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IIC Advanced Skills for the Insurance Broker and Agent Sample Questions:
1. What is the purpose of a letter of authorization?
A) Acts as express written permission for the broker to bind any policies on behalf of the insurer
B) Directs the underwriter to deal with the broker named in the letter on the particular client's account
C) Permits an insured to nominate a legal representative to speak and transact business on her behalf
D) Confirms the exclusive business agreement between the intermediary and the insurance company
2. A broker binds a property policy for a future date, and follows up for documentation. While reviewing documents the client sent, it is discovered that the property is actually used as a rooming house, and not a family home. Why does underwriting instruct that the policy be cancelled?
A) The policy cannot be bound without proof of how the home is used.
B) The broker did not complete an in-person home inspection.
C) The use of the home is a material fact that the client should have disclosed.
D) The insurer already has too many rooming houses in their book of business.
3. Davies Architect has opened two new offices in the last quarter. Its recent claims history includes a break-in at its head office a month ago and legal action against the firm due to a structural mistake made by the architect and engineer six months ago. The firm's insurance broker is reviewing its current insurance program, and the renewal date is in two months. Due to stable market conditions, there have been no recent changes made by insurers to policy wordings or pricing. The firm has been very cooperative with providing information. Briefly discuss how the broker would review the renewal for this architectural firm.
4. Valuable information about the principals of a prospect's company, the products and services the company sells, and other financial data could be found by reviewing which source?
A) The prospect's property appraisal
B) Best's Underwriting Guide
C) The prospect's website
D) D & B reports
5. Insurance premiums on automobile fleet policies are based on which factor?
A) Driving record of the individual drivers
B) Mechanical condition of a vehicle from one particular fleet
C) Original purchase price of all vehicles in the fleet
D) Overall experience of all drivers
Solutions:
| Question # 1 Answer: B | Question # 2 Answer: C | Question # 3 Answer: Only visible for members | Question # 4 Answer: D | Question # 5 Answer: D |
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