Test #1 (100 Ques.)

100 Questions | Total Attempts: 20

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Test #1 (100 Ques.)

Questions and Answers
  • 1. 
    Returning a policyholder to the same economic position prior to a loss is called:
    • A. 

      insurable interest

    • B. 

      Indemnity

    • C. 

      Replacement

    • D. 

      Benefits restoration

  • 2. 
    A person has an insurable interest in?
    • A. 

      A friend

    • B. 

      A neighbor

    • C. 

      A business partner

    • D. 

      A boss

  • 3. 
    Insurable interest must be evident?
    • A. 

      When the policy is delivered

    • B. 

      While the policy is being underwritten

    • C. 

      At the time the policy is applied for

    • D. 

      At the time the premium is paid at delivery

  • 4. 
    An insurance company able to do business in the state Georgia is said to be?
    • A. 

      Qualified

    • B. 

      Registered

    • C. 

      Authorized

    • D. 

      Approved

  • 5. 
    An insurance company headquartered in Canada is conduction business in your state. In your state, this company would be referred to as an?
    • A. 

      Foreign insurer

    • B. 

      Domestic insurer

    • C. 

      Alien insurer

    • D. 

      Unauthorized insurer

  • 6. 
    What type of plan pays benefits directly to the providers of the medical service on behalf of the subscriber?
    • A. 

      Comprehensive medical plan

    • B. 

      Blue cross/blue shield

    • C. 

      Medicare

    • D. 

      Medicaid

  • 7. 
    A person who is hired and trained by one company to sell this company’s products only and who receives a temporary training allowance is known as?
    • A. 

      A general agent

    • B. 

      A temporary agent

    • C. 

      An independent agent

    • D. 

      A captive agent

  • 8. 
    A company wanting to do business in Georgia must
    • A. 

      Meet financial requirements

    • B. 

      Have a home office located in state

    • C. 

      Have resident agents

    • D. 

      Have been in business at least 7 years

  • 9. 
    Facultative reinsurance is negotiated on?
    • A. 

      An individual basis

    • B. 

      On an excess only basis

    • C. 

      On members of the faculty only

    • D. 

      On an Automatic basis

  • 10. 
    An agent’s contract does not expressly grant him the authority to collect premiums after the first premium. However, the agent does so on a regular basis. This continuing authority would be described as?
    • A. 

      Apparent authority

    • B. 

      Express authority

    • C. 

      Presumed authority

    • D. 

      Implied authority

  • 11. 
    If benefits from a hospital expense policy are paid to the insured, it is considered to be a ?
    • A. 

      Service policy

    • B. 

      Limited policy

    • C. 

      Special risk policy

    • D. 

      Reimbursement policy

  • 12. 
    What type of company is able to pass on its losses to its insureds?
    • A. 

      Assessment

    • B. 

      Whole life

    • C. 

      Reciprocal

    • D. 

      Holding

  • 13. 
    What is the name of unincorporated groups of people providing insurance for one another through individual indemnity agreements and are handled by an attorney-in-fact-?
    • A. 

      Reciprocal

    • B. 

      Fraternal

    • C. 

      Lloyds

    • D. 

      Assessment

  • 14. 
    In the event that an insurance company should happen to become insolvent, what will the Guarantee Association are required to pay?
    • A. 

      50K

    • B. 

      100K

    • C. 

      150K

    • D. 

      300K

  • 15. 
    What is the term use to describe a party intentionally and voluntary give up a known right?
    • A. 

      Waiver

    • B. 

      Estoppel

    • C. 

      Warranty

    • D. 

      Condition

  • 16. 
    What is the term used to describe that a part may be precluded from asserting a right that would act to the detriment of the first party?
    • A. 

      Waiver

    • B. 

      Estoppel

    • C. 

      Warranty

    • D. 

      Condition

  • 17. 
    The Supreme Court stated that the Federal Government had the right to regulate the business of insurance, but only when Not regulates by state law. The is an example of?
    • A. 

      Federal regulation

    • B. 

      State regulation

    • C. 

      Self regulation

    • D. 

      Paul versus Virginia

  • 18. 
    Important information that assists the Company Underwriter in determining insurability comes from?
    • A. 

      M.I.B.

    • B. 

      Inspection report

    • C. 

      Applicant's statements on the application

    • D. 

      All of the above

  • 19. 
    A type of insurer that is chartered in another country in known as ?
    • A. 

      Alien

    • B. 

      Foreign

    • C. 

      Domestic

    • D. 

      Admitted

  • 20. 
    In a Stock Company, all of the following are true, EXCEPT?
    • A. 

      Management control rests with the board of directors

    • B. 

      Stockholders advance money to organize the company

    • C. 

      Policy holders share in the profits and losses

    • D. 

      Stockholders share in the profits and losses

  • 21. 
    The law of Large Numbers can best be described as?
    • A. 

      The fewer the number of units be considered, the greater the chance of a correct prediction

    • B. 

      The greater the number of units being considered, the lower the chances of a correct prediction

    • C. 

      The larger number of insureds that die during a given year, the lower the premium

    • D. 

      The greater the number of units being considered, the greater the chance for a correct prediction

  • 22. 
    The terms of the Fair Credit Reporting Act prohibits a consumer reporting agency from supplying all of the following information, except?
    • A. 

      Bankruptcies less than fourteen years old

    • B. 

      Suits and judgments over seven years old

    • C. 

      Paid tax liens over seven years old

    • D. 

      Criminal convictions over seven years old

  • 23. 
    A person attempting to obtain information about another person and pretends to be someone he is not or misrepresents the true purpose of the interview is conduction what?
    • A. 

      Consumer reports

    • B. 

      Pretext interviews

    • C. 

      Investigative consumer reports

    • D. 

      All of the above

  • 24. 
    An insurance institution or agent must provide a notice of information practices to all applicants                ?
    • A. 

      No later than at the time the collection of personal information begins

    • B. 

      When the policy is delivered

    • C. 

      It's not necessary to do

    • D. 

      At the time of claim

  • 25. 
    The accounting measure used by insurance companies to cover the insurer’s liabilities to the Policyholders?
    • A. 

      Surplus

    • B. 

      Dividend

    • C. 

      Reserve

    • D. 

      Risk

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