Cpcu 3

Front 1

SELF INSURANCE

Back 1

A retention program that possess one or more of the following characteristics:
1. sufficient number of independent losses as to make losses from the exposure highly predictable
2. established fund to which the organization makes regular contributions and from which losses are paid
3. A formalized captive insurance program
4. All state legal requirements met for "self-insurer"

Front 2

MASONRY NONCOMBUSTIBLE CONSTRUCTION

Back 2

EXTERIOR WALLS ARE MADE OF SELF-SUPPORTING MASONRY MATERIALS. FLOORS AND ROOF ARE MADE OF METAL OR SOME OTHER NONCOMBUSTIBLE MATERIAL

Front 3

EXTRA EXPENSE

Back 3

Extra expenses incurred to continue operations following an occurrence that would otherwise cause a suspension of operations.

Front 4

BUSINESS INTERRUPTION (BUSINESS INCOME LOSS)

Back 4

Loss due to a buisness being "out of businees" due to a covered loss.

Front 5

RETROSPECTIVE RATED INSURANCE

Back 5

The insured pays a premium based on either losses incurred or losses paid during the policy period subject to a minimum and maximum premium

Front 6

NONCOMBUSTIBLE CONSTRUCTION

Back 6

SPECIALIZED TERM - EXTERIOR WALLS, FLOORS AND ROOF ARE CONSTRUCTED OF AND SUPPORTED BY METAL, GYPSUM OR OTHER NONCOMBUSTIBLE MATERIALS THAT WILL CONTRIBUT LITTLE IF ANY FUEL TO A FIRE

Front 7

DIRECT LOSS

Back 7

Decrease in value and increased cost to repair or replace a covered piece of property

Front 8

RISK MANAGEMENT

Back 8

Broad-based systematic approach to prevention, loss cost reduction, finding the most efficient way to pay any remaining losses.

Front 9

INSURANCE

Back 9

A written agreement by two parties where the insured agrees to pay a premium and the insurance company agrees to pay a loss stipulated in the contract

Front 10

FRAME CONSTRUCTION

Back 10

THE EXTERIOR WALLS OF THE BUILDING ARE CONSTRUCTED OF WOOD OR OTHER COMBUSTIBLE MATERIALS EVEN IF COMBINED WITH OTHER MATERIALS SUCH AS BRUCK OR STUCCO

Front 11

INDIRECT LOSS

Back 11

Used to describe business income loss and extra expense

Front 12

RIDK MANAGEMENT

Back 12

Broad-based systematic approach to prevention, loss cost reduction, finding the most efficient way to pay any remaining losses.

Front 13

RISK CONTROL
(Also widely known as)
LOSS CONGTOL

Back 13

Any conscious action (or decision not to act) intended to reduce the frequency or severity of accidental losses

Front 14

IGNITION TEMPERATURE

Back 14

THE MINIMUM TEMPERATURE TO WHICH A SOLID SUBSTANCE MUST BE HEATED FOR IT TO IGNITE

Front 15

RISK MANAGEMENT SURVEY QUESTIONNAIRES

Back 15

Ask questions that are helpful in discovering both insurable and uninsurable loss exposures

Front 16

REVENUE

Back 16

Money that an organization makes by selling goods, renting space, providing services, collecting taxes, soliciting donations, etc.

Front 17

DUPLICATION OF EXPOSURE UNITS

Back 17

Involves complete reproduction of an organization's own asset or facility to be kept on standby or reserve

Front 18

FIRE LOAD

Back 18

THE EXPECTED AMOUNT OF COMBUSTIBLES AVAILABLE AS FUEL FOR A HOSTILE FIRE IN A GIVEN AREA

Front 19

INSURANCE SURVEY QUESTIONNAIRES

Back 19

Designed to reveal the insuranble loss exposures of the prospect or client; to provide information need to underwrite and rate the policies that would cover the loss exposures

Front 20

LOSS EXPOSURE

Back 20

The possibility of a loss.

Front 21

RETENTION

Back 21

The organization bears all cost of losses and related administrative expenses on its own

Front 22

JOISTED MASONRY CONSTRUCTION

Back 22

THE EXTERIOR WALLS ARE MADE OF MASONRY MATERIALS (BRICK, STONE, CONCRETE) AND THESE WALLS DO NOT DEPEND ON WOOD OR OTHER COMBUSTIBLE MATERIALS FOR SUPPORT - OTHER SUPPORTING ELEMENTS OF THE BUILDING ARE MADE OF WOOD

Front 23

CONSEQUENTIAL LOSS

Back 23

Synonym for indirect loss. Also a more limited use as 1)loss resulting from spoilage of perishable items or 2) loss of value of undamaged property because property with which it is used has been damaged or destroyed

Front 24

PERSONAL PROPERTY

Back 24

All property that is not real property.

Front 25

SEGREGATION OF EXPOSURE UNITS

Back 25

encompasses to distinct but closely related risk management techniques - separation of exposrue units and duplication of exposure unites. Aimed at making losses smaller and more predictable

Front 26

HUMAN BEHAVIOR APPROACH

Back 26

ATTACKS THE PROBLEM BY MODIFYING THE BEHAVIOR OF PEOPLE TO REDUCE THE FREQUENCY OF UNSAFE ACTS

Front 27

INTERVIEWS

Back 27

Often conducted during the course of an inspection. Used to get more information than just an inspection

Front 28

RISK MANAGEMENT PROCESS

Back 28

1.Identify/analyze loss exposure. 2. Examine feasibility of alternative risk management techniques. 3. Select the technique. 4. Implement the technique. 5. Monitor the results.

Front 29

SEPARATION OF EXPOSURE UNITS

Back 29

Involves dividing an organization's existing single asset or operation into two or more separate units

Front 30

AUTOMATIC FIRE DETECTION/SUPPRESSION SYSTEM
(SPRINKLYER SYSTEM)

Back 30

MAY BE WATER, DRY OR WET CHEMICALS, OR OTHER EXTINGUISHANTS -RELY ON FIRE DETECTION DEVICES TO SENS THE PRESENCE OF A HOSTILE FIRE AND ON SIGNALING DEVICES TO ALERT PERSONNEL TO DANGER

Front 31

FINANCIAL STATMENTS

Back 31

One category of documents used to discover loss exposures; most useful are the balance sheet, income statement, statement of cash flows

Front 32

CONTINGENT BUSINESS INTERRUPTION LOSS

Back 32

Indirect loss of revenue to a business due to another business' property being damaged.

Front 33

LOSS REDUCTION

Back 33

Reduce the severity of those losses that do occur

Front 34

FIRE PARTITION

Back 34

LESS STONG THAN A FIRE WALL, DIVIDES SPACE IN A BUILDING TO REDUCE SPREAD OF FIRE - DOES NOT CREATE A FIRE DIVISION

Front 35

BALANCE SHEET

Back 35

Used to report an organization's assets, liabilities and owner's equity as of a specific date

Front 36

LIABILITY LOSS

Back 36

Any loss a person or organization sustains as a result of a claim made against them by someone seeking monetary damages or some other legal remedy.

Front 37

POST-FUNDING

Back 37

Method of Paying Retained Losses - organization pays for its losses at a later time, using borrowing in the meantime

Front 38

FIRE DIVISION

Back 38

WHEN ONE SPACE IS SUFFICIENTLY SEPARATED FROM ANOTHER

Front 39

INSPECTION

Back 39

Of organization's premises and activities - means of discovering and understanding the organization's loss exposures

Front 40

HAZARDS

Back 40

Conditions that create or increase the probability or likely size of loss.

Front 41

LOSS PREVENTION

Back 41

Any measure that reduces the probability or frequency of a particular loss but does not eliminat e completely all possibility of that loss

Front 42

FIRE WALL

Back 42

A SELF-SUPPORTING SOLID WALL THE FULL WIDTH AND HEIGHT OF A BUILDING PLUS ADEQUAT EXTENSIONS BEHONE ANY COMBUSTIBLE ROOFS OR WALLS THAT SEPARATE A BUILDING INTO FIRE DIVISIONS

Front 43

AMOUNT SUBJECT

Back 43

maximum possible loss - the total value exposed to loss at any one location or from any one event

Front 44

PROPERTY LOSS

Back 44

Any loss taht a person or organization sustains as a result of the damaging, destruction, taking or loss of use of property in which that person or organization has a financial interest

Front 45

CAPTIVE INSURER

Back 45

A subsidiary that an organization owns and uses to "insure" some of its own loss exposures - both a form of retention and pre-funding

Front 46

FIRE STOPS

Back 46

SOLID PIECES RUNNING FROM SUPPORT TO SUPPORT OF A WALL OR FLOOR OF A BUILDING. HELPS REDUCE OPEN SPACES THAT CONTRIBUTE TO THE SPREAD OF FIRE

Front 47

MAXIMUM POSSIBLE LOSS

Back 47

The size of the largest loss that could occur

Front 48

REAL PROPERTY

Back 48

Land and all structures premanently attached to the land.

Front 49

PRE-FUNDING

Back 49

Method of Paying Retained Losses - the money needed to pay for losses is set aside in advance of the losses

Front 50

FIRE-RESISTIVE CONSTRUCTION

Back 50

PROVIDES MORE FIRE PROTECTION THAN ALL OTHER TYPES OF CONSTRUCTION. BUILDILNG MATERIALS USED RESIST HEAT LONGER THAN MATERIALS REQUIRED FOR PROTECTED ORDINARY OR NONCOMBUSTIBLE CONSTRUCTION

Front 51

INCOME STATEMENT

Back 51

The difference between items recognized as "income" and those recognized as "expenses"

Front 52

PERILS

Back 52

A cause of loss

Front 53

EXPOSURE AVOIDANCE

Back 53

Makes loss from a specified exposure impossible.

Front 54

MODIFIED FIRE RESISTIVE

Back 54

INCLUDES MASONRY MATERIALS SLIGHTLY LESS RESISTIVE THAN
FIRE RESISTIVE

Front 55

PROBABLE MAXIMUM LOSS

Back 55

The largest loss likely to occur

Front 56

ENGINEERING APPROACH

Back 56

ATTACY BY DESIGN AND LOCATION OF PROPERTIES AND EQUIPMENT TO REDUCE THE NUMBER OF PHYSICAL HAZARDS

Front 57

NONINSURANCE TRANSFER

Back 57

An entity other than an insurance company agrees to pay certain losses incurred by another

Front 58

FLASH POINT

Back 58

THE MINIMUM TEMPERATURE AT WHICH A LIQUID GIVES OFF VAPORS THAT CAN BE IGNITED BY A SPARK OR FLAME

Front 59

POTENTIAL LOSS FREQUENCY

Back 59

The number of events - fires, thefts, etc. - that are expected to occur within some time interval (such as a century, decade or year)

Front 60

CURRENT FUNDING

Back 60

Method of Paying Retained Losses - money is provided at the time of the loss or immediately after

Front 61

CREDIBILITY

Back 61

The level of confidence that one can properly have that available data is capable of being used as an accurate indicator of future losses.

Front 62

RISK FINANCING

Back 62

Raising funds to pay for losses that actually occur

Front 63

POTENTIAL LOSS SEVERITY

Back 63

Refers to how serious a loss occurrence may be

Front 64

STATEMENT OF CASH FLOWS

Back 64

Show the organization's experience as to cash coming in and cash going out, with the difference - the net cash flow - moving the cash on hand up or down.

Front 65

FLOWCHART

Back 65

A diagram of an organization's operations