Whole book study 411 Questions with
complete solutions,.
Blank refers to restore insureds to the same financial position in which they were before
the loss aroused - Correct answerINDEMNITY
The following is considered a social mechanism which distributes the risks of financial
losses between a large number of people - Correct answerINSURANCE
The purpose of insurance is to? - Correct answerREPLACE POSSIBLE
LOSSES FOR FUTURE FINANCIAL CERTAINTY
The prediction of future losses is more precise when studies are based on a? -
Correct answerLARGE GROUP
Distributing or spreading economic risks between a large number of members is called?
- Correct answerRISK POOLING
The law of large numbers allows insurers to? - Correct answerESTIMATE
FUTURE LOSSES OF A GROUP
Transferring the risks of one person to the group is? - Correct answerRISK
POOLING
Henry lost his house because it was totally burnt due to a fire that started after he went
out and forgot to blow out the candles which flame got in contact with some documents.
What was the risk in this situation? - Correct answerTHE BURNT HOUSE
John will invest 2 million dollars in the stock market in Wall Street. He called his
insurance company to buy a policy to cover such investment but the insurance company
refused to cover him because this is what kind of risk? - Correct
answerSPECULATIVE RISK
All of the following are considered pure risks except? Examples include ( die in a car
accident, be hospitalized due to pulmonary disease, lose a house property due to a fire,
,losing all money due to gambling in a casino ) - Correct answerLOSING ALL
MONEY DUE TO GAMBLING IN A CASINO
All of the following are speculative risks except? Examples include ( the amount
invested in Wall Street, be hospitalized due to pulmonary, the vet of Half million dollars
at the hippodrome and lose money in Wall Street market disease ) - Correct
answerBE HOSPITALIZED DUE TO PULMONARY
Henry lost his house because it was totally burnt due to a fire that started after he went
out and forgot to blow out the candles which flame got in contact with some documents.
What was the peril in this situation? - Correct answerTHE FIRE
Henry lost his house because it was totally burnt due to a fire that started after he went
out and forgot to blow out the candles which flame got in contact with some documents.
What was the hazard in this situation? - Correct answerHE FORGOT TO
BLOW OUT THE CANDLES
Laura is injured in a car accident because she distracted herself when sending text
messages by her phone. This is a case of what type of hazard? - Correct
answerMORALE HAZARD
Mr.Jefferson owns a supermarket and he is planning to install more cameras and other
security methods because he is afraid of his employees stealing merchandise. This is
an example of what type of hazard? - Correct answerMORAL HAZARD
Louis was born deaf but since very young he has been fascinated with cars. Now that
he inherited a sum of money from his father, he wants to hit his first race car and get his
driving permit. This could be a case of what type of hazard? - Correct
answerPHYSICAL HAZARD
John slipped on the wet floor and it is possible that he has injuries after falling down.
This is an example of a? - Correct answerRISK
If John has injuries after falling down because he slipped on the wet floor, what is the
peril? - Correct answerTHE FALL DOWN
If John has injuries after falling down because he slipped on the wet floor, what is the
hazard? - Correct answerTHE WET FLOOR
,Mr.Jones never travels by airplane, which method of risk management is he using to
manage the risk of being in a plane crash? - Correct answerAVOIDANCE
When a person is wearing a seatbelt while driving, what method of risk management is
the person using ? - Correct answerREDUCTION
What method of managing reduces self-insurance? - Correct
answerRETENTION
What It is considered a Social system for transfer risks? - Correct
answerINSURANCE
Robert had brought a health insurance policy that covers him, his wife and two children.
How has Robert managed the risk of getting sick or injured? - Correct
answerTRANSFERRING
In order for an Insurable interest to exist, death or injury resulting in blank to the
applicant must occur - Correct answerFINANCIAL LOSSES
Fernando is applying for an insurance policy to protect his house because he is afraid
that in case of a fire he could lose his investment. Fernando has? - Correct
answerINSURABLE INTEREST
Luisa wants to buy insurance to cover the financial losses of her family in case she dies
early. Would an insurance company consider the risk as Insurable? - Correct
answerYES BECAUSE ITS PURE RISK
All of the following are characteristics of an Insurable risk, except? Examples include
( loss must be measurable, loss must be foreseen, loss must he statistically predictable
and loss exposures must be randomly selection ) - Correct answerLOSS
MUST BE FORSEEN
The following is a type of policy which covers an insure from the risk of living too long?
Examples include ( health policy, life policy, property policy and annuity policy) -
Correct answerANNUITY POLICY
, Type of insurance that pays benefits to a beneficiary in case of the death of an insured -
Correct answerLIFE INSURANCE
Type of health insurance that Pays benefits to a beneficiary in cade of the death of an
insured - Correct answerLIFE INSURANCE
Type of health insurance that pays benefits to a beneficiary in case of accidental death
of an insured - Correct answerAD&D
The following are not covered by property insurance, except ? Examples include
( medical expense insurance, annuity policy, inland marine, credit insurence ) -
Correct answerINLAND MARINE
All of the following are limited insurance policies, except? Examples include ( ticket
insurance; travel insurance? General liability insurance, title insurance ) - Correct
answerGENERAL LIABILITY INSURANCE
Policies issued when there is no market through the original producer and non
authorized carriers in the state where the risks will be covered is? - Correct
answerSURPLUS LINES
Excess lines require a? - Correct answerP&C LICENSE ( PROPERTY AND
CASUALTY )
Type of insurance that indemnified a creditor or his debtors fail to pay due to disability or
death - Correct answerCREDIT INSURSANCE
In order to do insurance business in any state, insurers must receive a blank from the
commissioner - Correct answerCERTIFICATE OF AUTHORITY
RBK insurance company is a registered insurer in NY, and where to sell its policies in
NJ. RBK needs to get blank from the NJ insurance commissioner - Correct
answerCERTIFICATE OF AUTHORITY
BBC insurance company has no permission to transact insurance within a state where
this company is considered blank or and or blank - Correct
answerUNAUTHORIZED, NONADMITTED
complete solutions,.
Blank refers to restore insureds to the same financial position in which they were before
the loss aroused - Correct answerINDEMNITY
The following is considered a social mechanism which distributes the risks of financial
losses between a large number of people - Correct answerINSURANCE
The purpose of insurance is to? - Correct answerREPLACE POSSIBLE
LOSSES FOR FUTURE FINANCIAL CERTAINTY
The prediction of future losses is more precise when studies are based on a? -
Correct answerLARGE GROUP
Distributing or spreading economic risks between a large number of members is called?
- Correct answerRISK POOLING
The law of large numbers allows insurers to? - Correct answerESTIMATE
FUTURE LOSSES OF A GROUP
Transferring the risks of one person to the group is? - Correct answerRISK
POOLING
Henry lost his house because it was totally burnt due to a fire that started after he went
out and forgot to blow out the candles which flame got in contact with some documents.
What was the risk in this situation? - Correct answerTHE BURNT HOUSE
John will invest 2 million dollars in the stock market in Wall Street. He called his
insurance company to buy a policy to cover such investment but the insurance company
refused to cover him because this is what kind of risk? - Correct
answerSPECULATIVE RISK
All of the following are considered pure risks except? Examples include ( die in a car
accident, be hospitalized due to pulmonary disease, lose a house property due to a fire,
,losing all money due to gambling in a casino ) - Correct answerLOSING ALL
MONEY DUE TO GAMBLING IN A CASINO
All of the following are speculative risks except? Examples include ( the amount
invested in Wall Street, be hospitalized due to pulmonary, the vet of Half million dollars
at the hippodrome and lose money in Wall Street market disease ) - Correct
answerBE HOSPITALIZED DUE TO PULMONARY
Henry lost his house because it was totally burnt due to a fire that started after he went
out and forgot to blow out the candles which flame got in contact with some documents.
What was the peril in this situation? - Correct answerTHE FIRE
Henry lost his house because it was totally burnt due to a fire that started after he went
out and forgot to blow out the candles which flame got in contact with some documents.
What was the hazard in this situation? - Correct answerHE FORGOT TO
BLOW OUT THE CANDLES
Laura is injured in a car accident because she distracted herself when sending text
messages by her phone. This is a case of what type of hazard? - Correct
answerMORALE HAZARD
Mr.Jefferson owns a supermarket and he is planning to install more cameras and other
security methods because he is afraid of his employees stealing merchandise. This is
an example of what type of hazard? - Correct answerMORAL HAZARD
Louis was born deaf but since very young he has been fascinated with cars. Now that
he inherited a sum of money from his father, he wants to hit his first race car and get his
driving permit. This could be a case of what type of hazard? - Correct
answerPHYSICAL HAZARD
John slipped on the wet floor and it is possible that he has injuries after falling down.
This is an example of a? - Correct answerRISK
If John has injuries after falling down because he slipped on the wet floor, what is the
peril? - Correct answerTHE FALL DOWN
If John has injuries after falling down because he slipped on the wet floor, what is the
hazard? - Correct answerTHE WET FLOOR
,Mr.Jones never travels by airplane, which method of risk management is he using to
manage the risk of being in a plane crash? - Correct answerAVOIDANCE
When a person is wearing a seatbelt while driving, what method of risk management is
the person using ? - Correct answerREDUCTION
What method of managing reduces self-insurance? - Correct
answerRETENTION
What It is considered a Social system for transfer risks? - Correct
answerINSURANCE
Robert had brought a health insurance policy that covers him, his wife and two children.
How has Robert managed the risk of getting sick or injured? - Correct
answerTRANSFERRING
In order for an Insurable interest to exist, death or injury resulting in blank to the
applicant must occur - Correct answerFINANCIAL LOSSES
Fernando is applying for an insurance policy to protect his house because he is afraid
that in case of a fire he could lose his investment. Fernando has? - Correct
answerINSURABLE INTEREST
Luisa wants to buy insurance to cover the financial losses of her family in case she dies
early. Would an insurance company consider the risk as Insurable? - Correct
answerYES BECAUSE ITS PURE RISK
All of the following are characteristics of an Insurable risk, except? Examples include
( loss must be measurable, loss must be foreseen, loss must he statistically predictable
and loss exposures must be randomly selection ) - Correct answerLOSS
MUST BE FORSEEN
The following is a type of policy which covers an insure from the risk of living too long?
Examples include ( health policy, life policy, property policy and annuity policy) -
Correct answerANNUITY POLICY
, Type of insurance that pays benefits to a beneficiary in case of the death of an insured -
Correct answerLIFE INSURANCE
Type of health insurance that Pays benefits to a beneficiary in cade of the death of an
insured - Correct answerLIFE INSURANCE
Type of health insurance that pays benefits to a beneficiary in case of accidental death
of an insured - Correct answerAD&D
The following are not covered by property insurance, except ? Examples include
( medical expense insurance, annuity policy, inland marine, credit insurence ) -
Correct answerINLAND MARINE
All of the following are limited insurance policies, except? Examples include ( ticket
insurance; travel insurance? General liability insurance, title insurance ) - Correct
answerGENERAL LIABILITY INSURANCE
Policies issued when there is no market through the original producer and non
authorized carriers in the state where the risks will be covered is? - Correct
answerSURPLUS LINES
Excess lines require a? - Correct answerP&C LICENSE ( PROPERTY AND
CASUALTY )
Type of insurance that indemnified a creditor or his debtors fail to pay due to disability or
death - Correct answerCREDIT INSURSANCE
In order to do insurance business in any state, insurers must receive a blank from the
commissioner - Correct answerCERTIFICATE OF AUTHORITY
RBK insurance company is a registered insurer in NY, and where to sell its policies in
NJ. RBK needs to get blank from the NJ insurance commissioner - Correct
answerCERTIFICATE OF AUTHORITY
BBC insurance company has no permission to transact insurance within a state where
this company is considered blank or and or blank - Correct
answerUNAUTHORIZED, NONADMITTED
