Producers & Rules Of Agency Flashcards
Insurer as Principal?
Brokers/agents’ behavior represents the insurer.
The agent/producer will always represent an insurer.
Authority & Powers of Producers
(Per agency contract)
EXPRESS blatant
IMPLICIT not spelled out but obvious
APPARENT (business cards etc that make you look authoritative)
What’s a FIDUCIARY?
An agent who handles insurer funds in a trust capacity
Is there a code of ethics to protect the insured
Yup
When is a contract complete?
Signed
First Premium paid
What is CONSIDERAION in a contract?
Something of VALUE, which is the binding force. The PREMIUM.
CHARACTERISTICS of Insurance Contracts
1) unilateral: insurer bound to pay for loss
2) person-company contract (no xfers)
3) adhesion: TAKE it or LEAVE it
4) ALEATORY: uneven i.e. premium lower than payout.
5) conditional: did person do something to invalidate their insurance?
What is INDEMNITY
Agreement to pay the insured without gain. Just enough to cover the loss, not “get paid”.
What are Representations?
Statements on an application for insurance. Representations are valid in the absence of fraud.
What is a warranty?
A warranty is a statement that is absolutely true. I.e., true information.
What are WAIVERS and ESTOPPEL?
Waiver is to release a known right and a Stoppel is the legal right to stop someone from reneging on that waiver
What is concealment?
The act of intentionally failing to disclose information
What is RECISSION?
To rescind. The right to cancel our policy if it was fraudulently issued.
What is an investigative consumer report?
Credit report plus non-medical information up to end, including interviews. Governed by the FCRA.
What is the NAIC?
The national Association of insurance commissioners
