Rmi Quiz #1

Front 1

proprietor insurer

Back 1

insurer formed for the purpose of earning a profit for its owners

Front 2

mutual insurer

Back 2

insurer that is owned by its policyholders and formed as a corporation for the purpose of providing insurance to them

Front 3

reciprocal insurance exchange
(interinsurance exchange)

Back 3

an insurer owned by its policyholders, formed as an unincorporated associations, for the purpose of providing insurance coverage to its memebers (called subscribers), and managed by an attorney-in-fact. members agree to mutually insure each other and they share in profits and losses in the same proportion as the amount of insurance purchased from the exchange by that member.

Front 4

FAIR plans

Back 4

-fair access to insurance requirements-
an insurance pool through which private insurers collectively address an unmet need for property insurance of urban properties, especially those susceptible to loss by riot or civil commotion

Front 5

residual market

Back 5

a term referring collectively to insurers and other organizations that make insurance available through a shared risk mechanism to those who cannot obtain coverage in the admitted market

Front 6

surplus in line broker

Back 6

a person or firm that places business with insurers not licensed (nonadmitted) in the state in which the transaction occurred but that is permitted to write insurance )b/c) coverage is not available through standard market insurers

Front 7

independent agency and brokerage market system

Back 7

an insurance marketing systme under which producers (agents or brokers) who are independent contractors, sell insurance usually as representatives of several unrelated uninsurers

Front 8

direct writer marketing system

Back 8

an insurance marketing system that uses sales agents or sales representatives who are direct employees of the insurer

Front 9

exclusive agency marketing system

Back 9

an insurance marketing system under which agents contract to sell insurance exclusively for one insurer or for an associated group of insurers

Front 10

distribution channel

Back 10

a channel used by the producer of a product or service to transfer that product or service to the ultimate customer

Front 11

probable maximum loss (PML)

Back 11

the largest loss that an insured is likely to sustain

Front 12

underwriting

Back 12

the process of selecting the insureds, pricing the coverage, determining insurance policy terms and conditions, and then monitoring the underwriting decisions made

Front 13

book of business

Back 13

a group of policies with a common characteristic, such as territory or type, or all policies written by a particular agent or insurer

Front 14

underwriting guidelines/guide

Back 14

a written manual that communicates an insurers underwriting policy and that specifies the attributes of an account that an insurer is willing to insure

Front 15

adverse selection

Back 15

the tendency for people with the greatest probability of loss to be the ones most likely to purchase insurance

Front 16

national association of insurance commissioners (NAIC)

Back 16

an association of insurance commissioners from the 50 states, District of columbia, and the 5 us terrorities and possessions whose purpose is to coordinate insurance regulation activities among the various state insurance departments

Front 17

model law

Back 17

a document drafted by the NAICs proposed solution to a given problem or issue and provides a common basis to the states for drafting any laws that affect the insurance industry (any state may chose to adopt it with modifications)

Front 18

model regulation

Back 18

a draft regulation that may be implemented by a state insurance department if the model law is passed

Front 19

domestic insurer

Back 19

an insurer doing business in the jurisdiction in which it is incorporated

Front 20

foreign insurer

Back 20

an insurer licensed to operate in a state but incorporated in another state

Front 21

systemic risk

Back 21

the potential for a major disruption in the function of an entire market or financial system

Front 22

alien insurer

Back 22

an insurere domiciled in a country other than the united states

Front 23

capital stock

Back 23

a balance sheet value that represents the amount of funds that a corporations stockholders have contributed through the purchase of stock

Front 24

paid in surplus

Back 24

the amount of stockholders paid in the excess of par value of the stock

Front 25

insolvency

Back 25

a situation in which an entity's current liabilities (as opposed to its total liabilities) exceed its current assets

Front 26

guaranty fund

Back 26

a state established fund that provides a system for the payment of some of the unpaid claims off insolvent insurers licensed in that state generally funded by assessments collected from all insurers licensed in the state

Front 27

good faith claim handling

Back 27

the manner of handling claims that requires an insurer to give consideration to the insured's interests that is at least equal to the consideration it gives to its own interest

Front 28

bad faith

Back 28

a breach of the duty of good faith and fair dealing

Front 29

mortgagor

Back 29

the person of the organization that borrows money form a mortgagee to finance the purchase of real property

Front 30

reciprocal insurer

Back 30

an insurer owned by its policyholder, formed as an unincorporated association for the purpose of providing insurance coverage to its members and managed by an attorney in fact . members agree to mutually insure each other and share profits and losses etc....

Front 31

advisory organization

Back 31

an independent organization that works with and on behalf of insurers that purchase or subscribe to its services

Front 32

prospective loss costs

Back 32

loss data that is modified by loss development, trending, and credibility processes, but without considerations for profits and expenses

Front 33

producer

Back 33

any of several kinds of insurance personnel who place insurance business with insurers and who represent either insurers or insureds or both

Front 34

market intelligence

Back 34

information gathered and analyzed regarding a company's markets to improve competitive decision making

Front 35

underwriting cycle

Back 35

a cyclical pattern of insurance pricing in which a soft market (low rates, relaxed underwritng and underwriting losses) is eventually followed by a hard market (high rates, restrictive underwriting, and underwriting gains) before the pattern again repeats itself

Front 36

focus group

Back 36

a small group of customers or potential customers brought together to provide opinions about a specific product service need or other issue

Front 37

predictive analytics

Back 37

statistical and analytical techniques used to develop models that predict future events or behaviors

Front 38

market segmentation

Back 38

the process of identifying and dividing the groups within a market that share needs and characteristics and that will respond similarly to a marketing action

Front 39

target marketing

Back 39

focusing marketing efforts on a specific group of consumers

Front 40

niche marketing

Back 40

a type of marketing that focuses on specific types of buyers who are subset of a larger market

Front 41

distribution system

Back 41

the necessary people and physical facilities to support the sale of insurance products and services

Front 42

agency expiration list

Back 42

that record of an insurance agency's present policyholders and the dates their policies expire

Front 43

countersignature law

Back 43

laws that require all policies covering subjects of insurance within a state to be signed by a resident producer licensed in that state

Front 44

managing general agent (MGA)

Back 44

an authorized agent of the primary insurer that manages all or part of the primary insurer's insurance activities, usually in a specific geographic area

Front 45

direct response distribution channel

Back 45

an insurance distribution channel that markets directly to the consumer through such distribution channels as mail, telephone, or the internet

Front 46

affinity marketing

Back 46

a type of group marketing that targets various groups based on profession, association, interests, hobbies, and attitudes

Front 47

cold canvas

Back 47

contacting a prospect without an appointment

Front 48

loss run

Back 48

a report detailing an insured history of claims that have occurred over a specific period valued as of a specific date

Front 49

agency bill

Back 49

a payment procedure in which a producer sends premium bills to the insured, collects the premium, and sends the premium to the insurer, less any applicable commission

Front 50

direct bill

Back 50

a payment procedure in which the insurer assumes all responsibility for sending the premium bills to the insured collecting the premium and sending any commission payable on the premium collected to the producer