Most Insurance Policies Prohibit Direct Access from the Original Insured

question 28

Multiple Choice

Most insurance policies prohibit direct access from the original insured to the reinsurer.The prohibition exists because:

• A)insurance companies realized that the original insured can take insurance directly from the reinsurance company and put them out of business.
• B)direct assess of the original insured to the reinsurer is illegal.
• C)reinsurance companies do not want to deal directly with original insureds.
• D)the insurance company does not want the original insured to know that it is reinsuring the risks.
• E)the reinsurance agreement is a separate contract from the primary insurance contract.

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Definitions:

Natural Justice

Legal principles which ensure fair treatment in judicial and administrative decisions, including the right to a fair hearing and the rule against bias.

Fair Treatment

The principle of dealing with others in a way that is right, equitable, and free from bias or favoritism.

Minimum Standards

The lowest acceptable limits set by regulation for various criteria, such as working conditions, product quality, or safety requirements.

Criminal Matter

A legal case or issue that pertains to crimes, which are offenses against the state or the public.