Principle & Practices Of Insurance

Question 1

Who owns a mutual insurance company?

Answer 1

The policy holder

Question 2

What did Factory mutual insurance Companies specialize in?

Answer 2

Is fire risk management

Question 3

How often will policies with aggregated Policies Limit pay out in claims?

Answer 3

Until the limit is used up for the term

Question 4

How often will a policy with a current limit pay out On claims

Answer 4

Every time a loss occurs

Question 5

What is the difference between an agent and Broker

Answer 5

An agent One company and A broker Deals with multiple companies

Question 6

What is the difference between actual cash value and Replacement cost

Answer 6

Actual cash value is the replacement Cause less depreciation and replacement cost Is the cost of an item at time of loss without depreciation

Question 7

What is a Bailee

Answer 7

Someone in care custody and control of Someone else’s property

Question 8

What are four reasons of property insurance policy may automatically Assigned

Answer 8

Bankruptcy, Operation of law, Death and succession

Question 9

What is binding authority and Grants it to a broker

Answer 9

A binding authority is an authority to put a contract of insurance in effect without contacting the insurer for permission and is granted by the insurer.

Question 10

What are 3 elements? Necessary for contract of insurance only

Answer 10

Utmost good faith, indemnity and Insurable interest

Question 11

What is a claim reserve

Answer 11

Once the claim is reported insurers are required to put money To pay the claim

Question 12

To whom are the rights of suborgination grants once claimed if pay

Answer 12

The insurance company

Question 13

What value is depreciation taken off in a settlement of claims on an actual cash value basis

Answer 13

It is taken off the replacement cost of the item at the time of the loss

Question 14

Is approximate cause the last event That occurs and causes a loss

Answer 14

No. It is the immediate and Effective cause that of loss but not necessarily lash chain of events

Question 15

What is earn premium? what is unearned premium?

Answer 15

Earned premium is the premium that used up well. Unpremium is premium that has yet to be used up

Question 16

What is an endorsement used to do?

Answer 16

It’s used to change or amend a policy

Question 17

What does exclusion mean

Answer 17

Not included

Question 18

What types of refund is required when an insurer cancels and insurance policy

Answer 18

Pro rata

Question 19

What type of refund is required when an insured cancels his insurance policy

Answer 19

Short rate

Question 20

What is a franchise or disappearing deductible

Answer 20

A deductible that no longer exists once a loss reaches a certain amount

Question 21

What is material fact

Answer 21

A fact that is so important that it determines its own whether a risk is acceptable or not and bases on which the premium will be determined.

Question 22

What is miss representation

Answer 22

A lie about material fact

Question 23

What is a hazard

Answer 23

A condition that may cause a loss to occur

Question 24

What are two types of hazard

Answer 24

Physical and moral

Question 25

When is the principle of general average used?

Answer 25

When cargo on a ship or car on a ferry are jettison. To save the ship or ferry, all insurers of the cargo or cars are not jettisons will contribute towards the loss

Question 26

What is a stock insurance company

Answer 26

An insurance company that trades on stock markets and owned by its shareholders

Question 27

Who makes up the group of syndicates in regards to lloyd's of london

Answer 27

Investors

Question 28

What is common law based on?

Answer 28

Law of common people and precedents

Question 29

What is the statue law

Answer 29

Law enact by the government

Question 30

Who is the lessee? Who's the lessor?

Answer 30

Lessee is a person leasing the car, and the lessor is the leasing company

Question 31

What is the lien?

Answer 31

Alone or financial Interest someone holds on a property

Question 32

How does mortgage class protect the mortgage e if the insurer violates the policy

Answer 32

If an insurer violates the policy, they will not receive any benefits from the policy but The insurable interest Of the mortgagee is protected

Question 33

What insurance coverage requires that the insured be negligent before it will pay out

Answer 33

Liability

Question 34

What is peril

Answer 34

An event that may cause a loss to occur

Question 35

What is risk? What type of risk can be insured

Answer 35

A risk is a chance of loss and only pure risk can be insured

Question 36

What is reinsurance

Answer 36

Insurance companies take out insurance on what they are insure

Question 37

What is a rate?

Answer 37

The price of a unit of insurance

Question 38

What are three types of policies required statutory conditions

Answer 38

Accident and sickness, auto and fire

Question 39

Who is the first party and who is the third party in contract of insurance

Answer 39

The first party Is the insured and the third party? Is anyone else involved in a claim from the insurance contract

Question 40

What is time on Risk

Answer 40

The length of time and day that the policy Has been enforced

Question 41

What is tort? What does it usually result in

Answer 41

A tort is a Legal wrong done against another and it usually results in the injured party suing the person for causing their injury

Question 42

What is The unearned premium reserve fund

Answer 42

A fund to guarantee an insurer's Unearned premium as of any given valuation date

Question 43

What does a value policy do

Answer 43

It guarantees the amounts set out in the policy

Question 44

What's the difference between a vacant and unoccupied

Answer 44

The intent to return or to not return

Question 45

What occurs when a policy is made Void

Answer 45

It is treated as if it was never existed, canceled back to the To the inception date, and all premiums are returned.

Question 46

An insurance policy will pay the lesser of these three things

Answer 46

Actual cash value, insurable interests and policy limits

Question 47

When does an insurance policy expire

Answer 47

12:01 am. on the date stated

Question 48

What is an example of contract Of compensation

Answer 48

A life insurance policy

Question 49

What is necessary when determining what name an insurance policy would be Set up in

Answer 49

The owner of the property of a vehicle, whether it be a person or an organization

Question 50

What is a writ

Answer 50

A notice that someone is being sued