Washington Life Producer Practice Exam

Who negotiates an insurance contract on behalf of an insurer?

1. Broker

2. Agent

3. Producer

4. Underwriter

The correct answer is: Producer

The role of a producer includes negotiating insurance contracts on behalf of an insurer. A producer typically acts as an intermediary between the insurer and the clients, facilitating communication and helping clients choose appropriate insurance products. This role involves not only selling insurance policies but also discussing terms, coverage options, and negotiating conditions that best suit both the insurer and the client. While the terms 'broker' and 'agent' may seem similar, they have distinct roles in the insurance world. An agent represents a specific insurer and is limited to the policies that insurer offers, while a broker works on behalf of clients to find suitable policies from various insurers. The underwriter, on the other hand, is involved in risk assessment and determining the terms and pricing of insurance policies, rather than in the negotiation process for contracts. Therefore, the producer's function encompasses direct negotiation with clients and insurers, making them the correct choice in this context.