RMIN 4000 Exam 2|108 Q’s and
A’s |100% Correct
Major types of private insurers - -stock insurers, mutual insurers, and lloyds
of London
- Stock Insurers - -Private insurer. a corporation owned by stockholders
- Mutual Insurers - -Private Insurer. a corporation owned by policy holders
- Types of Mutual Insurers - -Assessment mutual, advance premium mutual,
fraternal insurer.
- Assessment Mutual - -type of mutual insurance. The insurer has the right
to assess policyholders an additional amount if the insurer's financial
operations are unfavorable
- Advance Premium Mutual - -type of mutual insurance. The insurer does
not issue assessable policies.
- Fraternal Insurer - -type of mutual insurance. Provides life and health
insurance to members of a social or religious organization. They have to be a
non-profit that does not issue common stock.
- Lloyd's of London - -NOT an insurer but falls under the category of private
insurance. World's leading market that provides services and physical
facilities for its members to write specialized lines of insurance. the purpose
is to insure and pool risks.
- Lloyd's Brokers - -represents policyholders to arrange coverage with
syndicates.
- Lloyd's Syndicates - -offer insurance contracts in the market. Members
that join together and provide capital to form syndicates receiving profits or
bearing losses.
- Managing Agents - -(Lloyd's of London) manage the syndicates who
typically specialize in certain lines.
- Underwriters (at Lloyd's of London) - -work for the syndicates to assess
risks and determine premiums.
, - Health Maintenance Organizations (HMOs) - -Another type of private
insurance. fixed fees, less restrictive, less costly forms of treatment
provided.
- Captive Insurers - -Type of Private insurance. Owned by parent company.
- Insurance Agent - -someone who legally represents the principle
(insurance company) and has the authority to act on the principle's behalf.
The principle is legally responsible for all acts of an agent.
- Insurance Binders - -provide temporary insurance until the policy is
actually written
- Insurance Broker - -someone who legally represents the insured and...
1. solicits applications and places coverage with the appropriate insurer
2. Is paid a commision from the insurer
3. no authority to bind
- Surplus Lines - -refer to any type of insurance which there is no available
market in the state.
- Non-admitted Insurer - -an insurer not licensed to do business in the state.
- Independent Agents - -represent several unrelated insurers and are paid
commission.
- Captive/Exclusive Agents - -only represent one insurer or group of insurers
under common ownership. Generally paid lower commission rate on renewal
business than on new business.
- Direct Writer - -an insurer that the salesperson is an employee of the
insurer, not an independent contractor.
- Direct Response - -insurer directly to the consumer by TV or some other
media. Ex: Magazine saying that runners get 30% off insurance, call for a
quote.
- Group Insurance Marketing - -methods to sell individual insurance policies
to employer groups, labor unions, trade associations, etc..
- Major Operations of Insurance Companies - -ratemaking, underwriting,
production, claims settlement, reinsurance, investment
- ratemaking - -the pricing of insurance and the calculation of insurance
premiums
A’s |100% Correct
Major types of private insurers - -stock insurers, mutual insurers, and lloyds
of London
- Stock Insurers - -Private insurer. a corporation owned by stockholders
- Mutual Insurers - -Private Insurer. a corporation owned by policy holders
- Types of Mutual Insurers - -Assessment mutual, advance premium mutual,
fraternal insurer.
- Assessment Mutual - -type of mutual insurance. The insurer has the right
to assess policyholders an additional amount if the insurer's financial
operations are unfavorable
- Advance Premium Mutual - -type of mutual insurance. The insurer does
not issue assessable policies.
- Fraternal Insurer - -type of mutual insurance. Provides life and health
insurance to members of a social or religious organization. They have to be a
non-profit that does not issue common stock.
- Lloyd's of London - -NOT an insurer but falls under the category of private
insurance. World's leading market that provides services and physical
facilities for its members to write specialized lines of insurance. the purpose
is to insure and pool risks.
- Lloyd's Brokers - -represents policyholders to arrange coverage with
syndicates.
- Lloyd's Syndicates - -offer insurance contracts in the market. Members
that join together and provide capital to form syndicates receiving profits or
bearing losses.
- Managing Agents - -(Lloyd's of London) manage the syndicates who
typically specialize in certain lines.
- Underwriters (at Lloyd's of London) - -work for the syndicates to assess
risks and determine premiums.
, - Health Maintenance Organizations (HMOs) - -Another type of private
insurance. fixed fees, less restrictive, less costly forms of treatment
provided.
- Captive Insurers - -Type of Private insurance. Owned by parent company.
- Insurance Agent - -someone who legally represents the principle
(insurance company) and has the authority to act on the principle's behalf.
The principle is legally responsible for all acts of an agent.
- Insurance Binders - -provide temporary insurance until the policy is
actually written
- Insurance Broker - -someone who legally represents the insured and...
1. solicits applications and places coverage with the appropriate insurer
2. Is paid a commision from the insurer
3. no authority to bind
- Surplus Lines - -refer to any type of insurance which there is no available
market in the state.
- Non-admitted Insurer - -an insurer not licensed to do business in the state.
- Independent Agents - -represent several unrelated insurers and are paid
commission.
- Captive/Exclusive Agents - -only represent one insurer or group of insurers
under common ownership. Generally paid lower commission rate on renewal
business than on new business.
- Direct Writer - -an insurer that the salesperson is an employee of the
insurer, not an independent contractor.
- Direct Response - -insurer directly to the consumer by TV or some other
media. Ex: Magazine saying that runners get 30% off insurance, call for a
quote.
- Group Insurance Marketing - -methods to sell individual insurance policies
to employer groups, labor unions, trade associations, etc..
- Major Operations of Insurance Companies - -ratemaking, underwriting,
production, claims settlement, reinsurance, investment
- ratemaking - -the pricing of insurance and the calculation of insurance
premiums
