2 The Insurance Market Flashcards
What are the five components of the insurance market?
Buyers, Intermediaries, aggregators, insurers and reinsurers
State three types of buyers in the market
Three from:
- private individuals
- corporate customers
- charities
- associations
- public bodies
What is the difference between a proprietary company and a mutual company, in terms of ownership?
A proprietary company is owned by is shareholders and a mutual company is owned by its policyholders
Why do reinsurers fall into the category of buyer and seller?
Reinsurers fall into both categories as they accept risks and also seek to transfer part of their portfolio of risks to other reinsurers.
What significant change took place in Lloyds in 2008 in relation to distribution channels?
The Legislative Reform (Lloyds) Order 2008 removed the restriction that only a Lloyd’s broker can place business at Lloyds.
What is the role of the intermediary in the market place?
The role of the intermediary in the market place is to bring buyers and sellers together.
What are the benefits for a manufacturing company in forming a captive company?
The benefits are:
- to obtain the full benefit of the group’s risk control techniques
- avoidance of the direct insurer overheads
- buying reinsurance at low cost
What is a loss adjuster?
A loss adjuster is an expert in processing claims from start to finish.
Their functions are:
* the investigation of the circumstances surrounds a claim
*determining whether and to what extent the policy covers the loss
* facilitating any emergency measures, e.g. for the protection of property
* negotiation of amounts claimed
* negotiation with any specialist suppliers
*making a recommendation for settlement to the insurer
What are two of the functions of claims personnel?
Functions of claims personnel are to:
- deal quickly and fairly with claims
- distinguishing between real and fraudulent claims
- settle claims with minimum wastage
What is the mission of the London and International Insurance Brokers’ Association (LIIBA)?
The mission of the London and International Insurance Brokers’ Association (LIIBA) is to ensure that:
‘London remains where the world wants to do business by continuing the transformation of market processes and maintaing the highest professional standards’
What are the two agreements entered into between the Motor Insurers Bureau (MIB) and the UK Government?
The uninsured drivers’ agreement and the untraced drivers’ agreement.
