ch 2-2

  1. McCarren-Ferguson Act
    Declares that the regulation of insurance companies should remain with the individual states
  2. Insurance Commissioner/Director/Superintendant
    • Enforces state laws and regulations by:
    • a) monotoring insurance companies and agents
    • b) renewing and approving rates/policies/forms
    • c) assuring public insurance availability
  3. "Admittted" Company
    Company that is approved to do buisness, considered to be authorized and has a "certificate of authority"
  4. "Nonadmitted" company
    Company that is unauthorized and cannot conduct business in that state
  5. Domestic insurer
    Insurance company formed and domiciled under the laws of a particular state
  6. Foreign Insurer
    Insurance company formed under the laws of the United States or a particular state of the US
  7. Alien Insurer
    Insurance company formed under the laws of a country other than the US and it's territories
  8. Stock Company
    Incorporated insurance company with its capital divided into shares. Owned by their shareholders
  9. Mutual company
    Incorporated insurance company without permanent stock that is owned by its policyholders
  10. Reciprocals
    Members agree to share in the risk. In case of a loss, the amount pais is shared by the participating members who accepted the risk
  11. Fraternal Benefit Society
    Incorporated society without capital stock, only benefits its members and is not for profit.
  12. Risk Retention Grops
    Liability insurance can be purchased on a group basis through purchase groups to protect against product liability exposures. Can transact business in other states
  13. Self-insurance
    Part or all of the risk of loss is borne without the benefit of insurance coverage to fall back on if a los occurs
  14. Exclusive Agency System
    Insurance companies contract with independant businesses represent and sell insurance for only that company
  15. Direct writer system
    Agents are company employees who may receive salary, commission or both
  16. Direct response system
    No agents. Business is conducted over the phone or through direct mail
  17. Independent agency system
    Independant agents represent and sell for more than one company
Card Set
ch 2-2
Chapter 2 - Insurance Regulation