Chapter 1 - Intro to Insurance Flashcards
An insurer owned by
Stockholders.
Stock Insurance Company
An insurer authorized to do business in the state.
Admitted
An insurer not authorized
to do business in the state.
Non-Admitted
An insurer organized under the laws outside the United States.
Alien Insurer
An insurer organized
under the laws of another state within the United States.
Foreign Insurer
An insurer organized under
the laws of a state.
Domestic Insurer
Protects the public from
overly intrusive collection practices.
Fair Credit Reporting Act (FCRA)
An insurer owned by policy holders, or members
Mutual Insurance Company
The department that reviews statistical information used to develop the rate.
Actuarial Department
The department that selects the risks.
Underwriting Department
A type of Producer’s authority that is written.
Express
A type of Producer’s
authority that the public assumes.
Implied
Created when the producer exceeds the authority expressed in the agency contract
Apparent
Requires each consumer to receive a Privacy Notice Annually.
Gramm-Leach-Bliley Act
Risk that has a chance for
loss, gain, or neither.
Speculative Risk
Uncertainty concerning a loss.
Risk
Cause of a potential loss.
Peril
The only risk that can be insured and not provide chance for gain.
Pure Risk
A physical condition that increases the probability of loss.
Physical Hazard
Increases the chance of loss.
Hazard
Attitude that increases the probability of loss. Also carelessness.
Morale Hazard
Dishonest tendency that increases the probability of loss.
Moral Hazard
As the number of units in a group increases, the more likely it is to predict a particular outcome. This is known as the ______ of _______ _________.
Law of Large Numbers
The principle that people will seek insurance for risks that are hard to insure.
Adverse Selection
