Louisiana P&C Adjuster Exam Prep Chapter 2 Questions & Answers (Graded A+)

The one who receives the authority to act on behalf of someone else? - ANSWER-Agent what does a sale's agent receive authority for? - ANSWER-to sell An insurance agent receives authority to what? - ANSWER-Settle claims brought against the insurer How do agents receive their authority? - ANSWER-written contract What is the power to bind? - ANSWER-an agent's authority can bind: -what an agent says or does can bind insurer -agents should take the utmost care in what they say or do -even if insure makes mistakes, the insurer may have to accept them What are the three major responsibilities of contracted agents? - ANSWER-e to or follow contract 2. use reasonable judgement and care at all times 3. provide all necessary info and documentation to the insurer What are the three types of authority granted in agency relationship? - ANSWER-expressed, implied, apparent What is expressed authority? - ANSWER-authority that is directly granted to the agent in writing via the agent's contract (usually to sell policies, collect premiums, issue binders, offer discounts, cancel insurance) What is implied authority? - ANSWER-authority that the public reasonably believes the agent to have, based on the agent's representations What does representation include? - ANSWER--portraying oneself as a representative -wearing a name tag w/ company logo -handing out company business cards -words to perform agent's duties What is apparent authority? - ANSWER-indirect authority that is granted when the insurer does not correct agent, even though agent may be acting in error -by not correcting agent, insurer implies consent -granted when insurer does not act What are the four types of sales agents? - ANSWER--independent insurance sales agent -exclusive agent -general agent -direct writer What is an independent agent? - ANSWER--self employed -offers insurance from more than one company at the same -they can compare and give quotes from different companies -find a policy that best suits the customer What is an exclusive agent? - ANSWER--also called captive agent -commissioned -represents only one insurer and only their policies What is a general agent? - ANSWER--works for only one insurance company -supervises other exclusive agents -trains other agents What is a direct writer agent? - ANSWER--salaried employees -works