Express authority is explicitly stated in the insurer's agency agreement. Which term describes this type of authority?

Express authority is explicitly stated in the insurer's agency agreement. Which term describes this type of authority?

• A. Express authority
• B. Implied authority
• C. Apparent authority
• D. Reserved authority

Answer: (A)

Express authority is permission that the insurer gives the agent in clear, explicit terms within the agency agreement. Because the agreement lays out the exact powers and scope of the agent’s authority, this authority is considered explicit and directly granted. Implied authority comes from the agent’s role and customary duties, not from a stated grant. Apparent authority depends on the insurer’s representations to third parties, creating a reasonable belief the agent has authority even if not explicitly granted. Reserved authority refers to powers reserved by the insurer, not the authority granted to the agent.

Express authority is permission that the insurer gives the agent in clear, explicit terms within the agency agreement. Because the agreement lays out the exact powers and scope of the agent’s authority, this authority is considered explicit and directly granted. Implied authority comes from the agent’s role and customary duties, not from a stated grant. Apparent authority depends on the insurer’s representations to third parties, creating a reasonable belief the agent has authority even if not explicitly granted. Reserved authority refers to powers reserved by the insurer, not the authority granted to the agent.