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97 Cards in this Set

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ABANDONMENT

Giving property to another or no one at all

ABSOLUTE LIABILITY

Extremely dangerous operations ie: explosives

ACCIDENT

Unplanned unforseen event

ACTUAL CASH VALUE (ACV)

More coverage for loss without increase in premium

ADDITIONAL INSURED

Non named on declaration page. Protected by policy

ADHESION

TAKE-IT-OR LEAVE IT the way the contract is offered

ADMITTED INSURER

Authorized and licensed to transact business in state

ADVERSE SELECTION

Higher risks higher probability of loss

AGENT

Licensed to sell negotiate on behalf of insurer

AGGREGATE LIMIT

Maximum limit under liability policy year regardless of # of claims



AGREED VALUE

Amount of insurance representing fair value for property at time insurance is written

ALEATORY

Low cost high return low payment high amount of insurance



ALIEN

Out of country

APPARENT AUTHORITY

Assumption of authority you really don't have

APPRAISAL

Assessment of property

ARBITRATION

Claim settlement when you can't agree

ASSIGNMENT

Transfer of legal right only with written consent

AUTHORIZED INSURER

Has a Certificate of Authority from Dept. of Insurance

Auto

Land motor vehicle, trailer, semi trailer Does NOT inclue moblie equipment

AVOIDANCE

Way of dealing with risk by deliberately keeping away from

BAILEE

A person that has personal property entrusted by owner ie tv repair man has tv at his shop

BINDER

Temporary contract until policy is in place

BLANKET BOND

Covers losses by dishonest employees

BLANKET INSURANCE

Single property for multiple classes at one location or one or more classes at multiple locations

BODILY INJURY LIABILITY

Liability arising from death physical trauma from negligence or a purposeful act

BOYCOTT

Refusal to do business until agreement to different conditions

BUILDERS RISK COVERAGE

Commercial Property form for contents

BURGLARY

Forced entry with felonious intent

CANCELLATION

Termination while in-force/ 10 day written notice

CASUALTY INSURANCE

Covers losses caused by injury to person or damage to property

CERTIFICATE OF AUTHORITY

Permission to conduct business as an insurance agent

CERTIFICATE OF INSURANCE

Legal document that insurance has been issued

CLAIM

Demand to cover loss protected in policy

CLASS RATING

Practice of computing price per unit

COERCION

Using physical or mental force to persuade

COINSURANCE

Both parties are expected to pay a portion of loss (insurer and insured)

COMBINED SINGLE

Single dollar limit of liability applied total damage for bodily injury and property combined from one accident or occurance

COMMERCIAL LINES

Business, mercantile or manufacturing insurance

COMMON LAW

Unwritten law based on past judicial decisions

COMPLAINT

Written statement of liability. Reason for a lawsuit

COMPONENTS

Factors determining rates including: Loss reserves, adjusting expenses, operating expenses, profits

COMPREHENSIVE COVERAGE

Covers loss fire, theft vandalism falling objects

CONCEALMENT

Withholding facts can void a contract

CONDITIONAL CONTRACT

When both parties must perform duties and follow rules of conduct to make enforcable

CONSIDERATION

Binding force requiring something of value in exchange for transfer of risk.

CONTROLLED BUSINESS

Entity that gets license for the purpose of writing business on the owner, immediate family relatives employer and employees

CONCURRENT CAUSATION

Multiple events leading to one loss

DECLARATION

Where the basic underwriting information is: name address amount description

Insurer audit's insured books at end of policy to be sue enough policy has been collected

DEPRECIATION

Lessening value due to wear and tear

DIRECT LOSSES

Physical damages a result of direct consequences of a particular peril

DISCLOSURE

Telling the name of the producer representing the firm

DOMESTIC

IN STATE

DOMICILE

Location of incorporation (state)

ECONOMIC LOSS

Estimated total cost, of an accident

ENDORSEMENT

Printed addendum to a contact used to change a policy

ESTOPPEL

Legal can't go back and take your rights back after you have waived them

EXCESS POLICY

Policy only pays for loss after primary policy has paid the limit

EXCLUSIONS

Causes of loss exposure conditions when policy will not pay

EXCLUSIVE/ CAPTIVE AGENT

Represent only one company commission only

EXPERIENCE RATING

Determines premium based on past loss experience

EXPOSURE

Unit of measure to determine rates

EXPRESS AUTHORITY

Authority granted to agent by written contract

EXTENSION OF COVERAGE

Property policy with extension of major coverage for certain loss

FAIR PLAN

Fair Access to Insurance Requirements makes insurance attainable to HIGH RISK

FLOOD

Temporary condition partial or complete overflow of island or tidal waters

FOREIGN

Out of country

FRAUD

Intentional misreprentation

FUNCTIONAL REPLACEMENT COST

Less expensive more modern

GROSS NEGLIGENCE

Reckless behavior dieregard for safety

HAZARD

Increase likelihood of loss/ MORAL,MORALE,PHYSICAL

IMPLIED AUTHORITY

Not written in contract but expressed. Taking a payment

INDEMNITY

Compensation/payment for the loss

INDEPENDENT AGENT

Sell insurance products from several companies

INDIRECT LOSSES

Loss from peril not directly caused by it IE: business disruption from fire

INFLATION GUARD

Coverage extension that increases annually by percentage

INSURABLE INTEREST

Any interest in a property so that could cause financial loss

INSURANACE

Transference of the possibility of loss spreading the cost to many individuals

INSURANCE POLICY

The contract that agrees to pay for the loss

INSURED CONTRACT

Definition of liability that describes who what when and where assumed loss is covered

INSURER

Indemnifies against loss, provides benefits

INSURING AGREEMENT

Section containing insurers promise to pay

INTENTIONAL TORT

Deliberate act causing harm

INTERLINE ENDORSEMENT

Written endorsement eliminates redundancy of endorsements

JUDGEMENT RATING

Used when credible statistics are lacking

LAW OF LARGE NUMBERS

Principle based on a large number of factors with similar factors

LEGAL LIABILITY

When a person is responsible for injuries or damages due to negligence

LIABILITY

Responsible under the law

LIBERALIZATION

Property insurance clause extends coverage without higher premiums

LIMIT OF LIABILITY

Maximum amount of liability (you are liable for )

LLOYDS

Provides support for underwriters and individuals who accept risk

LOSS

Reduction, decrease or disappearance of value by peril

LOSS PAYABLE CLAUSE

In property insurance to cover interest of secured lender in personal property (mortager)

LOSS RATIO

How to determine premium LOSS RATIO= INCURRED LOSS + EXPENSES/ EARNED PREMIUM

LOSS VALUATION

Premium charged and insurance required

MARKET VALUE

Not really used How to value loss based on amount buyer willing to pay for property prior to a loss

MISREPRESENTATION

False statement or lie