11. All of the following are functions of the marketing department of an insurance company
EXCEPT  
A) to advertise the insurer's products.         B) to develop new products.  
C) to identify production goals.              D) to make final underwriting decisions.  
12. All of the following are reasons for a primary insurer to use reinsurance EXCEPT   A) to increase the unearned premium reserve.      B) to increase underwriting capacity.  
C) to protect against catastrophic losses.          D) to stabilize profits.  
13. The underwriting process begins with the  (    )
A) agent.                   B) desk underwriter.  
C) inspection report.          D) acceptance of the application.
14. Factors that may result in more restrictive underwriting decisions include which of the following?     (     ) I. Inadequate rates.
II. The unavailability of reinsurance at favorable terms.  
A) I only                B) II only  
C) both I and II          D) neither I nor II  
15. The unearned premium reserve of an insurer is  (     )
A)an asset representing the investments made with premium income.  
B)a liability representing the unearned portion of gross premiums on outstanding policies.  
C)a liability representing claims that have been filed, but not yet paid.  
D)the portion of the insurer's net worth belonging to policyowners.  
16. Antonio is a claims adjustor for LMN Insurance Company. After the insurer is notified that there has been a loss, Antonio meets with the insured. The first step in the claims process that
Antonio should follow is to  (     )
A)determine the amount of the loss.  
B)attempt to deny the claim regardless of whether he believes the claim is covered.  
C)verify that a covered loss has occurred.  
D)delay paying the claim if the claim is covered.
17. Some investors decided to start an insurance company. Each investor contributed $50,000 to raise the capital required to charter a new company. Each investor received an ownership interest in the company. The company will raise additional capital by selling ownership rights to other investors. Under this type of organization, the customer and owner functions are separate. This type of insurer is called a  (     )
A) stock company.                 B) reciprocal exchange.  
C) fraternal company.              D) mutual company.    
18. Brian is a life insurance agent. He is licensed to represent one company and has been assigned a territory. In addition to marketing life insurance products in the territory, Brian is also responsible for recruiting, training, and motivating new agents for the company in his territory.
Brian is a(n)    (     )
A) exclusive agent.                B) general agent.  
C) insurance broker.               D) personal-producing general agent.  
19. The corporate structure of mutual insurers is changing rapidly.  All of the following are current trends EXCEPT  (     )
A)Demutualization of some insurers.  
B)Sharp increase in the number of mutual insurance companies.    
C)Increase in company mergers.    
D)Formation of mutual holding companies.
20. A risk manager is concerned with   (    ) I. Identifying potential losses.
II. Selecting the appropriate techniques for treating losses.  
A) I only                          B) II only  
C) both I and II                     D) neither I nor II