NJ Laws, Rules, And Regulations Flashcards
Stock companies
Owned by stockholder; non participating to policyholders; elect board of directors; dividends share in profit (taxable)
Mutual companies
Owned by policy holders; participating; return of premium (not taxable)
Domestic
Insurance company that is incorporated in this state
Foreign
Insurance company that is incorporated in another state
Alien
Insurance company that is incorporated in another country
Certificate of authority
Before insurers may transact business in a specific state, they must apply for this from the state department of insurance and meet any financial requirements set by the state
Insurance agent
Represents insurance company, not the client
Insurance broker
Represents the applicant or client
Insurance consultant
Gives advice, counsels, opinion for money
Insurance transaction
- Solicitation
- Negotiations
- Sale
- Advising an individual concerning coverage or claims
Insurance-related conduct
- Selling it, soliciting, negotiating and finding insurance policies
- All communication with the insured concerning any terms and conditions of the policy
- Office management policies affecting insureds
- Processing claims
- Transmitting fence between the insured, producers, premium finance companies and insurance companies
Paul vs. Virginia
The decision of the United States Supreme Court the insurance was not interstate commerce, and therefore was not subject to regulation by the federal government government
U.S. vs. Southeastern underwriters Association
Decided that insurance is interstate commerce and is therefore subject to regulation by the federal government
McCarran-Ferguson Act /Public Law 15
The federal government would not regulate insurance as long as the states did an adequate job of regulating the industry
Commissioner of insurance
- supervise insurance business
- licensing
- approve policies and forms
- enforce insurance laws and impose penalties for violations
- conduct examinations, investigations, hearings
