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65 Cards in this Set

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  • Back
SELF INSURANCE
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"
MASONRY NONCOMBUSTIBLE CONSTRUCTION
EXTERIOR WALLS ARE MADE OF SELF-SUPPORTING MASONRY MATERIALS. FLOORS AND ROOF ARE MADE OF METAL OR SOME OTHER NONCOMBUSTIBLE MATERIAL
EXTRA EXPENSE
Extra expenses incurred to continue operations following an occurrence that would otherwise cause a suspension of operations.
BUSINESS INTERRUPTION (BUSINESS INCOME LOSS)
Loss due to a buisness being "out of businees" due to a covered loss.
RETROSPECTIVE RATED INSURANCE
The insured pays a premium based on either losses incurred or losses paid during the policy period subject to a minimum and maximum premium
NONCOMBUSTIBLE CONSTRUCTION
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
DIRECT LOSS
Decrease in value and increased cost to repair or replace a covered piece of property
RISK MANAGEMENT
Broad-based systematic approach to prevention, loss cost reduction, finding the most efficient way to pay any remaining losses.
INSURANCE
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
FRAME CONSTRUCTION
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
INDIRECT LOSS
Used to describe business income loss and extra expense
RIDK MANAGEMENT
Broad-based systematic approach to prevention, loss cost reduction, finding the most efficient way to pay any remaining losses.
RISK CONTROL
(Also widely known as)
LOSS CONGTOL
Any conscious action (or decision not to act) intended to reduce the frequency or severity of accidental losses
IGNITION TEMPERATURE
THE MINIMUM TEMPERATURE TO WHICH A SOLID SUBSTANCE MUST BE HEATED FOR IT TO IGNITE
RISK MANAGEMENT SURVEY QUESTIONNAIRES
Ask questions that are helpful in discovering both insurable and uninsurable loss exposures
REVENUE
Money that an organization makes by selling goods, renting space, providing services, collecting taxes, soliciting donations, etc.
DUPLICATION OF EXPOSURE UNITS
Involves complete reproduction of an organization's own asset or facility to be kept on standby or reserve
FIRE LOAD
THE EXPECTED AMOUNT OF COMBUSTIBLES AVAILABLE AS FUEL FOR A HOSTILE FIRE IN A GIVEN AREA
INSURANCE SURVEY QUESTIONNAIRES
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
LOSS EXPOSURE
The possibility of a loss.
RETENTION
The organization bears all cost of losses and related administrative expenses on its own
JOISTED MASONRY CONSTRUCTION
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
CONSEQUENTIAL LOSS
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
PERSONAL PROPERTY
All property that is not real property.
SEGREGATION OF EXPOSURE UNITS
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
HUMAN BEHAVIOR APPROACH
ATTACKS THE PROBLEM BY MODIFYING THE BEHAVIOR OF PEOPLE TO REDUCE THE FREQUENCY OF UNSAFE ACTS
INTERVIEWS
Often conducted during the course of an inspection. Used to get more information than just an inspection
RISK MANAGEMENT PROCESS
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.
SEPARATION OF EXPOSURE UNITS
Involves dividing an organization's existing single asset or operation into two or more separate units
AUTOMATIC FIRE DETECTION/SUPPRESSION SYSTEM
(SPRINKLYER SYSTEM)
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
FINANCIAL STATMENTS
One category of documents used to discover loss exposures; most useful are the balance sheet, income statement, statement of cash flows
CONTINGENT BUSINESS INTERRUPTION LOSS
Indirect loss of revenue to a business due to another business' property being damaged.
LOSS REDUCTION
Reduce the severity of those losses that do occur
FIRE PARTITION
LESS STONG THAN A FIRE WALL, DIVIDES SPACE IN A BUILDING TO REDUCE SPREAD OF FIRE - DOES NOT CREATE A FIRE DIVISION
BALANCE SHEET
Used to report an organization's assets, liabilities and owner's equity as of a specific date
LIABILITY LOSS
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.
POST-FUNDING
Method of Paying Retained Losses - organization pays for its losses at a later time, using borrowing in the meantime
FIRE DIVISION
WHEN ONE SPACE IS SUFFICIENTLY SEPARATED FROM ANOTHER
INSPECTION
Of organization's premises and activities - means of discovering and understanding the organization's loss exposures
HAZARDS
Conditions that create or increase the probability or likely size of loss.
LOSS PREVENTION
Any measure that reduces the probability or frequency of a particular loss but does not eliminat e completely all possibility of that loss
FIRE WALL
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
AMOUNT SUBJECT
maximum possible loss - the total value exposed to loss at any one location or from any one event
PROPERTY LOSS
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
CAPTIVE INSURER
A subsidiary that an organization owns and uses to "insure" some of its own loss exposures - both a form of retention and pre-funding
FIRE STOPS
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
MAXIMUM POSSIBLE LOSS
The size of the largest loss that could occur
REAL PROPERTY
Land and all structures premanently attached to the land.
PRE-FUNDING
Method of Paying Retained Losses - the money needed to pay for losses is set aside in advance of the losses
FIRE-RESISTIVE CONSTRUCTION
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
INCOME STATEMENT
The difference between items recognized as "income" and those recognized as "expenses"
PERILS
A cause of loss
EXPOSURE AVOIDANCE
Makes loss from a specified exposure impossible.
MODIFIED FIRE RESISTIVE
INCLUDES MASONRY MATERIALS SLIGHTLY LESS RESISTIVE THAN
FIRE RESISTIVE
PROBABLE MAXIMUM LOSS
The largest loss likely to occur
ENGINEERING APPROACH
ATTACY BY DESIGN AND LOCATION OF PROPERTIES AND EQUIPMENT TO REDUCE THE NUMBER OF PHYSICAL HAZARDS
NONINSURANCE TRANSFER
An entity other than an insurance company agrees to pay certain losses incurred by another
FLASH POINT
THE MINIMUM TEMPERATURE AT WHICH A LIQUID GIVES OFF VAPORS THAT CAN BE IGNITED BY A SPARK OR FLAME
POTENTIAL LOSS FREQUENCY
The number of events - fires, thefts, etc. - that are expected to occur within some time interval (such as a century, decade or year)
CURRENT FUNDING
Method of Paying Retained Losses - money is provided at the time of the loss or immediately after
CREDIBILITY
The level of confidence that one can properly have that available data is capable of being used as an accurate indicator of future losses.
RISK FINANCING
Raising funds to pay for losses that actually occur
POTENTIAL LOSS SEVERITY
Refers to how serious a loss occurrence may be
STATEMENT OF CASH FLOWS
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.
FLOWCHART
A diagram of an organization's operations