When an Agent or Broker Fails to Recommend Appropriate Insurance

question 30

True/False

When an agent or broker fails to recommend appropriate insurance and the buyer suffers a financial loss that could have been prevented or lessened, the agent or broker can be charged with negligence.

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Definitions:

Materials Price Variance

The financial difference between the actual cost of materials and the expected (standard) cost, indicating cost management efficiency.

Direct Material

Materials that can be directly associated with the production of goods, directly entering into and being a significant component of the finished product.

Kilos

A metric unit of mass or weight equal to one thousand grams.

Labor Efficiency Variance

The difference between the actual hours worked and the standard hours worked, multiplied by the standard labor rate.