9 - Underwriters

Question 1

what are the four main functions of underwriters?

Answer 1

1. Assess risk
2. Decide whether to take risk
3. determine terms and conditions
4. calculate premium

Question 2

what does ‘competition law’ prevent?

Answer 2

The market acting together to the detriment of the client, ie. raising premiums.

Question 3

What does BIPAR stand for?

Answer 3

European Federation of Insurance Intermediaries

Question 4

What is the name given to the leader of the London Market part of any insurance placement?

Answer 4

Slip Leader

Question 5

What do you call the slip leader outside of the London Market?

Answer 5

Overall Leader

Question 6

What happens if a follower asks for higher premiums?

Answer 6

The leader and previous followers cannot automatically receive more premium, but the company asking can.

Question 7

What does the term ‘subscription market’ mean?

Answer 7

More than one insurer is involved in the risk.

Question 8

What is the most likely reason an insurer would not take 100% of a risk?

Answer 8

Overall size of risk exposure too ‘risky’

Question 9

What is the bureau leader?

Answer 9

Leader of the individual section of the London Market

Question 10

Which organisation is involved in recording risk data for insurers and transferring premium from the brokers to insurers?

Answer 10

XIS