life insurance companies

what is surplus lines insurance?

insurance placed with an an authorized insurer

Risk Retention Group (RRG)

liability insurance company owned by its members. the members are exposed to similar liability risks by virtue of being In the same business or industry

Foreign insurer

An insurance company that is incorporated in another state.

Rating organizations

Companies that rate financial strength of insurance carriers based on analysis of management, investment performance, company claim experience, & other factors. AM best Fitch Standards and Poor's Moody's Weiss

which of the following entities is not insured but an organization formed to provide insurance benefits for members of an affiliated lodge or religious organization?

Fraternal Benefit society

reciprocal

Insurance resulting from an interchange of reciprocal agreements of indemnity among persons known as subscribers.

which of the following is true regarding a risk retention group?

It is a liability insurance company owned by its members

which of the following is not true regarding a certificate of authority?

It is issued to group insurance participants.

the following are marketing arrangements used by insurers EXCEPT?

Reinsurance system

An unauthorized producer wrote a line of insurance on a stage production that's appearing in KY, Indiana, and TN. which of the following is true

The tax the producer will pay will be computed on the portions of the premium applicable to the risk in KY

An insurance producer who is by contract is bound to write insurance for only one company or group of companies is classified

captive agent

An insurance company sells an insurance policy over the phone In response to a TV ad. which of the following best describes this act?

direct response marketing

An insured purchased an insurance policy 5 years ago. Last year, she received a dividend check from the insurance company that was not taxable. This year, she did not receive a check from the insurer. From what type of insurer did the insured purchase the policy?

mutual

Fraternal benefit society

Organization formed to provide insurance benefits for members of an affiliated lodge, religious organization, or fraternal organization with a representative form of government

Lloyd's Association

Organizations that provide support facilities for underwriters or groups of individuals that accept insurance risk. not an insurance company

Alien insurer

insurance company that is incorporated outside the USA

Government insurance

provides insurance to areas that private insurers cant or wont provide to. Ex. Medicare

what is the major difference between a stock company and a mutual company?

the ownership-mutual companies are owned by policyholders, while stock companies are owned by stockholders

Which of the following is a characteristic of a reciprocal insurance exchange

The chief administrator of the insurer is called an "attorney-in-fact".

insurance companies may be classified according to the legal form of their ownership. the type of company organized to return any surplus money to their policy holder is

a mutual insurer

private insurance

offer many lines of insurance. they may be formed as stock, mutual, reciprocals, or fraternal insurers and they must be authorized to transact insurance by state departments

which of the following services are associated with Standard &Poor's and AM best?

rating the financial strength of insurance companies

Common types of ownership

stock companies mutual companies Fraternal Associations Reciprocal Exchanges Risk Retention and purchasing groups

A nonadmitted insurer who provided insurance coverage that are not available form an admitted insured is called

surplus lines insurer

If an insurer meets the state's financial requirements and is approved to transact business in the state, it is considered what type of insurer?

Authorized or admitted

All of the following are marketing arrangements used by insures EXCEPT

reinsurance system

Mutual Companies

Owned by the policy owners and issue participating policies.

Stock companies

Owned by the stockholders who provide the capital necessary to establish and operate the insurance company and who share in any profits or losses.

Private insurance companies can be classified in a variety of ways..

Ownership authority to transact business location (domicile) location marketing and distribution systems rating (financial strength)

Who might receive dividends from a mutual insurer?

Policyholders

Domestic

insurances company that is incorporated into the state

surplus lines

Insurance that is not available in the regular market place from admitted insurers

nonparticipating policies

Policy owners do not share in profits or losses; does not pay dividends to policy owners; however, taxable dividends are paid to stockholders

An unauthorized producer operating in KY pays a tax of how much of the gross premiums charged?

2%