Which of the following assertions about the necessity of insurable interest in property insurance is correct?
b. When the insurance is issued and any loss occurs, there must be an insurable interest.
c. Only when the property is owned in fee simple does an insurable interest arise.
d. Only when the property is owned by an individual is an insurable interest created.
Which of the following best describes the function of insurance?
Which of the following best characterizes insurance’s role? The purpose of insurance is to protect against financial loss by having the losses of a few people covered by the contributions of many others who are at risk.
Which statement regarding life insurance accelerated benefits is correct?
EXCEPT FOR THE FOLLOWING STATEMENTS ABOUT LIFE INSURANCE LIVING BENEFITS RIDERS OR PROVISIONS, ALL OF THEM ARE Insureds who require hospitalization for any reason are eligible for accelerated benefits. There are two fundamental categories. In most circumstances, if they are used, the net death benefit provided to recipients is lowered.
Which of the following statements is correct concerning conversion provisions in group life insurance policies?
The right answer is: Conversion requires proof of insurability. Except for the fact that dependents are often insurable under group life coverage, all of the following are true for the conversion option for group life insurance. The most common form of group life insurance is an annual renewable term policy.
Which of the following is also known as contract of insurance?
Explanation: Because payment of compensation is guaranteed by the Insurance Company, a Life Insurance contract is termed an Assurance contract.
Which of the following is a type of insurance where an insurer transfers?
A type of insurance in which an insurer transfers loss risks from policies produced for its insureds is known as which of the following? A reinsurance agreement is one in which one insurer transfers a portion of a risk it has assumed to another insurer.
Which of the following statements regarding life insurance policy cost comparison methods is correct?
EXCEPT FOR THE FOLLOWING STATEMENTS ABOUT LIFE INSURANCE COST COMPARISON METHODS, ALL OF THEM ARE TR Cost indices are used to estimate the cost of pure insurance protection over a given time period. The relevance of the cash value in estimating future coverage costs is recognized by all cost comparison tools.
Which of the following statements best describe life insurance policy dividends?
WHICH OF THE FOLLOWING STATEMENTS BEST DESCRIBES THE DIFFERENCES IN LIFE INSURANCE POLICY? DIVIDENDS IN POLICY ARE INTENTIONAL RETURNS OF A PORTION OF THE PREMIUMS PAID.
What is insurance explain principles of insurance?
Insurance is a service that protects you from certain sorts of risks that can occur as a result of unforeseeable circumstances. It provides confidence to individuals by offering a set amount of money in the event of death or damage to personal property. The insured must make a payment.
In exchange for this assurance, you will be charged a premium. The concepts of insurance on which insurance contracts are built are as follows:
i. Absolute good faith – Both the insurer and the insured must believe in each other and the contract they have signed. For example, Rahul, a heart sufferer, should disclose his health difficulties to his insurance firm while purchasing a life insurance policy.
ii. Insurable interest – This implies that the insured has an interest in the object for which he or she is insuring.
An insurable stake in a businessperson’s land, house, and other property, for example.
iii. Indemnity – The aim of an insurance contract, according to the indemnity principle, is to return the insured to the financial situation he or she was in before to the loss (because of a mishap).
For instance, if an individual loses Rs 1 lakh in a fire, the insurance company will only take a claim of Rs 1 lakh and not more.
iii. Proximate cause – This concept stipulates that the reason for the insured object’s loss or damage must be tied to the contract’s subject matter.
For example, if a person loses something in a fire, this should be included in the contract so that the person can collect the insurance money.
v. Subrogation – Once the compensation is paid, the insurer receives possession of the damaged property. The insured is unable to profit from the destroyed property.
For example, if a person receives Rs 1 lakh for a damaged stock, the stock’s ownership will be transferred to the insurance company, and the person will no longer have control over the stock.
vi. Contribution – If a person purchases many insurance policies for the same item, the insurer will make a contribution.
For example, if A insures his or her home for Rs 2 lakh with insurance B and Rs 1 lakh with another insurer, say C, then in the event of a loss of Rs 90,000, insurer B and insurer C will pay A only Rs 90,000 and not more.
vii. Mitigation – The insured should treat the insured thing with the same care that he or she would if the insurance were not present.
For example, if a person obtains fire insurance, he or she should take all reasonable precautions to minimize property damage in the event of a fire, just as he or she would have done if the insurance had not been purchased.
Which of the following statements regarding the accidental death benefit rider to a life insurance policy is correct?
Which of the following claims about a life insurance policy’s accidental death benefit (ADB) rider is true? The accidental death benefit rider pays benefits only if the insured dies as a direct result of an accident.