CPCU 552 ALL TERMS STUDY GUIDE
1. Liability Loss - Answer -Any loss that a person or an organization sustains as a result
of a claim or suit against that person or organization by someone seeking damages or
some other remedy permitted by law
1. Legal Liability - Answer -legally enforceable obligation of a person or an organization
to pay a sum of money (damages) to another person or organization
1. Civil law - Answer -classification of law that applies to legal matters not governed by
criminal law and that protects rights and provides remedies for breaches of duties owed
to others
1. Criminal Law - Answer -branch of the law that imposes penalties for wrongs against
society
1. Tort - Answer -A wrongful act or an omission, other than a crime or a breach of
contract that involves a legally protected right.
3 categories: 1)negligence, 2) intentional, 3) strict liability
1. Strict Liability (absolute) - Answer -Liability imposed by a court or by a statute in the
absence of fault when harm results from activities or conditions that are extremely
dangerous, unnatural, ultra hazardous, extraordinary, abnormal or inappropriate
1. Breach of contract - Answer -failure, without legal excuse, to fulfill a contractual
promise
1. Statute - Answer -written law passed by a legislative body, at either the federal or
state level
1. Common-law system - Answer -legal system in which the body of law is derived
more from court decisions as opposed to statutes or constitutions
1. Tort Law - Answer -the branch of civil law that deals with civil wrongs other than
breaches of contract
1. Statutory Law - Answer -formal laws or statutes enacted by federal, state or local
legislative bodies
1. tort - 4 elements - Answer -1. wrongful invasion(breach), 2. of a legally protected
right (duty), 3. resulting in(caused) 4. proximate or direct damages(damage)
1. warranty - Answer -a promise made by a seller about its product
,2. Premise and Operations Liability - Answer -liability for Bodily Injury and Property
Damage caused by: (1) an accident occurring on the premise owned, leased, rented,
(premise liability) (2) an accident away from the premise caused by the
person/organizations ongoing operations (operations liability)
2. Avoidance, Loss prevention, loss reduction, separation - Answer -4 risk control
techniques
2. Root causes - Answer -real causes of accidents, rather than symptoms
2. Commercial General Liability Coverage Form (CGL) - Answer -coverage form
commonly used for insuring an organizations premises and operations liability loss
exposures and products/completed operations liability loss exposure
2. Bodily Injury - Answer -Physical Injury to a person, including sickness disease and
death
2. Contractual Liability Coverage - Answer -coverage for liability that the insured has
assumed under contract
2. Amendment of Insured Contract Definition Endorsement - Answer -the endorsement
that modifies the CGL form so that subpart f. of the insured contract definition will not
include bodily injury or property damage caused solely by an indemnitee of the named
insured
2. Host Liquor Liability - Answer -Coverage for a person or an organization that serves
alcoholic beverages to others, but is not in the alcoholic beverage business; it covers
the insured host against liability for accidents caused by persons who become
intoxicated as a result of the insured's serving of alcoholic beverages.
2. Products and Completed Operations Liability - Answer -the legal responsibility of the
manufacturer, distributor, and or retailer of a product to the product customer (1) the
product was defective when it left (2) the defect made the product unreasonably
dangerous (3) the product was the proximate cause of the injury Completed operations:
liability arising out of completed work.
2. Auto liability - Answer -liability for BI and PD arising from the ownership,
maintenance, or use of autos (but not mobile equipment)
2. Negligent entrustment - Answer -loaning a vehicle to someone who is not fit to drive.
2. No-fault laws - Answer -provide benefits to injured persons without the need to prove
fault
, 2.Exclusive Remedy - Answer -workers compensation law grants benefits as the
employees' sole source of recovery against the employer, so employees lose the right
to sue their employers for injuries covered by workers comp.
2. Dual-capacity doctrine - Answer -a legal doctrine giving the employee the right to sue
the employer when the employer acts in a capacity other than that of employer
2. Montrose Language - Answer -in the occurrence version of the CGL eliminates
coverage for progressive injury or damage if the insured knew of the injury or damage
before the current policy period
2. Progressive Injury or Damage - Answer -Injury or damage that spans more than one
policy period
2. The amendment of the Liquor Liability Exclusion Endorsement - Answer -more
restrictive then the basic liquor liability endorsement
2. third-party actions - Answer -injured employee sues and recovers from a negligent
3rd party and then the 3rd part sues the employer for joint negligence
2. Auto - Answer -land motor vehicle, trailer, or semitrailer, designed from use on public
roads, including any attached machinery or equipment
2. Products liability coverage - Answer -coverage for BI caused by product and PD to
property other than the product
2. Completed operations coverage - Answer -cover for BI caused by defective work and
PD to property other than the product caused by defective work
2. Exclusion--Damage to Work performed by Subcontractors on Your behalf
Endorsement - Answer -eliminates coverage for work completed by subcontractors
2. Fire Legal Liability - Answer -applies to liability for Fire damage to premise rented to
or temporarily occupied by the named insured
3. Personal and advertising injury - Answer -Injury that is covered by coverage B of the
CGL and includes injury resulting from numerous offenses, such as false detention,
malicious, prosecution, wrongful eviction, slander, libel, use of another's advertising
idea, and copyright infringement
3. Medical Payments Coverage - Answer -coverage that pays necessary medical
expenses incurred within a specified period by a claimant (and in certain policies by an
insured) for a covered injury, regardless of whether the insured was at fault.
3. Excess Liability insurance - Answer -insurance coverage for losses that exceed the
limits of underlying insurance coverage or a retention amount
1. Liability Loss - Answer -Any loss that a person or an organization sustains as a result
of a claim or suit against that person or organization by someone seeking damages or
some other remedy permitted by law
1. Legal Liability - Answer -legally enforceable obligation of a person or an organization
to pay a sum of money (damages) to another person or organization
1. Civil law - Answer -classification of law that applies to legal matters not governed by
criminal law and that protects rights and provides remedies for breaches of duties owed
to others
1. Criminal Law - Answer -branch of the law that imposes penalties for wrongs against
society
1. Tort - Answer -A wrongful act or an omission, other than a crime or a breach of
contract that involves a legally protected right.
3 categories: 1)negligence, 2) intentional, 3) strict liability
1. Strict Liability (absolute) - Answer -Liability imposed by a court or by a statute in the
absence of fault when harm results from activities or conditions that are extremely
dangerous, unnatural, ultra hazardous, extraordinary, abnormal or inappropriate
1. Breach of contract - Answer -failure, without legal excuse, to fulfill a contractual
promise
1. Statute - Answer -written law passed by a legislative body, at either the federal or
state level
1. Common-law system - Answer -legal system in which the body of law is derived
more from court decisions as opposed to statutes or constitutions
1. Tort Law - Answer -the branch of civil law that deals with civil wrongs other than
breaches of contract
1. Statutory Law - Answer -formal laws or statutes enacted by federal, state or local
legislative bodies
1. tort - 4 elements - Answer -1. wrongful invasion(breach), 2. of a legally protected
right (duty), 3. resulting in(caused) 4. proximate or direct damages(damage)
1. warranty - Answer -a promise made by a seller about its product
,2. Premise and Operations Liability - Answer -liability for Bodily Injury and Property
Damage caused by: (1) an accident occurring on the premise owned, leased, rented,
(premise liability) (2) an accident away from the premise caused by the
person/organizations ongoing operations (operations liability)
2. Avoidance, Loss prevention, loss reduction, separation - Answer -4 risk control
techniques
2. Root causes - Answer -real causes of accidents, rather than symptoms
2. Commercial General Liability Coverage Form (CGL) - Answer -coverage form
commonly used for insuring an organizations premises and operations liability loss
exposures and products/completed operations liability loss exposure
2. Bodily Injury - Answer -Physical Injury to a person, including sickness disease and
death
2. Contractual Liability Coverage - Answer -coverage for liability that the insured has
assumed under contract
2. Amendment of Insured Contract Definition Endorsement - Answer -the endorsement
that modifies the CGL form so that subpart f. of the insured contract definition will not
include bodily injury or property damage caused solely by an indemnitee of the named
insured
2. Host Liquor Liability - Answer -Coverage for a person or an organization that serves
alcoholic beverages to others, but is not in the alcoholic beverage business; it covers
the insured host against liability for accidents caused by persons who become
intoxicated as a result of the insured's serving of alcoholic beverages.
2. Products and Completed Operations Liability - Answer -the legal responsibility of the
manufacturer, distributor, and or retailer of a product to the product customer (1) the
product was defective when it left (2) the defect made the product unreasonably
dangerous (3) the product was the proximate cause of the injury Completed operations:
liability arising out of completed work.
2. Auto liability - Answer -liability for BI and PD arising from the ownership,
maintenance, or use of autos (but not mobile equipment)
2. Negligent entrustment - Answer -loaning a vehicle to someone who is not fit to drive.
2. No-fault laws - Answer -provide benefits to injured persons without the need to prove
fault
, 2.Exclusive Remedy - Answer -workers compensation law grants benefits as the
employees' sole source of recovery against the employer, so employees lose the right
to sue their employers for injuries covered by workers comp.
2. Dual-capacity doctrine - Answer -a legal doctrine giving the employee the right to sue
the employer when the employer acts in a capacity other than that of employer
2. Montrose Language - Answer -in the occurrence version of the CGL eliminates
coverage for progressive injury or damage if the insured knew of the injury or damage
before the current policy period
2. Progressive Injury or Damage - Answer -Injury or damage that spans more than one
policy period
2. The amendment of the Liquor Liability Exclusion Endorsement - Answer -more
restrictive then the basic liquor liability endorsement
2. third-party actions - Answer -injured employee sues and recovers from a negligent
3rd party and then the 3rd part sues the employer for joint negligence
2. Auto - Answer -land motor vehicle, trailer, or semitrailer, designed from use on public
roads, including any attached machinery or equipment
2. Products liability coverage - Answer -coverage for BI caused by product and PD to
property other than the product
2. Completed operations coverage - Answer -cover for BI caused by defective work and
PD to property other than the product caused by defective work
2. Exclusion--Damage to Work performed by Subcontractors on Your behalf
Endorsement - Answer -eliminates coverage for work completed by subcontractors
2. Fire Legal Liability - Answer -applies to liability for Fire damage to premise rented to
or temporarily occupied by the named insured
3. Personal and advertising injury - Answer -Injury that is covered by coverage B of the
CGL and includes injury resulting from numerous offenses, such as false detention,
malicious, prosecution, wrongful eviction, slander, libel, use of another's advertising
idea, and copyright infringement
3. Medical Payments Coverage - Answer -coverage that pays necessary medical
expenses incurred within a specified period by a claimant (and in certain policies by an
insured) for a covered injury, regardless of whether the insured was at fault.
3. Excess Liability insurance - Answer -insurance coverage for losses that exceed the
limits of underlying insurance coverage or a retention amount
