CISR Agency Operations Exam 265 Questions with Answers
Professional - CORRECT ANSWER an adjective used to describe appearance, attitude, or
... [Show More] actions
Acting Ethically and Professionally - CORRECT ANSWER you put the needs of your clients above your own
Ethics - CORRECT ANSWER a system or set of moral principles or practice
a set of rules or standards based on a set of principles or values we accept as truths and that govern our behavior
Factors that influence ethics - CORRECT ANSWER Friends, Society, Media, Belief Systems, Educational Institution, Legal Restraints, Family
Benefits of Being Ethical - CORRECT ANSWER 1. Public Trust and Confidence Gained
2. Government regulation avoided
3. Enhanced Credibility Earned
Public Trust and Confidence Gained - CORRECT ANSWER it is difficult to criticize that person's behavior or motives
Government Regulation Avoided - CORRECT ANSWER acting in an ethical manner avoids this
Enhanced Credibility Earned - CORRECT ANSWER it allows people to regard you and your business as a reliable and trusted resource
Conducting Business in an Unethical Manner - CORRECT ANSWER always puts the customer secondary
Examples of Bending the Rules in Insurance - CORRECT ANSWER Vehicle Usage
Protection Class
Property Values
Other Residents in the Household
Young drivers in the household
Rate Basis, Classification, or Garaging Address
Signing for an insured
Contemplating the Ethical Response - CORRECT ANSWER Ask questions to clear blurey lines in situations
Six Steps to Ethical Decision Making - CORRECT ANSWER 1. Define the Problem
2. Seek Out Resources
3. Brainstorm a List of Potential Solutions
4. Evaluate those Alternatives
5. Make Your Decision and Implement It
6. Evaluate the Decision
Unethical Decision effects on the Agency's Profitability - CORRECT ANSWER Incorrect Rating = Unprofitable Agency
Legal Duties are based on Three Criteria - CORRECT ANSWER Peer Standards
Oral and Written Agreements
Statues
Peer Standards - CORRECT ANSWER require a person's duties be performed in a manner similar to others in the same position.
Not typically written, but rather associated with generally accepted practice in a specific field
Contracts (Oral and Written Agreements) - CORRECT ANSWER an agreement between two or more parties wich creates an obligation to do or to not do something
Statues - CORRECT ANSWER written laws open to little interpretation
Actual or Expressed Authourity - CORRECT ANSWER expressly given to the agency by the insurance company. It is granted in the agency contract (agreement).
Implied Authority - CORRECT ANSWER describes a situation in which the authority of the agent is not specifically expressed or communicated, but it still is consistent with the agent fully exercising the expressed authority granted by the company
Apparent Authority - CORRECT ANSWER authority the agent appears to have based on circumstances surrounding that belief. Insurance agencies can be held legally liable under apparent authority for things that are not expressed
Estoppel - CORRECT ANSWER the principle which prevents a person from asserting something contrary to what is implied by a previous action or statement of that person or by a previous pertinent judicial determination.
The insurance company is stopped from denying the agent's authority when it has allowed that same activity in the past without taking any corrective action
No Authority - CORRECT ANSWER Agency cannot generate a quote or conduct business tin that insurance company
Care owed to their Insurance Companies - CORRECT ANSWER Loyalty
Good faith
Reasonable Care
Contractual Duties
Loyalty - CORRECT ANSWER Act for the benefit of the insurance company regarding matters associated with the agency contract
Good Faith - CORRECT ANSWER Being honest throughout the entire insurance transaction and acting in the best interest of the insurance company
Reasonable Care - CORRECT ANSWER When one exercises care and concern for the safety of his or herself and others regarding business conducted with the insurance company
Contractual duties - CORRECT ANSWER Always act within the authority granted in the company-agency agreement. It defines duties and responsibilities of both parties as well as authorizing certain activities
Care owed to the Customer - CORRECT ANSWER Adequate Coverage
Proper Coverage
Coverage placed in the best interest of the customer
Prompt communication
Coverage placed with a financially sound insurance company
Adequate Coverage - CORRECT ANSWER The agency helps the customer determine the appropriate amount of insurance to meet their needs
Proper coverage - CORRECT ANSWER Must know the available polices, identify the best polic(ies) for the given exposures, and stay abreast of industry developments in order to provide pooper coverage for their customers
Coverage plans Ed in the best interests of the customer - CORRECT ANSWER Placing the best coverage for the customer based on the specific needs of that customer
Prompt Communication - CORRECT ANSWER Notify customers regarding all aspects of their insurance transactions with the agency including, but not limited to, changes, exclusions, limitations, claims, cancellations, and non-renewals
Coverage placed with a Financially Sound Insurance Company - CORRECT ANSWER It is important to make sure coverage is placed with an insurance company that will be able to pay claims
Insurance License - CORRECT ANSWER makes you eligible to sell and discuss insurance
Continuing Education - CORRECT ANSWER Decided at state level, additional training required to maintain licences
Good Ethics - CORRECT ANSWER =Good Business
Why is it important to define the agency's clues, vision, and mission - CORRECT ANSWER these statements help define expectations for the agency's employees and distinguish the agency from its competition thereby setting the culture
The Values Statement - CORRECT ANSWER this defines the heart of the organization: it is an expression of the core priorities and behavioral issues that matter most to the agency's management I.E. What do we stand for?
The fvision Statement - CORRECT ANSWER What are the current and future goals of the agency
The Mission Statement - CORRECT ANSWER action based statement declares what the agency actually does and how it intends to connect with and serve its customers, and it reveals what makes the agency unique
Smart Goal Setting - CORRECT ANSWER Specific
Measurable
Attainable
Relevant
Time-based
Specific Goal - CORRECT ANSWER What is the objective that needs to be accomplished
Who is/are the person(s) responsible for it?
What steps will be taken to achieve it
Measurable - CORRECT ANSWER must be able to track progress and know when you have reached the finish line
Attainable - CORRECT ANSWER realistic goals- not something that sets you up for failure
Relevant - CORRECT ANSWER there should be a true benefit attached to reaching the desired objective
Time Based - CORRECT ANSWER So everyone will stay the course within a designated time frame
Agency's Brand - CORRECT ANSWER included determining its target market(s), positioning its products and areas of specialization, and defining its personality. It will be a summary of the agency's values, vision, and mission statemnts
Agency Culutre - CORRECT ANSWER behavior and attitudes of the organization and its employees. It is a mix of leadership, values, traditions, beliefs, interactions, behaviors, and attitudes
Company Culture with WFH - CORRECT ANSWER Connection, Collaboration, and communication need to be a prioirty to keep employees productive
Leadership - CORRECT ANSWER should model and communicate the desired behaviors with in the agency
A Lack of Leadership - CORRECT ANSWER results in staff members struggling to understand the vision and grappling with how to unite and adhere to a particular plan or direction
Factors that Impact the Agency's Operations - CORRECT ANSWER The Agency Workforce
Areas of Specialization/Lines of Business
Number of Locations, Geographical Size of Operation, and Virtual Environment
Local, Reginal, National, Or international Operations,
Virtual or Hybrid Agency
Organizational Structure
Core Structure
Agency Management Systems
The Digital Agency
Agency Revenue
Expansion and Mergers and Acquisition
The Agency Workforce - CORRECT ANSWER the number of employees and the positions they hold influences how the agency operates
Areas of Specialization/Lines of Business - CORRECT ANSWER a higher level of training and skills in the type or types of business they handle may be needed
Number of locations, Geographical Size of Operation, and Virtual Environment - CORRECT ANSWER will affect how the agency operates, communicates and informs their clients, employees, and other interested parties
Local, Regional, National, or International Operatiosn - CORRECT ANSWER where an agency conducts business directly impacts how products are distributed and serviced.
The Cultural differences, environment, local economy and legal issues are all critical factors
Virtual or Hybrid - CORRECT ANSWER the agency may discover they can save money and attract more talent by setting up a partial or completely virtual work environment
hiring, training, and managing can be handled remotely as long as the appropriate processes and technology are in place
Organization Structure - CORRECT ANSWER will depend on and impact how resources are allocated, accountability is assigned, and responsibility is delegated.
can be Horizontal or Vertical
Horizontal Structure - CORRECT ANSWER Agencies with few employees have a flat structure. Staff will generally directly to the agency owner or in some cases office manager
Vertical Strucutre - CORRECT ANSWER The division of job functions and responsibilities are will defined, as are the reporting relationships.
Core Structure - CORRECT ANSWER it will be designed to support the accomplishment of its agency goals. Internal and External Factors may require change or modification to the structure
Departmental Core Structure - CORRECT ANSWER work is handled by type or line of business, or by function
Team- Oriented Core Structure - CORRECT ANSWER the sales and servicing of business is handled by a team of producers and service account managers under the direction of a team leader
Agency Management System - CORRECT ANSWER a software package that supports the many functions agencies tend to have in common
The digital Agency - CORRECT ANSWER leveraging more technology allows their workforce to work smarter, provide more immediate service, and support to stakeholders and reduces task time
Accurate Data - CORRECT ANSWER to conduct a proper analysis, the date must be accurate with uniform entries that follow the agency's procedures for workflows and data entry
Four Categories of Agency Revenue - CORRECT ANSWER Commission
Fee-Based Services
Contingent/Profit-Sharing
Investment Income
Commission - CORRECT ANSWER the largest source of income and are a percentage of the premium the agency earns from selling and renewing insurance policies including those for personal lines, commercial lines, life, health, and employee benefits
Fee-based services - CORRECT ANSWER loss control, risk management, and insurance consulting are examples
Contingent/Profit-Sharing - CORRECT ANSWER some insurance companies will do this with agencies to reward the agencies profitability and growth
Investment Income - CORRECT ANSWER generated from the investments of their assests
Expansion and Mergers and Acquisition - CORRECT ANSWER Agency growth often comes from this
Two major Categories of Insurance Agency Personnel - CORRECT ANSWER Sales
Service
The Sales Workforce - CORRECT ANSWER Comprised of Agents and/or Brokers with the responsibility of identifying prospects, making sales calls, determining prospects' needs, presenting solutions, and securing the buying decision
Producer - CORRECT ANSWER Agent
The Service Workforce - CORRECT ANSWER professional - not clerical. They manage the full customer life cycle. They are responsible for the day-to-day management of the customer relationship
Tasks during the Customer's Life cycle - CORRECT ANSWER Transacting Insurance
Account Rounding or Cross Selling
Referral Selling
Position Description - CORRECT ANSWER complete understanding of what their job is, how it should be done, and how it relates to the agency's performance ,
They give insight into the agency, set expectations, and provide goals and metrics for the employment life cycle
Components of a position description - CORRECT ANSWER 1. Position Title
2. Reason for the position
3. Level of Authority Granted
4. Responsibilities, Duties, and Functions
5. Measuring Performance
6. Qualifications
7. Working Conditions
Agency Stakeholders - CORRECT ANSWER a person who has the potential to be affected by any action taken by an organization
EX:
Board of Directors, Employees, Vendors, Customers, Industry Associations, Insurance Companies, Government
Board of Directors - CORRECT ANSWER helps to guide decision making that will lend to the agnecy's success. They benefit when there is an increase in the value of the agency's stock
Employees - CORRECT ANSWER continued job security and the potential for increased wages or benefits depend upon agency success
Vendors - CORRECT ANSWER depend on the agencies either keeping their existing systems or spending available revenues to upgrade to newer systems
Customers - CORRECT ANSWER high performance within agency results in high quality, responsive Customer Service
Industry Associations - CORRECT ANSWER more liektly to continue their memebership
Insurance Companies - CORRECT ANSWER the agency will function as a continued distribution source for their products
Government - CORRECT ANSWER can be affected by success or failure, particularly if it results in the agency's noncompliance with insurance regulations
Insurance Regulation - CORRECT ANSWER regulated by States and/or jurisdictions in which they conduct business
don to protect the consumer from unfair business practices
McCarran-Ferguson Act (1945) - CORRECT ANSWER returned insurance regulation to the states. State regulation has proven time and time again that it effectively protects consumers and ensures promises made by insurers are kept
Solvency regulations - CORRECT ANSWER seek to mitigate the risk of loss to businesses and individuals should an insurer become insolvent
Market Regulation - CORRECT ANSWER seek to ensure fair treatment of policyholders in ensuring they are charged fair and reasonable insurance prices
The Role of an Insurance Company - CORRECT ANSWER an Organization that provides financial protection and reimbursement of damages to individuals, families, and/or businesses according to the policy contract
Mono-line Insurance Company - CORRECT ANSWER Deals with just one line of insurance
Common Insurance Companies Departments - CORRECT ANSWER Claims, Finance, Legal, marketing, Product Development, and Underwriting
Insurance Company Ownership Classifications - CORRECT ANSWER Stock Company
Mutual Company
Reciprocal Exchange Company
Stock Company - CORRECT ANSWER owned by stockholders and operates with tthe goal of making a profit for those stock holders
Mutual Company - CORRECT ANSWER owned by the policy holders and the goal is to provide insurance at or near the actual cost of doing business. Any money left over in the form of profits or surplus, the money may be returned to the policyholders as a dividend or used to reduce future premiums
Reciprocal Exchange Company - CORRECT ANSWER describes groups of individuals or organizations called subscribers who join together into an association for the purpose of insuring one another and are managed by an attorney in fact
Distribution Methods - CORRECT ANSWER Independent Agent
Captive Agent (exclusive agents)
Direct Writing System
Independent Agents - CORRECT ANSWER represent and work with various insurance companies, having the ability to compare, offer, and sell policies and service from the insurance companies they represent.
Captive Agent - CORRECT ANSWER Also known as exclusive agents, work for one insurance company and therefore are limited to only selling policies for that insurance company. They must sell accounts to the Insurance company if the agent decides to end the working relationship
Direct Writing System - CORRECT ANSWER the consumer can ship online but does not have a local office to visit or primary contact person
What does the company expect from the agency - CORRECT ANSWER a good working relationship between agency/company staff members
honest submission with full disclosure of material facts
Agency premium growth with that company
What does the agency expect from the company - CORRECT ANSWER stability in the marketplace, not hopping in and out of lines of business
stability and fairness in its rate structure and underwriting decisions
some agency support through advertising, education, or possible management assistance
Fair and prompt claims handling and serice
What does the customer expect from the agent - CORRECT ANSWER Adequate Coverage
Proper coverage
Coverage placed in the best interest of the customer
Prompt communication
Coverage placed with a financially sound insurance company
Financial rating - CORRECT ANSWER Insurance companies are required to submit financial data to their insurance department quarterly. That dat is then evaluated by analysts to determine continued financial stability.
Two ways insurance agencies can monitor their companies - CORRECT ANSWER 1. Check with the appropriate state or jurisdiction's insurance department to see if they have taken any action as the result of the company's financial condition.
2. Check with rating organizations that can provide information about the financial stability of a specific company
Admitted Insurance companies - CORRECT ANSWER the standard market which have been licensed by the state. Their forms rules and rates and regulated and their financial condition is monitored by the insurance departments of the states in which they are licensed or domiciled
Guaranty Fund - CORRECT ANSWER protects business written and will step in to make payments on claims as necessary
Non-Admitted Insurance Companies - CORRECT ANSWER used to insure difficult to place risks that admitted carriers often can not afford to cover. Often referred to as excess and surplus lines companies
Excess and Surplus lines Agent/Broker - CORRECT ANSWER acts as a wholesale intermediary who places business for the benefit of the agent.
When to use a Non-Admitted Market - CORRECT ANSWER Type of Risk
Type of Coverage
Differences between a Non-Admitted and Admitted Market - CORRECT ANSWER Binding Authority does not typically exist
Minimum premiums are typically fully earned (if policy is canceled the insured does not receive a return premium)
Coverage Forms are Non-Standard
Minimum Premiums are Higher
Audits are done for additional premium only
They provide flexibility in product offerings
Their financial strength should be reviewed
Alternative Market Types - CORRECT ANSWER Lloyd's of London
Reciprocals, risk retention groups, captives
government programs/pools
Lloyds of London - CORRECT ANSWER known as a market for difficult to insure risks as well as unique or unusual risk. A market where members are grouped together to insure risks.
Members provide financing that back the policies
Managing General Agent (MGA) - CORRECT ANSWER a wholesale intermediary that represents one or more insurance companies. it accepts business on behalf of his/her principal within mutually agreed upon guidelines
Risk Retention Group - CORRECT ANSWER each of the policy holders is also a stock holder (owner) the members are businesses with related or similar activities and the coverage provided is limited to liability insurance
they are regulated by each state
Captive insurance companies - CORRECT ANSWER Owned and controlled by their insureds and typically provide coverage for P & C exposures. ,must be homogeneous in nature but can also insure
Regional Insurance Company - CORRECT ANSWER conduct business only in states located in that specific geographic region. Can be more stable and offer competitive rates by avoiding states prone to high risk exposures
National Insurance Companies - CORRECT ANSWER conduct business across the united states. They are larger and provide a great range of coverages
Government Insurance Programs - CORRECT ANSWER another source of insurance coverage for difficult-to-place risks handle risks that the admitted company will not write either because it fails to meet the underwriting criteria or because the exposure to loss is catastrophic in nature
EX: FAIR Plan, Wind and/or Hail Pools, National Flood Insurance Program, Work Comp Assigned Risk Plan, Federal Crop Insurance Corporation
Fair Access to Insurance Requirement (FAIR) Plan - CORRECT ANSWER to make fire insurance available to those who are unable to obtain it through other markets. Written on a basic homeowners and dwelling fire policy. State Sponsored
Wind and/or Hail Pools - CORRECT ANSWER available along the Atlantic and gulf coasts, provide insurance to property owners who are unable to get coverage for wind damage from hurricanes and other windstorms
National Flood Insurance Program (NFIP) - CORRECT ANSWER administered by the Federal Insuance Administration under the federal emergency management Agency ( FEMA) allows customers located in an area prone to flooding can obtain the needed coverage
Assigned Risk Plan - CORRECT ANSWER those unable to buy WC through other markets
Not available in all states
established by individual states to make sure employers can obtain worker's compensation insurance
Federal Crop Insurance Corporation (FCIC) - CORRECT ANSWER improves the economic stability of agriculture through a sound system of crop insurance
Reinsurance - CORRECT ANSWER a process of transferring risk from one insurer to another insurer
Primary Functions of Reinsurance are to - CORRECT ANSWER increase underwriting capacity
provide catastrophe protection
stabilize loss experience
manage financial rations
Two types of reinsuarnce - CORRECT ANSWER Treaty Insurance
Facultative Reinsurance
Treaty Insurance - CORRECT ANSWER the insurance company (the ceding company - the primary company) agrees to transfer (cede) certain classes of business to the reinsurance company. The reinsurance company agrees to to accept all business that qualifies as contained in the agreement (treaty)
Facultative Reinsurance - CORRECT ANSWER uses offer and acceptance of individual risks in which the reinsurer retains its faculty (the ability) to accept or reject each risk offered by the ceding company. Each exposures is a single transaction
Risk - CORRECT ANSWER a condition of either positive or negative uncertainty arising from a given set of circumstance.
Risk Management - CORRECT ANSWER the process of making and carrying out decisions that will minimize the adverse effect of risk on an organization.
Five Step Risk Management Process - CORRECT ANSWER 1. Risk Identification
2. Risk Analysis
3. Risk Control
4. Risk Finance
5. Risk Administration
Risk Identificaiton - CORRECT ANSWER identify all of the expousres
exposure - CORRECT ANSWER a situation, practice, or condition that may lead to an insured's susceptibility to adverse financial consequences of loss
Four Logical Classifications of Exposure to Loss - CORRECT ANSWER Property
Human Resources
Liability
Net Income
Property- exposure to loss - CORRECT ANSWER buildings, homes, personal property, BPP, equipment, intellectual property
Human Resources - exposure to loss - CORRECT ANSWER risk of injury disability or death, financial hardships may occur and need to be considered:
Loss of a key person
Employee Benefits
Employment Practices
Liability Exposures
Liability - Exposures to Loss - CORRECT ANSWER causing bodily injury or property damage to others through the insured's negligence
personal injury
Hold Harmless Requirements
Contractual obligations
Net Income - Exposures to Loss - CORRECT ANSWER exposures, perils, and/or hazards producing losses may interfere with an organization's goals and have a financial impact as a result
Methods to identify exposures - CORRECT ANSWER Expert Review
Checklist, Surveys, and Questionnaires
Physical Inspection
Loss Data Analysis
Insurance Policy Review
Procedures and Policies Review
Flowchart Review
Financial Statement analysis
Compliance review
Contract Review
expert Review Method - CORRECT ANSWER information is gathered from experts who provide their professional opinions, recommendations, and solutions
Checklists, Surveys, and Questionnaires Method - CORRECT ANSWER uses information-gathering documents to search systematically for as many loss exposures as possible
Lists of Assets - CORRECT ANSWER a checklist is best suited for property and physical assets
Strengths: provides a list of all resource's and capacities, stimulates staff to account for assets, and identifies assets that are often overlooked
Weaknesses: does not address liability risks, must be updated regularly
Activity or Situation Analysis - CORRECT ANSWER best suited for liability and human resources exposures to evaluate personnel and operations and how they function together
Strengths: instilling a through process for loss prevention, evaluation equipment, personnel, and operations that function together, and identifying perils that are often overlooked
Weaknesses: Include too much detail, it does not focus on the financial aspect of identification and operations and activities may vary by locale
Perils Analysis - CORRECT ANSWER used to identify the potential causes of loss from human, economic, and natural perils
Strength: provides a list of common or likely causes of loss, uses insurance terminology and can assist in identifying perils that occur infrequently and might otherwise be missed
Weakness: new perils are created daily, old perils are forgotten or overlooked and the analysis may become obsolete
Insurance Checklist - CORRECT ANSWER can be used to determine the feasibility of contractual transfer
Strengths: a definitive list of available coverage and exclusions
Weaknesses: geared toward exposures that are currently insured or are conventionally insurable
Industry List - CORRECT ANSWER tailored to specific assets, activities, perils, and insurable exposures commonly found in that industry or operation
Strengths: facilitates Comparisons with Peers
Weakness: can be too focused on the industry or it can be too generic
Physical Inspection Method - CORRECT ANSWER on site visit with pictures, safety checks, property survey report
Loss data Analysis method - CORRECT ANSWER reviews historical losses to identify trends and patterns
Insurance Policy Review Method - CORRECT ANSWER used to determine exposures and persils that are and are not covered
Procedures and Policies Review Method - CORRECT ANSWER internal, external, and legal reviews to evaluate
Flowchart method - CORRECT ANSWER consists of detailed diagrams of the sequence in which raw materials or good move through an organization's operations. Identifies bottlenecks and loss exposures
Financial Statement Method - CORRECT ANSWER used to identify values that are subject to loss, events that could cause loss, and the fiscal impact after loss.
Compliance Review Method - CORRECT ANSWER examination of whether there has been an adherence to professional standards and/ or regulations
Contract reivew Method - CORRECT ANSWER reviews contracts of other than insurance policies and gives insight to the organization's obligations
Risk Analysis - CORRECT ANSWER Step 2
measuring the exposure to loss
evaluates the frequency and severity
Risk Control - CORRECT ANSWER active measures taken by the insured to avoid, prevent, or reduce the frequency or severity of loss
focus on finding and implementing solutions to prevent or reduce actual harm
Five primary Risk Control Techniques - CORRECT ANSWER Avoidance
Loss Prevention
Loss Reduction
Duplication/Separation
Combination
Avoidance - CORRECT ANSWER choose not to own certain property or to engage in an activity
least expensive but not always practical
Loss prevention - CORRECT ANSWER reduce the frequency of loss
Loss reduction - CORRECT ANSWER reduce the severity of loss
Duplication/Separation - CORRECT ANSWER Focus on reducing the severity of loss
Combination - CORRECT ANSWER use more than one risk technique
Risk Finance - CORRECT ANSWER focuses on determining how losses will be paid
Retention - CORRECT ANSWER Active or Passive
Active Retention - CORRECT ANSWER the customer know beofre the loss that they will be financially responsible for all or some of the loss
Passive retention - CORRECT ANSWER customer finds out after the loss that they are financially responsible for the los
Transfer - CORRECT ANSWER the customer passes the responsibility to pay for the loss to another entity
Insurance or Non-Insurance
Insurance Transfer - CORRECT ANSWER transfers the financial consequences of a loss to an insurance company
Non-Insurance Transfer - CORRECT ANSWER transfers financial responsibility to another party through a contract or agreement
Froms of Risk Finance - CORRECT ANSWER Retention or Transfer
Risk Administration - CORRECT ANSWER Implementation and monitoring of the risk management process
Standard - CORRECT ANSWER stated, acceptable level of performance in every area of the agency's operations
Procedure - CORRECT ANSWER defines the task the agency must do or accomplish to achieve a stated standard. Who What and When should be identified with this
Workflow - CORRECT ANSWER describes the specifc keystrokes and steps that need to be performed in order to complete a procedure
Benefits of Written systems and procedures - CORRECT ANSWER work gets performed in a uniform way
they can used as a training tool for new employees
they can serve as arefernce tool for all employees
they can reinforce the quality and efficiency of work by removing uncertainty about how to accomplish goals
they can reduce or even prevent E&O losses
they are key for defending E&O claims
Automated Workflow - CORRECT ANSWER a series of tasks performed Automatically when a specific event occurs
Four Levels of Technology Utilization - CORRECT ANSWER Manual Transition
Process Focused
Service Focused
Client Focused
Manual Transition - CORRECT ANSWER agency has minimal reliance on technology and automation
Process Focused - CORRECT ANSWER beginning to utilize technology to enhance serice and allow staff to work more efficiently
service focused - CORRECT ANSWER the use use of technology and automation is essential and is the primary source of information and documentation
Client Focused - CORRECT ANSWER technology and automation are fully implemented allowing more time to focus on the customer and achieve increased productivity
Three Major areas for Sales and Service staff that require a strong skill level and work Experience - CORRECT ANSWER Technical
Product Knowledge
Agency Process
Technical Skills - CORRECT ANSWER a complete understanding of the insuring terms and conditions in the policies sold and serviced
Product knowledge - CORRECT ANSWER applicaiton of the right policies and risk management solutions, and where to secure such products and resources
Agency Process - CORRECT ANSWER the ability to perform your job as required by the agency
Components of a Formal Training Plan - CORRECT ANSWER Written
Constructed by the manager and the employee
Relevant
Specific
Time Sensitive
Achievable
Reviewed
Quality Control - CORRECT ANSWER a process through which the agency seeks to ensure its product and service quality is maintained or improved based on their standards
The purpose of implementing an internal quality control process is to determine - CORRECT ANSWER the work is being done according to the agency's systems and procedures
the quality of the work is within the required standards
the level of productivity
Interpersonal Skills - CORRECT ANSWER behaviors and tactics used to serve and interact effectively with others
Includes communication regarding coverages and exclusions, problem solving, time management, negotiating, and closing the account
Communicaiton - CORRECT ANSWER The activity of conveying information between two or more individuals
Verbal Communication - CORRECT ANSWER speaking or writing
Non-Verbal communicaiton - CORRECT ANSWER listening, visual media, or behavioral cues
Benefits of Effective Communication - CORRECT ANSWER builds trust
provides clear expectations
improves relationships
promotes team building
improves productivity
One Way Communication - CORRECT ANSWER linear and limited; it is information passed from the sender to the receiver without any feedback. Information will be dominated by the sender's knowledge
Two Way Communicaiton - CORRECT ANSWER reciprocal as the receiver becomes a sender and the sender, in turn, becomes the receiver. The most effective way to get the message across is by using a combination of listening and speaking
Four types of information exchange - CORRECT ANSWER Verbal
Non-Verbal
Visual
Written
Verbal Communictaion - CORRECT ANSWER the use of words to share information with other people.
Both spoken and written forms.
All about the words you choose and how they are heard and interpreted
Steps to improve verbal communication - CORRECT ANSWER Speak with Clarity; be Knowledgeable and effective
Speak Efficiently and be Respectfully empathetic
Pay attention to the volume of your speech
Use words customers can understand
Non Verbal Communicaiton - CORRECT ANSWER the transmission of messages or signals through a non-verbal platform
Steps to Improve Non Verbal Communication - CORRECT ANSWER Watch your Proximity to the Other Person
Make Eye contact
Be Aware of Facial Expressions
Be Aware of Smell
Visual communcaiont - CORRECT ANSWER infographics, slide presentations, screenshots, and videos
Written Communication - CORRECT ANSWER think about structure, clarity, and content of your message before you send it. Whether in Email, Memo, Report, or social media
Form Letters
Email
Texting
Form letters - CORRECT ANSWER templates of various letters the agency uses on a regular basis. Standardized, will save time and reduce the likelihood of E&O Claim
Email - CORRECT ANSWER no abbreviations in the text, used disclaimers
Texting - CORRECT ANSWER prompt and short response that can be transfered to the file
Steps to proof communication - CORRECT ANSWER 1. Proofing Content
2. Proofing Grammar
3. Review Grammar
Insurance Companies and digital Media - CORRECT ANSWER used to expand the customer base, provide customer service, inform clients, exchange information, increase product branding and visibility, and better connect with customer
Insurance Agencies and Digital Media - CORRECT ANSWER Help agents develop and maintain relationships as well as pursue sales opportunities beyond traditional methods
Insurance Consumers and Digital Media - CORRECT ANSWER a way to gather information in selecting insurance products they may be interested in purchasing
Employee Digital Media Policy - CORRECT ANSWER should include:
purpose
Confidentiality
No Expectation of Privacy
Authority
Productivity
Definitions
Violations
Definitions
Discipline
New Business Development Workflow - CORRECT ANSWER Identifying Prospects: Source of Business and relationships
Establishing a Plan
Gathering account information and Documentation
Submitting to Markets
Generating the Proposal
Converting the prospect to a Customer
Identifying Prospects: source of Business and Relationships - CORRECT ANSWER putting time builds trust and loyalty in both business and relationships
Sources include:
Producer Generated
Referrals
Associations/Programs
Advertising/Internet
Cross selling/Account Rounding of existing Clients
Producer Generated - CORRECT ANSWER a relationship has been created with the prospect by the producer through the producer's efforts
Referrals - CORRECT ANSWER existing customers or others recommend your agency to personal contacts for their insurance needs, creating an opportunity to develop a relationship
Associations/Programs - CORRECT ANSWER a relationship with this generates a source of prospects. The relationship is indirect and based on being endorsed by the association or industry
Advertising/Internet - CORRECT ANSWER Call-in business, no previous relationship exists with the agency
Cross Selling/ Account Rounding of Existing Clients - CORRECT ANSWER it is an obligation to present solutions and options that address your customer's needs
Establishing a plan - CORRECT ANSWER should include
who is responsible for which action
who will gather the necessary information
what solutions to provide
which markets are best
who will complete submission as well as the proposal
who will be the key contact
Gathering Account Information and Documentation - CORRECT ANSWER a complete understating of a prospect's exposures and insurance needs is critical
info must be current and accurate
Submitting to Markets - CORRECT ANSWER the quality of your submission and the markets selected will determine the quality of the product and pricing you will have to present to the prospect
Generating the proposal - CORRECT ANSWER a written proposal needs to be provided and explained to every prospect and/or customer
Converting the Prospect to a customer - CORRECT ANSWER Insurance Company is notified in writing
Evidence of Insurance, Invoice and Documents are generated
AMS is updated
Thank you/welcome notice sent
Staff is informed of New Client
Cross-selling potential is determined
New business policy review is completed and sent to client
Account Servicing Skills & Knowledge - CORRECT ANSWER Technical Insurance Knowledge
Agency Standards and procedures
Procedure to service account
Insurance Company Underwriting requirements/guidelines and underwriter's appetite
Documentation and effective Customer Service Practices
Renewal Prcess
Technical Kowledge - CORRECT ANSWER knows Coverage differences among the policies available before coverage can be placed on the best terms available for the customer
Underwriting Guidelines - CORRECT ANSWER Know your Binding Authority with each insurance company
Review underwriting guidelines periodically to stay aware of any changes
New business submitted should meet or exceed the company's underwriting guidelines
Know the appetite and additional services available
Non-negotiable Guidelines
Underwriting Exceptions
Underwriting Specialties
Applications - CORRECT ANSWER should always be completed thoroughly, accurately, and honestly
Insurable Interest - CORRECT ANSWER when a person seeking insurance would suffer a financial loss or experience a hardship if the object to be insured was damaged or lost
Lack of Market - CORRECT ANSWER once notified, contact the insured immediately
keep the insured updated and do not promise the coverage will be replaced
Submit the applicaiton - CORRECT ANSWER Send gathered information to Carrier and follow up
Inspections and REcommendations - CORRECT ANSWER may result in either suggested or mandatory recommendations to reduce hazards
Issuing Binders - CORRECT ANSWER confirmation of insurance must be promptly issued
Verifying the Policy - CORRECT ANSWER insure it was issued correctly with the requested coverage forms
Endosements - CORRECT ANSWER changes to the policy
Renewal List - CORRECT ANSWER a complied list of upcoming accounts 90 - 120 days prior to the renewal
Review the list and Contact the Insured - CORRECT ANSWER obtain updated information to make sure renewal policy will provided the needed protection
Complete Renewal Submission - CORRECT ANSWER applications, loss runs, exmods, updates
Balance Sheets - CORRECT ANSWER a snapshot of the financial condition of the individual or organization on the date the sheet was created
Includes:
Assets
Liabilities
Equity
Assets - CORRECT ANSWER what is owned and what has accumulated, Cash, Accounts receivables, Investmetns, Buildings, Buisness Property, Invetory ect
Liabilities - CORRECT ANSWER what is owed to others and the cost of accumulated assets. Mortgages, accounts payable, debt
Equity - CORRECT ANSWER difference between Assets and Liabilities
Income and Expense Statement (Profit and Loss Statement) - CORRECT ANSWER summarizes the financial results over a period of time
Revenues
Expenses
Profit or Loss
Revenues - CORRECT ANSWER sources of income such as sales, service, consulting
Expenses - CORRECT ANSWER all cost incurred to generate incompe
Profit or Loss - CORRECT ANSWER the difference between Income and Expenses
Direct Billed policies - CORRECT ANSWER the insurance company is responsible for communicating directly with customer about all premium correspondence
Agency Billed - CORRECT ANSWER billed by the agency. Responsible for collecting the premium for new business, renewals, and endorsements and then submitting the net premium to the insurance company
Account Current State - CORRECT ANSWER agency submits to company showing the policies billed, gross premium, commission, and net premium due
Premium Finance - CORRECT ANSWER a finance agreement is sent to the finance company along with Down payment the insured then makes scheduled payments to the finance company
Statement Billing - CORRECT ANSWER Company will send to agency for collection of premium
Certificate of Insurance - CORRECT ANSWER issued for information only and it does not amend, extend or change policy
Evidence of Property - CORRECT ANSWER similar to COI, mainly uesed for Loss Paybles
Insurance Binder - CORRECT ANSWER a temporary insurance contract when coverage has been bound but the policy has not been received
Claims Processing - CORRECT ANSWER insured reports a claim
take claim information
informing insured of policy conditions
reporting claim to the insurance company
logging the claim
PINES - CORRECT ANSWER what the insured must do
Protect the property from further damage
Inventory the Damaged Property
Notify the Insurance Company
Exhibit the property to the Adjsuter
Submit a sworn statement
Reservation of Rights letter - CORRECT ANSWER an insurance company agrees to investigate a claim or suit and defend the insured while retaining the right to deny coverage at a later time
Suit and Summons - CORRECT ANSWER notice that a lawsuit is being filed against the insured
Service Centers - CORRECT ANSWER assist agency's workforce and the ability to refocus their time
Negligence - CORRECT ANSWER must be prone, failure to perform a duty, failure to use a degree of care that is generally considered reasonable under a given set of Circumstances
Four elements for Negligence to have occured - CORRECT ANSWER 1. there must be a duty owed to another party
2. There must be a breach of that Duty
3. There are Damages - an actual loss or injury must occur
4. There has to be a proximate cause or cause -and- effect relationship between the duty and the loss or injury
Common Claims brought against Agents by Insureds - CORRECT ANSWER Failure to Obtain Proper Coverage
Failure to place coverage after binding it
Failure to give proper advice
Failure to promptly advise insured of rejection or lack of Coverage
Failure to maintain or renew coverage
Failure to service Policies
Failure to place coverage on best terms and conditions available
Misrepresentation of Facts
Placing coverage with an insolvent insurer or unauthorized insurer
Modifying established service to customers
Making a Clerical Error
Common causes of Claims brought against Agents by Insurance Companies - CORRECT ANSWER Exceeding Binding Authority
Failure to properly Process a claim
Failure to notify carrier of Material Change in Risk
Misrepresenting the risk to the carrier
Agency Defense Activites - CORRECT ANSWER 1. Agency reports claim to their E&O Carrier
2. Agency assigns one person to act as the coordinator
3. Promptly have a meeting with all agency personnel involved in E&O Claim
4. Prepare to be a good witness
5. Do not change any operating procedures
6. Inform the agency of the outcome [Show Less]