WEEK 5 FINAL QUESTIONS
August 8, 2019
personal liability insurance.
August 8, 2019

WHICH OF THE FOLLOWING TYPES OF HEALTH INSURERS NORMALLY REWARDS ITS DOCTORS THROUGH PROFIT SHARING?

Question 1
One of the reasons higher prices will not always increase the supply of insurance is:
consumers will not buy insurance if prices are increased.
the loss and therefore the expense ratio both will increase.
the premiums to surplus ratio must be maintained at a reasonable level.
the number of insurance contracts written by an insurer is totally regulated.

Question 2
Insurance obtained from insurers licensed by the state in which the insurance is purchased is called:
Answer
admitted insurance.
alien insurance.
domestic insurance.
nonadmitted insurance.
Question 3
Paul v. Virginia stipulated that solvency regulation and investment regulation fell under the jurisdiction of which of the following:
Answer
federal insurance departments.
state insurance departments.
local insurance departments.
Congress.
4 points
Question 4
A foreign insurer is one that:
Answer
is home-officed outside the U.S.
has offices both in the U.S. and in other countries.
is incorporated in another state.
has not been in existence for at least three fiscal years.
4 points
Question 5
Which of the following is the most important goal of insurance regulation?
Answer
Limiting the number of insurance companies so the law of large numbers is able to work adequately.
Promoting the solvency of insurance companies.
Mandating that all drivers of automobiles purchase insurance coverage.
Approving the contractual language of insurance policies sold in the state.
4 points
Question 6
All of these are reasons why an insurer might legitimately deny claims except the insured:
Answer
may have attempted to defraud the insurer.
may have failed to pay the premiums.
may have been circulating false literature about insurer.
violated a contract condition.
4 points
Question 7
All of the following insurance areas and activities are regulated by the states except:
Answer
investment decisions.
policy form approval and expense limitations.
taxation.
e-commerce.
4 points
Question 8
The purposes of the Gramm-Leach-Bliley Act of 1999 included all the following except to:
Answer
make financial markets more competitive.
formalize regulation of financial services markets.
modernize U.S. financial services markets.
prohibit federal licensing of financial markets.
4 points click here for more information on this paper
Question 9
“Best’s Insurance Reports” allows you to determine which of the following about your insurer?
Answer
Its reputation for settling claims.
Its customer service rating.
How many complaints have been filed against it.
It’s financial strength rating.
Question 10
In choosing an insurance company, the most important factor is:
Answer
how many dollars it pays for claims.
the number of employees it has.
its financial strength and stability.
the state in which it is domiciled.
4 points
Question 11
In the market for most consumer goods and services we assume the law of supply and demand, operating through open competition, determines the price. Competition, however, does not necessarily work to the consumer’s advantage in the insurance market. Here are the questions. How does the pricing of an insurance policy for the insurer differ from a bologna manufacture’s pricing its product? Why does the difference in pricing problems require that insurance pricing be subject to regulation? Why might be lowest-priced insurance policy be undesirable from the consumer’s standpoint?
Answer
Question 12
We all know football is enjoyable for spectators and participants because of comprehensive roles. Similarly, insurance transaction also needs regulation. So, what is meant by the term insurance regulation”? Why is the solvency of insurers of such great importance to regulators? How do the regulators try to establish and maintain insurers’ solvency?

 
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