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Which of the following is not an illustration of the responsibilities that an agent has as a fiduciary? (A) A fiduciary is an individual who holds a position of trust. An insurance agent is considered to be operating in a fiduciary capacity when they are in charge of the premiums that belong to an insurance firm.
Which of the following is an illustration of the fiduciary responsibility that a producer has?
Which of the following is an illustration of the fiduciary duties that a producer has? The confidence that a customer has in a provider with reference to the latter’s management of premiums – By managing the clients’ financial matters, including the management of premiums, an agent fulfills the duties of a fiduciary, which requires them to operate in a manner that is founded on trust and confidence.
Which of the following is not regarded to be part of an insurer’s responsibility?
The payment of premiums and the health statements given in the application are both things that are taken into consideration on the part of the insured. The commitment made by the insurance to compensate the policyholder in the event of a loss serves as the consideration provided by the insurer.
Which of the following best describes the role that a person plays when acting as a fiduciary?
The one who owes another individual a duty of trust and confidence is referred to as the principle or the beneficiary, while the fiduciary is the individual who owes that responsibility. In the event that the fiduciary breaches the fiduciary obligations, he or she will be required to account for any profits that were unlawfully obtained. In most cases, the beneficiaries are eligible for compensation for damages.
What kinds of insurance policies fall under the category of “risk sharing arrangements”?
In the context of compensation arrangements between an organization and a plan, the term “risk sharing arrangement” refers to any arrangement in which both the business and the plan share the risk of incurring a financial loss. Any compensation arrangement between a PPG and an HMO in which both the PPG and the HMO share a risk of sustaining a financial loss is referred to as a risk sharing arrangement.
Agency Relationships and Your Fiduciary Obligations | Real Estate Exam Prep Videos
We found 16 questions connected to this topic.
What is an illustration of the concept of adverse selection?
When either the buyer or the seller has more information about the product or service in question than the other, this situation is known as adverse selection. In other words, the buyer or seller is aware that the value of the goods is significantly less than what it is actually worth. For instance, a car dealer is aware that he is in possession of a defective vehicle that has a value of ,000.
What are some examples of keeping some of the risk?
Damage to an outside metal roof that is installed over a shed is an illustration of the type of risk that a corporation would be willing to retain. Instead of purchasing an insurance policy to pay for the ultimate replacement of the shed’s roof, the company can opt to put money aside for the eventual replacement of the roof and use those funds for that purpose.
What exactly are the three responsibilities of a fiduciary?
The responsibility of care, the duty of loyalty, and the duty of obedience are the three fiduciary responsibilities that are prescribed by state and common law and that all board directors are required to uphold. It is of the utmost importance for every director of a board to have a solid understanding of how their responsibilities fit into the various categories of fiduciary duties.
What exactly are the four responsibilities of a fiduciary?
- Duty of Care. …
- Duty of Loyalty. …
- Duty to Act Lawfully. …
- Duty to Act with/in Good Faith.
What does it mean to act in a fiduciary capacity?
A fiduciary relationship exists between an attorney and a client, a trustee and a beneficiary, a board of directors and the shareholders of a corporation, and an agent operating on behalf of a principal…. On the other hand, a person may in some circumstances bear a duty of fiduciary responsibility to another person or entity.
What are the four different components that make up a policy contract?
An insurance policy is comprised of the following four primary components: Page de la Déclaration Insuring Agreement. Exclusions.
What are the five different components that make up an insurance policy?
Declarations, insuring agreements, definitions, exclusions, and conditions are the five components that are included in each and every insurance policy. Many policies feature a sixth part: endorsements.
What are the four different kinds of insurance available?
Automobile insurance, health insurance, travel insurance, and homeowner’s insurance are just examples of the several sub-types of general insurance.
What exactly is meant by the term “material misrepresentation”?
A material misrepresentation occurs in an insurance contract when the insured makes an untrue statement that: 1) is material to the acceptance of the risk; and 2) would have changed the rate at which insurance would have been provided or would have changed the insurer’s decision to issue the contract. Abstract. A material misrepresentation occurs when an insured makes an untrue statement that: 1) is material to the acceptance of the risk; and 2) is material to the acceptance of the risk.
What is the most accurate way to describe a misrepresentation?
1. making a deliberately critical statement with the intent to hurt another individual by doing so in a public forum.
How do you refer to the process of replacing insurance policies?
The practice of purchasing new insurance contracts with the sole intention of earning commissions is referred to as “churning.”
What exactly are the five obligations of a fiduciary?
In particular, the duties of care, confidentiality, loyalty, obedience, and accounting may fall under the umbrella of fiduciary responsibilities. 5.
What are the two duties that come with being a fiduciary?
There are two primary types of obligations that are associated with fiduciary relationships: the duty of loyalty and the responsibility of care.
What are the many forms that duties of a fiduciary nature might take?
- Fiduciary Obligation to Show Obey…
- Fiduciary Obligation to Show Loyalty…
- Responsibility of care owed to fiduciaries….
- The fiduciary duty to act in good faith and deal fairly with one another…
- Transparency is required under a fiduciary duty.
How can you tell if someone is trustworthy enough to act as a fiduciary?
Look someone up on the SEC’s adviser search tool to get a decent idea of whether or not they are a fiduciary advisor. This is a good place to start when trying to determine whether or not someone is a fiduciary advisor. If their company (and, by extension, they themselves) works as a Registered Investment Advisor, then they will have a file that is known as a Form ADV Part 2A that may be accessed online.
What exactly does a fiduciary do for a living?
A person or organization that acts on behalf of another person or persons, placing their clients’ interests ahead of their own, with a duty to preserve good faith and trust, is known as a fiduciary. Fiduciaries have a responsibility to behave in good faith and trust at all times. So, in order to be a fiduciary, one must be legally and morally obligated to behave in the best interests of the person for whom they are acting.
How exactly does one go about paying a fiduciary?
They do not receive any commissions or trading fees, which means that their pay is not contingent on the investments that they suggest… A financial advisor is said to be fee-based when they earn compensation in the form of both a fixed charge and commissions. Fiduciaries are required to operate on a fee-only or fee-based basis. Both commission and fee arrangements are acceptable for non-fiduciary service providers.
What exactly does it mean for a plan to retain risk?
Risk Retention is the purposeful acceptance of losses through deductibles, deliberate noninsurance, and loss-sensitive plans, in which some of the risk, but not all of it, is consciously retained rather than transmitted.
What exactly is meant by the term “risk retention insurance”?
Risk retention refers to the decision made by an individual or organization to take responsibility for a particular risk it faces, as opposed to obtaining insurance to transfer the risk to another entity, such as a firm, in order to mitigate the effects of the risk…. A reinsurance policy allows them to transfer any risks that they do not wish to keep on their books.
What strategies are utilized in the process of risk retention?
The fundamental strategies of risk management, which include avoidance, retention, sharing, transfer, as well as loss prevention and reduction, are applicable to many aspects of a person’s life and have the potential to be profitable in the long run. Have a look at these five approaches, as well as how you may use them to manage health risks, in the following article.