CISR: Agency Operations
Study online at https://quizlet.com/_9b9r5p
1. Types of Stakeholders: managers and employees
customers
insurers
vendors
industry associations
government
2. Transfer: Insurance: transfer of financial consequence to an insurance company
Non Insurance: when a customer transfers financial consequences to another by
contract or agreement
3. Retention: Active: when a customer knows before the loss that they are respon-
sible for all or part of the loss
Passive: Whoops! when a client finds out after a loss occurs that they are responsible
4. What is NOT one of the four benefits of ethical behavior?: Ethical behavior
encourages governmental action
5. Describe the standard of care an insurance agency owes to an insurance
company: loyalty
good faith
reasonable care
contractual duty
6. Describe actual authority: when the agency is expressly given the authority in
the agency contract
7. Describe a contract: Oral or written agreements between two parties that cre-
ates an obligation to do or not do a particular thing
8. What are the four benefits of ethical behavior?: To be recognized as a knowl-
edgeable insurance professional within the community
To gain public trust and confidence
To avoid government regulation
To enhance credibility with customers and companies
9. What is the risk management process?: Risk Identification
Risk analysis
Risk control
Risk finance
Risk administration
10. Explain the five steps of risk management: Risk identification: identify the
customers exposure to loss
Risk analysis: determine frequency or severity of the exposure. How much could a
loss actually cost the customer
Risk control: understand what methods can be implemented to eliminate or reduce
cost associated with exposure
, CISR: Agency Operations
Study online at https://quizlet.com/_9b9r5p
Risk finance: fund losses by user either internal or external dollars
Risk administration: Implement and monitor the customers risk management pro-
gram
11. Stakeholders: People who have the potential to be affected by any action taken
by an organization. Any group or individual who is affected by the achievements of
a firm's objectives
12. Risk Control Methods: Avoid: not always practical
Prevent: reduces frequency
Reduce: reduces severity
Segregation: includes separation or duplication
Transfer: can be physical transfer or contractual transfer
13. What is the difference between a broker and an agent/producer?: Brokers
do not have binding authority
14. How would you best describe an agency stakeholder?: The primary stake-
holders are any group or individual who is affected by the achievement of a firm's
objective
15. Which source of revenue is typically the largest source of income for an
insurance agency?: Commission
16. What does a large number of locations mean for how an agency operates?-
: It may mean some features of the agency are centralized
17. List the four major classes of exposure to loss: Property
Human Resources
Liability
Net Income
18. What are the methods of identifying loss exposures?: Interview
Checklist
Physical inspection
Activity analysis
Document review
Advertising/website
Flow charts
Loss history
Financial statements
19. Why is insurance regulated?: To protect the consumer
20. Lloyd's of London: Not an insurance company, but rather a market where
Lloyd's members are grouped together to insure risks. Typically accessed through
an excess broker
21. Guarantee Fund: The pool of funds that standard insurer's contribute to in the
instance that they or another standard carrier become insolvent
Study online at https://quizlet.com/_9b9r5p
1. Types of Stakeholders: managers and employees
customers
insurers
vendors
industry associations
government
2. Transfer: Insurance: transfer of financial consequence to an insurance company
Non Insurance: when a customer transfers financial consequences to another by
contract or agreement
3. Retention: Active: when a customer knows before the loss that they are respon-
sible for all or part of the loss
Passive: Whoops! when a client finds out after a loss occurs that they are responsible
4. What is NOT one of the four benefits of ethical behavior?: Ethical behavior
encourages governmental action
5. Describe the standard of care an insurance agency owes to an insurance
company: loyalty
good faith
reasonable care
contractual duty
6. Describe actual authority: when the agency is expressly given the authority in
the agency contract
7. Describe a contract: Oral or written agreements between two parties that cre-
ates an obligation to do or not do a particular thing
8. What are the four benefits of ethical behavior?: To be recognized as a knowl-
edgeable insurance professional within the community
To gain public trust and confidence
To avoid government regulation
To enhance credibility with customers and companies
9. What is the risk management process?: Risk Identification
Risk analysis
Risk control
Risk finance
Risk administration
10. Explain the five steps of risk management: Risk identification: identify the
customers exposure to loss
Risk analysis: determine frequency or severity of the exposure. How much could a
loss actually cost the customer
Risk control: understand what methods can be implemented to eliminate or reduce
cost associated with exposure
, CISR: Agency Operations
Study online at https://quizlet.com/_9b9r5p
Risk finance: fund losses by user either internal or external dollars
Risk administration: Implement and monitor the customers risk management pro-
gram
11. Stakeholders: People who have the potential to be affected by any action taken
by an organization. Any group or individual who is affected by the achievements of
a firm's objectives
12. Risk Control Methods: Avoid: not always practical
Prevent: reduces frequency
Reduce: reduces severity
Segregation: includes separation or duplication
Transfer: can be physical transfer or contractual transfer
13. What is the difference between a broker and an agent/producer?: Brokers
do not have binding authority
14. How would you best describe an agency stakeholder?: The primary stake-
holders are any group or individual who is affected by the achievement of a firm's
objective
15. Which source of revenue is typically the largest source of income for an
insurance agency?: Commission
16. What does a large number of locations mean for how an agency operates?-
: It may mean some features of the agency are centralized
17. List the four major classes of exposure to loss: Property
Human Resources
Liability
Net Income
18. What are the methods of identifying loss exposures?: Interview
Checklist
Physical inspection
Activity analysis
Document review
Advertising/website
Flow charts
Loss history
Financial statements
19. Why is insurance regulated?: To protect the consumer
20. Lloyd's of London: Not an insurance company, but rather a market where
Lloyd's members are grouped together to insure risks. Typically accessed through
an excess broker
21. Guarantee Fund: The pool of funds that standard insurer's contribute to in the
instance that they or another standard carrier become insolvent
