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Life Cycle of an Insurance Policy

Binder

Proposal

A binder is a temporary contract between the insured and the insurance company that provides coverage for an insured before a policy is issued

A booklet that highlights the important features, including the coverage, deductibles and limits of the insurance policy and premium cost that she recommends.

When the prospect finally accepts the proposal, the insurance coverage can begin, on a date that is agreeable to all parities.

  • MGA/Carrier - Receive & review binding request; Issue binder/invoice/related documents

Assess Risk: Underwriting Decisions

Service: Prepare & Issue Policy

Policy

Quote

A policy is an insurance contract between the insured and the insurance company that states the rights and duties for both parties.

A quote is a statement that tells the producer how much the premium will be for the different coverages that the carrier or MGA agrees to provide

  • MGA/Carrier - Enter to Rating system; prepare quote cover letter and send to agent
  • MGA/Carrier - Policy typing; policy issuing
  • Broker/Agent - Policy checking; policy entry

Insurance Life Cycle

Preview

Service: Changes, Claims

RSP’S INDUSTRY CORRELATION MODEL

Adjustments

LIFE CYCLE OF AN INSURANCE POLICY

The term “life cycle” refers to the different phases of an insurance policy.

The life cycle of an insurance policy for individuals and for businesses is similar, although the process is more complex for businesses. It’s important to know each phase of an insurance policy’s life cycle because the different phases partly decide the tasks and activities that ReSource Pro performs for our

clients.

RSP Clients:

Submission

  • Broker/Agent
  • MGA
  • Carrier

Change something in policy, no need to re-writing or issuing a new policy, an endorsement can adjust current policy.

A submission is a package of information that the producer sends to the carrier so that they can determine whether to provide insurance and how much to charge.

  • Agent/Broker - Send endt request to MGA/Carrier; Endt checking
  • MGA/Carrier - Endt Processing; Endt Issuance

Life Cycle with some common tasks

  • MGA/Carrier - Submission clearance(RSP helps to clear the accounts in the MGA or insurance company’s system & send acknowledgement letters to brokers to indicate the processed prospect accounts are processed by this one broker already).

Sales: Find Prospects

Assess Risk: Renewal/Non-renewal

Application

Renewal

A producer (a person who sells insurance, such as an agent or broker) collects information about the person or business that wants to buy insurance. The document that contains the information is called the application.

Renew Policy based on the prior policy. no gap, no coverage difference.

  • Agent/Broker - Enter the data in their system, pull data from the internet and set up Acord and supplemental documents; Send APP to MGA/Carrier
  • Carrier - Send renewal notification letter; Premium audit
  • Broker - Generate loss runs
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