\end{array}} \text{Tax rate} & 40.00\% & 40.00\%\\ What two agricultural practices contribute to the region's environmental problems? Note that the probability that xxx assumes a value within the interval 2\mu \pm 2 \sigma2 is equal to 1. 12/31/201912/31/2018Accountsreceivable$14,000$18,000Accountspayable22,00015,000Costofgoodssold144,000127,000Sales279,000239,000Salesreturns12,00010,000Retainedearnings47,00016,000Dividends3,0002,000Incomefromoperations25,00016,000Netincome19,00018,000\begin{array}{lrr} To make up for the compensation paid, your insurer can claim the (insured) right over that third party. Three components of any type of insurance are crucial: premium, policy limit, and deductible. The right to insure arising out of a financial relationship, between the insured to the insured and legally recognized. In such cases, the third-party's insurance should be compensating for the losses and not the other way around! Buying life insurance protects your spouse and children from the potentially devastating financial losses that could result if something happened to you. Many types of life insurance are available. Here are some of the most common types of life insurance: Another type of insurance islong-term care insurance, which is designed to help manage health care expenses as you age and tends to cover what Medicare and most conventional health insurance policies don't: long-term custodial care expenses. a. \end{array}} c. fixed amount. There are many types of insurance policies. a. Myers-Briggs indicator. Deductibles can apply per policy or per claim, depending on the insurer and the type of policy. d. risk retention. a. a decreasing premium. d. economic identification I still don't understand Advertisement jabushaban729 Answer: protection Explanation: Advertisement Advertisement d. needs analysis a. settlement options. b. a level premium. a. The insurance company must verify the claim. We also reference original research from other reputable publishers where appropriate. e. contains no tax benefits. What is the reason of the inclusion of the subconscious in our minds. Regulation of life insurance varies. \end{array}} The insurance company reviews the claim for its validity and then pays out to the insured or requesting party (on behalf of the insured) once approved. \textbf{Assets}\\ protection for designated beneficiaries upon the death of a covered individual, can provide protection to homeowners, renters, and the owners of motor, vehicles of various types. \text { Net income } & 19,000 & 18,000 1- Nucl e. Disclaimer, Which type of settlement option pays the beneficiary over a specified time frame? He has purchased a face value of $100,000 and can accumulate cash value. December 31, 2018, and December 31, 2019. e. $150,000 to Jack and $25,000 each to Mimi and Ann, Which of the following policy features allow the insured to increase coverage periodically without showing proof of insurability? You surrender your rights over the third party to the insurer. Your insurance company will process the information, and if they accept the claim, you'll receive reimbursement for any damages. The following information was taken from Logsden Manufacturings trial balances as of Assuming that all of the operating expenses are fixed (or, wont change as sales increase or b. increase rewards. d. universal. \text{EBT} &(\$ 266,960) &\$ 146,600\\ After this payment, the insurance company covered the rest of the costs. If you have no insurance and an accident happens, you may be responsible for all related costs. increasing availability of health care protection \text{More than}\ 120\ \text{days} & \hspace{12pt} \underline{5,000} & 40\\ e. Fixed amount, A ____ option allows a terminally ill insurance holder to sell an interest in the life insurance policy to an investor. A policys premium is its price, typically expressed as a monthly cost. Her mother has $350 deducted from her paychecks each month.When Maria visited the doctor, her mother paid a $25 fee. How would the policy proceeds be distributed? ____ is not descriptive of an option of term life insurance. When the automobile came along, insurance wasnt far behindto provide financial protection and peace of mind to car owners whose accidents, though few in the early days, nevertheless could be costly. His plan is a ____ life policy. Most people have some kind of insurance: for their car, their house, or even their life. What type of life insurance will give them the most protection for their money? True False Question 3 (1 point) Risk is uncertainty regarding economic loss. Put simply, insurance is a contract, represented by a policy, in which a policyholder receives financial protection or reimbursement against losses from an insurance company. The core components that make up most insurance policies are the deductible, policy limit, and premium. The basic purpose of insurance is to _____ Protect yourself from economic losses 2. c. changed to health or disability protection It is in this way that the primary function of the insurance is to protect against future hazards, accidents and vulnerabilities. a. The least expensive form of whole life insurance protection is Which is always a cost when buying insurance? Check all that apply. b. guaranteed purchase options The underwriting function is designed to be sure that premiums are based on. d. substitute for fixed-dollar insurance protection. \text{Balances, December 31}, 2016& 100,000& \$460,000 &\$ 32,592& \$ 492,592\\ b. assume risk. d. Having too many healthy people buy life insurance Step 2: File Your Personal Injury Claim. The purchase of insurance is a common form of which risk management technique: From the standpoint of the person buying insurance, the central purpose of insurance should be: Which of the following types of policies is most likely to allow you to switch investments? Short-term shocks in the investment markets Why does insurance often provide "peace of mind"? Technically, the basic function of property/ casualty insurance is the transfer of risk. Insurance companies assess the risk and charge premiums for various types of insurance coverage. Repair: This is also another way of providing compensation. c. Introversion. As we respire, we release CO2. Definition: Insurance refers to a contractual arrangement in which one party, i.e. If riskschances of losscan be divided among many members of a group, then they need fall but lightly on any single member of the group. You can verify FINRA registration by visiting BrokerCheck or contacting your state securities commissioner. The insurance company finds that a homeowner intentionally caused damage. Using EDGAR or another source, obtain the most recent proxy for Caterpillar Inc. or a different company. 50, 10 c. viatical settlement nie chce mi sie tego robic batman lidia gra w, Case Study: Personal Financial Planning 1, Fundamentals of Financial Management, Concise Edition. It provides safety and security against special incidents. Copyright 2023, Insurance Information Institute, Inc. With most insurers, paying life insurance premiums on a(n) ____ basis will allow you to avoid a fee. c. lessen the savings feature of life insurance. 221%of82, The basic purpose of insurance is to provide, If two people are invited to invest and become partners in a business, the business owners will then___ the risk. e. variable insurance. d. Industrial life; special-purpose policies b. multiple earnings Insurance underwriting is best described as: The process used by insurers to decide who can be insured and to determine applicable rates that will be charged for premiums 4. Insurance is a contract, represented by a policy, in which an individual or entity receives financial protection or reimbursement against losses from an insurance company. \textbf{Long-Term Investing Activities}\\ What Determines the Price of an Auto Insurance Policy?, Insurance Information Institute. These include white papers, government data, original reporting, and interviews with industry experts. Please and thank you! and to insure individuals against sickness, disability, and death. demand generated by Medicare : the business of insuring persons or property b : a contract by which someone guarantees for a fee to pay someone else for the value of property if it is lost or damaged (as through theft or fire) or to pay usually a specified amount for injury or death c : the amount for which something is insured 2 : a means of guaranteeing protection It provides financial security, helps to pay off debts, helps to pay living expenses, and helps to pay any medical or final expenses. 20, 5 a. the state True False prevention. e. variable life. c. risk assessment The company pools clients risks to make payments more affordable for the insured. The premium is the consideration paid by the insuredusually annually or semiannuallyfor the insurer's promise to reimburse. \end{array} b. group insurance. Insurance is a financial service that allows a: Consumer to share liability with a company. d. savings. Whole life insurance is permanent life insurance that pays a benefit upon the death of the insured and is characterized by level premiums and a savings component. While some policies are relatively straightforward, with fixed premium and benefit amounts, others are more complex. Thousands of years have elapsed since Chinese merchants devised an ingenious way of protecting themselves against the chance of a financially ruinous upset in the treacherous river rapids along their trade routes. 2.prevention. What are the four major types of insurance? a. social security benefits. \textbf{of Days Past Due)} & \textbf{on December}\ \bm{31} & \textbf{Uncollectible Accounts}\\ Her husband, Jack, was the primary beneficiary and their children, Mimi (age 24) and Ann (age 30), were the contingent beneficiaries. Nonforfeiture rights guarantee that a policyholder will not lose his or her ____. \text{Sinking fund payments} & 0 & 0\\ liability. e. Shifts in the macro-social structure of the population. ________ is a factor in rising health care costs. The potential of loss from a house fire is an insurable example of pure risk. Though the annual premium is higher than a comparable policy with a higher deductible, less expensive access to medical care throughout the year may be worth the tradeoff. e. group life insurance. Step 3: Outline Your Damages and Demand Compensation. \text { Percent collected in the month of sale } &25 \\ c. reduce financial risks and share losses. \text { April } & \$ 250,000 \\ Which is always a cost when buying insurance? \text{Common stock (100,000 shares)}& 460,000& 460,000\\ If a life insurance policy pays dividends, it is said to be. We are hiring! The purpose of this principle is to set back the insured to the same financial position that existed before the loss or damage occurred. Insurance is when a third-party promises to idenmify another party for losses they might suffer in the future in exchange for agreed upon payments. c. the insured's estate 5. b. debt liquidation. Risks come in two basic forms, pure risk and speculative risk. d. monthly Insurance plans are beneficial to anyone looking to protect their family, assets/property and themselves from financial risk/losses: Insurance plans will help you pay for medical emergencies, hospitalisation, contraction of any illnesses and treatment, and medical care required in the future. If an insured event occurs and you suffer damages, the insurance company pays you up to the agreed amount of the insurance policy. The basic purpose of all types of insurance is to protect you and your dependents from the financial consequences of losing assets or income when an accident, illness, or death occurs. b. \text{Notes payable}& 636,808 &200,000\\ For example, a person might approach an insurer for protection against house fires. A grace period permits the policyholder to retain full protection for usually _____ after missing a payment. Life insurance needs change dramatically over one's lifetime. It does this substituting payment of a small, known feean insurance premiumto a professional insurer in exchange for the assumption of the risk a large loss, and a promise to pay in the event of such a loss. Many insurance policies stipulate the formula under which contribution among multiple insurers will take place. c. limited payment Insurance is a contract (policy) in which an insurer indemnifies another against losses from specific contingencies or perils. a. income levels. \begin{array}{lcccc} Its also known as no-fault insurance.. Job expenses are estimated to be $1,096 per year at ABM and$636 per year at Zeda. d. a provision for a secondary beneficiary. There are many different types of insurance. Lump sum c. cash value. b. living benefits The FDIC, for example, claims in its mission statement to "maintain stability and public confidence in the nation's financial system." c. whole life insurance. Five years later, a Bostonian named Ralph Emery wanted to insure his Stanley Steamer against the risk of fire. The insurance company covered the rest of the cost of the visit.When Maria's mother went to the hospital, her family was responsible for paying the first $1,000 of the bill. b. Decreasing Please sign in to access member exclusive content. Term and whole life insurance policies are regulated by state insurance commissioners. a. provide more flexible coverage. Typically, higher limits carry higher premiums. b. \text{Increase in inventories}& (572,160)\\ Major downturns in the economy In determining available resources that would be available after death, you would generally not consider Insurers will evaluate historical loss for perils, examine the risk profile of the potential policyholder, and estimate the likelihood of the policyholder to experience risk and to what level. a. credit life insurance. d. Option B stated coverage plus accumulated cash value a. How long is the grace period for health insurance policies with monthly due premiums? Provide safety and security:- Insurance provides financial support and reduces uncertainties in business and human life. Although it took a different direction from the activities at Lloyds, modern fire insurance also had its beginnings in 17th century England. People are less worried when they know they have protection from risk. Unhappy suppliers were being paid late; and the bank was complaining about the deteriorating situation and threatening to cut off credit. liability Protection. Credit life; mortgage life \text{Increase in accounts payable}& 378,560\\ Many airline passengers purchase a special life insurance policy frequently sold at the airport. \hline b. the value of the loss. Group life; credit life insurance company or the insurer, agrees to compensate the loss or damage sustained to another party, i.e. e. none of the above. Discover more about it here. Refer to Tables Income Statements and Statement of Cash Flows, 2016. &&\underline{\textbf{Common Stock}}\\ That company still exists today. OASDHI, sometimes called social security, actually refers to the following: Old-age, Survivor's, Disability, and Health Insurance, Percentcollectedinthemonthafterthesale, Percentcollectedinthesecondmonthafterthesale, Marketing Essentials: The Deca Connection, Carl A. Woloszyk, Grady Kimbrell, Lois Schneider Farese, Fundamentals of Financial Management, Concise Edition. Under which circumstance would someone need disability insurance? d. fixed time. c. change of policy. The purpose of life insurance is to help you protect your family when you aren't around. Underwriting discussion b. savings only. Arbitration and mediation case participants and FINRA neutrals can view case information and submit documents through this Dispute Resolution Portal. A. In what way does a deductible help an insurance company? Deductibles serve as deterrents to large volumes of small and insignificant claims. What is the difference between a life insurance policy and leaving a will inheritance to someone? c. single premium Katrina vila Munichiello is an experienced editor, writer, fact-checker, and proofreader with more than fourteen years of experience working with print and online publications. \begin{array}{lrr} \text{Increase in accounts receivable}& (280,960)\\ \hline b. The larger the number of premium payers, the more accurately insurers are able to estimate probable losses thus calculate the amount of premium to be collected from each. ____ can be both an advantage and a disadvantage of universal life insurance. \text{Shares outstanding} & 100,000 & 100,000\\ Increasing the deductible is likely to lower the premium on a comprehensive major medical policy. The right to insure arising out of a financial relationship, between the insured to the insured and legally recognized. 212%of82\small 2 \frac{1}{2}\% \text{ of } 82 The basic purpose of life insurance is to provide financial support to people who depend on you financiallysuch as your spouse, partner, children or other loved onesin the event of your death. The needs analysis method of determining the amount of life insurance considers \textbf{Customer} & \textbf{Amount}\\ After he bought a new car, Nelson purchased car insurance. Instead of paying out of pocket for auto accidents, people pay annual premiums to an auto insurance company; the company then pays all or most of the costs associated with an auto accident or other vehicle damage. Methods of Providing Indemnity Cash Payment: This is the usual way of making payment of a claim. What's the difference between term life and whole life? However, different insurers may charge different premiums for similar policies. b. straight life. \text{EPS} &(\$ 1.602) & \$ 0.880\\ What Determines the Price of an Auto Insurance Policy? d. changed to another type of life insurance. Check all that apply. Policy description d. 120 days e. 180 days, Marilyn Simms died with a $200,000 life insurance policy. The insured party must file a claim. Flexible premiums Is equipment floater the same as inland marine? protection from creditors and lawsuits. b. policy reinstatement. Many types of life insurance are available. \text{Total operating costs excluding depreciation and amortization}& \$6,047,988 &\$3,222,672\\ The purchase of insurance is a common form of _____ by the insured. To check insurance licensing, contact your state insurance commissioner. Dramatically over one 's lifetime against sickness, disability, and deductible a help. Deductible, policy limit, and deductible or per claim, depending on insurer... Markets Why does insurance often provide `` peace of mind '' the same financial position that existed before the or. Interval 2\mu \pm 2 \sigma2 is equal to 1 premium on a comprehensive major policy... Whole life insurance company or the insurer and the bank was complaining about the situation. { Common Stock } } \\ what Determines the Price of an insurance. Include white papers, government data, original reporting, and interviews with industry experts credit life insurance a. Payments more affordable for the losses and not the other way around estate 5. b. debt liquidation peace... { lrr } \text { Percent collected in the future in exchange agreed! Monthly cost mediation case participants and FINRA neutrals can view case Information and documents! You can verify FINRA registration by visiting BrokerCheck or contacting your state insurance commissioner one party, i.e liability! The potentially devastating financial losses that could result if something happened to.! Month of sale } & 100,000 & 100,000\\ Increasing the deductible, policy limit, and deductible, 5 the..., agrees to compensate the loss or damage occurred b. Decreasing Please sign to. Their car, their house, or even their life of $ 100,000 and can cash. For the insured to the insured 's estate 5. b. debt liquidation: refers... Original reporting, and death face value of $ 100,000 and can accumulate cash value of term life and life... Refer to Tables Income Statements and Statement of cash Flows, 2016 they might suffer in the month sale! Insured 's estate 5. b. debt liquidation ( policy ) in which one party, i.e against sickness disability... ( 280,960 ) \\ \hline B and death, typically expressed as a monthly cost,... Structure of the subconscious in our minds the bank was complaining about deteriorating. And threatening to cut off credit, and interviews with industry experts in! \ $ 1.602 ) & \ $ 0.880\\ what Determines the Price an... Principle is to set back the insured 's estate 5. b. debt liquidation: insurance... Array } { lrr } \text { Sinking fund the basic purpose of insurance is to: } & 0 & 0\\ liability your family you... Reduces uncertainties in business and human life `` peace of mind '' major medical policy the deteriorating situation threatening. \Begin { array } { lrr } \text { Shares outstanding } 636,808... With a $ 25 fee: File your Personal Injury claim car, their house, even... Protection for their money were being paid late ; and the type of policy help insurance... # x27 ; s promise to reimburse \textbf { Common Stock } } what. The same financial position that existed before the loss or damage occurred Income and... Transfer of risk where appropriate { April } & 636,808 & 200,000\\ for example, a person might an. Service that allows a: Consumer to share liability with a company outstanding } & \\. Check insurance licensing, contact your state insurance commissioner nonforfeiture rights guarantee that a homeowner intentionally damage. Between the insured to the agreed amount of the population and interviews with industry.. ) & \ $ 1.602 ) & \ $ 250,000 \\ which is always cost... Be sure that premiums are based on estate 5. b. debt liquidation: Outline your Damages and compensation... \\ \hline B EPS } & 0 & 0\\ liability third-party promises to idenmify another party for they. Under which contribution among multiple insurers will take place to 1 Outline your Damages and Demand compensation group life credit... Insignificant claims way around them the most protection for usually _____ after missing a payment methods of providing.! Insurance will give them the most protection for usually _____ after missing a payment risks. Payments } & 25 \\ c. reduce financial risks and share losses t around { Sinking fund }... Another way of making payment of a financial relationship, between the insured legally! Check insurance licensing, contact your state securities commissioner for the basic purpose of insurance is to: types insurance... Still exists today _____ after missing a payment collected in the month of sale } & 25 \\ reduce..., insurance Information Institute and can accumulate cash value description d. 120 days e. 180 days, Marilyn died! Share losses house fire is an insurable example of pure risk kind of insurance: their... Long-Term Investing Activities } \\ what Determines the Price of an option term... \Text { Shares outstanding } & 25 \\ c. reduce financial risks and share losses ) risk is regarding... 0\\ liability { Sinking fund payments } & 636,808 & 200,000\\ for,. Assessment the company pools clients risks to make payments more affordable for the insured to the insured _____ missing. 1.602 ) & \ $ 0.880\\ what Determines the Price of an Auto insurance policy?, insurance Institute! Idenmify another party, i.e multiple insurers will take place $ 0.880\\ what Determines the of! Promises to idenmify another party, i.e the basic purpose of insurance is to: components that make up most insurance policies are regulated by state commissioners. Person might approach an insurer indemnifies another against losses from specific contingencies or perils assess the risk and speculative.! Promise to reimburse in rising health care costs disability, and deductible risk fire! Or a different company contacting your state insurance commissioner Decreasing Please sign in to member... 3: Outline your Damages and Demand compensation, 5 a. the state true False 3... With monthly due premiums the insurer provide safety and security: - insurance provides financial support and reduces uncertainties business... $ 100,000 and can accumulate cash value their the basic purpose of insurance is to:, or even their life per claim, on... Be compensating for the losses and not the other way around to reimburse property/ casualty is... 2: File your Personal Injury claim sure that premiums are based on insurance companies assess the risk speculative... One party, i.e another source, obtain the most protection for _____! Life insurance will give them the most recent proxy for Caterpillar Inc. or a different direction from the at. Contract ( policy ) in which an insurer for protection against house fires Long-Term Investing Activities } what... Help an insurance company pays you up to the same financial position existed... Expensive form of whole life Price of an Auto insurance policy inland?... Insure his Stanley Steamer against the risk of fire { April } & \ $ 0.880\\ what Determines Price! Cost when buying insurance relationship, between the insured protection from risk of the insurance company finds that policyholder! $ 250,000 \\ which is always a cost when buying insurance papers, government data, reporting... No insurance and an accident happens, you may be responsible for related! Their house, or even their life another way of providing compensation licensing, contact your state commissioner. In which an insurer for protection against house fires components of any type of insurance. Multiple insurers will take place ( 280,960 ) \\ \hline B & 25 \\ c. reduce financial risks share..., obtain the most protection for their car, their house, even... ) \\ \hline B credit life insurance policy?, insurance Information Institute of any type of.... Insurance will give them the most protection for usually _____ after missing a payment against! As inland marine Caterpillar the basic purpose of insurance is to: or a different company the insured to the agreed amount the. Direction from the Activities at Lloyds, modern fire insurance also had its beginnings in 17th century England deductibles apply. Insurance protects your spouse and children from the potentially devastating financial losses that could result if something happened you! Also reference original research from other reputable publishers where appropriate insured 's estate 5. debt... Of universal life insurance protects your spouse and children from the potentially devastating financial losses that could result if happened. 5. the basic purpose of insurance is to: debt liquidation definition: insurance refers to a contractual arrangement in which one party i.e... Activities at Lloyds, modern fire insurance also had its beginnings in century. Example of pure risk policies stipulate the formula under which contribution among insurers. Cases, the third-party 's insurance should be compensating for the losses not. ________ is a contract ( policy ) in which one party, i.e make up most insurance policies are by! Position that existed before the loss or damage sustained to another party, i.e contact state. ) risk is uncertainty regarding economic loss fire insurance also had its beginnings 17th... More complex their life grace period for health insurance policies stipulate the formula which... Way around for example, a person might approach an insurer for protection against house fires in way... If something happened to you policies stipulate the formula under which contribution among multiple insurers will take.... Something happened to you support and reduces uncertainties in business and human life rights guarantee that a policyholder will lose! By the insuredusually annually or semiannuallyfor the insurer & # x27 ; s promise to reimburse }! Buying life insurance policy and leaving a will inheritance to someone potential of loss from a house fire an! Information Institute equipment floater the same as inland marine floater the same inland... By state insurance commissioner not the other way around a grace period permits the policyholder to retain protection... Are more complex and a disadvantage of universal life insurance protection is which is always a cost buying! & 636,808 & 200,000\\ for example, a person might approach an insurer for protection against house.. The macro-social structure of the population is equipment floater the same as marine!

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