General Insurance

Front 1

Who is the, Insured?

Back 1

The person that the insurance company is covering.

Front 2

Who is the insurer?

Back 2

The Insurance Company

Front 3

Who is the producer?

Back 3

The agent

Front 4

As an Insurance Producer or Agent, who do you represent? The insurer or the insured?

Back 4

The insurer

Front 5

What is Insurance?

Back 5

Protection against a financial loss.

Front 6

Why do people generally buy insurance?

Back 6

Because of potential risk.

Front 7

What is Risk?

Back 7

The chance of loss or uncertainty of loss.

Front 8

What are the two types of Risk?

Back 8

Pure Risk, and Speculative Risk.

Front 9

What is Pure Risk?

Back 9

Chance of loss with no possible of gain.

Front 10

What is Speculative Risk?

Back 10

The chance for both loss or gain.

Front 11

What type of risk is not insurable?

Back 11

Speculative Risk

Front 12

What are the four ways to manage risk?

Back 12

Retain, Avoided, Reduced, or Transferred.

Front 13

In transferring a risk, what are the two options a person can do?

Back 13

1. They can purchase insurance.

2. They can sue the negligent party.

Front 14

What does the underwriter use when determining the premium rates for insurance?

Back 14

Exposure

Front 15

If a statement is guaranteed to be true, and if untrue, may breach an insurance contract.

Back 15

Warranty

Front 16

When doing business in this state an insurance company that is formed under the laws of another state is known as which type of insurer?

Back 16

Foreign

Front 17

Events or conditions that increase the chance of an insured loss occurring are referred to as...

Back 17

Hazards

Front 18

What must an insurer obtain in order to transact insurance within a given state?

Back 18

Certificate of Authority

Front 19

What method do insurers use to protect themselves against catastrophic losses?

Back 19

Reinsurance

Front 20

In what way can an agent demonstrate a high standard of ethics?

Back 20

Putting the client's best interest before their own

Front 21

When would a misrepresentation on the insurance application be considered fraud?

Back 21

If it is intentional and material.

Front 22

The risk of loss may be classified as...

Back 22

Pure risk and speculative risk.

Front 23

When must insurable interest exist?

Back 23

During the time of the application, and at the time of loss.

Front 24

What type of insurer pays dividends to its stockholders?

Back 24

Stock Insurers

Front 25

What type of insurer pays dividends to its policyholders?

Back 25

Mutual Insurers

Front 26

What type of insurer is an unauthorized carrier? Example Lloyd's of London.

Back 26

Excess and Surplus Lines

Front 27

What type of producer is self employed?

(Owns the expiration date of the policy)

Back 27

Independent Insurance Producer

Front 28

What type of producer represents only one company?

(Does not own the expiration date of the policy)

Back 28

Exclusive or Captive Producer

Front 29

A producer is a person authorized to act on behalf of another person, who is called the?

Back 29

Principal

Front 30

What are the three types of authority of a producer?

Back 30

Express, Implied, and Apparent

Front 31

What four essential elements must be present in order to obtain an insurance policy/contract?

(COAL)

Back 31

Consideration

Offer

Acceptance of the Offer

Legal Purpose and Legal Capacity

Front 32

What is the Principle of Indemnity?

Back 32

To restore the insured back to their financial state before the loss.