Michigan Property & Casualty Exam (100 Out Of 100) Questions And Answer Elabirations.

Underwriting Department {Ans: Responsible for selection of risks and determines actual policy premium}Loss {Ans: Reduction, decrease, or disappearance of value. The basis of a claim for damages under the terms of an insurance policy.}Insurance Regulation at State Level {Ans: Insurance industry is regulated primarily at the state level. Legislature writes and passes laws, judicial branch interprets them.}Insurance Agents/Producers {Ans: Licensed individuals representing an insurance company when transacting insurance.}Fraud and False Statements (Fraudulent Insurance Act) {Ans: 1) Fraud always involves a false statement and deceit; it can be either a criminal or civil crime. Federal laws prohibit the commission of fraud. 2) In 2001, each state enacted its own Fraudulent Insurance Act. 3) A fraudulent act involves a misstatement of material fact by a person who knows or believes that statement to be false.}Insurable risks must include... {Ans: 1) Large number of units or groups with the same perils (law of large numbers as the number of units in a group increases, the more likely it is to predict a particular outcome. 2) The chance of loss must be calculable 3) The loss must be measurable 4) The premiums must be affordable 5) From the