CISR Agency Operations flashcards
CISR Agency Operations · Build recall with a focused review session.
32 cards. Read the term and the definition here. The deck at the top of this page is optional.
- Agency Operations
- The CISR segment covering how an insurance agency runs as a business: ownership and perpetuation, staffing and workflow, compliance and E&O, financial management, and technology.
- Perpetuation plan
- A written plan for transferring agency ownership at retirement, death, or disability through an internal sale, outside sale, ESOP, or buyout, ideally funded by insurance.
- Buy-sell agreement
- A contract among agency owners specifying how an owner's interest is valued, who may buy it, and how the purchase is funded, often with life or disability insurance.
- Expirations
- The agency's record of policy expiration dates and client information; it is the client list and a core agency asset whose ownership should be defined in agreements.
- Fiduciary funds
- Client premiums held by an agency under state trust rules; they cannot be commingled with agency operating money or used to pay agency expenses.
- Direct bill
- A billing method where the carrier invoices the insured directly and pays the agency commission, usually shown on a carrier commission statement.
- Agency bill
- A billing method where the agency invoices the insured, collects premium, and remits net premium to the carrier, creating receivables and fiduciary exposure.
- Producer
- A licensed individual who solicits, sells, and services insurance business for the agency and is typically compensated by commission or a salary-commission mix.
- CSR
- Customer service representative; agency staff who handle client service, policy changes, certificates, and renewals, and whose licensing and duties are defined by state law.
- Account rounding
- The practice of offering additional coverage lines to an existing client, such as umbrella or life coverage, to increase retention and revenue per account.
- Binding authority
- The scope defined in the agency-carrier agreement describing which risks the agency may bind, under what conditions, and what documentation must reach the carrier.
- Certificate of insurance
- A document evidencing coverage that does not amend, extend, or alter the policy; the agency should document that clients were told this.
- E&O insurance
- Professional liability coverage for the agency and its staff against claims of negligent acts, errors, or omissions in providing insurance services.
- Prior-acts coverage
- An E&O policy feature extending coverage to acts occurring before the policy's inception date, subject to the retroactive date in the policy.
- Retroactive date
- The date in a claims-made E&O policy before which covered wrongful acts are excluded; acts occurring before it are not covered.
- Retention ratio
- Policies retained divided by policies due for renewal over a period; a key measure of service quality and a driver of agency value.
- Contingency income
- Profit-sharing or bonus income paid by a carrier based on the agency's premium volume, growth, and loss ratio under the carrier's agreement.
- Loss ratio
- Incurred losses divided by earned premium; carriers use it to judge agency performance and to set contingency and profit-sharing payments.
- Agency management system
- Software that stores client and policy records, supports accounting, claims tracking, and certificate issuance, and produces management reports.
- Role-based access
- A security control limiting system permissions by job role, so staff can view or change only the client and policy data their duties require.
- Data breach notification
- State laws requiring notice to affected individuals and regulators after a security incident involving personal information, with deadlines and content rules.
- Compliance calendar
- A schedule tracking license renewals, continuing education deadlines, carrier appointments, surplus-lines filings, and other regulatory dates to prevent lapses.
- Surplus lines license
- A state license allowing an agency to place coverage with non-admitted insurers when admitted markets cannot provide it, subject to state placement rules.
- Carrier appointment
- A carrier's authorization for an agency or producer to represent it; losing an appointment can leave a book of business without a market.
- Documentation rule
- The E&O principle that if a recommendation, client refusal, or coverage discussion is not recorded in the file, it is treated as not having happened.
- Coverage review
- A documented renewal comparison of the client's current limits and forms against current exposures, with the recommendation and client decision recorded.
- Business continuity plan
- An agency plan for continuing operations during system, phone, or facility failure, including alternate locations, remote access, and client notification steps.
- Accounts receivable aging
- A report grouping unpaid agency-bill premiums by age (30, 60, 90 days) to manage collection and fiduciary risk.
- EBITDA multiple
- A common agency valuation method expressing value as a multiple of earnings before interest, taxes, depreciation, and amortization, adjusted for book quality.
- Non-piracy clause
- A producer employment agreement provision limiting a departing producer's use or solicitation of the agency's clients and expirations.
- Complaint log
- A record of client complaints with dates, investigation, and resolution, reviewed by management to find training or procedure problems.
- Claims first report
- The agency's initial notice of a claim to the carrier, documenting date, facts, and contact, without adjusting the claim or promising an outcome.