Insurance Policy Provisions and Considerations Quiz

Assignment permits the policyholder to transfer insurance rights to a different individual or entity.

Subrogation grants the insurer the right to legally pursue a third party for damages on behalf of the insured.

Medical expenses are not typically excluded from insurance policies, unlike certain perils or circumstances.

Deductible is the initial amount the insured must pay before the insurer starts covering losses.

Exclusion refers to a list of perils or circumstances explicitly not covered by an insurance policy.

Policy limit is the highest amount an insurer will pay for a covered loss.

Term life insurance offers coverage for a set duration and pays a death benefit if the insured passes away within that timeframe.

An endorsement is a document altering the terms of an insurance policy.

The grace period allows the insured to reinstate a lapsed policy without new underwriting during a specified time.

Whole life insurance enables the policyholder to accumulate cash value over the policy's duration.

Coinsurance necessitates the insured to pay a percentage of medical expenses after meeting a specified deductible in health insurance.

Variable life insurance offers a death benefit and an investment component that may accumulate cash value over time.

Ethnicity is not a typical factor in determining insurance premiums, unlike factors such as age, health, and occupation.

Actual cash value is the sum the insurer pays, considering depreciation, for a covered loss.

Reinstatement involves renewing a lapsed insurance policy.

Indemnity is the insurer's duty to compensate the insured for losses covered by the policy.

Policyholder surplus is the funds remaining with the insurer after covering claims and expenses.