Chapter 8 Flashcards
What is one of the most important benefits of good relationships ?
One of the most important benefits of good relationships is the dissemination of information they make possible.
How can good relationships make an underwriters job easier ?
Good relationships can make Underwriters jobs easier by giving them access to information they can be valuable or even necessary to properly underwrite. They help give Underwriters perspective by understanding the rules of other insurance professionals, which can help them proactively prepare for a conversation. Good relationships can also build trust between Underwriters and the insurance professionals they deal with.
Trust can help achieve the most important result of good relationships for underwriters, attracting and retaining profitable business
Why are underwriters expected to network?
Underwriters are expected to network, that is, to form, maintain, and expand their network of professional relationships to help achieve their business objectives. The more professional relationships Underwriters have, the better they will be able to undertake the many small transactions between people that make any business run well.
List 9 groups of insurance individuals underwriters should forge relationships with
- Other underwriters - for underwriters, relationships with fellow Underwriters are invaluable, especially when they need to consult each other about types of risks they may not be as experienced or familiar with.
- Reinsurers - Underwriters require good relationships with baculated reinsurance to ensure that vacculitative reinsurance will be available when it is needed. To develop such relationships, Underwriters must establish underwriting credit with various facultative reinsurers.
- Brokers- both Underwriters and brokers want to serve the best interest of the insurance buyer. The broker acts on behalf of the insurance prior to find an insurance company willing to insure the buyer and then tries to obtain for the buyer the best terms possible. The underwriter also acts on be half of the insurance company has a gatekeeper, opening the insurance doors to attractive risks and closing them or at least negotiating stricter terms for less attractive risks.
- Agents - the underwriters relationship with the agent is a relationship with a co-worker rather than a relationship with an outsider. The underwriter has to collaborate with an agent and developing the agents knowledge and skills
- Risk managers- contextually risk managers are Underwriters customers. Where the risk the underwriter is considering employees are risk manager, the role of the broker will depend on the sophistication of the risk manager. That’s sophistication often depends on the size of the organization. The larger the organization, the more sophisticated the risk management programs and therefore the more sophisticated the risk managers.
- The claims department - the claims department can be invaluable source of information for the underwriter about the development of a continuing loss adjustment. When a loss is incurred, it may be settled immediately with a payment and the file closed. But for larger and more complex losses, the claims department may have to set aside funds - that is establish a lost deserve to reflect its estimate of what the claim will ultimately cost the insurer to settle
- The actuarial department - Underwriters and an insurers underwriting management may work with actuaries to help determine that insurers underwriting philosophy. And underwriter at the branch level May rarely deal with actuaries but on occasion engage with them on underwriting larger and more complex risks
- The loss control department - one of the most important sources of information about a risk and the exposures it poses for an insurer is the report from the loss control inspector
- The legal department a lawyer can help an underwriter to take the temperature of the Court Dash that is, to understand how policy language has been and would be interpreted by the courts in the event of a dispute with the insured. This is especially helpful when the underwriter of a large commercial account must draft a manuscript reading - non-standard warning drafted exclusively for a given purpose and for a given insured
Underwriters may need facultative reinsurance for unique or especially hazardous exposures list six occurrences that this may include
- Hazardous occupancies, such as chemical manufacturing or furniture making
- Risks associated in areas unprotected by municipal water supplies or fire departments
3 risks with the potential to suffer catastrophic laws, such as large schedule of properties in the earthquake prone lower mainland of British Columbia
- Risks that sell their products in the united states, where many insurers fear the loss potential post by a more litigious culture
- Liability risks with the potential for long tail liability losses, such as pharmaceutical production
- Risks with high values
On such a counts, Underwriters may find it useful, perhaps necessary, to call upon the expertise of their counterparts in other branches. What information might they seek? List four things
- The operations of the risks in those territories
- The law in those restrictions
- Environmental considerations
- The business climate, or any other feature of the risk and its local circumstances that might be relevant to the underwriters assessment of the risk
Define risk management
Analyzing a risk to quantify the potential for losses in a specific investment and to decide what is the appropriate action to take or whether to not take action
Define loss reserve
An amount carried as a liability in an insurance balance sheet representing, in respect of each claim, and amount equal to the estimated final settlement cost less any amounts already paid
Define warranty
Statement or stipulation are promised in an insurance contract, the breach of which may nullify the contract
List five other industry organizations that benefit Underwriters in their work and education
- Underwriters laboratory of Canada : it is an independent, non-for-profit product safety testing and certification organization, it tests products for public safety and evaluates them for their markets. An underwriter might well benefit from being able to attend the next ulc where to test to acquire technical knowledge
- Insurance bureau of Canada : an organization engaged in, among other things, working with the federal, provincial, and territorial governments on the legislative framework within which property and casualty Insurance is practiced
- Risk management services : provides risk information, loss prevention and control services, commercial inspections, actuarial and other specified risk management, and insurance consulting services. A familiarity with SCM services and personal contact with SCM staff can offer an underwriter access to our repository of information about risks, ratemaking, and loss prevention
- Insurance institute of Canada : a Premier Source of professional education and career development for the country’s property and casualty Insurance industry. On behalf of the industry, iic also conducts demographic research and produces reports of publications. It provides insurance industry news and iic happenings via social media channels, various newsletters, email updates, and local news from individual institutes and chapters from around canada.
- Trusted social media platforms can also serve as a valuable source of information for underwriters. Individuals, organizations, and subject matter experts to seek to be relevant and on The cutting Edge of their industry will seek out, compose, or share information that their followers may find interesting and potentially useful. Using this information can be helpful to Underwriters to be aware of the trending topics and access new info in real time
Why should the under writer consider everyone a customer?
Of the particular challenges is not only two focus on the customer but to identify the customer. For example and underwriters customer but be the adjuster from the cleans apartment who is handling a large loss for one of the underwriters accounts. Or the customer could be the broker with whom the underwriters negotiating for business or the risk manager of the large commercial risk that the underwriter hopes to insure
What is ibc’s agreement of guiding principles?
Disagreement guides Insurance practice concerning multiple insurance policies where they depart from statutory specifications, where the law is unclear, where gaps exist in the law, OR in unusual or disputed circumstances. In the event of overlapping coverage, insurers determine when and how each policy will apply. The guiding principles provide a framework on how to approach these kinds of scenarios.
Example 9/11 losses (8-16)
