Core Curriculum Chapter 12

Question 1

RISK MANAGEMENT - What are the main strategies for managing risk?

Answer 1

Risk acceptance, risk control, risk reduction, risk segregation, and risk transfer.

Question 2

INSURANCE LAW - How is insurance regulated in Canada?

Answer 2

At the provincial level, with federal oversight through the Insurance Companies Act.

Question 3

INSURANCE CONTRACTS - What are the three requirements for an insurance contract?

Answer 3

Offer, acceptance, and consideration (premium payment).

Question 4

TERM LIFE INSURANCE - What are its key characteristics?

Answer 4

Provides coverage for a set period, low cost, no cash value, and expires without renewal.

Question 5

WHOLE LIFE INSURANCE - What are its key features?

Answer 5

Permanent coverage, fixed premiums, and cash value accumulation.

Question 6

UNIVERSAL LIFE INSURANCE - How does it differ from whole life?

Answer 6

Offers flexible premiums and investment options, allowing for cash value growth.

Question 7

DISABILITY INSURANCE - What is its purpose?

Answer 7

Replaces lost income due to injury or illness, ensuring financial stability.

Question 8

TAXATION OF LIFE INSURANCE - Are life insurance death benefits taxable?

Answer 8

No, they are tax-free to beneficiaries.