Basic Prinicples

- 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

- insurance is NOT characterized as which of the following?

As the number of insureds increase the number of losses decrease

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

Attorney-in-fact

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

Captive insurer

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

Captive insurer

- A(n) _______ agent may represent several insurers.

Independent

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

Life insurance

- 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

- 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

- A(n) ____ insurer assumes risk from another insurance company.

Reinsurance

- 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

- Who regulates an insurer's claim settlement practices?

State insurance departments

- 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 Reinsurance

- A(n) _____ agent is an insurance agent who represents only ONE insurance company

captive

- Which of the following is an unincorporated association whose members provide coverage for one another?

reciprocal

- A stock insurance company is owned by its

shareholders