1 General Insurance

B Foreign

C Domestic

D Sovereign

B Catastrophic loss exposure.

C Insurable risks.

D Law of large numbers.

B Cease and desist

C Non forfeiture

D Indemnity

B Licensed

C Legal

D Admitted

B Perils.

C Hazards.

D Exposures.

B Breach of warranty.

C Concealment.

D Waiver

B The applicant is under the influence of medication at the time of application.

C The applicant has a prior felony conviction.

D The applicant is intoxicated at the time of application.

B Insured

C Principal

D Client

B Assumed

C Apparent

D Express

B Frequently is depressed.

C Has an indifferent view of activities that may be dangerous.

D Always drives over the speed limit.

B When an insurer delivers the policy

C When an insurer receives an application

D When an insured submits an application

A Mexico

B Canada

C Washington D.C.

D Maryland

B A warranty.

C Implied warranty.

D Utmost good faith.

B To minimize the insured's level of liability in the event of loss.

C To reduce expenses and improve cash flow

D To increase control of claim reserving and claims settlements.

B Setting and meeting monthly production goals.

C Recommending qualified retirement plans to each client.

D Putting the client’s best interest before their own .

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correct!A company is domestic when doing business within the state in which it is incorporated

correct! The basis of insurance is sharing risk between a large homogeneous group with similar exposure to loss.

correct! If, because of advertising or sales literature or statements by an agent, an insured could reasonably expect the coverage, the courts have held that the insurer must provide that coverage. For example, if a person orders a new automobile, even though the order form does not state that it will have a steering wheel, the buyer could reasonably expect the automobile to include a steering wheel.Review ContentNext Question

Incorrect! Insurers who meet the state's financial requirements and are approved to transact business in the state are considered authorized or admitted into the state as a legal insurer.Review ContentNext Question

C Hazards.

Incorrect! Conditions such as lifestyle and existing health, or activities such as scuba diving are hazards and may increase the chance of a loss occurring.

Incorrect! In insurance, concealment is the withholding of information that will result in an imprecise underwriting decision.

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Correct! An agent represents the principal, acting on the entity's behalf in contractual agreements with third parties.

Correct! An agent who accepts a premium after the end of the grace period appears to the client to have the authority to prevent the policy from lapsing. In fact, the agent has no such power.

Incorrect! Moral hazards refer to those applicants that may lie on an application for insurance, or in the past, have submitted fraudulent claims against an insurer.

Incorrect! In insurance, the offer is usually made by the applicant, in the form of the application. Acceptance takes place when an insurer’s underwriter approves the application and issues a policy.

Incorrect! A foreign insurer is an insurance company that is incorporated in another state or territorial possession. Mexico and Canada are foreign countries, so their insurers will be considered alien. An insurer that is incorporated and that operates in Washington D.C. would be considered domestic.Review Content Next Question

D Utmost good faith.

Incorrect! The insurer must be able to rely on the statements given by the insured in the application. The insured must be able to rely on the insurer's promise to pay covered losses.Review ContentNext Question

B To minimize the insured's level of liability in the event of loss.

Incorrect! Retention usually results from three basic desires of the insured: to reduce expenses and improve cash flow, to increase control of claim reserving and claims settlements, and to fund losses that cannot be insured.

Correct! The needs of the client(s) are the priority to a highly ethical agent.Review Content Next Question.