#1
Which type of insurance provides coverage for damage to your own vehicle in an accident?
Collision Insurance
ExplanationCoverage for damage to your own vehicle in an accident.
#2
What is the purpose of a deductible in an insurance policy?
To discourage small and frequent claims
ExplanationDiscouragement of small and frequent claims.
#3
What is the purpose of an insurance policy's 'exclusion clause'?
To specify perils not covered by the policy
ExplanationSpecification of perils not covered by the policy.
#4
What is 'renewal notice' in the context of insurance?
A reminder to review and renew the insurance policy
ExplanationReminder to review and renew insurance policy.
#5
What is 'sublimit' in insurance policies?
A limit set within the overall coverage for specific items or risks
ExplanationLimit set within overall coverage for specific risks.
#6
What is the primary purpose of an insurance premium?
To create a pool of funds for claims payouts
ExplanationThe creation of funds for claims payouts.
#7
In insurance, what does the term 'underwriting' refer to?
Assessing and accepting risks
ExplanationAssessing and accepting risks in insurance.
#8
In insurance, what is 'reinsurance'?
An insurance policy purchased by an insurer to limit its own risk exposure
ExplanationPolicy purchased by insurer to limit risk exposure.
#9
What does 'indemnity' mean in the context of insurance?
Compensation for loss or damage
ExplanationCompensation for loss or damage in insurance.
#10
In health insurance, what does 'co-payment' refer to?
A fixed amount the insured must pay for each medical service
ExplanationFixed amount insured pays for each medical service.
#11
What is the 'waiting period' in insurance policies?
The time an insured must wait before coverage begins
ExplanationTime insured must wait before coverage begins.
#12
In life insurance, what is the 'beneficiary'?
The person or entity to receive the death benefit
ExplanationRecipient of the death benefit in life insurance.
#13
What is 'risk pooling' in insurance?
Spreading the risk among a large group of policyholders
ExplanationSpreading risk among a group of policyholders.
#14
What is 'insurable interest' in insurance?
The financial stake a policyholder has in the insured property or person
ExplanationFinancial stake in insured property or person.
#15
What does 'nonforfeiture' mean in life insurance?
The right of the policyholder to receive a portion of the policy's cash value
ExplanationPolicyholder's right to receive portion of cash value.
#16
What is 'moral hazard' in the context of insurance?
The increased risk due to the insured's behavior
ExplanationIncreased risk due to insured's behavior.
#17
What is 'subrogation' in insurance terminology?
The legal right of the insurer to pursue a third party for a claim payment
ExplanationInsurer's right to pursue third party for claim payment.
#18
What is the role of an insurance adjuster?
Investigating and evaluating insurance claims
ExplanationInvestigating and evaluating insurance claims.
#19
What is 'coinsurance' in property insurance?
The sharing of risk between the insurer and the insured
ExplanationRisk sharing between insurer and insured.
#20
What is the purpose of 'endorsements' in an insurance policy?
To modify or add coverage to the policy
ExplanationModification or addition of coverage to the policy.
#21
In auto insurance, what does 'no-fault insurance' mean?
Insured drivers are not at fault for accidents
ExplanationInsured drivers not at fault for accidents.
#22
What does 'claim settlement ratio' indicate in insurance?
The ratio of claims settled to the total claims filed
ExplanationRatio of settled claims to total claims filed.
#23
In property insurance, what is 'actual cash value'?
The depreciated value of damaged or lost property
ExplanationDepreciated value of damaged or lost property.
#24
What is the purpose of 'salvage value' in insurance claims?
The value of recovered property after a claim
ExplanationValue of recovered property after a claim.
#25
What does 'fiduciary responsibility' mean in insurance?
The legal obligation to act in the best interest of the policyholders
ExplanationLegal obligation to act in policyholders' best interest.