Term
| T/F On the basis of where they are domiciled, insurers are considered foreign if incorporated in another country |
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Definition
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Term
| T/F To facilitate access to capital markets and diversification of activities, there is currently a trend for stock companies to convert to mutual companies |
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Definition
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Term
| T/F Nearly all life insurance agents can bind coverage |
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Definition
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Term
| T/F A broker represents the policy owner, whereas an agent is a legal representative of the insurance company |
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Definition
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Term
| T/F In property and liability insurance, an independent agent can represent several insurers or groups of companies, whereas an exclusive agent typically represents only one company or group of affiliated companies |
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Definition
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Term
| T/F Exclusive agents generally receive the same commission rate for renewing a property/liability insurance policy as for initially selling the policy, whereas independent agents have traditionally received renewal commissions that are considerably smaller than their initial commissions |
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Definition
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Term
| T/F Among other things, reinsurance can help insurers spread larger losses and reduce the surplus drain associated with writing new business |
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Definition
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Term
| T/F The purpose of the claims settlement process is to determine the insurer's liability for a given loss and to reach agreement with respect to the amount of loss or damage payable under the insurance contract |
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Definition
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Term
| T/F In calculating the insurance premium, the pure net rate is multiplied by the number of units of coverage |
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Definition
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Term
| T/F Both life and property insurers invest more heavily in bonds than in stocks |
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Term
Which is not a reason for demutualization
A) Facilitate payment of certain types of non cash compensation
B) Influx of cash into company's capital
C) Diversify company activities such as acquisition of stock of other companies
D) Formation of a captive insurance company |
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Term
Which of the following is not a classification of an insurance company by domicile
A) Domestic
B) Monopolistic
C) Alien
D) Foreign |
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Definition
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Term
Which of the following is not a claims adjuster
A) Company employees
B) Independent adjusters
C) Agents
D) Underwriters |
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Definition
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Term
Life insurance premiums are established by applying mortality rates. Which of the following is not used in establishing these rates
A) Age
B) Tobacco use
C) Motor vehicle reports
D) Gender |
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Definition
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Term
Which is not a type of underwriting
A) Renewal
B) Home office
C) Field
D) Facultative |
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