The authority the principal explicitly grants the agent is called what?

Study for the Associate in Insurance (AINS) 21 Exam. Utilize our questions and detailed explanations to prepare effectively. Enhance your confidence and knowledge for exam success!

Multiple Choice

The authority the principal explicitly grants the agent is called what?

Explanation:
Express authority is the power the principal directly and clearly gives to the agent, either in writing or verbally, specifying the exact acts the agent may perform on the principal’s behalf. This explicit grant is what situates the agent’s authority in clear terms between the principal and third parties, unlike implied authority which comes from the duties or context, or apparent authority which depends on others’ reasonable beliefs based on the principal’s representations. Special authority isn’t the standard term for an explicit grant; it may describe a narrow task, but the recognized concept for an explicit grant is express authority.

Express authority is the power the principal directly and clearly gives to the agent, either in writing or verbally, specifying the exact acts the agent may perform on the principal’s behalf. This explicit grant is what situates the agent’s authority in clear terms between the principal and third parties, unlike implied authority which comes from the duties or context, or apparent authority which depends on others’ reasonable beliefs based on the principal’s representations. Special authority isn’t the standard term for an explicit grant; it may describe a narrow task, but the recognized concept for an explicit grant is express authority.

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