Chapter 11

Question 1

Nationwide marine definition

Answer 1

statement of the types of property that may be insured on inland marine and ocean marine insurance forms.

Question 2

Consignor

Answer 2

the party who is shipping goods.

Question 3

Carrier

Answer 3

a person or organization in the business of transporting property of others.

Question 4

Bill of lading

Answer 4

a document acknowledging receipt of goods from the shipper, given by the carrier which includes the terms of the contract of carriage for the goods.

Question 5

Act of God

Answer 5

a natural and unavoidable catastrophe that interrupts the expected course of events.

Question 6

Public enemy

Answer 6

a nation or government at war with the nation which the carrier is domiciled.

Question 7

Inherent vice

Answer 7

a quality of or condition within a particular type of property that tends to make the property destroy itself.

Question 8

Bailment

Answer 8

the temporary possession by one party (the bailee) of personal property owned by another party (the bailor) for a specific purpose, such as cleaning or repair.

Question 9

Bailor

Answer 9

the owner of the personal property in a bailment.

Question 10

Bailment for the benefit of the bailor

Answer 10

a bailment in which the bailee owes only a slight duty of care to safeguard the bailed property from loss or damage.

Question 11

Bailment for the benefit of the bailee

Answer 11

a bailment in which the bailee owes a high duty of care to safeguard the bailed property from loss or damage.

Question 12

Bailment for the mutual benefit of bailee and bailor (mutual benefit of bailment)

Answer 12

a bailment in which the bailee owes a duty of ordinary care to safeguard the bailed property from loss or damage.

Question 13

Bulk storage

Answer 13

storage of loose granules, powder, or pellets in silos, bins, or tanks, or in piles on the floor.

Question 14

Solid piling storage

Answer 14

a pallet, at floor level, piled high with cartons, boxes, bales, or bags, all in direct contact with one another.

Question 15

Pallet unit

Answer 15

a small wooden base stacked with smaller packages up to a height of three or four feet which are usually banded or shrink-wrapped to keep the packages in place.

Question 16

Rack storage

Answer 16

steel shelving of any height, on which goods are stored.

Question 17

Material safety data sheet (MSDS)

Answer 17

a document required by the Occupational Safety and Health Administration (OSHA) that describes the property’s hazardous chemicals and how they must be handled.

Question 18

Condominium

Answer 18

a real estate development consisting of a group of units, in which the air space within the boundaries of each unit is owned by the unit owner, and all remaining real and personal property is owned jointly by all the unit owners.

Question 19

Co-operative (co-op)

Answer 19

a nonprofit corporation that owns the housing units and the associated property.

Question 20

Condominium association

Answer 20

an entity composed of the unit owners in a condominium to manage the condominium and to own the common elements.

Question 21

Common elements

Answer 21

areas of a condominium that are jointly owned by all unit owners, including the land on which the buildings are located.

Question 22

Master deed

Answer 22

a document that defines a condominium and specifies the relationship between the unit owners and the association.

Question 23

Bare-walls concept

Answer 23

a concept of condominium ownership in which the association has no ownership interest within the bare walls of each unit.

Question 24

All-encompassing concept

Answer 24

a condo association’s interest when it owns and is responsible for all interior and exterior items within the individual condo unit at the time of the original purchase by the unit owner.

Question 25

Loss assessment

Answer 25

a charge by the condominium association against the unit owner for the cost of uninsured losses.

Question 26

Soft costs

Answer 26

various incidental expenses that may result from physical loss or from a delay in completion of a construction project, such as interest, real estate tax, advertising, architects and engineers fees, and legal and accounting fees.

Question 27

Burglary

Answer 27

the taking of property from inside a building by someone who unlawfully enters or exits the building.

Question 28

Robbery

Answer 28

the unlawful taking of property from the care and custody of a person by one who has caused or threaten to cause that person bodily harm; includes situations in which the thief commits an obviously unlawful act that is witnessed by the custodian of the stolen property (such as an observed "smash and grab" theft from a shop window).

Question 29

Scheduled articles

Answer 29

personal property specifically listed on a homeowner's policy that is typically covered against a broader range of perils, for a wider geographic scope, and/or at an agreed value.

Question 30

Employee

Answer 30

a person hired to perform services for another under the direction and control of the other party, called the employer.

Question 31

Occurrence

Answer 31

an accident, including continuous or repeated exposure to substantially the same general harmful conditions.

Question 32

Data

Answer 32

information recorded in a magnetic code that is used in or with a computer.

Question 33

Hardware

Answer 33

a physical machine and all of its component parts and cables.

Question 34

Media

Answer 34

any computer-readable device that can hold information.

Question 35

Programs (software)

Answer 35

a series of logically connected steps that are loaded into a computer, allowing it to perform a given function.

Question 36

Superfund law

Answer 36

federal legislation that gave the Environmental Protection Agency (EPA) the authority to identify, investigate, and remediate hazardous sites.

Question 37

Innocent landowner defense

Answer 37

a possible defense to Superfund liability; used when a party purchases a contaminated site without knowledge of the problem, despite having conducted the required site investigation before purchase.

Question 38

Contractors' equipment

Answer 38

the tools and machinery used in projects involving construction, renovation, earth-moving, and other activities.

Question 39

Earth-moving equipment

Answer 39

equipment that clears job sites and moves, eliminates, or compresses large amounts of earth, rock, snow, debris, construction materials, and other materials.

Question 40

Site-improvement equipment

Answer 40

pieces of equipment that prepare and finish asphalt and concrete surfaces.

Question 41

Material-handling equipment

Answer 41

equipment that raises, lowers, and transport supplies and personnel within a job site.

Question 42

Scheduled basis

Answer 42

a basis for ensuring each item of insured property by individually describing them in the policy declarations or schedule and assigning a coverage limit to each listed item.

Question 43

Blanket basis

Answer 43

a basis for ensuring all items within a single amount of insurance without specifically identifying each item.

Question 44

Weight-of-load exclusion

Answer 44

an exclusion that typically does not allow coverage for loss caused by the weight of a load exceeding the manufacturer's rated capacity of the equipment.

Question 45

Tandem lift exclusion

Answer 45

an exclusion that applies to losses occurring when two or more cranes are used together to perform a single lift.

Question 46

Boom operation exclusion

Answer 46

An exclusion for losses to crane and derrick booms while being operated, unless the losses directly caused by perils specified in the policy.

Question 47

Rental reimbursement coverage

Answer 47

coverage that can be added to a contractors equipment floater to pay the cost of renting necessary as substitute equipment to replace covered equipment that has been damaged by a covered peril.

Question 48

Catastrophe limit

Answer 48

a maximum amount that a policy will pay for all property losses associated with a single occurrence.