6. Insurance Intermediation Flashcards
How can an agency agreement occur?
- By agreement
- By ratification
- By necessity
What duties does an agent have towards their principle?
– Follow their instructions.
– Act in good faith towards their principal.
– Not to sub-delegate without permission.
– Account for funds.
– Act with all due care and skill.
Wholesale broker
Direct contact with the insurer (closest broker to insurer)
Retail broker
Direct contact with client (closest broker to client)
Producing broker
Term used to describe the broker which has contact with the client and creates or produces the work for the client
Single tied agent
Representative of the insurer not the insured (not in London Market)
Multi-tied agent
Agent of the insurer but selling a number of different insurers products (one product per insurer
Independent intermediary
Traditional London Market broker - not tied to any insurer
Surplus lines broker
Broker used to fulfil surplus lines
Open market correspondent
Intermediary but is not a Lloyd’s approved coverholder - but they intro business to Lloyd’s
Lloyd’s broker
A broker who is approved by their own regulator and accredited by Lloyd’s
Non-Lloyd’s broker
Not accredited by Lloyd’s
Brokers role in the placing process
- Review client needs
- Create Market Reform Contract
- Review quotes with client
- Finalise placement
- Compile documentation for submission to Xchanging
- Request premium
- Submit documents to Xchanging
- Make changes to the risk
What are Terms of Business Agreements?
Market agreements used to capture the terms and conditions under which a broker does business with various parties
Insurance Distribution Directive applies to who
Applies to
All sellers of insurance products
Any person assisting with insurance contracts
Ancillary insurance intermediaries
