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Which one of the following functional areas of Keithly can assist Alex with this audit's irregularity? - Correct Answers ✅Special Investigation Unit Which one of the following best describes a FAIR plan and its insureds? - Correct Answers ✅State-run plans with cost spread among private insurers in the state Which one of the following departments provides information to the underwriting department to assist in selecting and rating risks? - Correct Answers ✅Risk control All corporations are obligated to promote the well-being of society. At the minimum, this obligation demands that the insurer should - Correct Answers ✅Avoid causing any public harm. Which one of the following insurer functions includes calculating insurance rates, developing rating plans, estimating loss reserves, and providing predictive modeling services? - Correct Answers ✅Actuarial Property-casualty insurers can be classified in which one of the following ways? - Correct Answers ✅Licensing status
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Which one of the following statements is correct with regard to an insurer's goals? - Correct Answers ✅A proprietary insurer must earn competitive profits to raise the capital needed to operate. The United States regulatory framework has evolved over time into which one of the following approaches used by insurance regulators today? - Correct Answers ✅Risk-focused approach Which one of the following statements regarding licensing of insurers or insurance personnel is true? - Correct Answers ✅Some states permit the insurance commissioner to deny a license to an otherwise worthy applicant if the commissioner believes that no additional insurers are needed in the state. Which one of the following statements is correct? - Correct Answers ✅If insurers become insolvent, future claims might not be paid and the insurance protection already paid for might become worthless. One way state insurance regulators help to protect consumers is by reviewing insurance policy forms to determine whether they
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✅Restricting the rights of insurers to cancel or nonrenew personal auto insurance policies Under the terms of her agency contracts, the insurers forward policies promptly to Rhonda's customers and send a premium invoice with the policy. Insureds are instructed to remit premium payments to their insurer. The insurers calculate Rhonda's commissions and forward those commission payments to her monthly. Rhonda is operating under which one of the following payment procedures? - Correct Answers ✅Direct bill basis Omicron Manufacturing has approached Delta Insurance Brokerage to develop and implement a voluntary insurance program for life, health, and disability insurance for Omicron's employees. Delta puts together a program in which employees receive the coverage at discounted rates, and premiums are deducted from the employees' paychecks. Omicron and Delta are using which one of the following types of group marketing to offer this program? - Correct Answers ✅Franchise marketing The principal method of determining a prospect's insurance needs is through - Correct Answers ✅Completing a risk management review for the prospect.
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An agency bill process in which the producer is usually not required to pay the insurer until the premium is collected from the policyholder is known as - Correct Answers ✅The item basis. Which one of the following statements is true regarding traditional marketing systems for insurance? - Correct Answers ✅A principal characteristic that distinguishes one traditional marketing system from another is the ownership of policy expirations. Which one of the following insurance consumer groups would have the most risk financing alternatives available to them? - Correct Answers ✅National accounts Martin Insurance Company targets international manufacturers of specialty products. Its insureds place a high value on producer expertise, responsiveness, and confidentiality. Martin wants to expand into similar markets. Which one of the following insurance marketing distribution systems is most appropriate for Martin Insurance Company? - Correct Answers ✅Direct writer Tania, an underwriting trainee for Keithly Insurance Company, has received a new homeowners application for Nanami. The home is to be insured for $150,000. It is a frame house with a swimming
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Which one of the following statements is true regarding the establishment of loss reserves? - Correct Answers ✅Case reserves are established by the claim department while IBNR reserves are established by actuaries. The amount included in the insurance rate to protect insurers against the possibility that actual claims or expenses will exceed projections is referred to as - Correct Answers ✅The loading for profits and contingencies. Which one of the following statements is correct with respect to increased limits factors in liability insurance? - Correct Answers ✅Data used in developing insurance rates for basic coverage limits include only losses associated with the basic coverage limit. Which one of the following is a benefit of contingent surplus notes as an alternative to traditional reinsurance? - Correct Answers ✅They increase a primary insurer's assets without increasing its liabilities. Which one of the following statements is correct with regard to the use of facultative reinsurance? - Correct Answers ✅The treaty reinsurer is usually willing to allow the primary insurer to remove
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high-hazard loss exposures from the treaty by using facultative reinsurance. Pro rata reinsurance is the appropriate choice when which one of the following is the main concern related to a primary insurer's rapid growth? - Correct Answers ✅Drain on policyholders' surplus Westfork Insurance has a surplus share treaty with Durham Reinsurance and retains a line of $50,000. The treaty contains nine lines. Which one of the following represents that maximum amount of coverage Westfork can write for a single building under the treaty? - Correct Answers ✅Westfork's retention is $50,000. The treaty contains nine lines: $50,000 x 9 = $450,000. Westfork's $50,000 + $450,000 = $500, Which one of the following statements is correct regarding insurance regulatory constraints on growth? - Correct Answers ✅From a regulator's perspective, if an insurer's ratio of written premium to policyholders' surplus exceeds 3 to 1, the insurer is selling more insurance than is prudent relative to the size of its net worth.
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Insurers can use information technology (IT) to gain competitive advantage. Which one of the following statements is correct with respect to gaining competitive advantage? - Correct Answers ✅IT intelligence gives insurers better insight for underwriting, product development, and pricing A document management system (DMS) stores, organizes, and retrieves image files. Which one of the following statements is correct with respect to a DMS? - Correct Answers ✅At some insurers, producers, field claims representatives, and others can access electronic files directly. Information technology (IT) can help insurers increase operational efficiency. Which one of the following would enable field claim representatives at a storm site to access policy information, transmit claims information, and settle losses or make partial payments immediately so that displaced families could return to their homes as soon as possible? - Correct Answers ✅Low cost mobile technology A database management system (DBMS) is a group of programs that organizes data. Which one of the following statements is correct with respect to a DBMS? - Correct Answers ✅A DBMS
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collects data for reuse in other systems, such as premium billing, finance, and claims.
