ECONOMICS
INSURANCE
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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The insurer is the source of authority from which the producer must abide
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The producer is responsible for “producing” benefits, while the insurer writes the policies
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They are legally considered the same entity
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The insurer appoints the producer to act on its behalf
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Detailed explanation-1: -Which of the following outlines the authority given to the Producer on behalf of the insurer? The Producer (or Agent) contract outlines the authority given to the Producer on behalf of the insurer.
Detailed explanation-2: -By definition, an insurance agent acts on behalf of the insurer it represents, and as such is vested with apparent authority to collect premium payment from an insured.
Detailed explanation-3: -INSURANCE AGENT: An agent is an individual who is an intermediary representing an insurance company. A Composite Insurance Agent means an insurance agent who holds a license to act as an insurance agent for a life insurer and a general insurer.
Detailed explanation-4: -(1) An insurer may appoint any person to act as insurance agent for the purpose of soliciting and procuring insurance business: Provided that such person does not suffer from any of the disqualifications mentioned in sub-section (3).