Flashcards in Study 8 - Underwriting Relationships Deck (16)
What is one of the most important benefits of good relationships as an underwriter?
Access to information
What professionals should underwriters establish relationships with?
- Other underwriters
- Risk managers
- Claims department
- Actuarial department
- Loss control department
- Legal department
What information may underwrites seek from other underwriters?
- The operations of the risk in those territories
- The law in those jurisdictions
- Environmental considerations
- Business climate, or any other feature of the risk and its local circumstances that might be relevant to an underwriter's assessment of the risk
What are some risks where an underwriter may need to reach out to a reinsurer?
- Hazardous occupancies such as chemical manufacturing
- Risks located in areas unprotected by municipal water supplies or fire departments
- Risks with the potential to suffer catastrophic loss
- Risks that sell their products in the United States
- Liability risks with the potential for "long-tail" liability losses
- Risks with high values
How would an underwriter establish underwriting credit?
Share a mix of risks with facultative reinsurers, including more and less attractive risks
Define risk management
Analyzing a risk to quantify the potential for losses in a specific investment and to decide what is the appropriate action to take (or whether to not take action)
Define loss reserve
An amount carried as a liability in an insurer's balance sheet representing, in respect of each claim, an amount equal to the estimated final settlement cost less any amounts already paid
Statement or stipulation or promise in an insurance contract, the breach of which may nullify the contract
A lawyer could help the underwriter "take the temperature of the court", meaning what?
Understand how policy language has been and would be interpreted by the court in the event of a dispute
List some organizations that underwriters may benefit from
ULC (Underwriters Laboratories of Canada)
IBC (Insurance Bureau of Canada)
SCM Risk Management
IIC (Insurance Institute of Canada)
Trusted social media platforms
SMEs (Subject Matter Experts)
What is a benefit of good relations between the underwriter and the claims department?
Learning of changes in legal jurisdiction of newly released judgments that will affect the future assessment of risks
What is risk management?
Analyzing a risk to quantify the potential for losses in a specific investment to decide on the appropriate action to take (or whether to not take action)
Which organization tests products for safety?
What are the benefits of an underwriter establishing good relationships with other insurance
• The dissemination of information they make possible
• Make underwriters’ jobs easier by giving them access to information that can be valuable or even necessary to properly underwrite
• Help give underwriters perspective by understanding the roles of other insurance professionals, which can help them proactively prepare for a conversation
• Help build trust between underwriters and the insurance professionals they deal with
• Trust leads to attracting and retaining profitable business
List the reasons why it is beneficial for the underwriter to have a strong bond with other underwriters.
• Relationships with fellow underwriters are invaluable, especially when they need to consult each other about types of risk they may not be as experienced or familiar with
• Having a pool of professionals from which to draw for advice is important
• Regarding large commercial accounts, some will have operations in different parts of the country or even internationally; on such accounts, underwriters may find it useful or necessary to call upon the expertise of their counterparts in other branches
• Underwriters with regional or territorial responsibilities need to cultivate good working
relationships with their counterparts in other regions
• They might seek information about
o the operations of the risk in those other territories
o the law in those jurisdictions
o environmental considerations
o the business climate, or any other feature of the risk and its local circumstances that might be relevant to an underwriter’s assessment of the risk