RMIN 4000 Test 2 Daniel Brown (2024/2025) 100% Solved

RMIN 4000 Test 2 Daniel Brown (2024/2025) 100% Solved Stock Insurer Corporation owned by Stockholders (earn profit for stockholders by increasing the value of the stock and paying dividends). Mutual Insurer Corporation owned by Policyholders (profits are distributed to policyholders by dividends or rate reductions). Advance Premium Mutual Assessment Mutual Fraternal Insurer Lloyd's of London Specialized lines of business. Brokers represent policyholders to arrange coverage with syndicates. Legally represents insured. Syndicates Offer insurance contracts in the market. Managing Agents Manage the syndicates, who typically specialize in certain lines. Underwriters Work for the syndicates to assess risks and determine premiums. Insurance Agent Someone who legally represents the principal (insurance company) and has the authority to act on the principal's behalf (Company's Legal Representative). Insurance Binders Provide temporary insurance until the policy is actually written. Surplus Lines Broker Licensed to place business with a nonadmitted insurer. Surplus Lines Refer to any type of insurance for which there is no available market in the state. Nonadmitted Insurer An insurer not licensed to do business in the state. Independent Agency Usually represents several unrelated insurers. Commission paid agents. Exclusive Agency Agent represents only one insurer or group of insurers under common ownership. Lower commission paid agents on renewal of business rather than new business. Direct Writer An insurer in which the salesperson is an employee of the insurer, not an independent contractor. Direct Response Insurer sells directly to the consumer by television or some other media. Group Insurance Marketing Methods to sell individual insurance policies to: Employer groups, Labor unions, Trade associations Ratemaking The pricing of insurance and the calculation of insurance premiums. Regulatory Goals must be: Adequate Not be excessive Should not discriminate Business Rate Goals must be: Stable Responsive Able to Provide for contingencies Able to Promote Loss Control Simple Actuary A person who uses complex statistical methods and technology to analyze loss and other data to determine rates and premiums. Prospective Loss Costs (Pure Premium) Amount needed to pay future claims and loss adjustment expenses. Class (Manual) Rating: Frequency*Severity Expense Provisions (Load) Amount needed to pay future expenses (acquisition, overhead, premium taxes). Profit and Contingencies (Risk Charge) Amount needed to protect against the possibility that actual claims and expenses exceed projections