Act Sci 142 MEMORISE > Lists > Flashcards

Lists Flashcards

(49 cards)

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1
Q

Dodson’s 5 principles

A
  1. Insurance should be open to anyone who meets the medical requirements of the company
  2. Premiums should be level & guaranteed amount
  3. Women from a certain age & people from a certain occupation had to pay an extra premium
  4. Policies available so that individuals could share in profits or bare losses of company
  5. Individuals should have the option for a without-profit policy with no liability to share in any losses
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2
Q

10 Life Insurance Products

A
  1. Pure endowment
  2. Term assurance
  3. Endowment assurance
  4. Whole of life assurance
  5. Life annuity
  6. Income protection
  7. Long term care insurance
  8. Critical illness insurance
  9. Medical expenses insurance
  10. Pensions
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3
Q

3 Types of business in Insurance

A

With-profit
Without-profit
Unit Linked

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4
Q

Uses of unit-linked policies

A

Savings
Risk cover

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5
Q

4 types of units available

A

Local equities
Foreign equities
Property
Fixed interest

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6
Q

3 unitised business products available

A

Conventional annuities
Unit-linked annuities
Living annuities

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7
Q

7 Expense charges

A

Allocation rate
Regular policy fee
Bid-offer spread
Regular management charge
Alteration charge
Switching fee
Surrender penalty

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8
Q

3 Recouping Initial expenses

A

Front End Load
Reduced Level Allocation
Capital Unit charge

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9
Q

12 factors influencing type and range of product offered

A

Consumer needs
Owner needs
Size and expertise of company
Competition
Reinsurance availability
Legislation
Taxation
Economic conditions - Distribution channels available
Consumer knowledge
Historical offerings
Technology available
Demographic factors

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10
Q

10 Advantages to offering a wide range of products

A

Expected if your company is large
Required if you have tied agents
Avoid excluding potential business
Meet consumer needs, reduce lapses
More business generated from existing contracts
React better to market pressure / fluctuations
Expand target market
Spread risks in portfolio
Spread fixed expenses over a larger policy base

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11
Q

4 Distribution channels

A

Independent intermediaries
Tied agents
Own sales force
Direct marketing

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12
Q

10 Regulations (Govt. protecting consumers)

A

Restriction on types of contracts sold
Require authorisation to write certain business
Publish results regularly in prescribed formats
Restrict premiums & charges on the policies
Benefits & policy conditions
Sales regulation
Underwriting restrictions
Assets are valued & what assets are taken into account
Liabilities are valued
Volume restriction of business sold by a company

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13
Q

5 things tax is levied on

A

Company profits
Investment profits
Premiums
Benefits
Expenses

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14
Q

9 risks a life insurer faces

A

Mortality experience
Morbidity experience
Investment performance
Expenses and inflation
Types and volume of new business
Withdrawals
Guarantees
Options
Taxation

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15
Q

8 Reducing risk methods

A

Product design
Underwriting
Reinsurance
Prudent product pricing
Profit/loss sharing
Reduce guarantees / options offered
Prudent investment
Choose not to offer specific policy

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16
Q

3 life insurance products ranked by level of underwriting required (Highest to lowest)

A

Term assurances and whole of life
Endowment assurance
Annuities and pure endowment

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17
Q

3 steps of underwriting process

A

Class selection
Evaluation of information
If Special terms

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18
Q

8 Sources of information available for underwriting

A

Proposal form
Primary medical attendant’s report (PMAR)
Specific conditions questionnaire
Medical examination
Specialist medical report
AIDS supplementary questionnaire
Reinsurers underwriting manual
Financial questionnaire

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19
Q

6 ways of dealing with extra risk

A

Charging an extra premium
Reducing debt
Exclusion causes
Defer decision
Decline proposal
Offer an alternative contract

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20
Q

4 different categories of AIDS underwriting

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A

Sick with AIDS
HIV positive
Risk group
Clear group

21
Q

7 Reasons for reinsurance

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A

Reduce claim payment fluctuations to an acceptable level
Provide technical assistance to insurance company
Cost effective
Reduce new business strain
Allow to accept larger policies
Tax advantages
Opportunity for reciprocity

22
Q

Proportional measures for reinsurance (Life insurance)

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A

Original terms reinsurance
Risk premium reinsurance

23
Q

Non-proportional measures for reinsurance (Life insurance)

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A

Excess of loss
Catastrophe
Stop loss

24
Q

7 excluded claims against liability insurance

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A

Aviation other than a passenger
Suicide or self-inflicted injury
Existing disability
Use of alcohol / drugs
Dangerous sporting activities
Civil unrest
Pregnancy

25
5 types of liability insurance
Employer's Public Product Professional Other
26
4 Excluded claims from property insurance
Earthquakes Nuclear events War Civil unrest
27
9 Perils insured against for building insurance
Fire and smoke Lightning Explosion Weather Theft Pipes burst and glass breakage Damage caused by aircraft, vehicle or animal Malicious damage Fraudulent claims
28
5 Personal accident excluded claims
Suicide/self-inflicted injury Drugs / alcohol Dangerous sporting activities Unlawful activities Cosmetic surgery
29
4 Motor policy types
Private car Commercial vehicles Motor cycle Motor fleet
30
3 types of marine insurance
Hull Cargo Freight
31
3 Marine liability covers
Loss of life Liability for damage to harbours Cost of removing wrecks or pollution
32
9 Excluded marine claims
Unseaworthiness of vessel Unfitness of containers War Strikes Malicious acts Acts involving nuclear means Illegal use Use outside of geographical limits stated in the policy Piloted by someone not specified in policy
33
3 Aviation liability covers
Accidental damage to aircraft hull Injury to persons or damage to property on the ground Personal injury or damage to personal effects of passengers
34
2 Excluded aviation claims
Landing or taking off in places not conforming with specifications of manufacturer Number of passengers greater than stated in policy
35
5 providers of general insurance
Insurance companies Lloyd's syndicates Captives Protection & Indemnity clubs Other mutual insurance associations
36
2 types of insurance companies
Proprietaries - Owned by shareholders Mutuals - Owned by policyholders
37
3 levels of Lloyd's security
Syndicate assets Member fund's at Lloyd's Lloyd's central assets
38
4 unusual policies taken on by Lloyd's
Insurance of entertainers Insurance of sportsmen Kidnap and ransom insurance Fine art insurance
39
4 areas of cover provided by captives for parent company
Product, employer & professional liability Healthcare & Medical expenses Employee benefits Environmental liability
40
5 advantages of captives
Fill gaps which exist in usual market Tax and legislative benefits from offshore captive Keep insurance profits in house Able to take on larger risks Open market captives - provide insurance to other companies
41
4 Measures for premium rating
Good measure of amount of risk Measurable Verifiable & easily obtained Incapable of being manipulated
42
Gross / Office premiums must be enough to cover? (5)
Risk premium Contingency loading Expenses Commission Profit margin
43
3 types of proportional reinsurance
Quota share Individual surplus Quota share together with individual surplus
44
4 types of Excess of Loss cover (XL)
Individual risk excess of loss Aggregate excess of loss Catastrophe excess of loss Stop loss
45
Rank assets classes in terms of risk and return
1. Equities 2. Property 3. Corporate bonds 4. Government bonds 5. Cash and money market
46
What does SYSTEM T stand for
Security Yield Spread / Volatility Term Expenses Marketability Taxation
47
What does PESTLE stand for
Political Economic Social Technological Legal Environmental
48
What are the 5 steps of the Actuarial Control Cycle (Rough order)
General Economic and Commercial environment (PESTLE) Specifying Problem Developing solution Monitoring experience Professionalism
49
6 Factors influencing investment strategy
Nature of liabilities Currency of liabilities Term of liabilities Level of uncertainty of liabilities Tax Legal Restrictions
Act Sci 142 MEMORISE
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