Members must also meet stringent financial

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— Members must also meet stringent financial requirements — Lloyd’s is licensed only in a small number of jurisdictions in the U.S.A reciprocal exchange is an unincorporated mutualThe reciprocal is managed by an attorney-in-fact ( A person who is authorized to performbusiness-related transactions on behalf of someone else (the principal).)— In a pure reciprocal exchange, insurance is exchanged among the members; each member of the reciprocal insures the other members— A modified reciprocal exchangeis similar to an advance premium mutual— Most reciprocals are relatively small and account for only a small percentage of the total property and liability insurance premiums written — Most reciprocals specialize in a limited number of lines of insuranceBlue Cross and Blue Shield Plans are generally organized as nonprofit, community oriented plans— Blue Cross plans provide coverage for hospital services — Blue Shield plans provide coverage for physicians’ and surgeons’ fees — Most plans have merged into one entity— Sponsor HMOs and PPOs— In the majority of states, the plans are nonprofit organizations that receive favorable tax treatment and are regulated under special legislation — Some plans have converted to a for-profit status to raise capital and become more competitiveHealth Maintenance Organizations provides comprehensive health care services to its membersBroad health care services are provided for a fixed prepaid fee — Cost control is emphasized — Choice of health care providers may be restricted — Less costly forms of treatment are often provided
A captive insurer is an insurer owned by a parent firm for the purposes of insuring the parent firm’s loss exposuresSavings Bank Life Insurance refers to life insurance that is sold by mutual savings banks, overthe phone or through web sitesthe objective is to provide low-cost life insurance to consumers by holding down operating costs and the payment of high sales commissions to agentsAn agent is someone who legally represents the principal and has the authority to act on the principal’s behalf (the authority may be expressed, implied, and apparent)The principal is responsible for all acts of an agent when the agent is acting within the scope ofauthorityA property and casualty agent has the power to bind the insurer (a binder provides temporary insurance until the policy is actually written)A life insurance agent normally does not have the authority to bind the insurer (the applicant for life insurance must be approved by the insurer before the insurance becomes effective)A broker is someone who legally represents the insured and solicits applications and attempts to place coverage with an appropriate insurer, is paid a commission from the insurers where the business is placed, does not have the authority to bind the insurer.Large brokerage firms have knowledge of highly specialized insurance markets, provide risk

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