Question 1

A life insurance policy is not binding until the insured dies.

Accepted Answer

A) True 
 B)False

Question 2

Ben obtains a fire insurance policy on his house with Constant Insurance Company. Like all insurance, this policy is an arrangement for

Accepted Answer

A)   ​avoiding the assumption of responsibility.
B)   ​predicting a potential loss based on unknown factors.
C)   ​shifting the imposition of liability.
D)   ​transferring and allocating risk.E) All of the above
F) C) and D)

Question 3

Engineering Associates, P.A., obtains an insurance policy that protects its members against negligence claims by their clients. This is

Accepted Answer

A)   ​product liability insurance.
B)   ​general liability insurance.
C)   ​professional malpractice insurance.
D)   ​workers' compensation insurance.E) A) and B)
F) B) and C)

Question 4

An incorrect statement as to the age of the insured provides an insurance company with an excuse to avoid payment on the insured's death.

Accepted Answer

A) True 
 B)False

Question 5

Employer's liability insurance insures an employer against liability for injuries or losses sustained by employees during the course of their employment.

Accepted Answer

A) True 
 B)False

Question 6

Reno is the beneficiary of a life insurance policy on Sula's life obtained from Traditional Insurance Company. The underwriter of this policy is

Accepted Answer

A)   ​Reno.
B)   ​Sula.
C)   ​Traditional Insurance.
D)   ​the agent or broker through whom the policy was obtained.E) A) and B)
F) All of the above

Question 7

Rob applies to Standard Insurance Company for a life insurance policy. On the application, Rob understates his age. Rob obtains the policy, but for a lower premium than he would have had to pay had he disclosed his actual age. The policy includes an incontestability clause. Five years later, Rob dies. Can Standard refuse payment on the policy?

Accepted Answer

Probably not. An incorrect statement as ...

Question 8

Mena applies for a homeowners' insurance policy on her house with Neighbors Insurance Company through Obie, an agent who works for Neighbors. In this transaction, Obie is

Accepted Answer

A)   ​an agent for both parties.
B)   ​Mena's agent, and not Neighbors's agent.
C)   ​Neighbors's agent, and not Mena's agent.
D)   ​not an agent.E) C) and D)
F) B) and C)

Question 9

Property insurance cannot be canceled for nonpayment of premiums.

Accepted Answer

A) True 
 B)False

Question 10

Automobile liability insurance covers liability for property damage but not bodily injury.

Accepted Answer

A) True 
 B)False

Question 11

An insurance application is part of the insurance contract.​

Accepted Answer

A) True 
 B)False

Question 12

Businesses can not typically protect their financial interests by obtaining insurance.

Accepted Answer

A) True 
 B)False

Question 13

For property insurance, the insurable interest must exist when a policy is purchased.

Accepted Answer

A) True 
 B)False

Question 14

An arbitration clause requires arbitration of disputes that arise between the insurer and the insured concerning the settlement of claims.

Accepted Answer

A) True 
 B)False

Question 15

Gus obtains a health insurance policy for his family from Healthway Insurance Company. The policy includes an incontestability clause. Under such a clause, after a policy has been in force for two or three years

Accepted Answer

A)   ​Gus cannot contest Healthway's insurable interest.
B)   ​Gus cannot contest Healthway's refusal to pay a claim under the policy.
C)   ​Healthways cannot contest Gus's eligibility for continued coverage.
D)   ​Healthways cannot contest Gus's statements in the application.E) None of the above
F) A) and B)

Question 16

A person can insure anything in which he or she has an insurable interest.

Accepted Answer

A) True 
 B)False

Question 17

Lighting Concepts, Inc., a trade fixture vendor and installer, wants to insure itself against injuries to employees and others on the premises during and after work hours. This business should obtain

Accepted Answer

A)   ​workers' compensation insurance.
B)   ​general liability insurance.
C)   ​product liability insurance.
D)   ​professional malpractice insurance.E) A) and C)
F) A) and B)

Question 18

Kent applies for a life insurance policy with Long Life Insurance Company. The consideration Kent pays to Long Life is

Accepted Answer

A)   ​a premium.
B)   ​a fee.
C)   ​a policy.
D)   ​an insurable interest.E) C) and D)
F) A) and D)

Question 19

A person who obtains insurance from an insurance company's agent is usually protected the moment the premium is paid.

Accepted Answer

A) True 
 B)False

Question 20

Any loss sustained before the effective date of an insurance policy will not be covered.

Accepted Answer

A) True 
 B)False

Exam 50: Insurance

Engineering Associates, P.A., obtains an insurance policy that protects its members against negligence claims by their clients. This is

Correct Answer
verified

Businesses can not typically protect their financial interests by obtaining insurance.

Correct Answer
verified

Property insurance cannot be canceled for nonpayment of premiums.

Correct Answer
verified

An arbitration clause requires arbitration of disputes that arise between the insurer and the insured concerning the settlement of claims.

Correct Answer
verified

Kent applies for a life insurance policy with Long Life Insurance Company. The consideration Kent pays to Long Life is

Correct Answer
verified

A person who obtains insurance from an insurance company's agent is usually protected the moment the premium is paid.

Correct Answer
verified

Automobile liability insurance covers liability for property damage but not bodily injury.

Correct Answer
verified

Lighting Concepts, Inc., a trade fixture vendor and installer, wants to insure itself against injuries to employees and others on the premises during and after work hours. This business should obtain

Correct Answer
verified

Gus obtains a health insurance policy for his family from Healthway Insurance Company. The policy includes an incontestability clause. Under such a clause, after a policy has been in force for two or three years

Correct Answer
verified

Employer's liability insurance insures an employer against liability for injuries or losses sustained by employees during the course of their employment.

Correct Answer
verified

Correct Answer
verified
Probably not. An incorrect statement as ...
View Answer

Any loss sustained before the effective date of an insurance policy will not be covered.

Correct Answer
verified

Mena applies for a homeowners' insurance policy on her house with Neighbors Insurance Company through Obie, an agent who works for Neighbors. In this transaction, Obie is

Correct Answer
verified

A life insurance policy is not binding until the insured dies.

Correct Answer
verified

For property insurance, the insurable interest must exist when a policy is purchased.

Correct Answer
verified

Reno is the beneficiary of a life insurance policy on Sula's life obtained from Traditional Insurance Company. The underwriter of this policy is

Correct Answer
verified

An incorrect statement as to the age of the insured provides an insurance company with an excuse to avoid payment on the insured's death.

Correct Answer
verified

An insurance application is part of the insurance contract.

Correct Answer
verified

Ben obtains a fire insurance policy on his house with Constant Insurance Company. Like all insurance, this policy is an arrangement for

Correct Answer
verified

A person can insure anything in which he or she has an insurable interest.

Correct Answer
verified

Exam 50: Insurance

Engineering Associates, P.A., obtains an insurance policy that protects its members against negligence claims by their clients. This is

Correct AnswerverifiedShow Answer

Businesses can not typically protect their financial interests by obtaining insurance.

Correct AnswerverifiedShow Answer

Property insurance cannot be canceled for nonpayment of premiums.

Correct AnswerverifiedShow Answer

An arbitration clause requires arbitration of disputes that arise between the insurer and the insured concerning the settlement of claims.

Correct AnswerverifiedShow Answer

Kent applies for a life insurance policy with Long Life Insurance Company. The consideration Kent pays to Long Life is

Correct AnswerverifiedShow Answer

A person who obtains insurance from an insurance company's agent is usually protected the moment the premium is paid.

Correct AnswerverifiedShow Answer

Automobile liability insurance covers liability for property damage but not bodily injury.

Correct AnswerverifiedShow Answer

Lighting Concepts, Inc., a trade fixture vendor and installer, wants to insure itself against injuries to employees and others on the premises during and after work hours. This business should obtain

Correct AnswerverifiedShow Answer

Gus obtains a health insurance policy for his family from Healthway Insurance Company. The policy includes an incontestability clause. Under such a clause, after a policy has been in force for two or three years

Correct AnswerverifiedShow Answer

Employer's liability insurance insures an employer against liability for injuries or losses sustained by employees during the course of their employment.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedProbably not. An incorrect statement as ...View AnswerShow Answer

Any loss sustained before the effective date of an insurance policy will not be covered.

Correct AnswerverifiedShow Answer

Mena applies for a homeowners' insurance policy on her house with Neighbors Insurance Company through Obie, an agent who works for Neighbors. In this transaction, Obie is

Correct AnswerverifiedShow Answer

A life insurance policy is not binding until the insured dies.

Correct AnswerverifiedShow Answer

For property insurance, the insurable interest must exist when a policy is purchased.

Correct AnswerverifiedShow Answer

Reno is the beneficiary of a life insurance policy on Sula's life obtained from Traditional Insurance Company. The underwriter of this policy is

Correct AnswerverifiedShow Answer

An incorrect statement as to the age of the insured provides an insurance company with an excuse to avoid payment on the insured's death.

Correct AnswerverifiedShow Answer

An insurance application is part of the insurance contract.​

Correct AnswerverifiedShow Answer

Ben obtains a fire insurance policy on his house with Constant Insurance Company. Like all insurance, this policy is an arrangement for

Correct AnswerverifiedShow Answer

A person can insure anything in which he or she has an insurable interest.

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified

Correct Answer
verified
Probably not. An incorrect statement as ...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

An insurance application is part of the insurance contract.

Correct Answer
verified

Correct Answer
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Correct Answer
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