Question 1

What is the relationship between the underwriter and the actuary? How do they interact?

Accepted Answer

The underwriter uses the classification

Question 2

In 2004, insurance brokers in New York were accused of violating a duty to their clients (insurance buyers). What was that duty?

Accepted Answer

A)  Loyalty to the buyer 
B)  No self-dealing at the buyer's expense 
C)  Full disclosure to the buyer about the insurer's financial condition 
D)  Full disclosure of all the broker's investment interests in insurers 
A)  Loyalty to the buyer 
B)  No self-dealing at the buyer's expense 
C)  Full disclosure to the buyer about the insurer's financial condition 
D)  Full disclosure of all the broker's investment interests in insurers

Question 3

In reinsurance, the primary insurer is also known as the:

Accepted Answer

A)  retrocessionaire 
B)  first-layer reinsurer 
C)  ceding company 
D)  excess reinsurer 
A)  retrocessionaire 
B)  first-layer reinsurer 
C)  ceding company 
D)  excess reinsurer

Question 4

At the present, most insurance sold over the Internet is:

Accepted Answer

A)  illegal 
B)  personal lines coverage 
C)  small business coverage 
D)  expensive 
A)  illegal 
B)  personal lines coverage 
C)  small business coverage 
D)  expensive

Question 5

When a reinsurer cedes coverage to another reinsurer, it is called retrocession.

Accepted Answer

A) True 
 B)False

Question 6

In reinsurance, the reinsurer is also known as the "ceding" company.

Accepted Answer

A) True 
 B)False

Question 7

Insurance agents must never give clients legal advice.

Accepted Answer

A) True 
 B)False

Question 8

United Insurance Company insures Travelco for fire insurance. United reinsures part of the exposure with Promises Reinsurance Company on an excess of loss basis, with United's retention loss level equal to $150,000. In this instance, assuming a $400,000 insured loss, Promises will pay to United:

Accepted Answer

A)  $0 
B)  $100,000 
C)  $150,000 
D)  $250,000 
A)  $0 
B)  $100,000 
C)  $150,000 
D)  $250,000

Question 9

One duty of the insurance company actuary is to:

Accepted Answer

A)  handle claims when they involve property exposures and losses in multiple states 
B)  manage all contract negotiations when the agency agreement is signed by the agent and company 
C)  determine premium rates and classification schemes for the underwriters to apply 
D)  eliminate exposures from the pool that are going to have a loss 
A)  handle claims when they involve property exposures and losses in multiple states 
B)  manage all contract negotiations when the agency agreement is signed by the agent and company 
C)  determine premium rates and classification schemes for the underwriters to apply 
D)  eliminate exposures from the pool that are going to have a loss

Question 10

In Austin's agency contract, the insurer authorizes him to sell insurance policies, but does not specifically authorize him to make telephone calls to prospective clients. He makes such calls anyway. Does he have the authority to make these calls, and if so, what type of authority is this?

Accepted Answer

A)  No, he has no such authority. 
B)  Yes, and it is express authority. 
C)  Yes, and it is incidental authority. 
D)  Yes, and it is apparent authority. 
A)  No, he has no such authority. 
B)  Yes, and it is express authority. 
C)  Yes, and it is incidental authority. 
D)  Yes, and it is apparent authority.

Question 11

Which of the following types of claims adjusters do not represent insurance companies?

Accepted Answer

A)  Public adjusters 
B)  The insurance agent 
C)  The independent adjustment bureau 
D)  Company adjusters 
A)  Public adjusters 
B)  The insurance agent 
C)  The independent adjustment bureau 
D)  Company adjusters

Question 12

All of the following statements about the claims handling function are true except:

Accepted Answer

A)  overly liberal claims settlement procedures may be as bad as stingy claims settlement procedures 
B)  claims settlement problems are generally more complex in property and liability insurance than in life insurance 
C)  independent adjusters only work for small insurance companies 
D)  negotiation with the claims adjuster is often the only contact the insurance buyer has with the insurer, besides the selling agent 
A)  overly liberal claims settlement procedures may be as bad as stingy claims settlement procedures 
B)  claims settlement problems are generally more complex in property and liability insurance than in life insurance 
C)  independent adjusters only work for small insurance companies 
D)  negotiation with the claims adjuster is often the only contact the insurance buyer has with the insurer, besides the selling agent

Question 13

What are the steps in the loss adjustment process?

Accepted Answer

The loss adjuster must 1) investigate th

What is the relationship between the underwriter and the actuary? How do they interact?

In 2004, insurance brokers in New York were accused of violating a duty to their clients (insurance buyers). What was that duty?

In reinsurance, the primary insurer is also known as the:

At the present, most insurance sold over the Internet is:

When a reinsurer cedes coverage to another reinsurer, it is called retrocession.

In reinsurance, the reinsurer is also known as the "ceding" company.

Insurance agents must never give clients legal advice.

United Insurance Company insures Travelco for fire insurance. United reinsures part of the exposure with Promises Reinsurance Company on an excess of loss basis, with United's retention loss level equal to $150,000. In this instance, assuming a $400,000 insured loss, Promises will pay to United:

One duty of the insurance company actuary is to:

In Austin's agency contract, the insurer authorizes him to sell insurance policies, but does not specifically authorize him to make telephone calls to prospective clients. He makes such calls anyway. Does he have the authority to make these calls, and if so, what type of authority is this?

Which of the following types of claims adjusters do not represent insurance companies?

All of the following statements about the claims handling function are true except:

What are the steps in the loss adjustment process?

Introduction to Enterprise Risk Management and Insurance

Risk Identification

Risk Assessment and Pooling

Risk-Handling Techniques: Loss Control, Risk Transfer, and Loss Financing

Risk-Handling Techniques: Diversification and Hedging

Fundamentals of Insurance

Insurable Perils and Insuring Organizations

Insurance Markets: Economics and Issues

Insurance Regulation

Insurance Contracts

The Personal Auto Policy

Homeowners Insurance

Professional Financial Planning

Life Insurance Policies

Standard Life Insurance Contract Provisions and Options

Annuities

Health Insurance and Disability Income

Employee Benefits

Social Security

Unemployment and Workers Compensation Insurance

Commercial Property Insurance

Commercial Liability Insurance

Filters

Exam 8: Insurance Functions

What is the relationship between the underwriter and the actuary? How do they interact?

In 2004, insurance brokers in New York were accused of violating a duty to their clients (insurance buyers). What was that duty?

In reinsurance, the primary insurer is also known as the:

At the present, most insurance sold over the Internet is:

When a reinsurer cedes coverage to another reinsurer, it is called retrocession.

In reinsurance, the reinsurer is also known as the "ceding" company.

Insurance agents must never give clients legal advice.

United Insurance Company insures Travelco for fire insurance. United reinsures part of the exposure with Promises Reinsurance Company on an excess of loss basis, with United's retention loss level equal to $150,000. In this instance, assuming a $400,000 insured loss, Promises will pay to United:

One duty of the insurance company actuary is to:

In Austin's agency contract, the insurer authorizes him to sell insurance policies, but does not specifically authorize him to make telephone calls to prospective clients. He makes such calls anyway. Does he have the authority to make these calls, and if so, what type of authority is this?

Which of the following types of claims adjusters do not represent insurance companies?

All of the following statements about the claims handling function are true except:

What are the steps in the loss adjustment process?

Introduction to Enterprise Risk Management and Insurance

Risk Identification

Risk Assessment and Pooling

Risk-Handling Techniques: Loss Control, Risk Transfer, and Loss Financing

Risk-Handling Techniques: Diversification and Hedging

Fundamentals of Insurance

Insurable Perils and Insuring Organizations

Insurance Markets: Economics and Issues

Insurance Regulation

Insurance Contracts

The Personal Auto Policy

Homeowners Insurance

Professional Financial Planning

Life Insurance Policies

Standard Life Insurance Contract Provisions and Options

Annuities

Health Insurance and Disability Income

Employee Benefits

Social Security

Unemployment and Workers Compensation Insurance

Commercial Property Insurance

Commercial Liability Insurance

Filters