OHIO LIFE INSURANCE EXAM 4 QUESTION SET
WITH RATIONALES AND INSURANCE LAW AND
POLICY ANALYSIS 2026
◉ Lloyds of London.
Answer: A meeting place for members who transact insurance and
are individually liable for contracts they enter
◉ Reinsurers.
Answer: Insurers for insurers. The company that is transferring the
risk is called the ceding company
◉ Faculative reinsurer.
Answer: Negotiate on an individual risk basis. The reinsurer can
accept or reject each risk
◉ Treaty reinsurer.
Answer: Automatic sharing of risks by the ceding company
◉ Excess and surplus lines.
Answer: Risks that are difficult to insure in the normal marketplace
are attempted to be places in unauthorized carriers
,◉ Risk retention groups.
Answer: Spread liability among its members (only liability
insurance)
◉ Self- insurance.
Answer: Set aside reserve funds to cover loss and purchase excess
insurance to cover large losses above a given level
◉ Insurers domicile.
Answer: Classification: domestic, foreign, alien
◉ General agents / MGA's.
Answer: Hire, train and supervise agents within a specific
geographic area. They are compensated with commission they earn
as well as an overriding commission on the business produced by
agents they manage
◉ Direct writing companies.
Answer: Pay salaries to people to sell insurance (usually not paid
commission). The company owns all business produced
◉ Direct response marketing.
,Answer: TV, mail, magazines,...
◉ Franchise marketing.
Answer: Coverage to employees of small firms (individualized
policies)
◉ Producers.
Answer: May function as agents or brokers. Life and health
producers are authorized to solicit, receive and forward applications
for the contracts written by their companies. They may receive the
first premium but may not bind coverage. (Property and casualty
producers may bind an insurance company to an oral/ written
agreement)
◉ Broker.
Answer: Represents a buyer to an insurer
◉ Solicitor.
Answer: A salesperson who works for an agent or broker
◉ Federal regulations.
Answer: Means of overseeing areas not covered by state regulation
, ◉ Paul v Virginia.
Answer: The transaction of insurance across state lines is not
interstate commerce and therefore should be regulated by local law
◉ South- Eastern Underwriters Decision.
Answer: The SEUA supreme court overturned Paul v Virginia and
made these transactions interstate commerce
◉ McCarran-Ferguson Act.
Answer: Federal government can regulate insurance to the extent
that it is not regulated by state law. This exempt the insurance
industry from many anti-trust laws
◉ Notice to applicant.
Answer: Informs one that a report will be ordered concerning their
past credit history
◉ Consumer reporting agencies.
Answer: Write reports on ones credit, character, reputation, or
habits (can be investigative). They may be for profit (equifax) or
non-profit (credit union)
◉ Pretext interview.
WITH RATIONALES AND INSURANCE LAW AND
POLICY ANALYSIS 2026
◉ Lloyds of London.
Answer: A meeting place for members who transact insurance and
are individually liable for contracts they enter
◉ Reinsurers.
Answer: Insurers for insurers. The company that is transferring the
risk is called the ceding company
◉ Faculative reinsurer.
Answer: Negotiate on an individual risk basis. The reinsurer can
accept or reject each risk
◉ Treaty reinsurer.
Answer: Automatic sharing of risks by the ceding company
◉ Excess and surplus lines.
Answer: Risks that are difficult to insure in the normal marketplace
are attempted to be places in unauthorized carriers
,◉ Risk retention groups.
Answer: Spread liability among its members (only liability
insurance)
◉ Self- insurance.
Answer: Set aside reserve funds to cover loss and purchase excess
insurance to cover large losses above a given level
◉ Insurers domicile.
Answer: Classification: domestic, foreign, alien
◉ General agents / MGA's.
Answer: Hire, train and supervise agents within a specific
geographic area. They are compensated with commission they earn
as well as an overriding commission on the business produced by
agents they manage
◉ Direct writing companies.
Answer: Pay salaries to people to sell insurance (usually not paid
commission). The company owns all business produced
◉ Direct response marketing.
,Answer: TV, mail, magazines,...
◉ Franchise marketing.
Answer: Coverage to employees of small firms (individualized
policies)
◉ Producers.
Answer: May function as agents or brokers. Life and health
producers are authorized to solicit, receive and forward applications
for the contracts written by their companies. They may receive the
first premium but may not bind coverage. (Property and casualty
producers may bind an insurance company to an oral/ written
agreement)
◉ Broker.
Answer: Represents a buyer to an insurer
◉ Solicitor.
Answer: A salesperson who works for an agent or broker
◉ Federal regulations.
Answer: Means of overseeing areas not covered by state regulation
, ◉ Paul v Virginia.
Answer: The transaction of insurance across state lines is not
interstate commerce and therefore should be regulated by local law
◉ South- Eastern Underwriters Decision.
Answer: The SEUA supreme court overturned Paul v Virginia and
made these transactions interstate commerce
◉ McCarran-Ferguson Act.
Answer: Federal government can regulate insurance to the extent
that it is not regulated by state law. This exempt the insurance
industry from many anti-trust laws
◉ Notice to applicant.
Answer: Informs one that a report will be ordered concerning their
past credit history
◉ Consumer reporting agencies.
Answer: Write reports on ones credit, character, reputation, or
habits (can be investigative). They may be for profit (equifax) or
non-profit (credit union)
◉ Pretext interview.
