Cpcu 557 Vocabulary Chapters 1-3

Front 1

Real Property

Back 1

Tangible property consisting of land, all structures permanently attached to the land, and whatever is growing on the land

Front 2

Personal Property

Back 2

All tangible or intangible property that is not real property

Front 3

Commercial property coverage part

Back 3

Commercial package policy (CPP) coverage component that provides a broad range of coverages to "middle-market" or larger firms to insure buildings and business personal property.

Front 4

Commercial package policy (CPP)

Back 4

Policy that covers two or more lines of business by combining ISO's commercial lines coverage parts

Front 5

Monoline policy

Back 5

Policy that covers only one line of business

Front 6

Package modification factors

Back 6

Factors that are applied to the regular policy premiums for certain coverage parts of a CPP that includes both property and liability coverages, resulting in premium discounts for those coverage parts

Front 7

Commercial property declarations page

Back 7

A required commercial property coverage part component that provides basic information about the policyholder and the insurance provided

Front 8

Commercial property coverage form

Back 8

A commercial property coverage part component that can be any of several commercial property forms containing an insuring agreement and related provisions

Front 9

Causes of loss form

Back 9

A required component of the commercial property coverage part that specifies perils covered

Front 10

Commercial Property Conditions

Back 10

A required component of the commercial property coverage part that contains conditions applicable to all commercial property coverage forms

Front 11

Proof of loss

Back 11

A statement of facts about a loss for which the insured is making a claim

Front 12

Actual cash value (ACV)

Back 12

Cost to replace property with new property of like kind and quality less depreciation

Front 13

Collapse

Back 13

An abrupt falling down or caving in of a building or part of a building that, as a result, can no longer be occupied for its intended purpose.

Front 14

Agreed value optional coverage

Back 14

Optional coverage that suspends the Coinsurance condition if the insured carries the amount of insurance agreed to by the insurer and insured.

Front 15

Inflation Guard optional coverage

Back 15

Coverage for the effects of inflation that automatically increases the limit of insurance by the percentage of annual increase shown in the declarations.

Front 16

Replacement cost optional coverage

Back 16

Coverage for losses to most types of property on a replacement cost basis (with no deduction for depreciation or obsolescence) instead of on an actual cash value basis.

Front 17

Subrogation

Back 17

The process by which an insurer can, after it has paid a loss under the policy, recover the amount paid from any party (other than the insured) who caused the loss or is otherwise legally liable for the loss.

Front 18

External exposure

Back 18

A property outside the area owned or controlled by the insured that increases the probability of loss to the insured's building and its contents

Front 19

Business income insurance

Back 19

Insurance that covers the reduction in an organization’s income when operations are interrupted by damage to property caused by a covered peril.

Front 20

Net income

Back 20

The difference between revenues (such as money received for goods or services) and expenses (such as money paid for merchandise, rent, and insurance).

Front 21

Profit

Back 21

Net income that results when revenues exceed expenses.

Front 22

Net loss

Back 22

Net income that results when expenses exceed revenues.

Front 23

Continuing expenses

Back 23

Expenses that continue to be incurred during a business interruption

(payroll, debt repayments, taxes, insurance, etc.)

Front 24

Noncontinuing expenses

Back 24

Expenses that will not continue during a business interruption.

Front 25

Extra expenses

Back 25

Expenses, in addition to ordinary expenses, that an organization incurs to mitigate the effects of a business interruption

Front 26

Operations

Back 26

1. The business activities of the insured that occur at the premises described in the declarations

2. The "tenantability" (suitability of occupancy) of the described premises

Front 27

Suspension

Back 27

The slowdown or cessation of business activities or when part of a premises is rendered uninhabitable

Front 28

Probable maximum loss

Back 28

The largest loss that an insured is likely to sustain