UNIVERSITY OF ILLINOIS AT URBANA-CHAMPAIGN
College of Commerce and Business Administration
DEPARTMENT OF FINANCE
Finance 341 Assignment 2
Spring, 2003 Due: February 11, 2003
Access the homepage for Prudential Financial (www.prudential.com) to determine the
answers to the first three questions:
1. For an Illinois auto insurance customer, would Prudential be a domestic, foreign
or alien insurer?
2. What is Prudential’s predominant form of distribution system for auto
3. Is Prudential a Proprietary or Cooperative Insurer?
4. There are several external constraints on achieving objectives that
insurances companies face. List two actions that an insurance company might
take to overcome a public opinion constraint.
5. What is the primary difference between INA's and Allstate's approach to adopting
a combination insurance distribution system?
6. Assume you work for GEICO insurance and enjoy your job of selling insurance
so much, that you decide to go out on your own as an independent agent. Would
you or GEICO be in possession of the ownership of expirations?
7. Based on what you know about Liberty Mutual (http://www.libertymutual.com),
what Philosophy of Marketing Management would best describe that
company? Select, and justify, only one concept.
8. An insurer specializes in insuring supermarkets for property damage and liability
coverage. What Growth Strategy would apply if this insurer wanted to gain a
larger market share of this business? Explain your answer.
9. You are a line underwriter for a property-liability insurer. You receive an
application for homeowners insurance coverage from a new customer. The only
concern you have about writing this policy is that both the mother and father
smoke. List two questions you would ask the applicant before deciding whether
or not to accept this application.
10. One of your roommates is a terrible driver and is concerned about being able to
buy insurance. Your roommate knows that the state in which he plans to buy
insurance has a Joint Underwriting Association for a residual market, but he is
not sure what it is or how it works. In terms that your non-finance major
roommate could understand, briefly explain how a Joint Underwriting
Fin 341 - Assignment 2 Answer Sheet Name_________________________
(This sheet is for your answers only. Attach it to the front of your worksheets.)