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1.
With long-term care insurance, sound underwriting is crucial to all of the following except _______.
Investing cash reserves. Sound underwriting is crucial to forecasting and setting adequate premiums.
2.
The most important principle of insurance underwriting is that the covered risk must be _______.
Either accidental or unforeseen. The most important principle of all insurance underwriting is that the loss to be covered must be accidental or unforeseeable by the party seeking to buy the insurance.
3.
One of the biggest consumer worries about long-term care insurance is _______.
Price stability. The issue of long-term care rate stability has always been among the consumers biggest worries when thinking about this coverage.
4.
Which of the following is NOT a variable that influences the premium charge for insurance coverage?
Uninsurable conditions. An uninsurable condition would make it impossible to set a premium. It is not a variable; it is a roadblock.
5.
Which of the following is true about long-term care policies with low premiums and permissive medical standards?
All of the above are true. Some companies that were "easy-issue" or competed most aggressively on price have had to sharply increase premiums, or left the business entirely.