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PA Life & Health Insurance > General Insurance > Flashcards

General Insurance Flashcards

1
Q

Premium Elements

A
  • Mortality
  • Interest
  • Expenses
  • Net Premium
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2
Q

Net Premium

A

Mortality minus interest

Net Single

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3
Q

Gross Premium

A

Net premium plus expenses

Gross annual

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4
Q

Dividend Options

A 
CARPPO 
Cash 
Accumulate with interest
Reduce next premium 
Paid up policy 
One year term - attained age
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5
Q

Non Forfeiture Options

A

Surrender for cash
Reduced paid up insurance
Extended term

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6
Q

Backdating

A

Usually no more than 6 months

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7
Q

Conditional Receipt

A
  • Premium paid with application
  • Insurance effective - later of - date of application completed and signed or medical exam if required
  • Must be standard or preferred risk
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8
Q

Binding Receipt

A

Temporary - not common in life insurance

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9
Q

Underwriting Sources

A

Application - primary source
Medical exams and testing
Attending Physician Statement (APS)
AIDS testing - cannot be in MIB
MIB - application cannot be denied solely on this, insured must be informed
Consumer reports - Insured must be informed
Investigative Reports - Insured must give consent

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10
Q

Fair Credit Reporting Act: Penalty and Fines

A 
Max of $5,000
Or imprisonment (one year)
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11
Q

Moral Hazard

A

A belief that intentionally causing a loss is acceptable. Habits or lifestyle included

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12
Q

Morale Hazard

A

Carelessness

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13
Q

Business Overhead Expense Plan

A

Deductible

Taxable

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14
Q

Dental Expense Plan

A

Offered through PPO

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15
Q

Skilled Nursing Care for Medicare

A

100 Days

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16
Q

Medicare

A

Hospital Stays
Skilled Nursing Care
Home Health

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17
Q

Cobra Continuation Notice For Qualifying Events

A

14 Days

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18
Q

Executive Bonus Plan

A

EE Access to policy living benefits
ER Pays Premium
EE Owns Policy

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19
Q

Disability Buy Sell

A

Cannot Deduct

Benefits not taxed

20
Q

Limited Pay

A

Stop paying premiums at a specified time

No reduction of death benefits

21
Q

LTC Insurance

A

Assisted living facilities
Home health care
Adult day care
Respite care

22
Q

Hospital Indemnity Plan / Hospital Income Plan

A

Payment directly to insured
Flat dollar daily benefit
Used toward deductible and coinsurance payments

23
Q

Non Contributory

A

100%

Employer pays entire premium

24
Q

Contributory

A

75%

Employees pay part of premium

25
Q

Blanket Coverage

A

Covers accidents
Volunteer groups
No application needed for new members
Group exposed to same risks

26
Q

Underwriting is the process of

A

Selecting, classifying, and rating risks

27
Q

Cold Lead Advertising

A

Illegal marketing practice

28
Q

Appointment

A

A written agreement in which an insurer authorizes a producer to sell its products

29
Q

LTC Group Plan

A

Excluded from EE income

ER deducts

30
Q

Reduced Paid Up

A

Face value is reduced

Cash values continue to increase

31
Q

Insurers must maintain advertisements on file for

A

4 years (Four Advertisements)

32
Q

Insurance Application

A

Part 1: Personal and Occupational history

Part 2: Insureds Medical History

33
Q

Life Insurance Premium Factors

A

Interest earnings
Expenses
Mortality

34
Q

Producers Report

A
  • character
  • habits
  • financial status

The report is not attached to the application and never seen by the insured

35
Q

Reciprocal Exchange

A

Cooperative Insurance
Each Insured is an Insurer
Managed by attorney in fact

36
Q

Reinstating a lapsed policy

A

3 Years from missed premium payment

37
Q

Reinsurance

A

Act of one insurer selling part of a policy to another
Original company = ceding company
Second insurer = assuming company

38
Q

Treaty Reinsurance

A

Agreement of a reinsurer to underwrite certain class of business submitted by a ceding company

39
Q

Consideration Clause

A

The amount and frequency of premium payments

40
Q

Speculative Risk

A

Chance of both loss and gain

41
Q

Representations

A

Believed to be true and the time it has been given

42
Q

Misrepresentations

A

Information given that is false

Does not affect insurance companies decision in the contract

43
Q

Material Misrepresentations

A

Can void a contract

Does impact the insurer’s decision in the contract

44
Q

Binding Coverage

A

Coverage is guaranteed until insurer formally rejects the application

45
Q

Currently Insured

A

6 credits in the last 13 quarters

46
Q

Facility of Payment

A

Exists to expedite payment if unable to locate the beneficiary

47
Q

Basic Form of Health Insurance

A

Medical
Accident Only
Disability

PA Life & Health Insurance (3 decks)

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