#1
What does the term 'premium' refer to in insurance?
The cost of the insurance policy
ExplanationCost of insurance policy.
#2
What is 'coinsurance' in insurance policies?
Shared financial responsibility between insurer and insured
ExplanationShared financial responsibility.
#3
What is the purpose of 'policyholder surplus' in insurance?
Buffer for unforeseen losses and liabilities
ExplanationCushion for losses.
#4
What does the term 'sublimit' mean in insurance policies?
Maximum limit of coverage for a specific item or condition
ExplanationMaximum coverage limit.
#5
What does 'insurable interest' mean in insurance?
Financial stake in the insured person or property
ExplanationFinancial stake.
#6
What is the purpose of 'underwriting' in the insurance industry?
Determining the insured's eligibility
ExplanationAssessing eligibility for insurance.
#7
In insurance, what does 'subrogation' involve?
Legal process of recovering losses
ExplanationLegal recovery of losses.
#8
What does 'deductible' mean in insurance terms?
The portion of a claim paid by the insured
ExplanationPortion paid by insured.
#9
What is 'reinsurance' in the insurance industry?
Transfer of risk from one insurer to another
ExplanationTransfer of risk.
#10
In insurance, what does 'indemnity' refer to?
Compensation for losses or damages
ExplanationCompensation for losses.
#11
What is 'adverse selection' in the context of insurance?
Increased risk due to information asymmetry
ExplanationRisk from information imbalance.
#12
What is the significance of the term 'endorsement' in insurance policies?
Modifying or adding coverage
ExplanationModifying coverage.
#13
What does 'moral hazard' refer to in the context of insurance?
Increased risk due to the insured's behavior
ExplanationIncreased risk from behavior.
#14
What is the primary purpose of an 'insurance broker'?
Assisting clients in finding suitable insurance coverage
ExplanationHelping find coverage.
#15
What does 'exclusion' mean in the context of insurance policies?
Specified perils not covered by the policy
ExplanationPerils not covered.
#16
What does 'ceding company' mean in reinsurance?
Insurer that transfers risk to a reinsurer
ExplanationCompany transferring risk.
#17
What is the purpose of 'loss ratio' in insurance analytics?
Percentage of premiums paid as claims
ExplanationRatio of claims to premiums.