Chapter 1 = General Insurance

A ___________ insurance company is owned by its policyholders.

A__________________ insurance company is owned by its stockholders or shareholders

A _____________ is a group owned insurer whose main activity is risk sharing.

______________ is not an insurance company but consists of groups of underwriters called syndicates, each of which specializes in insuring a particular type of risk.

____________________ are primarily social organizations that engage in charitable activities that provide life and health insurance to their members.

_______________ is a group owned insurer that primarily assumes and spreads the liability related risks of its members.

___________________ is a private coverage source of last resort for those who have been rejected by voluntary market insurers.

If an insurance company wants to transfer all or part of the risk it has already taken on, it would buy ____________ insurance.

____________ refers to the jurisdiction (state or country) where the insurer is formed or incorporated.

A ____________ insurer is incorporated under the laws of this state whether or not it is admitted to do business in this state.

A _________________ insurer is incorporated in another state within the US but NOT this state whether or not it is admitted to do business in this state

A ____________ insurer is incorporated outside of the U.S. whether or not it is admitted to do business in this state

An _____________ insurer is authorized by this state's commissioner of insurance to do business in this state.

A ___________________ insurer has either applied for authorization to do business in this state and was declined or they have not applied.

_________________ oversee the operations of a business.

________________ departments gather and interpret statistical information used to make rates.

_________________ departments are responsible for the selection of risks (the people & policy to insure) and rating that determines policy premiums.

__________ department assists the policyholder in the event of a loss.

Insureds that are less desirable than average risks and tend to seek insurance coverage to a greater extent than better risks is called __________?

___________ involves applying techniques for prevention or reduction of potential loss, such as installing sprinkler systems, burglar alarms, safety guards on machinery, etc.

A potential cause of loss, such as fire, explosion, flood, or theft is considered to be a _______.

___________ insurance is used to provide coverage when insurance is not available from an admitted carrier.

In insurance, when an applicant intentionally fails to make a material fact known, it is known as __________

An _____________is a policy form that alters or adds to the provisions of the property and casualty insurance contract.

Does insurance (a) transfer or (b) eliminate risk?

The concept of ______________ says that both parties will bargain in good faith to form the contract.

____________prevents the denial of a fact , if the fact was admitted to be true previously.

The purpose of the ____________ is to restore the insured to the same financial or economic condition that existed prior to the loss. They should not profit from an insurance transaction.

_____________ is a method of managing risk. It will minimize the chance of loss, but not entirely prevent it. For example if you install a sprinkler which will minimize fire damage but will not prevent the fire completely.

Statements in the insurance application or in the policy that are guaranteed true are WARRANTIES. If it is later discovered to be untrue or breached, the contract will be ______________

Independent financial rating services, such as __________________, evaluate and rate the stability of insurance companies by assigning rating codes to show financial strength or weakness of each company rated.

___________is the value that each party gives the other - for example, the premium the insurer pays and the promise by the insurance company to pay for losses

A contract of ____________ is a contract between two parties that does not allow for negotiation (i..e take it or leave) it, so if anything is unclear in the document, the court will rule AGAINST the party who wrote it (the insurance company)

The _______________ is a private coverage source of last resort for businesses and individuals who have been REJECTED by voluntary market insurers.

Self-insurance is considered which type of risk management?

Who do PRODUCERS represent?

(A) the insurer

(B) The insured

Which Federal entity administers the Terrorism Risk Insurance Program Reauthorization Act?

A _____________ is a person or agency that represents an insurance company

An insurer is also know as the _____________ and is the source of authority for a producer

Your insurance agent is Tom. ___________ is the producer in this agency relationship and _____________is the principal in this agency relationship?

The ______________________ states that if a consumer says that certain information in their credit report is incorrect, the reporting agency must investigate and make the necessary changes.

An ___________insurer is not approved by the state Department of Insurance to transact insurance.

The __________________ Act allowed:

Te merger of banks, securities companies, and insurance companies.

Establishment of privacy protection for consumers

The Law of _________________ states that the larger the number of participants in a given arrangement, the more accurate the rate is to the exposure.

The ____________ is determined by dividing paid losses plus loss reserves by total earned premiums.

A ______________ contract is one where only one party makes a promise of performance.

Name the different ways of managing risk

_________________ doctrine is what a reasonable and prudent policy owner would expect.

A _______________risk is one where there is the possibility of gain or loss.

A _____________ risk is one where there is no chance for gain. The only outcome is for nothing to occur or for a loss to occur.

Gambling is an example of a _____________ risk.

The possibility of damage to your property caused by a fire is an example of _____________ risk.

Are members of the "National Association of Insurance Commissioners" required to accept its recommendations?

____________ is a condition where the chance, likelihood, probability or potential for loss exists.

A _______________ is a physical condition that increases the probability of loss.

Examples:

- Flammable material stored near a furnace

- Wet leaves on your sidewalk

A ____________ is dishonest tendencies that increase the probability of loss.

**Example: You burn down your house to get insurance payments.**

A____________ is an attitude that increases the probability of loss.

**Example: Carelessness of leaving your house unlocked.**

An agreement to pay on behalf of another party when a loss occurs is called an ___________ contract.

A waiver is when you ______________

How do you determine the loss ratio?

_____________ is when you transfer your rights of recovery from the person responsible for the loss to the insurance company.

**This prevents you from collecting twice for the same loss and helps hold responsible the third party responsible for the loss.**

Rates are referred to as ___________ rates when the insurance company files the rates for approval and then implements the rates.

_____________ is an insurance contract that requires the potential for you to suffer financial or economic hardship in the event of a loss.

Define ACTUAL CASH VALUE

Name the types of insurers