What are the risks associated with captive insurance?

Risks of captive insurance include regulatory compliance challenges, insufficient capitalization, poor risk management, adverse claims experience, and potential tax scrutiny. Companies must carefully assess their ability to manage these risks before establishing a captive.

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What is the impact of insurance fraud on policyholders?

Fraud increases premiums for all policyholders, reduces insurer profitability, and can lead to stricter claim processing rules, making legitimate claims harder to approve.

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What is "surplus share" reinsurance?

Surplus share reinsurance is a form of proportional treaty reinsurance where the reinsurer only covers the amount of a risk that exceeds the ceding company’s retention limit. This allows the ceding company to retain a portion of each risk while transferring the surplus above the retention to the reinsurer.

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Is Uninsured Motorist coverage the same as medical payments coverage?

No, medical payments (MedPay) coverage pays for medical bills regardless of fault, whereas UM coverage specifically covers damages caused by an uninsured or underinsured driver.

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Is there a limit on how much can be reimbursed?

Yes, reimbursement is subject to policy limits, deductibles, and coverage terms. Any amount exceeding the policy limit must be paid by the insured.

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How do hurricane and earthquake deductibles work?

Some homeowners insurance policies have special deductibles for hurricanes and earthquakes, often calculated as a percentage of the insured home’s value rather than a fixed amount. These deductibles are higher than standard deductibles and only apply when damage results from a named storm or seismic event.

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What is the role of blockchain in cryptocurrency?

Blockchain is the foundational technology behind cryptocurrencies like Bitcoin and Ethereum. It provides a decentralized and secure ledger for tracking cryptocurrency transactions. The transparency, security, and immutability of blockchain ensure that cryptocurrency transactions are verifiable and tamper-resistant, providing a trustless system for users to transfer and trade digital currencies.

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What happens if my claim is smaller than my deductible?

If your claim amount is lower than your deductible, insurance will not pay, and you must cover the cost yourself.

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