California Life, Accident, and Health Insurance Final Exam
Questions and Answers
1. A moral hazard: is a dishonest person (lacking in morals)
2. A morale hazard: a careless person.
3. A peril: is a cause of loss
4. Pure risk: is insurable & includes only a chance of loss.
5. The highest premium: would be found with a substandard risk classification.
6. Agent commissions: are an insurer expense
7. "Insurance": is a contract that transfers risk from one party to another.
8. An "insurance policy": is a written contract
9. Neglect to communicate that which a party knows is "concealment": may
cause the injured party
to rescind the policy
10. "Materiality": is determined solely by the probable and reasonable influence
,of the facts upon the part
to whom the communication is due
11. The "materiality of concealment": is the rule used to determine the impor-
tance of the
misrepresentation.
12. An insurance policy: must specify the parties between whom the contract is
made
13. The financial rating of an insurer: is not required to be included in the
insurance policy
14. In a direct response marketing system: the mail and/or internet is used to
sell policies, not agents
15. An insurance broker is a person who: for compensation and on behalf of
another person, transacts
insurance.
16. An insurance agent is a person who: for compensation, transacts insurance
for the insurer.
17. An insurance solicitor: is a person employed by an insurance agent or broker
to aid in insurance
,transactions
18. A person can always use their legal name: to transact insurance
, 19. The state may disapprove the use of any true or fictitious name except: a
person's legal name
20. An insurance agent or broker hires a third party to prepare their website-
: The insurance agent or
broker, not the third party, is responsible for the content of the website.
21. An admitted insurer: is an insurer entitled to transact business in this state
22. A mutual insurer: is owned by the policyholders and issues participating
policies
23. The Insurance Commissioner in California: is elected by the people.
24. The Insurance Commissioner may serve: up to two (2) four-year terms
25. A mutual insurer must pay out: dividends at minimum annually.
26. An insurance policy: is a legal contract.
27. A representation in an insurance contract: is an implied warranty
28. Concealment, whether intentional or unintentional, entitles the injured
party to: rescind an insurance
contract.
29. Agents of insurers who utilize "direct response" marketing systems do
not: conduct personal
Questions and Answers
1. A moral hazard: is a dishonest person (lacking in morals)
2. A morale hazard: a careless person.
3. A peril: is a cause of loss
4. Pure risk: is insurable & includes only a chance of loss.
5. The highest premium: would be found with a substandard risk classification.
6. Agent commissions: are an insurer expense
7. "Insurance": is a contract that transfers risk from one party to another.
8. An "insurance policy": is a written contract
9. Neglect to communicate that which a party knows is "concealment": may
cause the injured party
to rescind the policy
10. "Materiality": is determined solely by the probable and reasonable influence
,of the facts upon the part
to whom the communication is due
11. The "materiality of concealment": is the rule used to determine the impor-
tance of the
misrepresentation.
12. An insurance policy: must specify the parties between whom the contract is
made
13. The financial rating of an insurer: is not required to be included in the
insurance policy
14. In a direct response marketing system: the mail and/or internet is used to
sell policies, not agents
15. An insurance broker is a person who: for compensation and on behalf of
another person, transacts
insurance.
16. An insurance agent is a person who: for compensation, transacts insurance
for the insurer.
17. An insurance solicitor: is a person employed by an insurance agent or broker
to aid in insurance
,transactions
18. A person can always use their legal name: to transact insurance
, 19. The state may disapprove the use of any true or fictitious name except: a
person's legal name
20. An insurance agent or broker hires a third party to prepare their website-
: The insurance agent or
broker, not the third party, is responsible for the content of the website.
21. An admitted insurer: is an insurer entitled to transact business in this state
22. A mutual insurer: is owned by the policyholders and issues participating
policies
23. The Insurance Commissioner in California: is elected by the people.
24. The Insurance Commissioner may serve: up to two (2) four-year terms
25. A mutual insurer must pay out: dividends at minimum annually.
26. An insurance policy: is a legal contract.
27. A representation in an insurance contract: is an implied warranty
28. Concealment, whether intentional or unintentional, entitles the injured
party to: rescind an insurance
contract.
29. Agents of insurers who utilize "direct response" marketing systems do
not: conduct personal
