Reciprocal
When insurance is obtained through a reciprocal insurer, the insureds are sharing the risk of loss with other subscribers of the reciprocal.
Which of the following insurance options would be considered a risk sharing arrangement?
Adhesion
A contract of adhesion is prepared by only the insurer, the insureds only option is to accept or reject the policy as it is written.
An insurer had made all of the decisions regarding the provisions included in the insureds policy. The insured finds an objectional provision and wants to negotiate it with the insurer but is not allowed to do so. Her only options are to reject the policy
Consideration
Is something of value that each party gives to the other. The consideration on the part of the insured is the payment of premium and the representations made in the application.
When an insured makes teuthful statements on the application for insurance and pays the required preimum, it is known as whoch of the following?
A statement by the applicant that, upon discovery, would affect the underwriting decision of the insurance company.
Material misrepresentation is a statement that, if discovered, would alter the underwriting decision of the insurance company.
What is a material misrepresenatation?
To minimize the insured level of liability in the event of loss.
Retention usually results from three basic desires of the insured. To reduce expenses and improve cash flow, to increase control of claim reserving and claims settlements, and to fund losses
Which if the following is not a goal of risk retention?
Mutual.
Funds not paid out after claims and other operating costs are returned to the policy owners in the form of a dividend. If all funds are paid out, no dividends are paid.
An insured purchased an insurance policy 5 years ago. Last year she recieved a dividend check from the insurance company that was not taxable. This year, she not receive a check from the insurer. From what type of insurer did the insured purchase the poli
One sided. Only one party makes an enforceable promise
An insurance contract is unilateral in that only one of the parties to the contract is legally bound to do anything.
What is the definition of a unilateral contract?
Express authority
Express powers are written into the contract between the insurer and the agent.
The authortit granted to an agent through the agents contract is reffered to as?
AM Best
AM Best and company assigns rating to life, property and causality insurance companies based upon the financial stability of the insurer.
Which of the following produces evaluations of insurers financial status often used by state departments of insurance?
Homogeneous
The basis of insurance is sharing risk between a large homogeneous group with similar exposure to loss
Units with the same or similar exposure to loss are referred to as?
Avoidance
Risk avoidance is elimination of risk of loss by avoiding any exposure to an event that could give rise to such loss
The risk management technique that is used to orevent a specific loss bu bot exposing oneself to thst activity is called?
Consideration.
Consideration is something of value that each party to an insurance contract gives to the other.
Something of value exchanged between the insurer and the insured is considered an?
Foreign
A foreign insurer is domiciled in one state and transacts insurance in another. A domestic insurer transacts insurance in the domicile states. An alien insurer is one country transacts insurance in another.
An insurance company that is domiciled in montana and tranacts business in wyoming. Which term best describes the insurers classification in wyoming?
Loss
The reduction, decrease of dissapearance of value of the person or property by a peril insured agaisnt is known as a ?
The trust that a client passes in the producer in regard to handling premiums
Which of the following is an example of a producers fiduciary duty?
The agent accepts a premium payment after the end of the grace period.
Which of the following is an example of apparent authority of an agent appointment by an insurer?
Premiums
Retention is planned on assumption of risk, or acceptance or acceptance of responsibility for the loss by an insured through the use of deductibles, copayments or self insurance
Which of the following are examples of risk retention except