Producer Robert represents Oakhaven Property & Casualty. His written agency agreement explicitly grants him the power to solicit homeowners insurance applications and collect initial premium payments. To conduct his daily business, Robert sets his own office hours and purchases client-tracking software, though these administrative details are not mentioned in his contract. Additionally, Oakhaven provides Robert with official company letterhead and marketing brochures, which he prominently displays in his office. When meeting with a client, Robert incorrectly assures them that flood damage is covered under the standard policy, and he issues a temporary binder printed on Oakhaven's official letterhead.
Which of the following statements correctly describe the agency law principles operating in this scenario? (Select all that apply)
- Robert's power to solicit applications and collect initial premiums is an example of express authority.Answer
- Robert's decisions regarding his office operations, such as setting business hours, represent implied authority necessary to carry out his express duties.Answer
- Oakhaven's provision of official letterhead creates apparent authority, which can legally bind the insurer to Robert's unauthorized issuance of a binder.Answer
- DRobert is operating under apparent authority when he collects the initial premium because the client assumes he has the right to accept payment.
- EOakhaven Property & Casualty cannot be held liable for the incorrect flood coverage promise because Robert strictly exceeded his written express authority.