Arizona Insurance Exam ACTUAL UPDATED Questions and CORRECT Answers
Terms in this set (200)
Grace Period For all other modes ( Quartlerly, Biannual, 31 Days
Annual)
Grace Period for Monthly Premiums 10 Days
Grace Period for Weekly Premiums 7 Days
Elements of a Legal Contract agreement, consideration, competent parties, legal purpose
Fiduciary Responsibility agent submits premium collected to the insurance company
Apparent Authority Assumed by Customer ( Business card, Letterhead Stationary)
Implied Authority Authority that is not expressed or written into the contract, but which the agent is
assumed to have.
Express Authority The authority granted to an agent by means of the agent's written contract.
Law of Agency agent represents the insurer and the knowledge of the agent is knowledge of the
insurer
Morale Hazard carelessness or indifference to a loss because of the existence of insurance
Moral Hazard Lying on Purpose. Lying on insurance application.
Physical Hazard Material and structural things you can see and touch. (Smoking, drinking, gas cans
net to clothes in garage, tree limbs to trip on(
Hazards increase the chance of the risk occurring
STARR Share.
Transfer.
Avoid.
Retain
Reduce
Speculative Risk A chance of loss, no loss, or gain.
Pure Risk Loss or nothing. No chance of gain.
Mutual Companies Owned by the policy owners and issue participating policies.
Dividends are not taxed
Stock Comp Owned by shareholders and issue non participating policies.
Dividends are taxed.
, Certificate of Authority Allows insurers to sell in the state. Making them admitted and authorized.
Exposure Unit of measurement to determine rates for an insured based on how risky they
are
Law of Large Numbers The more data you have to look at the more predictable losses will be.
indemnity restore to the insured's original pre-loss condition, no better, no worse
Loss Reduction, decrease, or disappearance of value.
Terms in this set (200)
Grace Period For all other modes ( Quartlerly, Biannual, 31 Days
Annual)
Grace Period for Monthly Premiums 10 Days
Grace Period for Weekly Premiums 7 Days
Elements of a Legal Contract agreement, consideration, competent parties, legal purpose
Fiduciary Responsibility agent submits premium collected to the insurance company
Apparent Authority Assumed by Customer ( Business card, Letterhead Stationary)
Implied Authority Authority that is not expressed or written into the contract, but which the agent is
assumed to have.
Express Authority The authority granted to an agent by means of the agent's written contract.
Law of Agency agent represents the insurer and the knowledge of the agent is knowledge of the
insurer
Morale Hazard carelessness or indifference to a loss because of the existence of insurance
Moral Hazard Lying on Purpose. Lying on insurance application.
Physical Hazard Material and structural things you can see and touch. (Smoking, drinking, gas cans
net to clothes in garage, tree limbs to trip on(
Hazards increase the chance of the risk occurring
STARR Share.
Transfer.
Avoid.
Retain
Reduce
Speculative Risk A chance of loss, no loss, or gain.
Pure Risk Loss or nothing. No chance of gain.
Mutual Companies Owned by the policy owners and issue participating policies.
Dividends are not taxed
Stock Comp Owned by shareholders and issue non participating policies.
Dividends are taxed.
, Certificate of Authority Allows insurers to sell in the state. Making them admitted and authorized.
Exposure Unit of measurement to determine rates for an insured based on how risky they
are
Law of Large Numbers The more data you have to look at the more predictable losses will be.
indemnity restore to the insured's original pre-loss condition, no better, no worse
Loss Reduction, decrease, or disappearance of value.
