RMIN 5100S Test 1 questions with
complete solutions passed
Insured definition - correct answer ✔✔(risk manager) the buyer of insurance
intermediary definition - correct answer ✔✔can be an agent or broker
facilitates the purchase of insurance. Advises the insured and negotiates with insurer
Insurer - correct answer ✔✔underwriter, provides the insurance coverage aka: insurance
company
Risk management process- 6 steps - correct answer ✔✔1. identify potential risks
2. measure and analyze these loss exposures
3. Examine feasibility of RM techniques
4. Select a technique/combination of techniques
5. Implement techniques
6. Monitor results and revise
Definition of an agent - correct answer ✔✔someone who legally represents the principal and
can act on its behalf.
Agents authority - correct answer ✔✔The principal is bound by the actions of the agent when
the agent is acting within the scope of their authority. *power to bind coverage usually
, Independent agent defintion - correct answer ✔✔agent works with a variety of insurance
companies. Has contracts with multiple companies and works to find the coverage that is best
suited for the client. *common in P&C
exclusive or captive agent - correct answer ✔✔works with only one insurance company. It
cannot sell products from other insurance companies. Usually used in personal lines and small
businesses.
captive insurance - correct answer ✔✔not "insurance". It is a form of retention within a larger
business. The risk is not transferred.
Similarities between agent and broker 3 - correct answer ✔✔1. attempt to get the best
coverage with the most appropriate insurer
2. both can market to multiple ins companies
3. typically paid on commission
4 Characteristics of brokers - correct answer ✔✔1. works on behalf of the insurance buyer
2. Can work on any size of business
3. Wide breadth of services
4. Paid via commission or some form of this sometimes
4 Characteristics of agents - correct answer ✔✔1. works on behalf of ins company
2. works on any size business- usually NOT international
3. typically focuses on the transaction and related services
4. producing agents paid on commission, others are paid salary
underwriting definition - correct answer ✔✔selecting, classifying and pricing applicants for
insurance involving terms, conditions, pricing
complete solutions passed
Insured definition - correct answer ✔✔(risk manager) the buyer of insurance
intermediary definition - correct answer ✔✔can be an agent or broker
facilitates the purchase of insurance. Advises the insured and negotiates with insurer
Insurer - correct answer ✔✔underwriter, provides the insurance coverage aka: insurance
company
Risk management process- 6 steps - correct answer ✔✔1. identify potential risks
2. measure and analyze these loss exposures
3. Examine feasibility of RM techniques
4. Select a technique/combination of techniques
5. Implement techniques
6. Monitor results and revise
Definition of an agent - correct answer ✔✔someone who legally represents the principal and
can act on its behalf.
Agents authority - correct answer ✔✔The principal is bound by the actions of the agent when
the agent is acting within the scope of their authority. *power to bind coverage usually
, Independent agent defintion - correct answer ✔✔agent works with a variety of insurance
companies. Has contracts with multiple companies and works to find the coverage that is best
suited for the client. *common in P&C
exclusive or captive agent - correct answer ✔✔works with only one insurance company. It
cannot sell products from other insurance companies. Usually used in personal lines and small
businesses.
captive insurance - correct answer ✔✔not "insurance". It is a form of retention within a larger
business. The risk is not transferred.
Similarities between agent and broker 3 - correct answer ✔✔1. attempt to get the best
coverage with the most appropriate insurer
2. both can market to multiple ins companies
3. typically paid on commission
4 Characteristics of brokers - correct answer ✔✔1. works on behalf of the insurance buyer
2. Can work on any size of business
3. Wide breadth of services
4. Paid via commission or some form of this sometimes
4 Characteristics of agents - correct answer ✔✔1. works on behalf of ins company
2. works on any size business- usually NOT international
3. typically focuses on the transaction and related services
4. producing agents paid on commission, others are paid salary
underwriting definition - correct answer ✔✔selecting, classifying and pricing applicants for
insurance involving terms, conditions, pricing
