CIP - C120 Underwriting Essentials Questions With Complete Answers.

Definition #1 - An underwriter is an insurance professional employed to accept or reject risk on behalf of an insurer Definition #2 - An underwriter is an investor of shareholder capital Definition #3 - An underwriter is an insurance professional employed to implement an insurer's strategic plan Complete Definition - An underwriter is an insurance professional who invests the capital of an insurer's shareholders by accepting or rejecting risk to implement an insurer's strategic plan Speculative Risk - exists where there is a chance of either gain or loss Pure Risk - exists where there is only a chance of loss Contract - an agreement between legally capable parties for a consideration demonstrating intent to do something which is legal Consideration - is money or a thing or act of value that one party gives or promises in exchange for the act or promise of the other party; it is the evidence that the parties intend to be bound by the contract Insurable Interest - exists when the insurance buyer stands in such a legal relationship to the object of insurance as to be financially benefited by its continued existence or financially prejudiced by its loss or damage. Indemnify - to return someone after a loss to the same financial position he or she enjoyed immediately before the lossInsurance Policy - a document that provides evidence of a contract of insurance. It states in detail the terms of the contract - that is, the terms of the agreement between insurer and the insured