Chapter 1 Flashcards
What do you call the company activities specifically associated with administering life insurance policies- including u/w, reinsurance, CS, and claims?
Insurance administration.
Define the term applicant.
The person/entity that submits an application for individual insurance and seeks to purchase the insurance coverage.
Define the term proposed insured
during the UW process, this is the person whose life, health or income is to be covered by an insurance policy.
Define the term insured
the person whose life, health or income is covered by an insurance plan
Define the term policyowner
the person or entity that owns an individual life insurance policy
Define the term beneficiary
the person or party that the owner of the pollcy named to receive the policy benefit.
Define the term groupo policy holder
the person or organization that decides what types of group insurance coverage to purchase for a specific group negotiates the terms of the group insurance contract, and purchases the group insurance coverage.
Define the term group prospect
A group that has applied for- but has not yet been approved for - group coverage from an insurance company
Define the term group insured
an individual covered by a group insurance policy.
what is a third-party policy?
an individual insurance policy that is purchased by one person or business on the life of another person.
What is the role of the financial professional
in context of insurance sales- refers to any individual who is licensed to sell insurance products.
sales agents, brokers, financial advisors, and bank affiliated sales personnel.
For life insurance companies, what are the primary administration functions?
new business underwriting reinsurance customer service claims.
What is New Business?
the activities an insurer undertakes in receiving applications, underwriting applications and issuing policies.
What is Underwriting?
the process of 1) assessing and classifying the degree of risk represented by a proposed insured or group with respect to a specific insurance product and 2) making a decision to accept or decline that risk.
Who is an underwriter?
an insurance company employee who performs the risk assessment, classification, and selection process.
What is reinsurance?
insurance that one insurance company obtains from another insurance company to protect against the possibility of financial loss associated with isnruance policies issued b y the first company
What is customer service?
the broad range of activities that a company and its employees perform to keep customers satisfied so that they will continue doing business with the company and speak positively about it to others.
What is policyowner service?
a specific type of customer service that includes all the service activities performed for people or entities that own individual insurance policies.
CS transactions for group insurance can be different and some companies devote a segment of CS exclusively to member service. What is member service?
customer service activities performed for group insureds. Member service personal provide information and answer questions about a group plan’s eligibility requirements, benefits, and contract provisions.
A policy’s life cycle ends at claim time. The claim administration staff review the claim and determine the liability. What is claim administration?
the process of evaluating each submitted claim, deciding whether the claim is valid, informing the person who submitted the claim of the decision, and authorizing the payment of each value claim according tot the terms of the policy.
Define the term marketing
the functional area of an insurance that is responsible for
- identifyng the insurers customers and the prodcuts or serviecs that its what custimers want
- promoting and distributing those products or services to customers.
Define Actuary
its a technical expert in insurance, annuities and other fiancnial products who applies mathematical knowledge to industry and company statistics to calculate carious fiancnial values.
What are the occupational duties of actuarial staff of an insurance company?
- predict rates of death with statistics
- calculate premium rates for insurance products
- determine legal reserve liabilities,
- conduct research on trends in mortality rates, policy lapses, loans, and interest rates
- engage in financial reporting activities
What is the action of accounting?
area of insurance company responsible for collecting, recording, summarizing, analyzing, and reporting data about a company’s financial condition.
