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  4. General Insurance Concepts

Free General Insurance Concepts Practice Questions

North Dakota Accident & Health exam — 45 practice questions.

Subtopics: Indemnity, Adverse selection, Law of large numbers, Contract of adhesion, Risk transfer, Risk definition, Morale hazard, Peril, Stock insurer, Mutual insurer, Admitted insurer, Foreign insurer, Consideration, Legal purpose, Competent parties, Express authority, Apparent authority, Utmost good faith, Representations, Concealment, Aleatory contract, Pure risk, Speculative risk, Physical hazard, Moral hazard, Implied authority, Fiduciary duty, Warranty, Misrepresentation, Waiver, Estoppel, Reciprocal insurer, Fraternal benefit society, Reinsurance, Non-admitted insurer, Alien insurer, Unilateral contract, Conditional contract, Offer and acceptance, Insurable interest

Read the General Insurance Concepts study guide

Sample questions & answers

1. The principle of indemnity in health insurance generally means the insured should:

Be restored toward their pre-loss financial position without profiting

Indemnity aims to restore the insured to the pre-loss position without allowing a profit from the loss.

2. Adverse selection in health insurance is the tendency of:

Less healthy individuals to seek coverage more than healthier ones

Adverse selection is the tendency of higher-risk individuals to seek or retain coverage more than lower-risk individuals.

3. The law of large numbers helps a health insurer to:

Predict expected losses more accurately across a large insured group

The law of large numbers improves the accuracy of loss predictions as the number of similar insureds grows.

4. A health insurance contract is a contract of adhesion because:

The insurer writes it and the applicant generally accepts it as written

In a contract of adhesion, the insurer drafts the contract and the applicant generally takes it or leaves it.

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Practice: General Insurance Concepts

Take a randomized, timed-style practice test. Answer choices are shuffled and your results are scored instantly with an explanation for every question.

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.