Which of the following is a statement that is guaranteed to be true?
Warranty. A warranty in insurance is a statement guaranteed to be true.
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What is the purpose of a conditional receipt?
A conditional receipt gives an insurance company a window of time in which they can ultimately issue or refuse to approve the policy. If during this time, the applicant for a life insurance contract dies, the company will pay a death benefit if the policy would have been issued.
What is another name for a substandard risk classification?
Another substandard risk classification name is an impaired risk or table-rated life insurance. The substandard risk class refers to people who have significant health impairments. Depending on their risks, these individuals may have to pay an extra fee or “table rating” to the issuing life insurance company.
What is a statement that is guaranteed to be true is?
A warranty is a statement that is considered guaranteed to be true.
Which part of a life insurance policy are guaranteed to be true?
Among the guaranteed elements are policy benefits, premiums, values, credits, and charges that are guaranteed and determined at issue.
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What are statements that are guaranteed to be true in all respects?
Warranties are statements that are guaranteed to be true and are part of the legal contract. Insurers are held to the principle of warranties, not insureds. Breach of warranty is grounds for voiding an insurance contract.
Which of the following is not an insurable risk?
Potential for Catastrophic Loss – this applies to non-insurable risks like war, nuclear hazards or even earthquakes. When one of these types of catastrophic losses occur, the amounts insurers could be liable for paying are so high that it would put them out of business or severely shake their financial stability.
What is true about insurable risk?
Insurable risks are risks that insurance companies will cover. These include a wide range of losses, including those from fire, theft, or lawsuits. When you buy commercial insurance, you pay premiums to your insurance company. In return, the company agrees to pay you in the event you suffer a covered loss.
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Which of the following statements does not describe an element of an insurable risk?
Which of the following statements does NOT describe an element of an insurable risk? The loss must not be due to chance.
What are the 3 elements of insurable risk?
What is the purpose of a conditional receipt quizlet?
What is the purpose of a conditional receipt? It is intended to provide coverage on a data earlier than the date of the issuance of the policy. An agent and an applicant for life insurance policy fill out and sign the application.
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What does conditional receipt mean in life insurance?
Conditional Binding Receipt — a receipt in life insurance that guarantees that if the risk is accepted, the named insured is insured from the date of issuance of the receipt.
How does a conditional receipt differ from a binding?
The difference between a conditional binding receipt and a straightforward binding receipt is that a straightforward binding receipt requires the insurance company to pay the death benefit once the first premium gets paid, whether the applicant is ultimately approved or not. Conditional binding receipts are common.
What are the types of conditional receipts?
The conditional receipt contains two subcategories as well: (1) Insurability and (2) approval. The insurance agent should collect the first full installment from the applicant at the time of application. The conditional receipt is the most common form of receipt, but it is not a full receipt.
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What is another name for a substandard risk classification quizlet?
RATED – SUBSTANDARD RISK CLASSIFICATION IS ALSO REFERRED TO AS "RATED" SINCE THESE POLICIES COULD BE ISSUED WITH THE PREMIUM RATED-UP, RESULTING IN A HIGHER PREMIUM. AN APPLICANT SIGNS AN APPLICATION FOR A $25,000 LIFE INSURANCE POLICY, PAYS THE INITIAL PREMIUM, AND RECEIVES A CONDITIONAL RECEIPT.
What is an example of substandard risk?
For example, an individual who has survived cancer may be considered a substandard risk for health or life insurance policies. It is also known as impaired risk.
What is substandard in insurance terms?
Substandard — less than standard. For example, substandard auto insurance is insurance written for drivers with poor driving records. For obvious reasons, substandard insurance premiums are typically higher and coverage terms more restrictive than those for insurance written on standard risks.
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What are the 4 risk classes?
Most commonly used risk classifications include strategic, financial, operational, people, regulatory and finance.
