2
NYS Insurance Licensing Exam with accurate detailed answers
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insurance transfers - ✔✔the risk of an loss for an individual or business to an insurance
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company which spreads out the costs to many individuals
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agency contract - ✔✔a contract that is held between insurer and an agent/producer
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containing the expressed authority given to the agent/producer, and the
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duties/responsibilities to the principal, any agent in violation of the agency contract may be || || || || || || || || || || || || || ||
held personally liable to the insurer
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agent - ✔✔legal representative of a an insurance company that acts for another person or
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entity known as the principal with regard to contractual arrangements
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beneficiary - ✔✔receives benefits from the insurance || || || || || ||
death benefit - ✔✔the amount paid when a claim is issued against policy of insurance
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insurance policy - ✔✔a contact b/w insured and insurance company that agrees to pay the
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insured in the event of unforseen events caused by specific events
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risk - ✔✔is the uncertainty or chance of loss occurring only two types of risks exist which
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are speculative and pure and only one is insurable
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pure risk - ✔✔is the the certainty that loss or no change will occur with no financial gain to
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be sought only this type of risk is insurable
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speculative - ✔✔the type that may either lead to loss or gain. example gambling. these are
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NOT insurable ||
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exposure - ✔✔the unit of measure used to determine the premiums for insurance coverage
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hazards - ✔✔broken into 2 subtypes (physical, moral, morale); conditions that increase the
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probability of the insured to experience a loss || || || || || || ||
physical hazard - ✔✔hazards arising from material, structural, and operational features
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moral hazard - ✔✔hazards to applicants that may lie or provide fraudulent information to
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insurance companies ||
morale - ✔✔hazard derived from complacent (If broken the insurance will fix it ) state of
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mind
perils - ✔✔are CAUSES of the loss that are covered in insurance policies
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loss - ✔✔is defined as the reduction , decrease, or disappearance of value of property or
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person insured in the policy caused by a name peril
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Pure Death protection - ✔✔(Term/temporary protection) if the insured dies during this
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term, the beneficiary receives the pay out; if policy is cancelled/expires prior to insured
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death, there is nothing payable at the end; NO cash value; maximum age that coverage is
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not offered is 80
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3 basic types of Term Coverage - ✔✔determined by how the face amount or death benefit
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changes throughout coverage (Level, Increasing, Decreasing) however, premiums usually
|| || || || || || || || ||
stay constant the only thing that changes is the death benefit
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NYS Insurance Licensing Exam with accurate detailed answers
|| || || || || || ||
insurance transfers - ✔✔the risk of an loss for an individual or business to an insurance
|| || || || || || || || || || || || || || || ||
company which spreads out the costs to many individuals
|| || || || || || || ||
agency contract - ✔✔a contract that is held between insurer and an agent/producer
|| || || || || || || || || || || || ||
containing the expressed authority given to the agent/producer, and the
|| || || || || || || || || ||
duties/responsibilities to the principal, any agent in violation of the agency contract may be || || || || || || || || || || || || || ||
held personally liable to the insurer
|| || || || ||
agent - ✔✔legal representative of a an insurance company that acts for another person or
|| || || || || || || || || || || || || || ||
entity known as the principal with regard to contractual arrangements
|| || || || || || || || ||
beneficiary - ✔✔receives benefits from the insurance || || || || || ||
death benefit - ✔✔the amount paid when a claim is issued against policy of insurance
|| || || || || || || || || || || || || ||
insurance policy - ✔✔a contact b/w insured and insurance company that agrees to pay the
|| || || || || || || || || || || || || || ||
insured in the event of unforseen events caused by specific events
|| || || || || || || || || ||
risk - ✔✔is the uncertainty or chance of loss occurring only two types of risks exist which
|| || || || || || || || || || || || || || || || ||
are speculative and pure and only one is insurable
|| || || || || || || ||
pure risk - ✔✔is the the certainty that loss or no change will occur with no financial gain to
|| || || || || || || || || || || || || || || || || ||
be sought only this type of risk is insurable
|| || || || || || || || ||
speculative - ✔✔the type that may either lead to loss or gain. example gambling. these are
|| || || || || || || || || || || || || || || ||
NOT insurable ||
, 2
exposure - ✔✔the unit of measure used to determine the premiums for insurance coverage
|| || || || || || || || || || || || ||
hazards - ✔✔broken into 2 subtypes (physical, moral, morale); conditions that increase the
|| || || || || || || || || || || || ||
probability of the insured to experience a loss || || || || || || ||
physical hazard - ✔✔hazards arising from material, structural, and operational features
|| || || || || || || || || ||
moral hazard - ✔✔hazards to applicants that may lie or provide fraudulent information to
|| || || || || || || || || || || || || ||
insurance companies ||
morale - ✔✔hazard derived from complacent (If broken the insurance will fix it ) state of
|| || || || || || || || || || || || || || || ||
mind
perils - ✔✔are CAUSES of the loss that are covered in insurance policies
|| || || || || || || || || || || ||
loss - ✔✔is defined as the reduction , decrease, or disappearance of value of property or
|| || || || || || || || || || || || || || || ||
person insured in the policy caused by a name peril
|| || || || || || || || ||
Pure Death protection - ✔✔(Term/temporary protection) if the insured dies during this
|| || || || || || || || || || || ||
term, the beneficiary receives the pay out; if policy is cancelled/expires prior to insured
|| || || || || || || || || || || || || ||
death, there is nothing payable at the end; NO cash value; maximum age that coverage is
|| || || || || || || || || || || || || || || ||
not offered is 80
|| || ||
3 basic types of Term Coverage - ✔✔determined by how the face amount or death benefit
|| || || || || || || || || || || || || || || ||
changes throughout coverage (Level, Increasing, Decreasing) however, premiums usually
|| || || || || || || || ||
stay constant the only thing that changes is the death benefit
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