Insurance 101 Flashcards
What is Personal Lines Insurance?
Definition: Insurance that covers individuals and families rather than businesses. It includes policies like home, auto, travel, and pet insurance.
Examples: Car insurance, home insurance, renters insurance.
What is Commercial Insurance?
Definition: Insurance designed for businesses to protect against risks related to their operations, employees, and liabilities.
Examples: Public liability, professional indemnity, commercial property, fleet insurance.
What is an Account Handler?
Definition: A professional who manages client accounts, liaises with insurers, processes renewals, and provides insurance advice.
Personal Lines Account Handler: Works with individual policies.
Commercial Account Handler: Works with business insurance policies.
What is an Account Executive?
Definition: A client-facing role responsible for winning new business and managing key relationships with commercial clients.
Difference from Account Handler: More focused on business development rather than administrative policy work.
What is an Insurance Broker?
Definition: A professional who acts as an intermediary between clients and insurers, helping find the best policies to suit clients’ needs.
Types of Brokers:
Personal Lines Broker (home, auto, travel)
Commercial Broker (business, professional indemnity, liability)
What is an Underwriter?
Definition: A specialist who assesses the risk of insuring a person or business and decides the terms, conditions, and pricing of an insurance policy.
What is Indemnity?
Definition: A principle in insurance that ensures a policyholder is compensated for a loss but cannot profit from it.
Example: If your insured car is stolen, the insurer pays the car’s market value, not more.
What is Public Liability Insurance?
Definition: Insurance that protects businesses if a third party (customer, visitor, or supplier) is injured or their property is damaged due to business activities.
Example: A customer slips in a shop and sues for medical costs.
What is Professional Indemnity Insurance?
Definition: Covers professionals against claims for mistakes, negligence, or omissions in their work.
Example: A financial advisor gives incorrect investment advice, leading to a client’s financial loss.
What is Employers’ Liability Insurance?
Definition: A legal requirement in the UK that protects businesses against claims from employees who suffer work-related injuries or illnesses.
Example: An employee falls off a ladder at work and sues the company.
What is an Insurance Premium?
Definition: The amount a policyholder pays for insurance coverage.
Example: Monthly or annual payments for car or business insurance.
What is an Excess?
Definition: The amount the policyholder must pay towards a claim before the insurer covers the rest.
Example: A car insurance policy has a £500 excess. If repairs cost £2,000, the insurer pays £1,500.
What is Reinsurance?
Definition: Insurance for insurers. A process where insurers transfer some of their risk to other insurance companies to reduce exposure to large claims.
Example: A major natural disaster results in huge claims; reinsurance helps insurers stay financially stable.
What is the FCA (Financial Conduct Authority)?
Definition: The UK regulator for financial services, ensuring fair treatment of customers and compliance with laws.
Why It Matters: Insurance brokers and firms must follow FCA guidelines to operate legally.
What is Risk Management in Insurance?
Definition: The process of identifying, assessing, and reducing risks to prevent financial losses.
Example: Businesses install fire alarms to lower fire risk and reduce insurance premiums.
What is Fleet Insurance?
Definition: A single policy that covers multiple company vehicles under one contract.
Example: A delivery company insures all vans under one fleet policy instead of separate ones.
What is Business Interruption Insurance?
Definition: Covers financial losses if a business is unable to operate due to an insured event like a fire or flood.
Example: A restaurant closes for months after a fire; the policy covers lost income.
What is Cyber Insurance?
Definition: Covers businesses against cyber threats like data breaches, hacking, and ransomware attacks.
Example: A hacker steals customer data from an online retailer; cyber insurance covers legal costs and damages.
What is the Most Common CRM System in Insurance?
Definition: Acturis is the leading CRM and policy administration system used by brokers and insurers to manage client policies, renewals, and claims efficiently.
Why It Matters: Many insurance professionals need to be familiar with Acturis to work effectively in the industry.
