As a General Rule, If an Applicant Suffers a Loss

question 27

Multiple Choice

As a general rule, if an applicant suffers a loss after applying but before the insurer formally accepts the application, the:

• A) insurer must cover the loss.
• B) applicant and the insured must bear the loss equally.
• C) applicant must bear the loss.
• D) insurer must cover the loss only if there is no binder.

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Definitions:

Prevention Cost

Costs incurred to avoid producing defective products, including expenses related to quality training, equipment maintenance, and process improvement.

Quality Cost Report

A document summarizing the costs associated with preventing, detecting, and rectifying product defects, including the costs of quality control measures.

Manufacturing Cycle Efficiency

A metric that measures the ratio of productive manufacturing time to total cycle time, aiming to assess production efficiency.

Increase

A rise in quantity, value, or some other measure, indicating growth or expansion.