Terms in this set (107)
Financial (a monetary interest);
The 3 elements of insurable risk Blood (a relative); and
are: Business (a business partner).
imposed upon a person or company engaged in hazardous or
potentially dangerous business who, by negligence or by an
omission, causes harm or injury to another person or property.
Examples of absolute liability include owning a swimming pool,
Absolute liability harboring wild animals, or selling explosives. The injured party does
not need to prove negligence.
Accident - sudden, unplanned and unexpected event resulting in
injury or damage
accident vs. Occurrence Occurrence - includes losses caused by continuous or repeated
exposure to conditions resulting from injury or property damage
method of valuation reinforces the principle of indemnity because it
recognizes the reduction of value of property as it ages and
becomes subject to wear and tear and obsolescence. Usually, actual
actual cash value (ACV) cash value is calculated as follows:
Current Replacement Cost – Depreciation = Actual Cash Value
, the maximum limit of coverage available under a liability policy
during a policy year, regardless of the number of claims made or the
number of accidents that occur. Losses paid under coverages
subject to aggregate limits reduce the amount available for future
Aggregate limit losses. Aggregate limits are restored at the anniversary of the policy.
The actual premium can be determined by the audit of the insured’s
records at the end of the insuring period. If the audit determines that
the initial premium collected was too low, additional premium will be
assessed, and vice versa, if the audit shows that the initial premium
to the insured was too high (the exposures were over-estimated),
audit the insured will receive a return premium. Typically, audit premium is
used with liability and workers compensation insurance.
a single property insurance policy that provides coverage for multiple
classes of property at one location, or for one or more classes of
property at multiple locations. All insured properties are written for
one total amount of insurance, and no single insured item is
assigned a specific amount of insurance. However, different
Blanket insurance
amounts may be shown for buildings in general, equipment in
general, and other items.
Both robbery and burglary can be Theft
considered what?
, crime of forced entry into or out of the premises of another by a
person or persons with felonious intent. Insurance policies covering
Burglary the peril of burglary require that, following a loss, there are visible
signs of forced entry or exit from the premises.
Written evidence showing the insurance policy has been issued
certificate of insurance Lists amounts and types of insurance provided
clause states that, in consideration of a reduced rate, the
insured agrees to maintain a certain minimum amount of
insurance on the insured property.This encourages the insured to
insure the property closer to its full value. In case of a partial loss,
the insurer will pay the partial loss in full if the insured has
maintained the required percentage of insurance with relation to the
value of the property. If the amount of insurance maintained is less
than the coinsurance clause requirement, the insurer will only pay
coinsurance the percent of the loss that the insurance bears in relation to the
amount of insurance that should have been carried. In the event of a
total loss, the coinsurance clause does not operate, and the face
amount of the policy is paid.
the amount of insurance carried over the amount of insurance the
insured should have had, multiplied by the loss, which equals the
reduced payment for loss.
coinsurance penalties (Insurance Carried ÷ Insurance Required) X Loss Amount =
Loss Payment
Financial (a monetary interest);
The 3 elements of insurable risk Blood (a relative); and
are: Business (a business partner).
imposed upon a person or company engaged in hazardous or
potentially dangerous business who, by negligence or by an
omission, causes harm or injury to another person or property.
Examples of absolute liability include owning a swimming pool,
Absolute liability harboring wild animals, or selling explosives. The injured party does
not need to prove negligence.
Accident - sudden, unplanned and unexpected event resulting in
injury or damage
accident vs. Occurrence Occurrence - includes losses caused by continuous or repeated
exposure to conditions resulting from injury or property damage
method of valuation reinforces the principle of indemnity because it
recognizes the reduction of value of property as it ages and
becomes subject to wear and tear and obsolescence. Usually, actual
actual cash value (ACV) cash value is calculated as follows:
Current Replacement Cost – Depreciation = Actual Cash Value
, the maximum limit of coverage available under a liability policy
during a policy year, regardless of the number of claims made or the
number of accidents that occur. Losses paid under coverages
subject to aggregate limits reduce the amount available for future
Aggregate limit losses. Aggregate limits are restored at the anniversary of the policy.
The actual premium can be determined by the audit of the insured’s
records at the end of the insuring period. If the audit determines that
the initial premium collected was too low, additional premium will be
assessed, and vice versa, if the audit shows that the initial premium
to the insured was too high (the exposures were over-estimated),
audit the insured will receive a return premium. Typically, audit premium is
used with liability and workers compensation insurance.
a single property insurance policy that provides coverage for multiple
classes of property at one location, or for one or more classes of
property at multiple locations. All insured properties are written for
one total amount of insurance, and no single insured item is
assigned a specific amount of insurance. However, different
Blanket insurance
amounts may be shown for buildings in general, equipment in
general, and other items.
Both robbery and burglary can be Theft
considered what?
, crime of forced entry into or out of the premises of another by a
person or persons with felonious intent. Insurance policies covering
Burglary the peril of burglary require that, following a loss, there are visible
signs of forced entry or exit from the premises.
Written evidence showing the insurance policy has been issued
certificate of insurance Lists amounts and types of insurance provided
clause states that, in consideration of a reduced rate, the
insured agrees to maintain a certain minimum amount of
insurance on the insured property.This encourages the insured to
insure the property closer to its full value. In case of a partial loss,
the insurer will pay the partial loss in full if the insured has
maintained the required percentage of insurance with relation to the
value of the property. If the amount of insurance maintained is less
than the coinsurance clause requirement, the insurer will only pay
coinsurance the percent of the loss that the insurance bears in relation to the
amount of insurance that should have been carried. In the event of a
total loss, the coinsurance clause does not operate, and the face
amount of the policy is paid.
the amount of insurance carried over the amount of insurance the
insured should have had, multiplied by the loss, which equals the
reduced payment for loss.
coinsurance penalties (Insurance Carried ÷ Insurance Required) X Loss Amount =
Loss Payment
