Chapter 1 - Basic Principles

Which of the following is a syndicate established by a group of insurers to share underwriting duties?

Lloyd's Organization

Dividends from a mutual insurance company are paid to whom

Policyholders

An agent's authority to bind an insurer to an insurance contract may be granted in the

agent's contract and the insurance company's appointment

What is the accounting measurement of an insurance company's future obligations to its policyowners?

reserves

A group-owned insurance company that is formed to assume and spread the liability risks of its members is known as a

Risk Retention Group

Dividends from a stock insurance company are normally sent to

Shareholders (stockholders)

Who regulates an insurer's claim settlement practices?

State insurance departments

Which of the following types of insurers limits the exposures it writes to those of its owners?

Captive insurer

A reciprocal insurer typically has an administrator who manages the premiums collected from the group's members. This administrator is called a(n)

Attorney-In-Fact

Which of the following financial products creates an instant estate, no matter when the date of death?

Life Insurance

Which of the following accurately describes a participating insurance policy?

Policyowners may be entitled to receive dividends

Which of the following outlines the authority given to the producer on behalf of the insurer?

Producer Contract

Which group is the Do Not Call Registry designed to protect against?

Telemarketers

Which reinsurance contract between two insurers involves an automatic sharing of the risks assumed?

Treaty Insurance