Key Terms Flashcards
Actuarial Department
The actuarial department calculates policy rates, reserves, and dividends.
Alien Insurer
An Alien Insurer in the United States is an insurer whose principal office and domiciled location is outside the country
Admitted Insurer
An insurer who has received a certificate of authority from a state’s department of insurance authorizing them to conduct insurance business in that state
Broker
represents themselves and the insured
Captive Insurer
an issuer established and owned by a parent firm for the purpose of insuring the parent firm’s loss exposure.
Certificate of Authority
is a license issued to an insurer by a department of insurance, which authorizes that company to conduct insurance business in that particular state.
Claims Department
is responsible for processing, investigating, and paying claims.
Divisible Surplus
is the amount of earnings paid to policyowners as dividends after the insurance company sets aside funds required to cover reserves, operating expenses, and general business purposes.
Domestic Insurer
an insurer with its principal or home office in a state where it is authorized.
Foreign Insurer
an insurer with its principle office or domicile location in a state different from the state it is transacting insurance business.
Fraternal Benefit Sociaty
are nonprofit benevolent organizations that provide insurances to its members.
Industrial Insurer
primarily provide policies with a small face amounts with weekly premiums. Other names include home service or debit insurers.
Insurance
The transfer of risk through the pooling or accumulation of funds.
Insured
The insured is the customer receiving insurance protection under an insurance pollicy
Insurer
The insurer is the insurance company
Lloyds of London
is NOT an insurer, but a group of individuals and companies that underwrite unusual insurance
Multi-line Insurer
Offers multiple different types of insurances, usually a large insurance company.
Mutual Insurance Company
insurance companies characterized by having no capital stock, being owned by its policy owners, and usually issue participating insurance.
Non-admitted Insurer
is an insurer who has not received a ceritficate of authority from a state’s department of insurance authorizing them to conduct insurance business in that state.
Nonparticpating policy
typically issued by stock companies, do not allow policyowners to participate in dividends or electing the board of directors.
Participating Plan
an insurance poliy under which the policyowners share in the company’s earnings through a receipt of dividends and also elect the board of directors.
Private Insurer
Private or commercial insurance companies are companies owned by private citizens or groups that offer one or more insurances lines. Commercial insurers are NOT gov-owned
Reciprocal Insurer
is an unincorporated organization in which all members insure one another
Reinsurance
the acceptance by one or more insurers, called reinsurers, of a portion of the risk underwritten by another insurer who has contracted for the entire coverage.
Reinsurer
a company that provides financial protection to insurance companies. Handle risks that are too large for insurance companies to handle on their own.
Risk Retention Group
is a group-owned liability insurer which assumes and spread product liability and other forms of commercial liability risks among its members
Self-Insurers
establishes a self-funded plan to cover potential losses instead of transferring the risk to an insurance company
Stock Insurance Company
owned and controlled by a group of stockholders whose investment in the company provides the safety margin necessary of guaranteed, fixed premium, nonparticipating policies.
Surplus Lines Insurance
nontraditional insurance only available from a surplus lines insurer. Offer coverage for substandard or unusual risks not available through private or commercial carriers.
Underwriting Department
a department within an insurance company responsible for reviewing applications, approving or declining applications, and assigning risk classifications
