CISR Agency Operations Self Quiz Study online at https://quizlet.com/_8nb2mw 1. Which one of the following best describes actual authority? When the agency is expressly given authority in the agency contract 2. Which one of the following statements best describes the standard of care an insurance agency owes an insurance company? Loyalty, good faith, reasonable care and contractual duties 3. Which one of the following is not one of the four benefits of ethical behavior? thical behavior encourages governmental regulation 4. Which one of the following best describes a contract? Oral or written agreements between two parties that creates an obligation to do or not do a particular thing 5. Which one of the following statements best describes agency stakeholders? The primary stakeholders are any group or individual who is affected by the achievement of a firm's objective 6. Which one of the following sources of revenue for insurance agencies is typically the largest source of income for the insurance agency? Commission 7. Which one of the following statements best describes how an agency operates? A larger number of locations may mean that some features of the agency be centralized 8. Which one of the following is not one of the four major classes of exposure to loss? Loss of use 9. Insurance brokers, who act on behalf of the buyer/client, differ from agents in what way? Brokers do not have binding authority 10. The best definition of active retention is: The customer knows before the loss that he/she is finan1 / 6 CISR Agency Operations Self Quiz Study online at https://quizlet.com/_8nb2mw cially responsible for all or part of the loss 11. Which one of the following statements regarding the process of identifying loss exposures is correct? A document review of the policy is not the best method because it shows the limits, but not the risks 12. Which one of the following best describes the risk management process? Risk identification, risk analysis, risk control, risk finance, risk administration 13. The primary reason for the regulation of insurance companies is: To protect insurance consumers 14. Which one of the following statements regarding alternative markets is correct? Agents do not typically have binding authority in alternative markets 15. Which one of the following statements concerning non-admitted insurance companies is correct? Non-admitted insurance companies can only be accessed by an excess/surplus lines broker 16. The Managing General Agent (or Agency) can best be described as representing: One or more insurance companies 17. A process involving the transfer of risk from one insurer call the ceding (or primary) company, to another called the reinsure Reinsurance 18. Form of reinsurance in which a contract automatically establishes the terms for reinsuring a class or classes of business. Treaty Reinsurance 19. Form of reinsurance using offer and acceptance of individual risks in which, under a contract of reinsurance, the reinsurer retains the faculty accept or reject each risk offered by the ceding company. Facultative reinsurance 2 / 6 CISR Agency Operations Self Quiz Study online at https://quizlet.com/_8nb2mw 20. Which is the most important component of face-to-face communication? Body Language 21. The four primary communication skill areas are: Listening, speaking, writing, and body language 22. Face-to-face non-verbal communication with customers is improved with each of the following, except: Maintaining constant direct eye contact 23. Which one of the following does not normally apply regarding the use of social media in an insurance agency? Most agencies provide their staff with a personal email address. 24. Two-way communication is best described as: Speaking and listening 25. Which one of the following methods could reduce the likelihood of an errors and omissions claim? Using standardized letters or memos 26. Which one of the following statements does not describe a purpose of a position guide? Used to determine promotions. 27. A formal training plan for sales and service staff of an agency should include strong skill development in which of the three major areas. Technical, product knowledge, agency process (The Agency Way) 28. The purpose and benefits of an internal quality control process include all of the following except: To determine peer group results. 29. Which one of the following best describes Standards? Standards are important as they define what the expected result is for the responsibilities, duties and function of a position. 3 / 6 CISR Agency Operations Self Quiz Study online at https://quizlet.com/_8nb2mw 30. While commercial lines underwriting guidelines are very similar to personal lines underwriting guidelines, there are some differences. Which one of the following is one of these differences? Additional services such as loss control could be the deciding factor when selecting the company to place the coverage with 31. Commercial applications contain boxes that 'trigger' coverage. This coverage is in place: Only if the box is marked 32. For personal lines, the guidelines for effective documentation include all but the following: Documentation should include helpful editorial comments regarding knowledge that you possess of the insured's lifestyle, etc. 33. Which one of the following statements best describes new business submissions? Make sure the application is completely filled out including marking boxes that "trigger" coverage 34. Steps in new account servicing for personal lines include all but the following: Sign the application for the insured in order to expedite approval 35. Each of the following are steps in servicing personal lines accounts, except: Process the endorsement immediately without verifying accuracy 36. Which one of the following statements about the role of personal underwriting guidelines is incorrect? As most underwriting guidelines are negotiable, and reinsurance is readily available, it is not necessary to strictly adhere to most of these guidelines 37. The steps in renewal processing include all but the following: Changes in competitors' activities 38. The three options for premium payment are: Direct bill, agency bill, and premium finance