COPY: FOI - Chapter 1

<p>Providing insurance at the lowest possible price for policyholders (A)</p> Signup and view all the answers

<p>Indemnity in money or another valuable form (D)</p> Signup and view all the answers

<p>Reduced motivation to buy insurance before a loss (C)</p> Signup and view all the answers

<p>Health insurance (C)</p> Signup and view all the answers

<p>Development of the concept of the forgetting curve (C)</p> Signup and view all the answers

<p>Public sale of stock and private funds (D)</p> Signup and view all the answers

<p>Through continuous review and participation in class activities (D)</p> Signup and view all the answers

<p>The gradual loss of learned information over time (A)</p> Signup and view all the answers

<p>To participate in discussions and review content regularly (C)</p> Signup and view all the answers

<p>The enactment of fire insurance due to a significant fire disaster in London (B)</p> Signup and view all the answers

<p>Customer Service for Insurance Professional (CSIP) (A)</p> Signup and view all the answers

<p>Experienced Broker (A)</p> Signup and view all the answers

<p>Utilizing multiple boats to navigate rapids (D)</p> Signup and view all the answers

<p>Producers are employees of the insurer. (C)</p> Signup and view all the answers

<p>Over 80% (A)</p> Signup and view all the answers

<p>Pay salaries to the insurers. (B)</p> Signup and view all the answers

<p>Commission and bonuses for business sold. (B)</p> Signup and view all the answers

<p>It is an insurance market, not an insurance company. (A)</p> Signup and view all the answers

<p>BC, SK, MB, Quebec (D)</p> Signup and view all the answers

<p>They typically own the business they produce. (A)</p> Signup and view all the answers

<p>Independent brokers can handle a wide range of insurers. (B)</p> Signup and view all the answers

<p>To gather underwriting members to collectively assume risks (C)</p> Signup and view all the answers

<p>They manage the syndicate's affairs and appoint expert underwriters (C)</p> Signup and view all the answers

<p>To provide essential underwriting information for risk placement (D)</p> Signup and view all the answers

<p>It requires meeting specific financial requirements set by the Committee of Lloyd’s (C)</p> Signup and view all the answers

<p>The slip is submitted to the Policy Signing Office (C)</p> Signup and view all the answers

<p>Allows people to share their losses among a larger group (D)</p> Signup and view all the answers

<p>By protecting investments and reducing financial worry (D)</p> Signup and view all the answers

<p>Offering financial gains through investment (C)</p> Signup and view all the answers

<p>Payments are made only for the exact amount of loss (C)</p> Signup and view all the answers

<p>The risk of financial loss due to specific perils (A)</p> Signup and view all the answers

<p>Eliminating the chances of financial loss by not owning property (B)</p> Signup and view all the answers

<p>Independent brokers, adjusters, and actuaries (C)</p> Signup and view all the answers

<p>Educating the public on ways to avoid losses and reduce severity (D)</p> Signup and view all the answers

The primary purpose of insurance is to provide financial support for future and accidental losses.

Automobile insurance accounts for over 50% of premiums in the Property & Casualty (P&C) insurance sector in Canada.

Private insurers operate with the goal of generating profits, while government insurers prioritize public service and may not focus on profits.

Mutual insurance companies focus on offering insurance at the lowest possible cost to its policyholders, who are also its owners.

Instead of repair or replacement, insurance companies might offer indemnity - financial compensation or other valuable forms to cover losses.

Allowing people to buy insurance after a loss can reduce their motivation to purchase it beforehand. This can lead to unpredictable costs for insurers.

Property & Casualty (P&C) types cover losses related to properties and accidents. Typical P&C coverage excludes health insurance.

Hermann Ebbinghaus, a German psychologist, introduced the concept of the forgetting curve, which demonstrates the gradual loss of information over time.

Stock insurance companies primarily obtain their operating funds through the public sale of their stock and private investments.

To counter the effects of the forgetting curve, students can engage in continuous review and active participation in class activities.

The forgetting curve illustrates that information learned is gradually lost over time, unless it is frequently reviewed and reinforced.

A key expectation for students in the course is active participation in discussions and regular review of course materials.

A significant fire disaster in London led to the enactment of fire insurance, highlighting the societal need for protection against such risks.

Customer Service for Insurance Professionals (CSIP) is a key part of the basic training for new insurance brokers, focusing on client interaction and service standards.

The CAIB designation, signifying a high level of insurance knowledge, is typically associated with experienced brokers who have advanced their expertise.

In ancient China, boat operators used multiple boats to navigate dangerous rapids, demonstrating a risk management strategy similar to insurance.

In the Direct Writing System, producers (insurance salespeople) are directly employed by the insurance company, working within the company structure.

Independent Brokerage Systems dominate the Canadian insurance market, accounting for over 80% of insurance sales through this distribution channel.

Independent brokerages facilitate the insurance distribution process, connecting clients with suitable insurers, but they don't pay salaries to insurers.

Agents in the Agency System primarily earn commission and bonuses based on the amount of insurance business they sell.

Lloyd's of London is a global insurance market, not an insurance company itself. It facilitates the exchange of insurance risks between various members.

Provinces like BC, SK, MB, and Quebec have compulsory auto insurance coverages, meaning all drivers must have car insurance.

A key trait of brokers in the Independent Brokerage System is that they typically own the business they generate.

Independent brokers differ from agents in the Agency System by representing a wide range of insurance companies, offering more options to clients.

Syndicates in marine insurance act as groups of underwriting members who collectively assume risk for maritime ventures.

Underwriting agents in syndicates manage the syndicate's affairs and appoint expert underwriters who assess risks and determine insurance terms.

The 'slip' is a document used in the insurance distribution process that contains vital underwriting information about the risk to be insured.

Membership to Lloyd's is open to individuals and entities who meet specific financial requirements set by the Committee of Lloyd's.

Once 100% of the risk is subscribed by underwriting members, the slip (risk information) is formally submitted to the Policy Signing Office to finalize insurance arrangements.

Insurance serves the vital function of allowing individuals to share financial losses among a larger group, reducing the impact of individual misfortune.

Insurance acts as a crucial foundation for the credit system by protecting investments and alleviating financial worry, facilitating economic activities.

The insurance industry's functions primarily revolve around managing risk, providing protection, and facilitating financial stability, NOT aiming to offer financial gains through investment.

The principle of indemnity in insurance states that payments are made only for the exact amount of loss, preventing individuals from profiting from insurance claims.

Individuals can manage various risks through insurance, one being the risk of financial loss due to specific perils like fire, theft, or accidents.

The concept of avoidance in insurance refers to completely eliminating the chance of financial loss by not owning property or participating in activities that pose a risk.

The insurance industry employs a diverse group of professionals, including independent brokers who connect clients with insurers, adjusters who assess losses, and actuaries who analyze risk.

Loss prevention in the insurance industry involves educating the public about ways to avoid losses and reduce the severity of potential damages, leading to lower premiums.