Insurance-保险学-课后答案-英文版.doc

CHAPTER 1 /RISK IN OUR SOCIETYKEY CONCEPTS AND TERMSFundamental risk: A fundamental risk is a risk that affects the entire economy or large numbers of persons or groups within the economy.Hazard: A hazard is a condition that creates or increase the chance of loss.Law of large number: As the number of exposure units increase, the more closely the actual loss experience will approach the expected loss experience.Liability risks: you can be held legally liable if you do something that results in bodily injury or property damage to someone else.Moral hazard: Moral hazard is dishonesty or character defects in an individual that increase the frequency or severity of loss.Morale hazard: Morale hazard is carelessness or indifference to a loss because of the existence of insurance.Physical hazard: A physical hazard is a physical condition that increase the chance of loss.Premature death: Premature death is defined as the death of a household head with unfulfilled financial obligations.Pure risk: Pure risk is defined as a situation in which there are only the possibilities of loss or no loss.Speculative risk: Speculative risk is defined as a situation in which either profit or loss is possible.REVIEW QUESTIONS1. How does objective risk differ from subjective risk?Objective risk is defined as the relative variation of actual loss from expected loss. Objective risk declines as the number of exposures increases. Objective risk can be measured.Subjective risk is defined as uncertainty based on a persons mental condition or state of mind. The impact of subjective risk varies depending on the individual. High subjective risk often results in conservative and prudent behavior, while low subjective risk may result in less conservative behavior.2. Define peril, hazard, physical hazard, moral hazard, morale hazard, and legal hazard.Peril: peril is defined as the cause of loss.Physical hazard: A physical hazard is a physical condition that increase the chance of loss.Moral hazard: Moral hazard is dishonesty or character defects in an individual that increase the frequency or severity of loss.Morale hazard: Morale hazard is carelessness or indifference to a loss because of the existence of insurance.Legal hazard: Legal hazard refers to characteristics of the legal system or regulatory environment that increase the frequency or severity of losses. 3. Explain the difference between pure and speculative risk and between fundamental and particular risk.pure and speculative risk:First, private insurers generally insure only pure risk. Second, the law of large numbers can be applied more easily to pure risk than to speculative risk. Finally, society may benefit from a speculative risk even though a loss occurs, but it is harmed if a pure risk is present and a loss occurs. fundamental and particular risk:Government assistance may be necessary to insure a fundamental risk.4. Identify the major types of pure risk that are associated with great financial insecurity. (P 5)The major types of pure risk that can create great financial insecurity include Personal risks, property risks, and liability risks.Personal risks are risks that directly affect an individual. 5. Describe briefly the five major methods of handling risk. Give example of each method.(P 9)APPLICATION QUESTIONSSeveral methods are available for handling risk. However, certain techniques are more appropriate than others in a given situation.a. (1) Should retention be used in those situations where both loss frequency and loss severity are high? Explain your answer. (P 11)(2) Explain why loss control is a highly desirable method for handling risk.(P 10)b. Explain why chance of loss and risk are not the same thing.(P 3)CHAPTER 2 / INSURANCE AND RISKKEY CONCEPTS AND TERMSAdverse selection: Adverse selection is the tendency of persons with a higher-than-average chance of loss to seek insurance at standard (average) rates, which if not controlled by underwriting, results in higher-than-expected loss levels.Fortuitous loss: A fortuitous loss is one that is unforeseen and unexpected and occurs as a result of chance.Indemnification：Indemnification means that the insured is restored to his or her approximate financial position prior to the occurrence of the loss.Insurance: Insurance is the pooling of fortuitous losses by transfer of such risks to insurers, who agree to indemnify insureds for such losses, to provide other pecuniary benefits on their occurrence, or to render services connected with the risk.Law of large numbers: the law of large numbers states that the greater the number of exposures, the more closely will the actual results approach the probable results that are expected from an infinite number of exposures.Underwriting: Underwriting refers to the process of selecting and classifying applicants for insurance.REVIEW QUESTIONS1. Explain the major characteristics of a typical insurance plan.(P 16)2. Explain the law of large numbers and show how the law of large numbers can be used by an insurer to estimate future losses. (P 17)3. Explain the major requirements of an insurable risk.（P 18）APPLICATION QUESTIONS1. Although no risk completely meets all of the ideal requirements of an insurable risk, some risks come much closer to meeting them than others.a. Identify the ideal requirements of an insurable risk.(P 18)b. Compare and contrast automobile collisions and war in terms of how well they meet the requirements of an insurable risk.( p 18)2. One author states that “The law of large numbers forms the basis of insurance.” Do you agree or disagree with this statement? Explain your answer.CHAPTER 5 / FUDAMENTAL LEGAL PRINCIPLESKEY CONCEPTS AND TERMSActual cash value（实际现金价值）: Actual cash value is defined as replacement cost less depreciation.(重置成本折旧)Aleatory contract(射幸合同): Aleatory contract is a contract where the values exchanged may not be equal but depend on an uncertain event.Commutative contract(等价交易合同) : A commutative contract is one in which the values exchange by both parties are theoretically equal.Conditional contract（条件合同）: Conditions are provisions inserted in the policy that qualify or place limitations on the insurers promise to perform.Consideration(对价): the value that each party gives to the other. The insureds consideration is payment of the first premium (or a promise to pay the first premium) plus an agreement to abide by the conditions specified in the policy. The insurers consideration is the promise to do certain things as specified in the policy.Contract of adhesion（符合性合同）: A contract of adhesion means the insured must accept the entire contract, with all of its terms and conditions.Material fact(重要事实)：Material means that if the insurer knew the true facts, the policy would not have been issued, or it would have been issued on different terms.Offer and acceptance(要约和承诺): The first requirement of a binding insurance contract is that there must be an offer and acceptance of its item. In most case, the applicant for insurance makes the offer, and the company accepts or rejects the offer.Principle of indemnity: The principle of indemnity states that the actual amount of the loss; stated differently, the insured should mot profit from a loss.Principle of utmost good faith（最大诚信原则）: A higher degree of honesty is imposed on both parties to an insurance contract than is imposed on parties to other contracts.Subrogation(代位追偿): Subrogation means substitution of the insurer in place of the insured for the purpose of claiming indemnity from a third person for a loss covered by insurance.Unilateral contract(单务合同)：A unilateral contract means that only one party makes a legally enforceable promise.Valued policy(定值保险单)：A valued policy is a policy that pays the face amount of insurance if a total loss occurs.Waiver(弃权)：Waiver is defined as the voluntary relinquishment of a known legal right.REVIEW QUESTIONS1. Explain the principle of indemnity. How does the concept of actual cash value support the principle of indemnity? (P 30)2. What is an insurable interest? Why is an insurable interest required in every insurance contract? (P 32)3. Explain the principle of subrogation. Why is subrogation used? (P34-P35)4. Explain the principle of utmost good faith. How do the legal doctrines of representations, concealment, and warranty support the principle of utmost good faith? (P36-P37)5. Identify the four requirements that must be met to have a valid insurance contract. (P37-P39)CHAPTER 6 / ANALYSIS OF INSURANCE CONTRACTSKEY CONCEPTS AND TERMSAggregate deductible(总额免赔): An aggregate deductible is sometimes used in commercial property insurance, by which all covered losses during the year are added together until they reach a certain level.“All risk” policy（一切险保险单）: All losses are covered except those losses specifically excluded.Coinsurance clause(共保条款): A coinsurance clause in a property insurance contract requires the insured to insure the property for a stated percentage of its insurable value. If the coinsurance requirement is not met at the time of loss, the insured must share in the loss as a coinsurer.Deductible(免赔额): A deductible is a provision by which a specified amount is subtracted from the total loss payment that otherwise would be payable.Elimination (waiting) period(剔除/等待期): An elimination period is a stated period of time at the beginning of a loss during which no insurance benefits are paid.Endorsements and riders: In property and liability insurance, an endorsement is a written provision that adds to, deletes from or modifies the provisions in the original contract. In life and health insurance, a rider is a document that amends or changes the original policy.Exclusions(除外责任): Exclusion are another basic part of any insurance contract. There are three major types of exclusion: excluded perils, excluded losses, and excluded property.Insuring agreement(承保协议): The insuring agreement summarizes the major promises of the insurer. The insurer, in other words, agree to do certain things, such as paying losses from insured perils , providing certain services ,or agreeing to defend the insured in a liability lawsuit.Large-loss principle(大损失原则): The concept of using insurance premiums to pay for large losses rather than for small losses is often called the large-loss principle.Named-perils policy(制定风险保单): The contract must indicate the person or person for whom the protection is provided.Pro rata liability(比例责任条款): Each insurers share of the loss is base on the proportion that its insurance bears to the total amount of insurance on the property.Straight deductible(绝对免赔额): With a straight deductible, the insured must pay a certain number of dollars of loss before the insurer is required to make a payment.REVIEW QUESTIONS1. Describe the basic of an insurance contract.(P 45)2. Identify the major types of exclusions typically found in insurance contract. Why are exclusions used by insurers?(P 46)3. Define the term conditions. What is the significance of the conditions section to the insured?(P47-P48)4. What is an endorsement or rider? If an endorsement conflicts with a policy provision, how is the problem resolved? (P48)5. Why do deductibles appear in insurance contracts? Indentify some common deductibles that are found in insurance contracts. (P49-P50)CHAPTER 7 / THE LIABILITY RISKKEY CONCEPTS AND TERMSAbsolute (strict) liability(绝对责任): Absolute liability means that liability is imposed regardless of negligence or fault.Comparative negligence law(比较过失法则): Under a comparative negligence law, if both the plaintiff (injured person) and the defendant contribute to the plaintiffs injury, the financial burden of the injury is shared by both parties according to their respective degrees of fault.Contributory negligence law(共有过失): Contributory negligence means that if the injured persons conduct falls below the standard of care required for his or her protection, and such conduct contributed to the injury, the injured person cannot collect damages.Imputed negligence (疏忽归咎): Imputed negligence means that under certain conditions, the negligence of one person can be attributed to another.Last clear chance rule (最后机会原则): The last clear chance rule states that a plaintiff who is endangered by his or her own negligence can still recover damages from the defendant if the defendant has a last clear chance to avoid the accident but fails to do so.Negligence (疏忽): Negligence typically is defined as the failure to exercise the standard of care required by law to protect others from an unreasonable risk of harm.Proximate cause(近因原因): A proximate cause is a cause unbroken by any new and independent cause, which produces an event that otherwise would not have occurred.Punitive damages (惩罚赔偿金): Punitive damages are paid to punish people and organizations so that others are deterred form committing the same wrongful act.Tort(侵权): Tort is a legal wrong for which the law allows a remedy in the form of money damages.REVIEW QUESTIONS1. Define the meaning of a tort and list the three broad classes of torts.(P57)2. Define negligence. What are the essential elements of a negligent act.(P57-P58)3. Describe some legal defenses that can be used if person is sued. (P59)4. Explain the meaning of imputed negligence.(P59)CHAPTER 8 / HOMEOWNERS INSURANCE KEY CONCEPTS AND TERMSAppraisal clause(估价条款): The appraisal clause is used when the insured and insurer agree that the loss is covered, but the amount lf the loss is in dispute.Fair rental value(公平的租用价值): Fair rental value means the rental value of that part of the residence premises rented to others or held for rental less any expense that do not continue while the premises are not fit to live in.Mortgage clause(抵押条款): The mortgage clause is designed to protect the mortgagees insurable interest.REVIEW QUESTIONS1. List the basic coverages that are provided in Section I of the homeowners policy? (P75-P81)2. What duties are imposed on the insured after a property loss occurs?(P87左)3. Explain briefly how the mortgage clause protects the insurable interest of the mortgagee.（P90）CHAPTER 16 / FUNDAMENTALS OF LIFE INSURANCEKEY CONCEPTS AND TERMSLegal reserve(法定准备金): Because the method of investing and accumulating the fund is regulated by state law, it is referred to as a legal reserve.Level-premium method(均衡保费方法): Under the level-premium method, premiums do not increase from year to year but remain level throughout the premium paying period, and the insured has lifetime protection to age 100.Met amount at risk(净风险额): The difference between the face amount of the policy and the legal reserve is called the met amount at risk.Premature death(过早死亡): Premature death can be defined as the death of a family head with outstanding unfulfilled financial obligations, such as dependents to support, children to educate, and a mortgage to pay off.Yearly renewable term Insurance(按年续保的定期寿险): Yearly renewable term insurance provide life insurance protection for only one year.REVIEW QUESTIONS1. Explain the meaning of premature death and identify the costs associated with it.(P114)2. Explain the yearly renewable term method for providing life insurance to individuals.(P125)3. Explain the level-premium method for providing life insurance to individuals.(P127)CHAPTER 17 / TYPES OF LIFE INSURANCEKEY CONCEPTS AND TERMSCash surrender value(解约退还金): Ordinary life insurance also has an investment or saving element called a cash surrender value. The cash values are due to the overpayment of insurance premiums during the early year.Endowment insurance(两全险): Endowment insurance is another traditional form of life insurance. An endowment policy pays the face amount of insurance if the insured dies within a specified period; if the insured survives to the end of the endowment period, the face amount is paid to the policyowner at that time.Limited-payment policy(限期缴费终身寿险): A limited-payment policy is another type of traditional whole life insurance. The insurance is permanent, and the insured has lifetime protection. The premiums are level, but they are paid only for a certain period. Ordinary life insurance(普通终身寿险): Also called straight life and continuous premium whole life, pro