What type of authority is usually granted to an agent through an agent/company contract?

The type of authority usually granted to an agent through an agent/company contract is express authority. This specific kind of authority is created through clear, written terms in the agreement between the insurance company and the agent. Express authority involves the explicit powers that are outlined in the contract, detailing what the agent can do on behalf of the insurance company, such as binding coverage, collecting premiums, or negotiating contract terms.

Express authority is crucial in the insurance industry, as it establishes a clear understanding of the expectations and limits of the agent's role. This clarity helps protect both the agent and the insurer, ensuring that the agent acts within the scope of their authority while carrying out their responsibilities.

In contrast to express authority, implied authority is generally created through the actions and practices established over time, where certain powers are assumed to exist to facilitate normal business operations. Restricted authority is not typically a term used in this context, and specific authority would refer to designated powers rather than the broad powers granted by the contract as a whole. Understanding these distinctions helps clarify why express authority is the most appropriate answer in this scenario.