- Limited Lines Authority
- A restricted insurance license that permits an agent to sell only specific, narrowly defined types of coverage rather than full property, casualty, life, or health lines.
- Producer
- The legal term for a licensed individual or business entity authorized to solicit, negotiate, or sell insurance on behalf of insurers.
- Solicit
- To attempt to persuade or induce a person to buy or apply for a particular insurance policy, an activity that generally requires a license.
- Insurable Interest
- A financial or personal stake in the person or property being insured, such that the policyholder would suffer a genuine loss if the insured event occurred; it must exist for a policy to be valid.
- Premium
- The amount of money the policyholder pays, typically on a recurring schedule, to keep an insurance policy in force.
- Underwriting
- The insurer's process of evaluating risk to decide whether to accept an applicant and, if so, at what premium and terms.
- Fiduciary Duty
- The legal obligation of an agent to act honestly and in the best interest of clients and insurers, including properly handling any premiums or funds held on their behalf.
- Rebating
- Offering a customer an inducement to buy insurance—such as a portion of the commission, cash, or a gift—that is not stated in the policy; it is prohibited in most jurisdictions.
- Misrepresentation
- Making a false or misleading statement about the terms, benefits, or conditions of an insurance policy, which is an illegal and unfair trade practice.
- Appointment
- The authorization an insurance company grants to a licensed producer, allowing that producer to transact business and bind coverage on the insurer's behalf.
- Binder
- A temporary agreement that provides insurance coverage immediately while the formal policy is being prepared and issued.
- Endorsement (Rider)
- A written amendment attached to a policy that adds, removes, or changes coverage terms after the policy has been issued.