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Function of Underwriting -
Evaluate applications; select rating factors, policy terms and conditions.
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Private Insurers - 3 Types:
Stock, Mutual, Reciprocal
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Benefits of Insurance -
Peace of mind and securing credit.
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Self-Funding -
Retaining all or part of the risk
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Reinsurance -
Companies share the risk and premiums.
- Marketing Distribution Marketing Distribution - 4 Systems:
- Direct Writing, Direct Mail, Exclusive Agents, Independent Agencies
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Investigative Agencies - 5 areas:
Personal Interviews, MIB, DMV, Financial Reports, Physician Statements
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Agent -
Works on behalf of a company for an insured.
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Broker -
Works on behalf of an insured for a company.
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Solicitor -
Works for an employer, selling insurance under an agent.
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MGA -
Works with agents and is appointed with many companies.
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Property & Casualty Licensee -
Licensed to transact Hazard insurance and Liability policies including Health and Disability insurance.
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Personal Lines Licensee -
Cannot transact Health Disability or Commercial.
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Adjuster -
Assists in settling claims either for a company or for an insured.
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Non-Admitted/Admitted -
Not authorized to transact business in CA, except through a Surplus. Lines broker.
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Alien/Foreign/Domestic -
Organized under laws of another country/another state/CA.
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Surplus Lines and Special Surplus Lines -
- Only transact for non-admitted/brokers who
- transact railroad, aircraft, ship owners coverage, etc.
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Inactive License -
No Notice of Appointment on file, but all fees and CE units are up to date.
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Fiduciary -
Handles affairs and funds of others.
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CE Unit requirements -
Continuing Education is: First 4 years=25 units each year, 3rd renewal cycle, 15 units every year or 30 units each renewal cycle.
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CIC & CCR’s -
California Insurance Code & California Code of Regulations
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Departments in an Insurance Company - 4 areas:
Marketing, Sales, Underwriting, Actuarial
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Types of Insurance Companies - 5 Types:
Reciprocal, Mutual, Stock, Risk Retention Group, Lloyds
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Commissioner -
Elected by the citizens to administer, interpret and enforce the code.
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CSGA -
California State Guaranty Association
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Rating Laws - 4 types:
Prior Approval, File & Use, Use & File, Open Competition
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ISO -
Insurance Service Office
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Subrogation -
Insured gives up the right to sue the 3rd party and the company does it for them.
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Arbitration -
Mediator that helps settle disputed claims.
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