Insurance Policies 101
The _________ of insurance is to cover the insured for a loss not to enable the insured to profit.
What is purpose?
What is the insurer's promise to pay for covered losses in exchange for a periodic payment?
Most property and liability policies are considered to be this?
What are Contracts of Indemnity?
This is typically on the first page of an insurance policy.
What is Declarations?
Loss for which the insured cannot have control over whether or when a loss will occur.
What is Fortuitous?
A loss that is suffered by one insured and does not affect any other insured or group of insured.
What is independent?
A type of Coverage Policy that is common to a large number of insureds is what?
What is a Self Contained Policy?
A type of contract that is designed as a "take it or leave it" such as an auto insurance policy.
What is Contract of Adhesion?
These 3 provisions are the CORE of every insurance policy?
What are
Declarations
Definitions
Insuring Agreement
A Commercial Auto Policy is considered to be this and why.
What is a Modular Policy the customer needs a variety of coverage that may not be common to a large number of insureds.
Loss exposures that are small as well as involve a high probability of loss are considered to be this.
What is uninsurable?
These are the 2 types of policy forms.
What are Pre-printed forms and manuscript forms?
What is Nontransferable?
Differences between Property and Liability are found in the Insuring Agreement. The Provisions of Liability must address these covered activities?
What are:
Covered types of injury and damage
Excludes loss exposures
Covered costs
covered time period
Covered Parties and amounts of recovery
An insured cannot collect more than the amount of loss.
What is Principal of Indemnity?
This type of loss involved numerous exposure units suffering the same type of loss at the same time resulting significant consequences for the insurer.
What is catastrophic loss?
These are the other documents that be contained in a policy.
What are:
1. Application
2. Endorsements
3. Insurer's bylaws
4. Statutes
These make Insurance Policies unique.
What are: Contracts of Indemnity
Utmost good faith
Fortuitous events and exchange of unequal amounts
Contracts of Adhesion
Nontransferable
These are the duties that the insured has under the insurance policy?
What are:
paying premiums
reporting losses timely
cooperating with the insurer
An auto policy typically has this for both physical damage and one for liability.
What is the Insuring Agreement, which states the insurer's promises to the insured.
These are the 6 traits of Ideally Insurable Loss Exposures.
What are:
Pure Risk
Fortuitous
Definite and Measurable
One of a large number of similar exposure units
Independent and not catastrophic
Affordable
A ______ _______ is considered to be owned by it's policyholders.
What is Mutual Insurer?
All the rules of _____ ____ apply to insurance policies although there are special characteristics that distinguish them from other policies.
What is contract law?
These are the 5 specific reasons why insurers use exclusions.
What are: 1. Eliminate coverage for uninsurable loss exposures
2. Discourage the insured from intentionally causing the loss
3. Reduce duplicate coverage
4. Eliminate unnecessary coverage
5. Eliminate coverages that need special treatment.
What is Utmost Good Faith?