In which type of insurance authority does an agent have the assumption of rights not explicitly defined?

Implied authority refers to the powers and rights that an agent is assumed to have, which may not be explicitly defined in their contract or agreement with the principal. This type of authority allows an agent to perform duties that are necessary to fulfill their expressed responsibilities, based on the circumstances of the agency relationship. For example, if an agent is hired to sell insurance, they are implied to have the authority to negotiate terms and make certain decisions that are typical for someone in that role, even if those specific actions are not detailed in writing.

This concept is essential in the context of agent-principal relationships, as it helps allow agents to function effectively without the need for constant oversight or additional permissions for common actions associated with their roles. The understanding of implied authority ensures that agents can act promptly to serve the needs of clients and carry out necessary tasks, which ultimately benefits both the agent and the principal.