Study 2: Commercial Insurance Stakeholders Flashcards
Describe the roles and responsibilities of commercial insurance professionals. Provide an overview of predominant commercial industries. identify general business characteristics that affect a commercial client's insurance solutions. Discuss essential workplace skills needed for building strong professional relationships.
What is an agent?
A person who is employed or authorised to act on behalf of another. Agents can be independent or direct writers.
What is a captive agent?
Agents who place all their business with one insurance company.
What is a rate manual?
A manual containing rates and underwriting rules for use by a company’s staff, agents, and/or brokers.
What is a line guide?
A listing of the maximum amounts of exposure an insurance company is prepared to accept on various classes of risk.
What is loading?
An additional charge included in an insurance rate to reflect a hazard not contemplated in the basic rate for the class.
What is an adjuster?
One who investigates insurance claims, makes recommendations regarding the payment of benefits from insurance policies and negotiates payments and settlements.
What is a claimant?
One who makes claims.
What is a managing general agent (MGA)?
An independent business operation given authority by a number of insurance companies to solicit business on behalf of such companies. Responsibilities include recruiting, training and supervising agents.
What is a moral hazard?
A hazard arising from the character, interest, habits, and lack of integrity of the insured or person concerned.
What are the two most common classification systems used by Canadian insurers?
North American Industry Classification System (NAICS) and Standard Industrial Classification.
What are 5 roles of insurance professionals?
1) Brokers/agents
2) Underwriters
3) Commercial claims professionals
4) Risk Analysts
5) Managing general agents (MGAs)
What is the difference between a broker and an agent?
Brokers work with clients and help them find the best options for products to meet the business’s insurance needs. Agents generally represent one insurer and operate according to agreements with that insurers. Agents can be independent or exclusive.
Which 2 parties are intermediaries in the insurance transaction responsible for?
The insured and the insurer.
What is the first step for individuals wishing to become a broker?
They must first complete a licensing exam.
Which 4 areas must commercial insurance brokers be proficient?
1) Communication
2) Research
3) Negotiation
4) Time Management