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Unit 3 Nature of the Industry
Review Your Knowledge
Match the following terms with the definition that fits best.
A. claim
B. conditions
C. credit score
D. declarations
E. endorsements
1. A legally binding document also called a policy.
2. Describes the responsibilities the policyholder has when a loss occurs.
3. Losses the insurance carrier will not cover.
4. Lists a policy number, the name of the policyholder, and the insurance
company.
5. A more-detailed look at the applicant’s finances, health habits,
occupation, and character.
6. A numerical value that reflects a person’s credit history.
7. Numerical value that reflects the risk the applicant represents to the
insurance company.
8. An insurance company transfers some of its risk to another insurance
company.
9. The process of documenting the loss against the policy.
10. Details agreements that are not otherwise part of the policy.
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12. Explain how the law of large numbers affects an insurance company’s
profitability.
13. What roles do smart systems play in the insurance application process?
14. What does a loss adjuster do?
15. What function does the insuring agreement portion of an insurance
policy serve?
Now that you have finished this chapter, see what you
know about insurance by taking the chapter post test.
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F. exclusions
G. inspection report
H. insurance contract
I. insurance score
J. reinsurance