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15 Cards in this Set
- Front
- Back
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Stock Company
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an incorporated insurance company with its capital divided into shares. Stock companies are owned by their stockholders
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Mutual Company
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an incorporated insurance company without permanent stock that is owned by its policyholders
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Reciprocals
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a member of the reciprocal agrees to share in the risk. (i.e. Lloyds of London) In case of loss, the amount paid is shared by the participating members who accepted the risk
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Fraternal Benefit Society
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An incorporated society or order, without capital stock, operated on the lodge system and not for profit. Fraternals offer insurance that is available only to their members.
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Risk Retention and Purchasing Groups
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manufacturers use risk retention groups to protect them against product liability exposures and to purchase liability insurance on a group basis through pruchasing groups
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What are the 4 basic Insurance Marketing Systems?
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Exclusive agency system
Direct writer system Direct response system Independent agency system |
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Exclusive agency system
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the insurance company contracts with agencies which are independent businesses, to represent and sell insurance only for that insurance company
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Direct writer system
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the insurance company's agents are actually employees
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Direct response system
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there are no agents, Companies sell through direct mail or over the phone
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Independent agency system
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agencies that are independent contractors contract with several different companies to represent and sell for those companies
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Three types of agent authority
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Express authority
Implied authority Apparent authority |
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Express Authority
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authority specifically given to the agent either in writing or orally
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Implied Authority
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this allows the agent to perform all the usual tasks required to sell and service the insurance contracts and to exercise the agent's express authority
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Apparent Authority
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doctrine that assumes that the agent has the authority that a normal prudent person would think or be lead to believe they have
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agent's responsibility (authority)
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selling insurance
collecting premiums servicing the contract issuing and countersigning policies they act as the representative for the insurance company and the link between the insured and the insurer |
