Chapter 5 - Common Functions Within Insurance Organisations Flashcards
The control of underwriting is through an underwriting …
Manual
What is a pure risk premium?
The amount before expenses and profit and sometimes brokerage is added.
Often the policy wordings will have been specifically negotiated to fit a particular category of client e.g haulage contractors or hoteliers. These will be often referred to as ….
Schemes
The party to whom authority has been delegated is known as the …
Cover holder
An agreement called a ??????? ???????? Is set up between the parties, which sets out the scope and extent of the authority delegated to the cover holder.
Binding authority
A line slip is…
An agreement between an individual broker and a group of two or more insurers whereby each insurer or underwriter agrees to accept a pre agreed proportion of a specified type of insurance.
Risks placed on the line slip are usually notified to the supporting insurers via a monthly/quarterly/annually listing called a….
Bordereaux
Risks placed on the line slip are usually produced in bulk to reduce…
Costs
The role of the claims department is to ensure that…
When claims are made, the policyholder receives a fair and equitable settlement for their loss, in accordance with the contractual obligations of the insurance policy.
The job of the claims department is often one of managing expectations and protecting …
The good reputation of the company for fair dealing.
Claims management processes are written down and captured in a …
Claims manual
The marketing teams role may include the following:
- market research
- competitior research
- customer profiling, target markets or segmentation
- development of strategic marketting plans
- development of operational marketing plans
- advertising
- media relations
- public relations and sponsership
- product development
- relationship management including sales management and customer service
In the circle of what the marketing team does, this would be to..
- Identify target markets
- Formulate marketting strategy
- Control marketting operations
- ## Monitor the successes of products of services
Develop marketing plans
An important part of market research is investigating the activities of…
Competitors
Advertising can be defined as…
Any form of impersonal presentation and promotion of ideas, goods or services by an identified organisation that must be paid for.
Relationship marketing uses…
Information about individual customers as a device for building up a strong relationship between an organisation and its clients by pre-emptying a customers buying needs on the evidence of past purchases.
A feature of successful customer relationship management is knowing…
The customer and their needs and preferences, based on previous sales.
The marketting and selling of insurance products must comply with…
FCAs rules, particularly the insurance conduct of business sourcebook, ICOBS and treating customers fairly.
Many organisations have created the role of ????????? Or ????????? To take the lead of risk management acitities.
Chief risk officer or head of risk mangement
In regards to risk identification, what are some of the methods used?
- brainstorming and risk workshops
- site visits
- scenario analysis
- flow process analysis
What is scenario analysis?
A risk identification technique that asks questions like what if? To see exposures to the firm.
What is risk reporting?
Key risk indicators will be reported to ko they risk and compliance committee and then a summary sent to the board. Risk managers will also maintain a risk and events log that will carry details of every risk event that occurs, whether a minor property damage or regulatory breach.
Risks that have been identified and analysed are then recorded in a…
Risk register.
In the risk analysis, risks will be assessed from both an ?????? And ??????? View point.
Inherent and residual.
An insurer usually has a department that is responsible for managing the investments to get the …
Best return possible, while at the same time keeping the assets readily available to meet the expenses of running the business and to pay claims.
If insurances the company write are short tail then the investments need to be…
Short duration
For short tail insurances, what is used for paying the claims quick?
Cash at the bank
Management of finances is a core activity and an area of interest for…
Senior management and board
Decisions regarding the insurances to be transacted, management of costs and expenses, investment strategy and capital raising and solvency ratios are all under the direct influence of the…
Finance director
The finance department including accounting takes responsibility for the …
Banking and reconciliation of all aspects of income. The main source of income are premiums, but other sources include investment income, fees and commissions for services, recoveries under reinsurance claims, property rental income and sales of salvaged property.
The finance and accounting control activities are centred ensuring that the amounts of income receivable are in da f collected and the ledgers can be matched (???????) with balances shown on the bank statements.
Reconciled
An important part of the firms financial management is credit…
Control
There is no credit risk if…
Premiums are collected by debit/credit card.
The period of credit for the broker may be 30-60 days which allows the broker to collect premiums from clients and then pay these over to the insurer on a monthly basis in one payment. The risk to the insurer is that..l
Broker may take longer to pay premiums(with the consequent loss of interest it the insurer) or indeed may be in finanal difficulty and go into ligiqudaiton.
The general counsel is responsible for…
Dealing with all legal affairs of the company.
A key role of the compliance department is to…
Ensure as far as possible, that the operations of the firm are compliant with regulatory requirements.
The compliance team is usually headed by…
A compliance officer or compliance director.
Compliance team will communicate to all relevant staff the regulatory requirements of their role as well as…
https://www.brainscape.com/decks/11705504/cards/quick#Any updates or changes that are introduced.
The compliance team should act as a point of contact for…
Regulators in their dealings with the firm.
Compliance should develop new compliance…
Procedures
Compliance should arrange or undertake training for key regulatory or legal issues such as the…
- proceeds of crime act 2002 (for anti money laundering)
- data protection act 1998 (for personal data)
- and the bribery act 2010
While the internal audit department covers all areas of the business, the key focus is on …
The financial statements in the firms annual reports and accounts.
The audits may address a particular department or activity of there may be ?????? Reviews.
Themed
Experienced auditors carry out the ??????? And the initial findings are discussed with a ????? ???????
Fieldwork. Then discussed with senior auditor.
A core role of the internal audit is to ensure the financial resources of the firm are…
Protected against fraud and errors.
The head of internal audit has an unusual reporting structure in that they usually…
Report to two people. A senior executive such as finance director or CEO and chairman of the audit committee.
Why does head of internal audit report to chairman of audit committee?
Maintain independence from the operating divisions, also allows open discussions of any problems found in the auditing work.
How can IT department help in business strategy?
They are aware of the new technology etc.
The central function of IT is to…
Establish the hardware requirements, including servers, desktop PCs and printers and the whole of the system of connections.
What is a server farm?
Where server storage space can be rented
The training and development team will be required to provide a ….
Return on investment report on larger scale training programmes in order to outline the business and individual benefits of the invesmtnent in training.
The role of facilities management may include…
Procurement of an office of other property to meet the accommodation needs to the company. To achieve this, external property agents will be employed to seek the type of property required and advise the firm on rent, services charges and local authority rates.
What is a hot site location?
Where the IT runs parallel in real time and the building can be occupied at short notice.
