Insurance Contracts & Policy Structure
Section of an insurance policy that states the insured's name, address, amount of coverage, premium, and a description of the insured property.
Declarations page
A sudden, unplanned and unexpected event or loss resulting from a singular exposure to a hazard.
Accident
What is the formula for Actual Cash value?
Current Replacement cost - Depreciation
Provision that defines how a policy will respond if there is other valid insurance on the same risk.
Other Insurance Provision
Individual whose name appears FIRST on the policy declarations page is known as the
First Named Insured
Component of an insurance policy that clarifies terms used in the policy.
Definitions
Owning a pool, harboring wild animals, or selling explosives are an example of what type of liability?
Absolute liability
The cost to replace damaged property with like kind and quality at today's price, without any deduction for depreciation.
Replacement Cost
Protects consumers against the circulation of inaccurate or obsolete personal or financial information.
Fair Credit Reporting Act
An act or event considered to be the natural and reasonably foreseeable cause of the loss or event that caused damage is considered to be the
Proximate Cause of loss
A statement that, if discovered, would alter the underwriting decision of the insurance company
Material Misrepresentation
The 2 types of Compensatory damages are:
Special and General damages
Estimated value that comes from selling the damaged property (maybe for parts).
Salvage value
A temporary federal program that would share the risk of loss from future terrorist attacks with the insurance industry.
TRIA
Terrorism Risk Insurance Act
Clause that states, in consideration for a reduced rate, the insured agrees to maintain a certain minimum amount of insurance on the insured property.
Think about: 80%, this is typically what you'll see in most test examples.
Coinsurance
Takes place when an insurer’s underwriter approves the application and issues a policy.
Acceptance
Type of liability in which an principle (business) is responsible for the actions of their agent (employee).
Example, A parent held responsible for the actions of their child.
Vicarious Liability
Seldom-used method based on what a willing buyer would pay to a willing seller for the property loss.
It also takes into consideration the value of land and location, rather than just the cost to rebuild.
Market Value
Stipulates that in general, an insurance company may not disclose nonpublic personal information to a nonaffiliated third party.
Think about: Privacy protection relating to the nondisclosure of nonpublic personal information.
Gramm-Leach-Bliley act
Utilized when insurer and insured do not agree on how to settle claim.
Arbitration
Section of the policy that outlines the insureds responsibility to,
cooperate with the insurer's investigation,
Promptly notify the insurer of a loss
Pay premiums for continued coverage
Conditions
Loss of business income would be considered what type of loss?
Indirect / Consequential loss
An amount of insurance scheduled in a property policy that is not subject to any coinsurance requirements or depreciation in the event of a covered loss. This scheduled amount is the maximum amount an insurer will pay in the event of a loss.
Stated Value
Provision that provides for the sharing of loss with other insurance based on their own proportionate share of coverage to the total available limits is called?
Pro-rata
An absolutely true statement that the insurance policy depends on to be valid.
Warranty