Texas State Exam Simulator Life and Health Insurance
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1. What type of risk involves the potential for loss AND Speculative
the possibility for gain?
Speculative
Homogeneous
Adverse
Pure
2. Which of the following can be defined as a cause of Peril
loss?
Peril
Hazard
Adversity
Risk
3. Which of the following types of risk is insurable? Pure
Pure
Speculative
Operational
Physical
4. Which one of these is NOT considered to be an ele- Speculative risk
ment of an insurable risk?
Speculative risk
Loss must be due to chance
Pure risk
Loss cannot be catastrophic
5. Management
, Texas State Exam Simulator Life and Health Insurance
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Risk ____ is the process of analyzing exposures that
create risk and designing programs to handle them.
Management
Acceptance
Administration
Transfer
6. What type of risk involves the potential for loss with Pure risk
no possibility for gain?
Pure risk
Speculative risk
Adverse risk
Morale risk
7. Which of the following describes the act of insuring a Risk transfer
risk against a possible loss?
Loss management
Hazard reduction
Risk avoidance
Risk tansfer
8. Which of the following can be defined as "the potential Risk
for loss?"
Transference
Peril
Risk
Hazard
9.
, Texas State Exam Simulator Life and Health Insurance
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Which of these statements regarding insurance is As the number of insured
false? units increases, the num-
ber of losses decreases
Speculative risk cannot be insured
As the number of insured units increases, the number
of losses decreases
One way insurers deal with catastrophic loss is
through reinsurance
Pure risk can be insured
10. An insurable risk requires? That the chance of loss be
calculable
That the loss must be incalculable
The loss must be catastrophic
That the chance of loss be calculable
That the chance for both a loss or gain exists
11. Life and health insurance policies are: Unilateral contracts
Non-lateral contracts
Bilateral contracts
Unilateral contracts
Multi-lateral contracts
12. When must insurable interest be present in order for When the application is
a life insurance policy to be valid? made
Before the insured dies
When the application is made
Within the incontestability period
When the insured dies
13.
, Texas State Exam Simulator Life and Health Insurance
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A life insurance arrangement which circumvents in- Investor-Originated Life
surable interest statues is called: Insurance
Investor-Originated Life Insurance
A contract of adhesion
Key person insurance
An indemnity contract
14. A policy of adhesion can only be modified by whom? The insurance company
The primary beneficiary
The agent
The insurance company
The applicant
15. If a contract of adhesion contains complicated lan- Insured
guage, to whom would the interpretation be in favor
of?
Insurer
Insured
Reinsurer
Beneficiary
16. Stranger Originated Life Insurance (STOLI) has been Legal Purpose (Insurable
found to be in violation of which of the following con- Interest)
tractual elements?
Consideration
Competent Parties
Legal Purpose (Insurable Interest)
Offer/Acceptance
Study online at https://quizlet.com/_fxj1bm
1. What type of risk involves the potential for loss AND Speculative
the possibility for gain?
Speculative
Homogeneous
Adverse
Pure
2. Which of the following can be defined as a cause of Peril
loss?
Peril
Hazard
Adversity
Risk
3. Which of the following types of risk is insurable? Pure
Pure
Speculative
Operational
Physical
4. Which one of these is NOT considered to be an ele- Speculative risk
ment of an insurable risk?
Speculative risk
Loss must be due to chance
Pure risk
Loss cannot be catastrophic
5. Management
, Texas State Exam Simulator Life and Health Insurance
Study online at https://quizlet.com/_fxj1bm
Risk ____ is the process of analyzing exposures that
create risk and designing programs to handle them.
Management
Acceptance
Administration
Transfer
6. What type of risk involves the potential for loss with Pure risk
no possibility for gain?
Pure risk
Speculative risk
Adverse risk
Morale risk
7. Which of the following describes the act of insuring a Risk transfer
risk against a possible loss?
Loss management
Hazard reduction
Risk avoidance
Risk tansfer
8. Which of the following can be defined as "the potential Risk
for loss?"
Transference
Peril
Risk
Hazard
9.
, Texas State Exam Simulator Life and Health Insurance
Study online at https://quizlet.com/_fxj1bm
Which of these statements regarding insurance is As the number of insured
false? units increases, the num-
ber of losses decreases
Speculative risk cannot be insured
As the number of insured units increases, the number
of losses decreases
One way insurers deal with catastrophic loss is
through reinsurance
Pure risk can be insured
10. An insurable risk requires? That the chance of loss be
calculable
That the loss must be incalculable
The loss must be catastrophic
That the chance of loss be calculable
That the chance for both a loss or gain exists
11. Life and health insurance policies are: Unilateral contracts
Non-lateral contracts
Bilateral contracts
Unilateral contracts
Multi-lateral contracts
12. When must insurable interest be present in order for When the application is
a life insurance policy to be valid? made
Before the insured dies
When the application is made
Within the incontestability period
When the insured dies
13.
, Texas State Exam Simulator Life and Health Insurance
Study online at https://quizlet.com/_fxj1bm
A life insurance arrangement which circumvents in- Investor-Originated Life
surable interest statues is called: Insurance
Investor-Originated Life Insurance
A contract of adhesion
Key person insurance
An indemnity contract
14. A policy of adhesion can only be modified by whom? The insurance company
The primary beneficiary
The agent
The insurance company
The applicant
15. If a contract of adhesion contains complicated lan- Insured
guage, to whom would the interpretation be in favor
of?
Insurer
Insured
Reinsurer
Beneficiary
16. Stranger Originated Life Insurance (STOLI) has been Legal Purpose (Insurable
found to be in violation of which of the following con- Interest)
tractual elements?
Consideration
Competent Parties
Legal Purpose (Insurable Interest)
Offer/Acceptance
