Unit 2 Property And Casualty Terms And Related Concepts Part B

Front 1

the maximum amount of money an insured/claimant can recover in the event of a loss

Back 1

policy limits

Front 2

changing limits, sub-limits, specific, blanket, scheduled

Back 2

types of policy limits

Front 3

inflationguard and reporting forms

Back 3

changing limits

Front 4

limit used when there is a high-probability of loss

Back 4

sub-limit (special limits)

Front 5

automatically restored after a loss

Back 5

policy limits

Front 6

used to change the amount of coverage in force to reflect fluctuations in property values

Back 6

reporting forms

Front 7

promote proper values/limits on insured property

Back 7

reporting forms

Front 8

penalizes the insured if values are under reported; penalty is the percentage the insured under-reported their values

Back 8

full reporting or honesty clause

Front 9

per person, per occurrence, aggregate, split, combined single

Back 9

policy limits

Front 10

limits the amount of coverage for each person in any given occurrence regardless of the per occurrence limit

Back 10

per person

Front 11

limits the amount of coverage per occurrence regardless of the number of persons injured

Back 11

per occurrence

Front 12

limits the total amount of coverage available for a policy period, a specific location, or a project

Back 12

aggregate limit

Front 13

different amounts of coverage for different types of losses

Back 13

split limit

Front 14

combines BI and PD into 1 limit

Back 14

combined single limit

Front 15

requires and insured to carry insurance covereag equal to a percentage of the property's value to be fully indemnified

Back 15

coinsurance

Front 16

requires coverage equal to 80% of the property's replacement value

Back 16

coinsurance

Front 17

promote insurance to value

Back 17

coinsurance

Front 18

(amount carried divided amount required) X loss= settlement

Back 18

coinsurance formula

Front 19

a sudden, unforseen, unexpected/unplanned event, normally identifiable as to time and place

Back 19

accident

Front 20

an accident, including continuous/repeated exposure to substaintailly the same general harmful conditions

Back 20

occurrence

Front 21

requires advanced written notice for insurers to do this

Back 21

cancel or non-renew policies

Front 22

Insured canceled the policy and is changed a fee to cancel the policy

Back 22

short rate

Front 23

Insurer canceled the policy and all unearned premium is returned to the Insured

Back 23

pro rate

Front 24

no premium is exchanged, no coverage provided

Back 24

flat rate

Front 25

absence of people from the insured home/building

Back 25

unoccupancy

Front 26

absence of people and contents from the insured building/home

Back 26

vacancy

Front 27

4 peril excluded due to vacancy

Back 27

Burlglar damage

Accidental dischange of a plumbing system

Vandalism and malicious mischief

Glass damage

Front 28

a wrongful act not a crime or breach of contract

Back 28

tort

Front 29

2-party contact that provides 3rd part coverage

Back 29

liability insurance

Front 30

doctrines which allocate liability without regard to fault/negligence

Back 30

strict and absolute liability

Front 31

commonly applied in product liability cases

Back 31

strict liability

Front 32

imposed when conduct is of hazardous nature

Back 32

absolute liability

Front 33

liability is imputed from one party to another

Back 33

vicarious liability

Front 34

legal duty to act or not to act, violations of that legal duty, proximate cause, actual lose/damage/injury to another person

Back 34

negligence

Front 35

unwritten body of law that was developed form judicial case decisions based upon precendent/custom

Back 35

common law or case law

Front 36

the written body of the law developed thorugh legislation

Back 36

statutory law

Front 37

bars recovery if the injured party contributed to the accident in any degree

Back 37

contributory negligence

Front 38

mitigated contributory risk by allowing an injured plaintiff to receive damages if the defendent had the last chance to avoid an accident

Back 38

Last Clear Chance Rule

Front 39

bars/reduce recovery if an injured party knew the consequences yet assumed the risk

Back 39

assumption of risk

Front 40

bars/reduces recovery if an intervening cause interruped the chain of events

Back 40

intervening cause

Front 41

compares actions and apportions negligence

Back 41

comparative negligence

Front 42

sets a time limit during which the injured party may bring legal action

Back 42

statute of limitations

Front 43

temporary insurance contract, written/oral, typically valid for 30 days

Back 43

binder

Front 44

gives temporary coverage between time of binding and time of underwriting apporval

Back 44

binder

Front 45

putting a policy into legal effect

Back 45

binding authority or binding

Front 46

1 limit for all locations; must equal at least 90% of the value of all the properties insured under that limit

Back 46

blanket insurance

Front 47

1 limit for 1 specific location

Back 47

specific insurance

Front 48

1 single limit for each location or item

Back 48

scheduled limit

Front 49

taking property from the care and custody of a person

Back 49

robbery

Front 50

property disappears without reasonable explaination

Back 50

mysterious disappearance

Front 51

ensures the proper premium is paid for commercial policies; the insurer changes a deposit premium

Back 51

premium auditing

Front 52

after a policy expires the insurer examines its insured's books, determines the exact payroll and adjust the premium

Back 52

paper/field audit

Front 53

a document issued by an insurer as evidence of their insured's coverages; a snapshot/outlined of coverage

Back 53

certificate of insurance

Front 54

compensatory, special, general, and punitive

Back 54

types of damages

Front 55

damages awarded for specific out-of-pocket expenses you can calculate a bill for

Back 55

special damages

Front 56

damages awarded for pain and suffering

Back 56

general damages

Front 57

damages awarded to claimants beyond their actual loss, designed to punish the wrongdoers who commit especially outrageous wrongs

Back 57

punitive damages

Front 58

consists of special and general damages and compensates injured parties for acutal losses

Back 58

compensatory damages

Front 59

prevents inserers from paying less that the diminished value of a set and insureds from collecting the entire value of a set that's not a total loss

Back 59

loss to a pair or set

Front 60

has custody of someone's property for service/storage

Back 60

bailee

Front 61

prohibits the insured from abandoning the property to the insurance company and claiming a total loss

Back 61

abandonment

Front 62

represents the portion of premium paid by the insured and already used for coverage during a policy term

Back 62

earned premium

Front 63

represented premium paid by the insured but not yet used for coverage; may be refuned

Back 63

unearned premium

Front 64

the ratio of losses incurred to premiums earned

Back 64

loss ratio

Front 65

the ration of expenses incurred by the company in producing the business to premiums earned

Back 65

expense ratio

Front 66

combination/sum of the loss and expense ratios

Back 66

combined ratio

Front 67

the process by which the company determines a price for the exposure its underwriting

Back 67

rating

Front 68

anything that increased the frequency or severity of a loss also does what?

Back 68

increases the premium

Front 69

the price per exposure unit

Back 69

rate

Front 70

manual/class, individual/judgement, merit, lost cost

Back 70

rating systems

Front 71

this rating system applies to large homogenous groups

Back 71

manual/class

Front 72

used for rare/unique risks

Back 72

individual judgement rate

Front 73

applies to scheduled and experience rated policies (e.g. good student discount)

Back 73

merit rate

Front 74

insurer purchases lost cost data from a rating bureau, then adds their own expense to determine a rate

Back 74

loss cost rate

Front 75

consturction type, fire protection class, occupancy type

Back 75

rating factors

Front 76

requires insurer to invistigate and defend claims brought against an insured, if the claim is only arguably/resonably covered by the policy

Back 76

Duty to Defend

Front 77

a person to whom property or power is entrusted for the benefit of another

Back 77

fiduciary

Front 78

policies billed directly to the insured

Back 78

direct billed policies

Front 79

policies billed by the agency to the insured

Back 79

agency billed policies

Front 80

producers submitting payments collected for agency billed policies to the insurer in a timely matter

Back 80

remittance of premiums

Front 81

if an insured is unable to pay the premium in whole, the policy may be financed like an installment loan agreement

Back 81

premium financing

Front 82

12:01 AM

Back 82

when policies typically end and begin

Front 83

defines the location where coverage is provided

Back 83

policy territory

Front 84

if a policy form is broadened at no additional premium, the broadened benefit automatically applies to all existing policies of the same type on the date benefits apply to new customers

Back 84

liberalization clause