What Would an Insurance Agent Who Fails to Advise a Client

question 48

Multiple Choice

What would an insurance agent who fails to advise a client that a form of requested coverage is unavailable likely be found by a court to have committed?

• A) breach of insurance standard
• B) breach of fiduciary duty
• C) breach of agency of insurance
• D) breach of enduring contract

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Definitions:

Capital Balance

The amount of money that an entity has in its capital account, reflecting the net worth contributed by the owners/shareholders plus retained earnings.

Bonus Method

An accounting method for recording partnership transactions where a new partner's investment is more than or less than the book value of the capital they are entitled to.

Capital Balance

The amount of capital recorded in a company's accounts, representing the sum of the initial capital invested and additional contributions, minus any withdrawals.

Goodwill

An intangible asset that arises when a business is acquired for more than the fair value of its net identifiable assets, representing future economic benefits.