A provision in a disability income insurance policy that requires a person to be disabled for 60 days before receiving benefits is an example of a(n) A) calendar year deductible. B) grace period. C) elimination period. D) probationary period. ANSWER Answer: C
Date: September 19th, 2020
Kate is covered under her employer’s group health plan. She is also covered as a dependent under her husband’s group health plan. Under the usual coordination-of-benefits provision, how will each company respond to a claim filed by Kate? A) Kate’s plan is primary, and her husband’s plan is excess. B) Her husband’s plan is primary, […]
Date: September 19th, 2020
Kim purchased a one-year property insurance policy. She agreed to pay half the premium when she bought the coverage, and the other half six months later. If Kim fails to pay the second premium, the insurer cannot sue her for the premium because insurance contracts are A) unilateral contracts. B) contracts of adhesion. C) personal […]
Date: September 19th, 2020
A pharmaceutical company employs a young chemist who is responsible for three new patents last year and for the development of the company’s two best-selling drugs. The company purchased a large life insurance policy on the chemist. In this case, the insurable interest requirement was met because of a(n) A) ownership interest. B) close family […]
Date: September 19th, 2020
ABC Life Insurance Company insures both smokers and nonsmokers. Beth lied on her life insurance application, checking the box for “no” in response to the question of whether she smokes cigarettes or uses other tobacco products. Even though Beth smokes 10 to 15 cigarettes each day, the policy was issued at the “preferred nonsmoker rate.” […]
Date: September 19th, 2020
Hank bought a farm that had an old barn. He noticed one day that the roof of the barn was swaying in the wind. Hank went to see his insurance agent and he insured the barn for $20,000. The agent didn’t ask if the roof might collapse, and Hank didn’t say anything about it. One […]
Date: September 19th, 2020
Charles Blake told Wendy that he was an agent for Easy Pay Life Insurance Company. He presented no credentials. He asked Wendy some questions about her health and activities, and recorded the answers on scrap paper. He collected a $250 cash premium from Wendy. When Wendy did not receive a policy from Easy Pay, she […]
Date: September 19th, 2020
Which of the following statements about “open-perils” coverage is (are) true? I. All losses are covered except those losses specifically excluded. II. The burden of proof is on the insured to prove that a loss is covered. A) I only B) II only C) both I and II D) neither I nor II […]
Date: September 19th, 2020
What information is contained in the insuring agreement of an insurance policy? A) a description of the property or life to be insured B) a summary of the major promises of the insurer C) a summary of the obligations of the insured D) a list of the property, losses, and perils that are not covered […]
Date: September 19th, 2020
That part of a property and liability insurance contract that contains information about the property or activity to be insured is called the A) declarations. B) insuring agreement. C) exclusions. D) conditions. ANSWER Answer: A
Date: September 19th, 2020
