed, fixed premium, nonparticipating policies.

Question 4

Nonparticipating Plan

Answer 4

Insurance, under which the insured is not entitled to share in the divisible surplus of the company.

Question 5

Mutual Companies

Answer 5

Are insurance companies characterized by having no capital stock; it is owned by its policy owners and usually issues participating insurance.

Question 6

Participating Plan

Answer 6

Insurance is a plan, under which the policy owner receive shares, (commonly called dividends) of the divisible surplus of the company.

Question 7

Reinsurer

Answer 7

Company that provides financial protection to insurance companies. Reinsurers handle risks that are too large for insurance companies to handle on their own and make it possible for Insurance to obtain more business than they would otherwise be able to.

Question 8

Fraternal Benefit Societies

Answer 8

nonprofit benevolent organization that provide insurance to its members. Producers or agents, who only sell within their society, do not receive commission, and stay, under a specific premium threshold, often have less stringent licensing requirements.

Question 9

Fair Credit Reporting Act

Answer 9

Federal law requiring an individual to be informed if she is being investigated by an inspection company, the law also outlines the sharing an impact of such information and requires individuals to be notified prior to being investigated.

Question 10

Buyer’s Guide

Answer 10

Informational, consumer guidebook, that explain insurance policies, and insurance concept; in many states, they are required to be given to applicants when certain types of coverages are being considered. Buyers guides are often used with life insurance, long-term care, insurance, and annuities.

Question 11

Policy Summary

Answer 11

a summary of the terms of an insurance policy, including the conditions, coverage, limitations, and premiums. Policy summaries are often used with life insurance, long-term care insurance, and annuities.

Question 12

National Association of insurance, commissioners (NAIC)

Answer 12

Association of all of the state, insurance, commissioners, active and insurance, regulatory problems, and informing and recommending model, legislation and requirements. The NAIC does not directly make laws, as laws are made at the state level. They do not work on suggesting standards for states to adopt with the goal of standardrizing, the insurance industry throughout the United States of America.

Question 13

State Guarantee Association

Answer 13

Established by each state to support insurers and protect consumers in the case of ensure insolvency, guaranty associations are funded by insurers through assessments. All authorized insurers are legally required to participate in the state guarantee association for any state state that they are authorized to do business in regardless of where their corporate office is.

Question 14

Life Insurance

Answer 14

Insurance against loss due to the death of a particular person (the insured) upon whose that the insurance company agrees to pay a stated sum or income to the beneficiary. In its purest form life, insurance states, we will pay this amount when this person dies.

Question 15

Term Life Insurance

Answer 15

Protection for a certain number of years; expiring without value, if the insured survives the stated., Which may be one or more years. Term life is designed to provide temporary protection in case a person dies during a set period of time.

Question 16

Whole Life

Answer 16

Permanent level insurance protection for a person’s whole of life from policy issue to the death of the insured. Characterized by level premium, level, benefits, and cash values.

Question 17

Group Life

Answer 17

Type of life insurance in which a single contract covers an entire group of people most often the group is an employer employee group. Those covered under a group life policy may or may not pay a portion of the premium and can usually choose her beneficiary. however, the insured typically does not own the policy. The group (employer) owns and controls the policy.

Question 18

Consideration

Answer 18

Part of an insurance contract setting for the amount of an initial and renewal, premiums and frequency of future payments. Consideration, as often said to include the initial premium and completed application for insurance. In other words, the applicant and is saying, please consider me for insurance. Here is my initial premium my completed application and how much/how often I agree to pay the future in the future please consider me.

Question 19

The insuring agreement (insuring clause, insurance provision)

Answer 19

The portion of the insurance policy, in which the insurer promises to make payment, two or on behalf of the insured, is states the scope in limits of coverage, the insuring agreement is usually contained in a coverage form from which a policy is constructed. In other words, it is the insurance company saying we ensure to ensure you under these conditions for this amount.

Question 20

health insurance

Answer 20

General way of describing insurance against loss through sickness or accident toe, bodily injury, it is also called accident and health, accident and sickness, sickness and accident or disability insurance. It is important to remember the general term health insurance applies to many different types of insurance not just the medical insurance that pays for doctor in hospital visits.

Question 21

Disability (income)

Answer 21

Insurance is a form of insurance that ensures the beneficiaries and income against the risk that a disability creates a barrier for a worker to complete the core functions of their work. Although disability insurance is designed to protect one’s income, there are typically rules and regulations in place limiting the benefits of a disability policy to one’s income level, and typically only allowing protection for a portion of their income.

Question 22

Medical Expense

Answer 22

insurance pays benefits for non-surgical doctors fees, commonly rendered in a hospital; sometimes pays for a home and office calls

Question 23

Entire contract

Answer 23

an insurance policy provision, stating that the application and policy contain all provisions and constitute the entire contract

Question 24

notice of claim

Answer 24

Policy provision that describes the policy owners obligation to provide a notification of laws to the insurer within a reasonable period of time. Notice of claim only requires the insurance company being notified of a loss. It does not require that proof of the loss is provided.

Question 25

Reinstatement

Answer 25

Act of putting a lapsed policy back in force by producing satisfactory evidence of insurability and paying any past due premiums required. Most states have reinstatement laws require it an insurer to allow for a policy to be reinstated upon request of the policy owner within a specified period of time.

Question 26

Property Insurance

Answer 26

Insurance policy that provides financial reimbursement to the owner or renter of a structure in its contents in the event of damage or theft, simply put property insurance protects the things you own and rent.

Question 27

Casualty (liability) insurance

Answer 27

Insurance which broadly encompasses insurance not directly concerned with life, insurance health insurance or property insurance casualty insurance includes vehicle, insurance liability, insurance theft, insurance, workers compensation insurance and elevator insurance. casualty insurance protects you financially in the event that someone sues you.

Question 28

Property and casualty insurance

Answer 28

Often referred to collectively as property and casualty insurance, because the things you on has the potential to harm people in ways that could cause them to sue you. The main kinds of property and casualty insurance include auto insurance homeowners insurance, renters, insurance and umbrella insurance.

Question 29

Proof of loss

Answer 29

Mandatory health, insurance provision, stating that the insured must provide a completed, claim form to the ensure within days of the date of loss. If the insured wants pay, they must proof, the lost occurred.

Question 30

Deductible

Answer 30

Amount of expense or loss to be paid by the insured before an insurance policy starts paying benefits. Deductibles typically apply to property, casualty and health insurance.

Question 31

Declaration page

Answer 31

Piece of paper which provides basic information about an insurance policy. Typically the first page of an insurance policy is a declaration page, the declarations page normally specifies the name insured, address, policy period, Location of property, policy limits, and other key information.