PEARSON VUE NATIONAL HEALTH INSURANCE
TEST PAPER 2026 STUDY GUIDE
◉ Speculative Risk. Answer: there is possibility of loss but of gain no
insurablility
◉ exposure unit. Answer: subject to loss
◉ peril. Answer: cause of loss
◉ life insurance. Answer: death
◉ Health insurance. Answer: accident and sickness
◉ hazard. Answer: increases the likelihood or severity of loss
◉ Three types of hazard. Answer: physical, moral, morale
◉ physical hazard. Answer: arise from the inherent characteristic of
the exposure unit
◉ Moral Hazard. Answer: lifestyle of the insured person
,◉ Morale hazard. Answer: arise more from an outlook on life
◉ risk avoidance. Answer: eliminating all risk altogether
◉ risk retention. Answer: manage risk Deduction
◉ self-insurance. Answer: instead of buying health insurance and
saving $ in the bank
◉ Pure risk that are not insurable. Answer: Flood, War, Catastrophic
losses
◉ Intentional losses. Answer: not insurable
◉ Adverse selection. Answer: bad for insurance
◉ insurance actuary. Answer: a specially trained mathematician who
calculates premiums
◉ underwriter. Answer: checks out the medical history of the
proposed insured and other factors to eliminate adverse selection
against the insurance company, issue policy premium restrictions
, ◉ Days for applicant to requests an explanantion. Answer: 90 days
◉ Days insurance company must furnish an explanation. Answer: 21
days
◉ A dispute must begin within in. Answer: 30 days
◉ Law of Large numbers. Answer: the larger the number the easier
it is to predict losses
◉ how much $ must a insurance company have in reserve at all
times. Answer: 4 million
◉ Reinsurance agreements. Answer: enable an insurance company
the ceding company to transfer risk to the reinsurer (seller)
◉ Capital Stock companies are owned by. Answer: stock holders and
most common
◉ Main purpose of the stock company. Answer: make a profit for its
investors
TEST PAPER 2026 STUDY GUIDE
◉ Speculative Risk. Answer: there is possibility of loss but of gain no
insurablility
◉ exposure unit. Answer: subject to loss
◉ peril. Answer: cause of loss
◉ life insurance. Answer: death
◉ Health insurance. Answer: accident and sickness
◉ hazard. Answer: increases the likelihood or severity of loss
◉ Three types of hazard. Answer: physical, moral, morale
◉ physical hazard. Answer: arise from the inherent characteristic of
the exposure unit
◉ Moral Hazard. Answer: lifestyle of the insured person
,◉ Morale hazard. Answer: arise more from an outlook on life
◉ risk avoidance. Answer: eliminating all risk altogether
◉ risk retention. Answer: manage risk Deduction
◉ self-insurance. Answer: instead of buying health insurance and
saving $ in the bank
◉ Pure risk that are not insurable. Answer: Flood, War, Catastrophic
losses
◉ Intentional losses. Answer: not insurable
◉ Adverse selection. Answer: bad for insurance
◉ insurance actuary. Answer: a specially trained mathematician who
calculates premiums
◉ underwriter. Answer: checks out the medical history of the
proposed insured and other factors to eliminate adverse selection
against the insurance company, issue policy premium restrictions
, ◉ Days for applicant to requests an explanantion. Answer: 90 days
◉ Days insurance company must furnish an explanation. Answer: 21
days
◉ A dispute must begin within in. Answer: 30 days
◉ Law of Large numbers. Answer: the larger the number the easier
it is to predict losses
◉ how much $ must a insurance company have in reserve at all
times. Answer: 4 million
◉ Reinsurance agreements. Answer: enable an insurance company
the ceding company to transfer risk to the reinsurer (seller)
◉ Capital Stock companies are owned by. Answer: stock holders and
most common
◉ Main purpose of the stock company. Answer: make a profit for its
investors
