Basic Principals of Life and Health Insurance Flashcards
This is the department within an insurance company that’s responsible for reviewing applications, approving or declining applications, and assigning risk classifications.
Underwriting Department
This is a non-admitted insurer.
Unauthorized Insurer
This is non-traditional insurance that provides coverage for substandard or unusual risks and is not available through private or commercial carriers.
Surplus Lines Insurance
This is an insurance company that’s owned and controlled by a group of shareholders whose investment in the company provides the safety margin necessary in the issuance of guaranteed, fixed premium, nonparticipating policies.
Stock Insurance Company
These are the individuals who solicit and schedule sales meetings between consumers and the producers for whom they work. Some states separately license these individuals.
Solicitors
These are customer service employees. They are not required to obtain a license because they neither sell nor solicit coverage, and they don’t bind coverage.
Service Representatives
This is a company that establishes a self-funded plan to cover potential losses rather than transferring the risk to an insurance company.
Self-Insurer
This department acquires clients through one-on-one meetings in which consumers complete applications.
Sales Department
This is the person who’s responsible for the payment of premiums and who possesses all ownership rights of the contract. Typically, the y are also the insured.
Policy owner
This is an insurer that’s owned by private citizens or groups that offer one or more insurance lines. They are NOT government-owned.
Private (Commercial) Insurer
This is an individual who’s licensed by one or more states to sell, solicit, or transact insurance in a given state.
Producer
This is the person whose life will be covered by an insurance policy.
Proposed Insured
This person acts on behalf of a consumer who’s settling an insurance claim.
Public Adjuster
This is an unincorporated organization in which all members insure one another. An attorney-in-fact manages it.
Reciprocal Insurer
This is the acceptance by one or more insurers of a portion of the risk being underwritten by another insurer that has contracted with a consumer to cover the entire risk.
Reinsurance
This is a company that provides financial protection to insurance companies. They handle risks that are too large for insurance companies to cover on their own and make it possible for insurers to obtain more business than they would otherwise be able to obtain
Reinsurer
This is a group-owned liability insurer that assumes and spreads product liability and other forms of commercial liability risks among its members.
Risk Retention Group
This is an agency that represents one or more specific insurers. A (Blank) is a similar agency system, they don’t recruit, train, or supervise career agents.
Personal Producing General Agency (PPGA)
This is an insurance policy that pays policy dividends to policy owners. By receiving dividends, policy owners share in the company’s divisible surplus and also elect the company’s board of directors.
Participating Policy
This is an insurance company that’s characterized by having no capital stock, being owned by their policy owners, and typically issuing participating insurance.
Mutual Insurance Company
This is a policy that’s typically issued by stock companies. This type of policy doesn’t allow policy owners to participate in dividends or to elect the board of directors.
Nonparticipating Policy
This is an insurer that has not received a certificate of authority from a state’s department of insurance which authorizes it to conduct insurance business in that state.
Non-Admitted (Unauthorized) Insurer
This is an insurance company or independent agent that provides a “one-stop-shop” for businesses or individuals who are seeking coverage for all of their insurance needs. For example, many large insurers offer individual policies for automobile, homeowner, long-term care, life, and health insurance needs.
Multi-Line Insurer
This is an insurance carrier that only sells one line of insurance
Monoline Insurer
This is the division that’s responsible for acquiring prospective applicants through various advertising media.
Marketing Division
This is an agency that any number of insurance companies through contractual agreements.
Independent Insurance Agency
This is the transfer of risk through the pooling or accumulation of funds.
Insurance
This is the customer who receives insurance protection under an insurance policy.
Insured
This is an insurance company
Insurer
This is NOT an insurer but a group of individuals and companies that underwrite unusual insurance policies.
Lloyds of London
This is a non-profit benevolent organization that provides insurance to its members.
Fraternal Benefit Society
This is an insurer whose principal office or domicile location is in a state that’s different from the state in which it’s transacting insurance business.
Foreign Insurer
This is an insurer with its principal or home office in the state in which it’s authorized.
Domestic Insurer
This is the amount of earnings that are paid to policy owners as dividends after the insurance company sets aside funds required to cover reserves, operating expenses, and general business purposes.
Divisible Surplus
This is the department that’s responsible for processing, investigating, and paying claims
Claims Department
This is a license that’s issued to an insurer by an insurance department (or equivalent state agency) that authorizes that company to conduct insurance business in that particular state.
Certificate of Authority
This is an insurer that’s established and owned by a parent firm for the purpose of insuring the parent firm’s loss exposure.
Captive Insurer
This is a person who represents himself and the insured (i.e., the client or customer). They cannot bind coverage on behalf of an insurance carrier because they are not appointed as an agent.
Broker
This is an admitted insurer.
Authorized Insurer
This is an individual or organization that’s authorized to solicit, sell, and transact (bind) coverage for specific insurance providers under the terms of one or more agent contracts.
Agent
This is an insurer who has received a certificate of authority from a state’s department of insurance which authorizes them to conduct insurance business in that state.
Admitted Insurer
In the United States, this is an insurer whose principal office and domicile location is outside this country.
Alien Insurer
This is the person who investigates claims and arranges for them to be settled or denied.
Adjuster
This is the department that calculates policy rates, reserves, and dividends.
Actuarial Department
