RMIN 4000 BROWN EXAM 2 PRACTICE
QUESTIONS AND ANSWERS FULL REVIEW
SHEET
●● Stock Insurer
Answer: -A corporation owned by stockholders.
-Objective is to earn profits for the stockholders by increasing stock and
paying dividends.
(Progressive, Allstate, Metlife, etc.)
●● Mutual Insurer
Answer: -a corporation owned by policyholders.
-profits are distributed to policyholders by dividends or rate reductions.
(statefarm, nationwide, liberty mutual)
●● types of mutual insurers
Answer: assesement
advanced
fraternal
●● Lloyd's (of London)
,Answer: -NOT an insurer, but a society of members who underwrite
insurance in syndicates.
-World's leading market that provides services and physical facilities for
its members to write specialized lines of insurance
●● Lloyd's broker
Answer: represent policyholders to arrange coverage with syndicates
●● Lloyd's Syndicates
Answer: those insurance companies that offer insurance contracts in the
market
●● managing agents
Answer: manage the syndicates, who typically specialize in certain lines
●● underwriters
Answer: work for the syndicates to asses risks and determine premiums
●● other types of private insurers
Answer: blue cross blue shield plans
health maintenance organizations (HMO'S)
captive insurers
, ●● insurance agent
Answer: -someone who legally represents the principle (insurance
company) and has the authority to act on the principle's behalf
-the principle (insurance company) is legally responsible for all acts of
an agent when the agent is acting within the scope of authority
●● insurance binders
Answer: provide temporary insurance until the policy is actually written
-can be provided by property and casualty (P&C) agents
-life insurance agents usually have no authority to issue binders
●● insurance broker
Answer: Someone who legally represents the insured and:
◦Solicits applications and places coverage with the appropriate insurer.
◦Is paid a commission from the insurer.
◦In general, does NOT have the authority to bind
●● large brokerage firms
Answer: -Very important in Commercial P&C coverage.
-May have knowledge of highly specialized insurance markets.
-May provide risk management and losscontrol services.
(AON, Marsh & McLennan, Willis Towers Watson)
QUESTIONS AND ANSWERS FULL REVIEW
SHEET
●● Stock Insurer
Answer: -A corporation owned by stockholders.
-Objective is to earn profits for the stockholders by increasing stock and
paying dividends.
(Progressive, Allstate, Metlife, etc.)
●● Mutual Insurer
Answer: -a corporation owned by policyholders.
-profits are distributed to policyholders by dividends or rate reductions.
(statefarm, nationwide, liberty mutual)
●● types of mutual insurers
Answer: assesement
advanced
fraternal
●● Lloyd's (of London)
,Answer: -NOT an insurer, but a society of members who underwrite
insurance in syndicates.
-World's leading market that provides services and physical facilities for
its members to write specialized lines of insurance
●● Lloyd's broker
Answer: represent policyholders to arrange coverage with syndicates
●● Lloyd's Syndicates
Answer: those insurance companies that offer insurance contracts in the
market
●● managing agents
Answer: manage the syndicates, who typically specialize in certain lines
●● underwriters
Answer: work for the syndicates to asses risks and determine premiums
●● other types of private insurers
Answer: blue cross blue shield plans
health maintenance organizations (HMO'S)
captive insurers
, ●● insurance agent
Answer: -someone who legally represents the principle (insurance
company) and has the authority to act on the principle's behalf
-the principle (insurance company) is legally responsible for all acts of
an agent when the agent is acting within the scope of authority
●● insurance binders
Answer: provide temporary insurance until the policy is actually written
-can be provided by property and casualty (P&C) agents
-life insurance agents usually have no authority to issue binders
●● insurance broker
Answer: Someone who legally represents the insured and:
◦Solicits applications and places coverage with the appropriate insurer.
◦Is paid a commission from the insurer.
◦In general, does NOT have the authority to bind
●● large brokerage firms
Answer: -Very important in Commercial P&C coverage.
-May have knowledge of highly specialized insurance markets.
-May provide risk management and losscontrol services.
(AON, Marsh & McLennan, Willis Towers Watson)
