group insurance marketing - ️️Methods to sell individual insurance policies to:
◦Employer groups
◦Labor unions
◦Trade associations
-Products are sold through group representatives, employees who receive a salary and
incentive payments based on sales.
-Employees typically pay for ins...
RMIN 4000 Exam 2
group insurance marketing - ✔️✔️Methods to sell individual insurance policies to:
◦Employer groups
◦Labor unions
◦Trade associations
-Products are sold through group representatives, employees who receive a salary and
incentive payments based on sales.
-Employees typically pay for insurance by payroll deduction.
Distribution-Independent Agency - ✔️✔️-Usually represents several unrelated insurers.
---Agents are paid a commission which varies by the line of insurance.
-The agency owns the expirations or renewal rights to the business.
-Agents may be authorized to adjust small claims and may provide loss control services
to their insurers
insurance broker - ✔️✔️Someone who legally represents the insured and:
◦Solicits applications and places coverage with the appropriate insurer.
◦Is paid a commission from the insurer.
◦In general, does NOT have the authority to bind
Major Types of Private Insurers - ✔️✔️Stock Insurers
Mutual Insurers
Lloyds of London
Stock Insurer - ✔️✔️-A corporation owned by stockholders.
-Objective is to earn profits for the stockholders by increasing stock and paying
dividends.
(Progressive, Allstate, Metlife, etc.)
Mutual Insurer - ✔️✔️-a corporation owned by policyholders.
-profits are distributed to policyholders by dividends or rate reductions.
(statefarm, nationwide, liberty mutual)
types of mutual insurers - ✔️✔️assesement
advanced
fraternal
Lloyd's (of London) - ✔️✔️-NOT an insurer, but a society of members who underwrite
insurance in syndicates.
-World's leading market that provides services and physical facilities for its members to
write specialized lines of insurance
Lloyd's broker - ✔️✔️represent policyholders to arrange coverage with syndicates
, Lloyd's Syndicates - ✔️✔️those insurance companies that offer insurance contracts in
the market
managing agents - ✔️✔️manage the syndicates, who typically specialize in certain
lines
underwriters - ✔️✔️work for the syndicates to asses risks and determine premiums
other types of private insurers - ✔️✔️blue cross blue shield plans
health maintenance organizations (HMO'S)
captive insurers
insurance agent - ✔️✔️-someone who legally represents the principle (insurance
company) and has the authority to act on the principle's behalf
-the principle (insurance company) is legally responsible for all acts of an agent when
the agent is acting within the scope of authority
insurance binders - ✔️✔️provide temporary insurance until the policy is actually written
-can be provided by property and casualty (P&C) agents
-life insurance agents usually have no authority to issue binders
large brokerage firms - ✔️✔️-Very important in Commercial P&C coverage.
-May have knowledge of highly specialized insurance markets.
-May provide risk management and losscontrol services.
(AON, Marsh & McLennan, Willis Towers Watson)
surplus lines broker - ✔️✔️Licensed to place business with a nonadmitted insurer.
surplus lines - ✔️✔️Insurance for which there is no readily available, admitted market
in the state
nonadmitted insurer - ✔️✔️an insurer not licensed to do business in the state
Distribution-Exclusive Agency System (Captive Agents) - ✔️✔️-Agent represents only
one insurer or group of insurers under common ownership.
-Agents are generally paid a lower commission rate on renewal business than on new
business.
-Agents usually do not own the expirations or renewal rights to the policies.
-Insurers provide strong support services to new agents
direct writer - ✔️✔️-An insurer in which the salesperson is an employee of the insurer,
not an independent contractor.
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