Free General Insurance Concepts Practice Questions
Alaska Life, Accident & Health exam — 61 practice questions.
Subtopics: Moral hazard, Risk avoidance, Insurable risk, Risk pooling, Speculative risk, Handling risk, Hazards, Definitions, Insurer classifications, Adverse selection, Elements of a contract, Legal interpretations, Law of large numbers, Indemnity, Aleatory contract, Contract of adhesion, Utmost good faith, Unilateral contract, Conditional contract, Express authority, Apparent authority, Fiduciary duty, Reinsurance, Reciprocal insurer, Estoppel, Insurable interest timing, Competent parties, Warranties, Material misrepresentation, Waiver, Parol evidence, Implied authority, Law of agency, Pure risk, Risk sharing, Risk reduction, Fraternal benefit society, Insurer financial strength, Producers, Contract characteristics
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Sample questions & answers
1. A moral hazard is best described as:
A dishonest tendency that increases the likelihood of a loss, such as faking a claim
A moral hazard is a dishonest tendency that increases the chance of a loss such as a fraudulent claim.
2. Choosing not to engage in an activity to eliminate its risk entirely is risk:
Avoidance
Avoiding an activity altogether eliminates its risk and is called risk avoidance.
3. One characteristic of an insurable risk is that the loss should be:
Definite, measurable, and due to chance
An insurable loss should be definite, measurable, and the result of chance.
4. Insurance works on the principle of pooling so that:
The losses of the few are shared among the premiums of the many
Pooling spreads the losses of the few across the premiums contributed by the many.
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Practice: General Insurance Concepts
Answer choices are shuffled every time, and every question comes with an explanation.
Practice questions are study aids generated for exam preparation and are not actual exam questions. Content is provided for educational purposes and is not legal advice. Verify current statutes, rules, and exam specifications with the Insurance Department and the exam administrator before relying on it.
