Ch 2: Insurance Companies & Distribution Systems Flashcards
Stock companies are owned by?
Stock holders
In a stock company, who gets dividends?
Stockholders, and they are taxable, as they are surplus of profit
In a stock company, what kind of policies are issued?
Non-participating - the policyholders. Receives no dividends since the stockholders do.
Mutual insurers are corporations owned by?
The policy owners
Policies issues by mutual insurers are referred to as ____policies and received dividends
Participating
What is demutualization?
When a mutual company turns into a stock company
What’s reciprocal and who are they managed by?
They are unincorporated associations of individuals known as subscribers who agree to insure one another. Managed by attorney in-fact.
In life insurance, Proof (evidence of insurability refers to
A medical exam being required
