Which of the following statements about the exclusive agency system for marketing property and liability insurance is true?
A)Exclusive agents typically have complete ownership of policy expirations.
B)A higher commission rate is usually paid on exclusive agents' renewal business than on new business.
C)Exclusive agents represent several different insurance companies.
D)New exclusive agents may start as employees and after a training period become independent contractors.

Question

Quizplus · Accepted Answer

The exclusive agency system typically involves agents starting out as employees and after a training period, becoming independent contractors. This allows new agents to receive training and support from the insurance company before running their own agency. Option A is incorrect because policy ownership typically remains with the insurance company. Option B is also incorrect because commission rates vary based on the specific agency contract and are not necessarily higher for renewal business. Option C is incorrect because exclusive agents only represent one insurance company.

Which of the Following Statements About the Exclusive Agency System