C16 - The Business of Insurance Exams Pack | Questions & 100% Correct Answers (Verified) | Latest Update | Grade A

Which department in a company is responsible for ensuring that PIPEDA is followed? : Accounting and finance The conduct of people in power who take advantage of their position to use their influence illegally for personal gain is referred to as what? : Self-dealing Initiating a process to assu...

Insurance companies are typically either direct writers or broker markets : Insurance companies are typically either direct writers, which use no intermediaries to distribute their products but rather sell directly to the public, or they are broker markets, which use intermediaries (that is, br...

The portion of gross written premium (sales) that is refundable if the policy is cancelled is known as what? : unearned premiums What is the combined ratio used to measure? : difference between premiums earned and losses Using ratios to compare the results of one aspect to the results of anoth...

List the two fundamental principles of insurance. : 1. The premiums of the many are used to pay the losses of the few. 2. The premiums shall be commensurate with the risk (must charge an appropriate premium for the risk.) (there must be an appropriate balance of premiums and claims paid) Why w...

5 Ways Insurance companies spread risk : -Share risk with other insurance companies (for very large risk, several insurers subscribe to percentage of risk) -Reinsure the risk -deductible -spread risk over diverse geographical region (soften risk of localized disasters) -form risk pools (synd...

What is *retrospective rating plan*? : The retrospective rating plan is based on the insured's actual loss experience during the policy term. The client and insurer agree on a formula under which the ultimate cost of claims will be borne by the insured. Min and Max premium, LO - Explain the d...

Define *cybercrime* : *Cybercrime* is a criminal offence involving a computer as the object of the crime, or the tool used to commit a material component of the offence. LO - Examine the risks associated with cybercrime : - Theft of intellectual property; -Extortion; - Web defacement; - Misc...

Define Subscribed capital : The amount of stock sold by a corporation Define paid-up capital : Represents that part of subscribed capital that has been paid in full by shareholders Define Mutual Insurer (MIDTERM?) : A form of cooperative enterprise owned by its *policyholders* (also known as ...

1. List 4 responsibilities of provincial regulators. : 1. Solvency 2. Market conduct 3. Affordability of insurance 4. Availability of insurance 2. State a responsibility of federal insurance regulatory authorities. : - monitoring solvency of federally incorporated insurers 3. What government ...

1. What are the 4 main financial statements : 1. Statement of operations 2. Balance sheet 3. Statement of retained earnings 4. Statement of comprehensive income 2. What is the accrual basis of accounting? : Every business transaction is recorded in the accounting period (or periods) to which...

1. What are the 3 CATEGORIES of AGENT, and what are the distinctions between those categories : 1. company employed agent, - works directly for insurer as staff. - paid salary with possible bonus or commission, or blend of compensation. - insurer owns client expiration list.` 2. Independent A...

What are 4 main financial statements : Statement of operations Balance sheet Statement of retained earnings Statement of comprehensive income What is the accrual basis of accounting? : Every business transaction is recorded in the accounting period (or periods) to which it belongs. Revenue a...

Subscribed capital : The amount of stock sold by a corporation Paid-up capital : Represents that part of the subscribed capital that has been paid in full by shareholders Mutual insurer : A form of cooperative enterprise owned by its policyholders also known as members. The association is f...