Flashcards in Class 4 Deck (23)
Extra Expense Coverage Form
Commercial property insurance that pays for additional costs in excess of normal operating expenses that an organization incurs to continue operations while its property is being repaired or replaced after having been damaged by a covered cause of loss. Profits are not covered since the firm is still operating.
Business Income from Dependent Properties
♠ Contributing location
♠ Recipient location
♠ Manufacturing location
♠ Leader location
Contributing location (Business Income from Dependent Properties)
When the location that provides you raw materials/services, fails to perform. That delay causes you to slow down your production.
Recipient location (Business Income from Dependent Properties)
when the recipient fails to pay for the order
Manufacturing location (Business Income from Dependent Properties)
when the manufacturing service fails to perform. For example, the factories that Nike uses in Bangladesh burn down.
Leader location (Business Income from Dependent Properties)
when your business benefits form some larger business near by.
Other Commercial Property Coverage
A. Builders Risk Insurance
B. Equipment Breakdown Insurance -- aka Boiler and Machinery Coverage
C. Difference in Conditions (DIC) Insurance
Difference in Conditions (DIC) Insurance (Other Commercial Property Coverage)
All risks coverage. A policy designed to broaden coverage by providing additional limits of coverage for specific perils when standard markets won't provide adequate limits of coverage, providing coverage for perils that are excluded on standard coverage forms, or supplementing international policies that are written by admitted insurers in the applicable foreign countries.
A. Ocean Marine Insurance
B. Inland Marine Insurance
Ocean Marine Insurance (Transportation Insurance)
Insurance covering the transportation of goods and/or merchandise by vessels crossing both foreign and domestic waters including any inland or aviation transit associated with the shipment. This type of marine insurance also encompasses coverage for damage to the vessels involved in shipments and any legal liability arising in the course of shipment.
Policies may also be written on an “particular/general average” basis.
General Liability Loss Exposures
A. Premises and Operations
B. Products Liability
C. Completed Operations
D. Contractual Liability
E. Contingent Liability
F. Other Liability Exposures
Premises and Operations (General Liability Loss Exposures)
1. Liability because of operations on and off
2. Liability because of ownership and maintenance of premises.
Products Liability (General Liability Loss Exposures)
Faulty work on your peremises
Contingent Liability (General Liability Loss Exposures)
Potential liability that may occur, depending on the outcome of an uncertain future event. A contingent liability is recorded in the accounting records if the contingency is probable and the amount of the liability can be reasonably estimated.
Other Liability Exposures (General Liability Loss Exposures)
1. Liability arising out of ownership or use of autos, aircraft or watercraft
2. Occupational injury or disease to employees
3. Suits by employees alleging discrimination
4. Professional liability
5. Directors and officers liability
Commercial General Liability (CGL) Policy
A type of insurance policy that provides coverage to a business for bodily injury, personal injury, and property damage caused by the business’ operations, products, or injury that occurs on the business’ premises. Commercial general liability, or CGL, is considered comprehensive business insurance, though it does not cover all risks that a business may face.
♠ Occurrence policy
♠ Claims made policy
Occurrence policy (Commercial General Liability (CGL) Policy)
Protects you from any covered incident that “occurs” during the policy period, regardless of when a claim is filed. An occurrence policy will respond to claims that come in – even after the policy has been canceled – so long as the incident occurred during the period in which coverage was in force.
Claims made policy (Commercial General Liability (CGL) Policy)
A policy providing coverage that is triggered when a claim is made against the insured during the policy period, regardless of when the wrongful act that gave rise to the claim took place. (The one exception is when a retroactive date is applicable to a claims-made policy.
Overview of the CGL Occurrence Policy
- Coverage A—bodily injury and property damage liability
- Coverage B—personal and advertising injury liability -slander, libel, malicious prosecution
- Coverage C—medical payments - covered regardless of liability. Why? It takes long to investigate who is liable.
- Supplementary payments—coverages A and B - cover bail bonds, pre and post judgment interest
A provision found in many (although not all) claims-made policies that eliminates coverage for claims produced by wrongful acts that took place prior to a specified date, even if the claim is first made during the policy period.
Particular average insurance (Ocean Marine Insurance)
Insurance just for your cargo
General average insurance
The law of general average is a legal principle of maritime law according to which all parties in a sea venture proportionally share any losses resulting from a voluntary sacrifice of part of the ship or cargo to save the whole in an emergency (for instance, when the crew throws some cargo overboard to lighten the ship in a storm).