P&C, S, M Producer SC

agent/producer

legal representative of an insurance company with fiduciary duty to company

broker

representative of the customer who works with insurance companies to find the best coverage for their customer to which they owe a fiduciary duty

indemnification

to make whole after loss, without being ahead or behind

insurance

the transfer of risk from insured to insurer

insured

the party being covered by an insurance policy

insurer

the party covering the insured with an insurance policy

law of large numbers

it is easier to predict losses based on historical data with a larger number of insured

NAIC

organization of state regulators that advises states and provides uniformity in insurance laws

pure risk

chance of loss without possibility of a gain

risk

the chance of a loss

speculative risk

chance of loss with possibility of a gain; not insured

to be insurable, a loss must be…

predictable, accidental, financially measurable, non-catastrophic

stock company

owned by stockholders; non-participating

mutual company

owned by its policyholders; can pick BoD; participating

insurance is mostly regulated at what level?

state