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IF1 > The Insurance Market > Flashcards

The Insurance Market Flashcards

1
Q

5 components of the insurance market

A
  • buyers
  • Insurers
  • Intermediaries
  • Comparison Websites
  • Reinsurers
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2
Q

Types of insurer by ownership

A
  • proprietary companies
    *mutual companies
    *mutual indemnity companies
    *captive insurers
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3
Q

Proprietary Companies

A

Owned by shareholders - have limited liability

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4
Q

Mutual Companies

A

Owned by policy holders - benefit from profits by lower premiums

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5
Q

Mutual Indemnity Associations

A

self-managed pools if insurers - owned by policy holders

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6
Q

Captive Insurers

A

Insurance company established by its parent company providing insurance for the parent company - protected cell companies (PPC) type of captive insurer

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7
Q

Types of insurer defined by function

A

composite companies
specialist insurers

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8
Q

composite companies

A

accept several types of business and represent the major part of the company market

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9
Q

specialist insurers

A

issue policies for only one class of business

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10
Q

takaful insurance

A

works on the principal that any transaction risk and profit should be shared between the participants - takaful insurance products need to be approved by Islamic Scholars

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11
Q

managing agents

A

Lloyds syndicates outsource the day-to-day running to a managing agent - they are dual-regulated ie. have to be approved by the FCA and the PRA

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12
Q

contract certainty

A

contract certainty is achieved by the complete and final agreement of all terms between the insured and insurers by the time they enter into the contract with contract documentation provided promptly thereafter

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13
Q

Intermediaries

A

An agent that brings the insured and insurer together - must be FCA regulated or exempt ie AR or IAR

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14
Q

Appointed Representative (AR)

A

Appointed by an authorised person - can act for more than one principal

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15
Q

Authorised person

A

Individual or firm authorised by the FCA to engage in regulated activities

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16
Q

Introducer appointed representatives q

A

limited to effecting introductions and distributing non-real time financial promotions

17
Q

Lloyds insurance broker

A

most follow requirements of lloyds and FCA for an authorised person

18
Q

Services provided by intermediaries

A

Act on behalf of client

19
Q

Direct insurance

A

from insurer to client eg through websites

20
Q

Indirect insurance

A

intermediaries paid by the insurer to promote products on their behalf

21
Q

Delegated Authority

A

many insurers delegate authority to intermediaries to act on their behalf - the intermediary is authorised to issue cover within defined limits - improves the flow of business

22
Q

Bancassurance

A

insurance products are sold to the banks customers through the banks branches

23
Q

Reinsurance

A

May be on an individual risk basis or an event basis or on a portfolio basis

24
Q

Association of British Insurers (ABI)

A

gathers market stats, frames codes and creates awareness of the role of insurance

25
Q

International Underwriting Association (IUA)

A

Represents international and wholesale insurance and reinsurance companies

26
Q

British Insurance Brokers Association (BIBA)

A

non -statutory trade association for insurance intermediaries

27
Q

London Market Regional Committee (LMRC)

A

maintains a lobbying role and represents the sector to the FCA, Europe, the UK govt and other stakeholders

28
Q

London and International Broker Association (LIIBA)

A

independent trade body

29
Q

Llpyds Market Association (LMA)

A

provides information, representation and technical services to underwriting businesses in Lloyds

30
Q

Managing General Agents Association (MGAA)

A

gives the insurance industry a better understanding of what an MGA is and what they contribute to the industry

31
Q

Chartered Insurance Institute (CII)

A

Forefront of insurance education and professionalism

32
Q

Chartered Institute of Loss Adjustors (CILA)

A

Members must preserve impartiality - CILA has its own complaints handling mechanism

33
Q

Institute and Faculty of Actuaries (IFoA)

A

provides manuals of actuarial practice and issue guidance notes in particular areas

34
Q

Institute of Risk Management (IRM)

A

develops new educational programmes

35
Q

Association of Insurance and Risk Managers in Insurance and Commerce (Airmic)

A

members include company secretaries, finance directors, internal audit and risk and insurance managers

36
Q

Insurtech UK

A

represents insuretech companies

37
Q

Motor Insurance Bureau (MIB)

A

aims to:
*reduce level and impact of uninsured drivers
*provide data to specialist claims services

38
Q

Insurance Premium Tax

A

*standard rate of 12%
*20% for travel and some vehicles and domestic and electrical appliances

IF1 (2 decks)

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