Who typically buys facultative reinsurance?

Primary insurers, also known as ceding insurers, buy facultative reinsurance when they want to manage risks from individual policies that are larger or more complex than what they can cover on their own, or if a policy is not included in their treaty reinsurance agreement.

Are there penalties for pausing or canceling on-demand insurance?

Generally, no penalties exist since on-demand insurance is designed for flexibility. However, some policies may have minimum activation durations or restrictions on frequent pauses.

What rights does a beneficiary have in an insurance policy?

A beneficiary has the right to receive the policy proceeds upon the insured’s death but does not control policy decisions unless specified.

What documents do I need to support my baggage loss claim?

You typically need a PIR, a written confirmation from the airline, receipts of lost items, and proof of ownership. Some insurers may also require a police report if theft is involved.

What is variable universal life insurance (VUL)?

Variable universal life insurance allows policyholders to invest the cash value in various sub-accounts, similar to mutual funds, with higher growth potential but also greater risk.

How does the loss ratio impact policyholder premiums?

If loss ratios are high, insurers may increase premiums to cover costs; if low, they might offer discounts or better coverage options.

What is the difference between an actuary and a statistician?

While both professions use statistical techniques, actuaries focus on financial risk and long-term uncertainty, especially in insurance and pensions. Statisticians work in various industries, analyzing data for general research and decision-making.

How does the NAIC impact insurance company licensing?

The NAIC helps ensure that only qualified insurance companies are licensed by providing regulatory standards and reviewing insurer applications for compliance.