Pecuniary Losses Flashcards

1
Q

What does Pecuniary mean

A

Relating to or involving a monetary loss, Covers wealth

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2
Q

Why are Pecuniary policies different to other policies

A

Wealth is intangible

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3
Q

Are these usually commercial or personal policies?

A

Commercial

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4
Q

Money insurance

A

Third-party theft of physical money

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5
Q

Why is money insurance usually only offered to businesses

A

Susceptible to moral hazard

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6
Q

What are excluded from money insurance policies?

A

Employee error and omissions

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7
Q

When is money covered in a money policy

A

At all times: In transit, on-premises at the owners home, or authorised employees homes

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8
Q

Credit insurance

A

If a debtor fails to meet obligations this cover the remainder of the debt they are due to payout

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9
Q

Why might you get credit insurance besides financial reasons?

A

The management interment: the help you get from the insurer to monitor and recoup the debit

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10
Q

Guarantees or bonds

A

If the insured does not or can not fulfil the contract or an insured event occurs that causes the loss

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11
Q

Performance bond

A

Bond issued to one party of a contract as a guarantee against failure of the other party to meet obligations specified in the contract.

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12
Q

What cost is covered in a performance bond?

A

The additional cost of switching providers

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13
Q

Abandonment and cancellation

A

When an insured event causes an event to not happen due to unforeseen circumstances

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14
Q

What is the difference between an abandoned and a cancelled event?

A

Abandoned stopped after it started, cancelled never happened

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15
Q

Fidelity guarantee

A

Covers theft committed or aided by employees

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16
Q

What must be proven in a fidelity guarantee claim?

A

That the loss happened due to an employee

17
Q

Who can Fidelity guaranteeas cover (2)

A

All employees or certain employees such as accountants

18
Q

Business interruption/consequential loss

A

Covers business losses against unforeseen risks that cause the business to lose money due to inability to continue business for a period of time as a result of an insured peril.

19
Q

What is covered in business interruption insurance

A

Loss of income and cost of working can also cover standing charges such as costs of working

20
Q

Why does FBD have to pay out claims of Covid but other insurers don’t have to?

A

FBD explicitly said to a client that their policy cover covid, other insurers did not say this explicitly and the pandemic in their contract intended to cover something like e coli, since they made no provision for it they had not intended to include it in the contact

21
Q

Contingent business interruption

A

Addons for business interruption policies

22
Q

Addons for business interruption insurance (5)

A
  • Supplier extension: Cost of getting goods from somewhere else
  • Customer extension: Customer cant accept delivery
  • Public utility extension
  • Motor vehicle
  • Goods in transit
23
Q

Legal expenses insurance

A

Covers the cost of pursuing or defending a claim

24
Q

What are some of the limitations of legal expenses insurance

A

-Fines and penalties are excluded so are risks covered elsewhere (el, pl policies also cover this risk)

25
Q

How are pecuniary claims processed differently and why

A

They are thoroughly investigated because of the intangible nature and susceptibility to fraud