Misstatement of the Insured's Age Will Result in

question 40

Multiple Choice

Misstatement of the insured's age will result in

• A) voiding of the policy.
• B) possible cancellation of the policy by the insurance company.
• C) adjustment of the face value of the policy by the insurance company.
• D) none of these.

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Definitions:

Losses Accrued

Expenses that have been incurred but not yet paid or recorded in the financial statements.

Probable Loss

An expected financial loss from contingent liabilities that can be reasonably estimated.

Estimable Loss

A potential financial loss that can be predicted or estimated in terms of its amount or impact.

Effective Interest Rate

This is the actual return on an investment, taking into account the effect of compounding interest as opposed to the nominal rate.