A request for insurance that introduces the applicant to the insurer
application
Providing factual info about a risk to help with underwriting. Honest, possibly incomplete disclosure. May result in denial/claim/ or policy reassessment
representation
Telling a lie, purposely omitting material facts. Voids coverage/policy
misrepresentation
What are the 2 types of applications?
Oral and Written
Name 7 pieces of info required on an application
named insured, policy term, subject of insurance, loss payees/loss history, prior insurance, agents/brokers report, signatures
A way to present additional information, a way to advocate for the client
Agent & Brokers report
What are some options for an underwriter to accept a risk
premium surcharge, additional info required, inspections, limited coverage, repairs ordered, higher deductibles
How do you calculate the premium?
rate x amount of insurance
** How do you calculate the rate or unit cost? **
pure premium + loading costs/quantity of the risk
What are the 3 databases to use to verify loss history?
Habitual Insurance Tracking System (HITS)
Autoplus
Commercial Tracking System (CTS)
The maximum amount the insurer can insure
retention
an additional charge included in an insurance rate to reflect a hazard not contemplated in the basic rate for the class
loading
The process of revealing all relevant facts
disclosure
an interest that the insured must have in the subject matter of the insurance purchased so that if the event insured against occurs, the insured will suffer an economic loss
insurable interest
a person or entity other than the named insured to whom the proceeds of insurance will be paid
loss payee
a special class of loss payees that has a registered interest in real property offered as security for the money that the mortgagee has loaned the property owner
mortgagee
a clause in an insurance policy that stipulates the rights and obligations of the insurer and the mortgagee
mortgage clause
to insure. more commonly to scrutinize a risk and then decide on its eligibility for insurance
underwrite
foreseen hazards/risks common to certain types of businesses that are not covered in an ordinary policy
special hazards
rules used by insurance companies to assess the insurability of a risk. these rules are set individually by insurance companies and may differ for each class of business
underwriting rules
Insurance purchased by an insurance company from another insurance company to provide it protection against large losses on cases it has already insured.
Reinsurance
Pricing method in which an insurer yes rates based on its own experience rather than on that of a specific group for which it is calculating a premium
manual rating
