Week 3 Flashcards
Define what an insurance stakeholder is?
Someone who can contribute financially or create money for the company and whom bare the risk.
Name 3 ways in which insurance across different countries are different, what factors might drive this?
The political system, regulatory laws and the demographic.
Explain how risk is shared in insurance between primary insurers, what are the two most common methods?
Coininsurance where the insurance is split (maybe 30, 30, 30), meaning if there was a claim multiple insurance groups would contribute.
Insurance pools are when insurance groups pool together to insure risks which have a larger impact such as an earthquake spreading the cost.
Who supports primary insurers?
Reinsurers support primary insurers rather than directly to the consumer. Composite insurers do both.
When a group of shareholders make a pot of money in a separate for insurance rather than paying an external insurer what is this called?
Proprietary insurance.
What might be an advantage of having a proprietary insurance?
If you do not claim, the profits are kept rather than paid out to insurers. You use what you need.
What is mutual insurance?
When you buy a policy/ pay for the insurance you own a share. If Connor bought insurance he would also own a share.
How might mutual insurance beat proprietary insurance?
Spreading risk as more people can buy into mutual insurance therefore raising the capital to which can be paid out during a claim and spreads the risk to multiple people rather than the lone shareholders of a proprietary.
Who is the voice for insurance
The ABI (association of British insurers)
What does the ABI do?
They inform the public of insurance debates, changes in regulations or insurance with politicians, they promote insurance and its benefits and promote the growth of insurance and information about insurance and its importance for an economy.
What is the difference between a reinsurer and a composite reinsurer?
Reinsurer insures towards insurance, composite reinsurer does the same but offers a broader range of policies like health or damages etc…
Whats a soft vs hard market
Can a proprietary company be classified as life or general, composites or specialists
All of the above.
How might you identify a mutual insurance company?
No capital stock, insurance is usually cheaper and profits are returned to shareholders.
What are three reasons/ what do insurance agents do for insurance companies?
Sell their insurance products, sell insurance as part of a bundle, may be able to underwrite for the insurance and provide a platform for insurance to gain expert sales knowledge
