P&C Insurance Flashcards

Question

4 Elements of a contract

Answer 1

Ins policies are contracts, Agreement - known as offer and acceptance, 1 person makes an offer and the other accepts it. offer = customer submits an app. acceptance = insurer issues policy Consideration- both parties must bring value. Consideration on the insured = application + premium. Consideration on the insurer= promise to pay for claim. Competent parties - not under the influence, sound mind, legal age Legal Purpose - cannot be against public policy, break the law

Answer 2

insurer writes policy, customer has to buy entire policy. must stick to what they said in policy

Answer 3

Unequal exchange ( customer pays small premium, and ins pays out big claim)

Answer 4

Assign you policy to someone else

Answer 5

Between the customer and insurer

Answer 6

1 sided promise, insurer promise to pay

Answer 7

both parties have rules and duties they must follow. ways of behaving, obligations.

Answer 8

if a agent says you're covered then you are

Answer 9

absolute true statements, guarantee. home and auto

Answer 10

life and health, can't have warranties because you cant guarantee that its true but to best of knowledge its true

Answer 11

untrue statement

Answer 12

hiding or withholding information on the application.

Answer 13

lying or deceiving

Answer 14

INS would've made a different decision if they had a piece of info that was not given to them.

Answer 15

As long as you have 80 % of insurance e of the property's value, the policyholder will agree to insure. 80 percent of rebuild if the insured covers at least 80% for replacement/rebuilt (exam question) if yes then they will pay the full claim, answer is no is then: Co-ins equation: did carry(amount of coverage) / should carry (80%)(put the number value x loss = claim payout

Answer 16

means that if house is 250k to build then ins will pay 250k

Answer 17

insurance mechanisms that provide coverage for individuals or businesses unable to obtain insurance through the standard or voluntary market. These markets serve as a last resort for those with higher risks or who have been rejected by private insurers.

Answer 18

If insured as multiple ins companies as insurers, each company will pay their fair share. Pro rata equation: whatever company amt you're looking for is on top(for ex. payout for comp a / companies added together x loss Company I'm looking for # / all companies x loss

Answer 19

Duty of care Proximate cause Breach of duty Loss or damage - victim

Answer 20

gather info to determine the probability of loss

Answer 21

is the principle that people will seek insurance more frequently for risks that are hard to insure. Some Insurers may charge a high premium or decline eins altogether

Answer 22

Typically purchased by landlords, for liability

Answer 23

negligent act that could require compensation. only unintentional torts are insured. wrongful civil act

Answer 24

Special Damages: compensate someone for out-of-pocket, hospital expenses. anything u can put a specific number on it. General Damages: compensate for pain and suffering. punitive (punish) damages - teach someone a lesson to prevent an negligent offense.

Answer 25

Vicarious- libility for others, dog, kids, employees Strict- Defective products, tires, cars, ladder Absolute - Hazardous activites, firework shows, swimming pools,

Answer 26

Aggregate: max amount will pay out for all claims during policy period Per occurrence: Max payment in a single accident or occurance Combined Single: max payment for bodily injury and property damage combined Per person: max amt payment for bodily injury to single person Split Limits: max payments for different types of coverages divided into 3 seperate limits of liabilty

Answer 27

Open peril will cover anything not excluded (best) Named- policy that only covers what is named Even numbers are named and odd are open perils HO2(broad), 3(special, open peril) , 5 (Comprehensive, open peril) - for House Ho 2 broad covers things inside Fire/light, windstorm hail, aircraft, riot, vechiles, volcanic eruption, explosion, smoke, VMM, falling objects, overflow of water, AC/HEAT, freezing plumbing, accidental damage from Artically generated elcetrical current H0 3 is only open peril on the outside (like roof, walls,) and named peril in the inside ho5 covers in and out of home open on inside and outside, and disappearance. comprehensive (best)

Answer 28

Ho4 - (4 rent), no a or b coverage Ho6 condo(upgrade) - owner of building will pay for your apt but it will be the cheapest base model. get this to upgrade your condo.personal property are settled on an ACV basis Ho 8 modified - outdated old house not restored - market value(buy or sell house) is less than rebuilt. theft is only covered up to 1k on premise

Answer 29

Section 1: Coverage A- dwelling B: other structures C: Personal property(15500 for jewels and firearms) D: loss of use Section 2: liability coverage Section E: Personal liability Coverage F: liability to others

Answer 30

If insurer makes policy better then existing policyholder automatically get the benefits

Answer 31

process where after insurer pays insured takes legal action against 3rd party.

Answer 32

efers to a clause found in many insurance policies that addresses how coverage will be coordinated if more than one insurance policy provides coverage for the same loss or claim.

Answer 33

provides limited coverage for property damage for which the insured is liable, regardless of negligence. Though the coverage would exclude coverage for losses caused intentionally by an insured who is 13 years of age or older, intentional damage by insured children under the age of 13 would be covered.

Answer 34

contain info specific to individual and property insured,

Answer 35

is the initial event that starts a chain of events leading to an outcome. It's not always the last thing to happen, but it's the one that sets everything else in motion. Without this initial event, the outcome wouldn't have happened. So, it's like the starting point of a series of events that lead to a result.

Answer 36

is an accident that includes continuous or repeated exposure to the same general harmful conditions.

Answer 37

the amount for which it can be sold at the end of its useful life, often determined by the property’s scrap value for insurance purposes.

Answer 38

insurer cannot file against insured

Answer 39

resolve difference between insured and insurer

Answer 40

the insurance company will not accept property abandoned by an insured. prevents the insured from relinquishing ownership

Answer 41

exist at time of loss

Answer 42

Liberalization, subrogation, and other ins

Answer 43

insurer give up a right that they had

Answer 44

once right is given up cant reclaim it

Answer 45

is the insurer’s promise of protection to the insured, affirming that the insurer will indemnify the insured for covered losses. The perils insured against by the policy are specified in the Insuring Agreement.

P&C Insurance Flashcards

(72 cards)