Types of Casualty Policies, Bonds, and Terms
The maximum amount or limit allowed for payment during a policy period
Aggregate Limit
Term describing reduction in value, particularly due to wear and tear
Depreciation
The legal term for the intentional withholding of information of a material fact that is crucial in decision making.
Concealment
This policy form covers Condominium unit owners.
HO-6
The title of the head of the State Department of Insurance
Commisioner
Obligee or insured
Premium
A temporary agreement issued by an agent or insurer providing temporary coverage until a policy can be issued
Binder
A unique homeowners insurance form used when replacement cost coverage is not practical. Often hen the market value of the structure is considerably lower than replacement cost.
HO-8 (modified coverage form)
A company owned by the policy holders
Mutual Company
Explain the difference between uninsured motorist coverage and Underinsured motorist coverafe
UM- pays out if the other party does not have insurance or coverage is reduced by the other parties coverage.
UIM- Pays out if the other party has insufficient coverage in addition to their limits
A type of risk that is uninsurable. It involves the opportunity for loss or gain, such as gambling
Speculative Risk
Name 3 examples of typical water damage exclusions that would not be covered in a home insurance policy without an additional endorsement.
Floods
Water back up from sewers or sump pumps
Underground water seeping into the home
The only for that DOES NOT provide dwelling coverage. This form is used for renters insurance.
HO-4
What are the continuing education requirements for an insurance license?
Must be renewed every 2 years with 24 CE credit hour- 3 of which must be ethics.
What 3 coverages are listed in Section I of a Commercial General Liability Policy?
Coverage A - Bodily Injury and Property Damage
Coverage B- Personal and Advertising Injury
Coverage C- Medical Payment
The insurers legal right to seek damages from third parties. This occurs only after the insurer reimburses the insured.
Subrogation
Joe has 2 property policies covering his home. Each policy has a limit of $100,000.00. When he suffers a loss of $50,000 on his home, policy 1 has an exclusion that denies the claim. The second policy covers the claim. If there is no deductible, what amount would the second policy pay out?
$25k
Give an example of something that may be covered under Coverage B - Other Structures in a homeowners insurance policy.
detached garage
shed
fences
What is the difference between a foreign insurer and an alien insurer
Foreign- an insurance company that is incorporated in another State, D.C, or territorial possession
Alien- An insurance company that is incorporated outside of the US
This type of policy provides coverage for financial loss resulting from incorrect advice or not placing correct coverage.
Errors and Omissions
Jeremy has a policy for his restaurant with an aggregate limit of 2 million and a 1 million per occurrence limit. The policy period is 1/1/2021 -1/1/2022. On 2/4/2021, the ceiling caves and injures 10 people with a loss of 1 million. On 9/8/2021 a fire caused negligently by the chef caused injuries to 12 more people in the amount of $1.7 million. On 12/1/2021 there is another incident resulting in a $500,000 loss How much would be paid out each claim assuming the insurance pays out in its full capacity for each occurrence and there is no deductible.
2/4/2021- 1 million
9/8/2021- 1 million
12/1/2021 -$0
Name the 4 elements of a contract
Agreement- Offer and acceptance
Consideration- Premiums are representations on the part if the insured; payment of claims on the part of the insurer.
Competent Parties- legal age, sound mind, not under the influence.
Legal Purpose
The section of an insurance policy containing the basic underwriting information such as the insureds name, address, amount of coverage and premiums, and a description of the insureds location.
Policy Declaration/ Declarations Page
What is the maximum period for a temporary insurance license?
15 months