AINS 102 REVIEWED EXAM
REVISION STUDYGUIDE
General Forms for personal property
three general forms that are commonly used to provide
coverage on a single form for different types of personal
property:
Personal Articles Standard Loss Settlement Form -
provides special form coverage for several classes of
personal property. there's a specific amount for each class
of article
Exclusions: wear and tear, deterioration, inherent vice,
insects or vermin
Personal Property Form - provides special form coverage
on unscheduled personal property under used by the
insured and normally kept at the insured residence. the
same form provides worldwide coverage when the same
property is temporarily away from the premises. this form
can be used to ensure 13 classes of unscheduled
personal property with a separate amount for each class.
can be used to insure the property in his self-storage unit
Personal Effects form - is designed for frequent travelers.
provides coverage on personal property such as luggage,
clothes and cameras. it covers worldwide, but only when it
is away from the insured's residence, not in storage.
Damaged or destroyed property can result in these
outcomes
Reduction in property value—The difference between the
value of the property before the loss (pre-loss value) and
,after the loss (post-loss value)
Increased expenses—Expenses in addition to normal
living expenses that are necessary because of the loss,
such as the cost of renting a hotel room following a house
fire*
Lost income—Loss of income that results when property is
damaged or destroyed, such as the loss of rent that can
be collected on a property that is damaged by a hurricane*
real property (realty)*
Land, buildings, other structures attached to the land
(swimming pool, storage shed, flagpole), anything growing
on the land (trees, crops), and anything embedded in the
land (foundations, underground pipes, minerals)
personal property
Dwelling contents (furniture, electronics), high-value
property (jewelry, silverware, firearms), rare or unique
property (antiques, artwork), business personal property
(supplies, machinery), intangible property (patents,
copyrights), motor vehicles, trailers, watercraft, and aircraft
Risk control techniques
Avoidance
Loss Prevention
Loss reduction
Separation
Duplication
Diversification
risk financing techniques
retention and transfer
What are two risk management techniques?
,Risk control - reduce the frequency or severity of a
particular loss, make the loss more predictable*
Risk Financing- generate the funds to pay for losses or
risk control measures
Avoidance
ceasing an activity or deciding not to engage in it so that
the possiblity of future loss is eliminated
Loss prevention
reduces the frequency of a particular loss. to break the
sequence of events that lead to a loss
Loss Reduction
reduces the severity of a particular loss.
Separation
isolates loss of exposure from one another to minimize the
adverse affect of a similar loss
Duplication
creating backups, spares, or copies of property or
information
Diversification
Spreads loss exposures over numerous areas or projects
retention
Funds are generated or set aside to pay for losses that are
retained by the individual or family
Transfer
shifting the financial responsibility for losses on to another
party, like an insurer
When a liability claim occurs, an individual or a family
can suffer two major financial consequences.*
1. having to pay money damages if the legal defense isn't
successful or if the claim is settled out of court.*
, 2. having to pay the costs of a legal investigation and
defense (even if the defense is successful).*
Damages in a liability suit
Often in the form of special and/or general damages
Special damages
Particular damages or out-of-pocket losses; can include
the amount spent to restore lost property, hospital, and
doctor bills and related expenses for bodily injury, and loss
of wages and earnings
General damages (compensatory)
direct damages or necessary damages; often presumed
when special damages are proven; can include
compensation for non-financial losses i.e. pain, suffering,
future effect of disfigurement, loss of limb, sight or hearing,
as well as emotional distress
Punitive Damages
Money damages that may be awarded to a plaintiff to
punish the defendant and deter future similar conduct i.e.
reckless, malicious, or deceitful acts. Often imposed on
companies.
Civil Law
the system of law concerned with private relations
between members of a community rather than criminal,
military, or religious affairs. Often liability cases fall under
civil law
Compulsory auto insurance law
Law that requires the owners or operators of automobiles
to carry automobile liability insurance at least equal to
certain minimum limits before the vehicle can be licensed
or registered.
financial responsibility law
REVISION STUDYGUIDE
General Forms for personal property
three general forms that are commonly used to provide
coverage on a single form for different types of personal
property:
Personal Articles Standard Loss Settlement Form -
provides special form coverage for several classes of
personal property. there's a specific amount for each class
of article
Exclusions: wear and tear, deterioration, inherent vice,
insects or vermin
Personal Property Form - provides special form coverage
on unscheduled personal property under used by the
insured and normally kept at the insured residence. the
same form provides worldwide coverage when the same
property is temporarily away from the premises. this form
can be used to ensure 13 classes of unscheduled
personal property with a separate amount for each class.
can be used to insure the property in his self-storage unit
Personal Effects form - is designed for frequent travelers.
provides coverage on personal property such as luggage,
clothes and cameras. it covers worldwide, but only when it
is away from the insured's residence, not in storage.
Damaged or destroyed property can result in these
outcomes
Reduction in property value—The difference between the
value of the property before the loss (pre-loss value) and
,after the loss (post-loss value)
Increased expenses—Expenses in addition to normal
living expenses that are necessary because of the loss,
such as the cost of renting a hotel room following a house
fire*
Lost income—Loss of income that results when property is
damaged or destroyed, such as the loss of rent that can
be collected on a property that is damaged by a hurricane*
real property (realty)*
Land, buildings, other structures attached to the land
(swimming pool, storage shed, flagpole), anything growing
on the land (trees, crops), and anything embedded in the
land (foundations, underground pipes, minerals)
personal property
Dwelling contents (furniture, electronics), high-value
property (jewelry, silverware, firearms), rare or unique
property (antiques, artwork), business personal property
(supplies, machinery), intangible property (patents,
copyrights), motor vehicles, trailers, watercraft, and aircraft
Risk control techniques
Avoidance
Loss Prevention
Loss reduction
Separation
Duplication
Diversification
risk financing techniques
retention and transfer
What are two risk management techniques?
,Risk control - reduce the frequency or severity of a
particular loss, make the loss more predictable*
Risk Financing- generate the funds to pay for losses or
risk control measures
Avoidance
ceasing an activity or deciding not to engage in it so that
the possiblity of future loss is eliminated
Loss prevention
reduces the frequency of a particular loss. to break the
sequence of events that lead to a loss
Loss Reduction
reduces the severity of a particular loss.
Separation
isolates loss of exposure from one another to minimize the
adverse affect of a similar loss
Duplication
creating backups, spares, or copies of property or
information
Diversification
Spreads loss exposures over numerous areas or projects
retention
Funds are generated or set aside to pay for losses that are
retained by the individual or family
Transfer
shifting the financial responsibility for losses on to another
party, like an insurer
When a liability claim occurs, an individual or a family
can suffer two major financial consequences.*
1. having to pay money damages if the legal defense isn't
successful or if the claim is settled out of court.*
, 2. having to pay the costs of a legal investigation and
defense (even if the defense is successful).*
Damages in a liability suit
Often in the form of special and/or general damages
Special damages
Particular damages or out-of-pocket losses; can include
the amount spent to restore lost property, hospital, and
doctor bills and related expenses for bodily injury, and loss
of wages and earnings
General damages (compensatory)
direct damages or necessary damages; often presumed
when special damages are proven; can include
compensation for non-financial losses i.e. pain, suffering,
future effect of disfigurement, loss of limb, sight or hearing,
as well as emotional distress
Punitive Damages
Money damages that may be awarded to a plaintiff to
punish the defendant and deter future similar conduct i.e.
reckless, malicious, or deceitful acts. Often imposed on
companies.
Civil Law
the system of law concerned with private relations
between members of a community rather than criminal,
military, or religious affairs. Often liability cases fall under
civil law
Compulsory auto insurance law
Law that requires the owners or operators of automobiles
to carry automobile liability insurance at least equal to
certain minimum limits before the vehicle can be licensed
or registered.
financial responsibility law
