Duties that agents owe their principals are spelled out in the:

Answer

insurer’s instructions.

underwriting manual.

agency contract.

advertising brochures.

4 points

Question 2

The actuary is not responsible for which of the following:

Answer

develop rates that are fair to all insureds.

calculate and analyze operating results or profits.

represent the insurance company’s interest in lawsuits.

project the future based on historical results.

4 points

Question 3

Insurance marketing channels that include group sales, internet sales, and telephone sales all fall under:

Answer

direct marketing.

direct writer.

adjusters.

underwriters.

4 points

Question 4

Which of the following statements about stock insurance companies is true?

Answer

Stockholders provide operating capital and receive dividends.

They are nonprofit organizations.

The insureds own the company.

They are more likely to provide lower-cost insurance than mutuals.

4 points

Question 5

Internet sales have been least successful providing:

Answer

automobile insurance.

lower insurance costs.

term life insurance.

commercial insurance.

4 points

Question 6

Direct writing:

Answer

describes the distribution system used by independent agents and brokers in the property/liability area.

is used only by life insurers.

is an expensive way to distribute insurance to high-income people.

describes a system of insurance company distribution using employee/agents.

4 points

Question 7

Insurance brokers are:

Answer

compensated by a flat salary.

legally, agents of the insurance company.

only used in life insurance.

legally, agents of the insurance consumer.

4 points

Question 8

The primary difference between an insurance agent and an insurance broker is:

Answer

their compensation scheme.

the parties they each legally represent.

the fringe benefits their employers provide.

there is a big difference, but it isn’t one of the answer choices listed above.

4 points

Question 9

The term “HMO” means:

Answer

Health Maintenance Organization.

Health Management Organization.

Healthy Mamas Organization.

High Maintenance Operation.

4 points

Question 10

Which of the following statements is false?

Answer

Factory mutuals insure only highly protected risks.

A stock insurance company is a profit-making venture in both life and property insurance.

Dividends are paid to stockholders of stock companies.

In stock companies, non-insured stockholders bear none of the risk of loss.

4 points

Question 11

Blue Cross and Blue Shield insurance organizations provide health insurance to millions of Americans. What is the difference between Blue Cross and Blue Shield? In what ways is Blue Cross insurance similar to the other kind of insurance? In what ways is it different? Please explain your answer.

Answer

Press Tab to enter the content editor. For the toolbar, press ALT+F10 (PC) or ALT+FN+F10 (Mac).

Path: pWords:0

30 points

Question 12

Insurance agents and brokers bring buyers and sellers of insurance together. Are there any differences between an insurance agent and an insurance broker? Are these differences important to the insurance consumer? Why do life insurance agents and property insurance agents have different grants of authority? What factors should the consumer consider in choosing a property insurance agent? A life insurance agent?