Which of the following statements about mutual insurers is true?

Janice purchased a living room set for $1,000 and insured this furniture on an actual cash value basis. Two years later the living room set was destroyed by a covered peril. At the time of loss, the property had depreciated in value by 25 percent. The replacement cost of the furniture at the time of loss was $1,200. Assuming no deductible, how much will Janice receive from her insurer?

When must an insurable interest legally exist in property insurance for an insured to receive payment for a loss from the insurer?

Grace is a life insurance agent. She is attempting to sell a large life insurance policy, but the prospective purchaser is having second thoughts. To persuade the prospective purchaser, Grace said, “I will earn a $1,000 commission if you buy this policy. I’ll give you $500 of my commission if you buy the policy.” In most states, what illegal sales practice will Grace be guilty of if she splits her commission with the purchaser?

One method through which reinsurance is provided is through an organization of insurers that underwrites insurance on a joint basis. Through the organization, financial capacity is available for large commercial risks. This reinsurance arrangement is a(n)

Which of the following statements about the licensing of insurance companies is (are) true?I.A new capital stock insurer must meet minimum capital and surplus requirements, which vary by state and line of insurance.II.The licensing requirements for insurance companies are less stringent than those imposed on most other types of firms.

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

The policyholders’ surplus of an insurer is defined as the difference between its

Sarah owns a property and liability insurance agency. She is authorized to represent several insurance companies and she is compensated by commissions. Sarah’s agency owns the expiration rights to the business she sells. Sarah is a(n)

A shortcoming of state regulation of insurance according to Congressional committees and the General Accounting Office is that state regulation