Chapter 1-2
What is a chance of loss
A risk
The most important piece of information in the underwriting process
the application
How many days' notice is required if the insurer is cancelling an auto policy for non payment of premium?
15 days
Frame - Construction Code 1
What is the territory coverage for Broad Theft Coverage?
on and off premise
The dishonesty tendency of an insured that increase the probability of the loss
Moral Hazard
How is the premium returned when the named insured cancels the policy?
short rate
Where would you find the limit for the towing and labor endorsement on a personal auto policy ?
Declarations page
What homeowners policy does not cover dwelling?
HO-4
Which policy only covers broad perils?
DP-2
Situation where there is no chance of gain only loss
Pure Risk
What are the four elements of a contract
Consideration
Legal Purpose
Agreement = offer + acceptance
Competent parties
What is 3rd party coverage on an auto policy?
Bodily Injury and Property Damage
What is the loss valuation for Coverage C on homeowner's policies?
actual cash value
What is coverage D on a dwelling policy?
Fair Rental Value
Insurance company organized under the laws of any jurisdiction outside of the United States
Alien Insurer
What is underwriting?
the process of selecting, classifying, pricing and insuring risk
What clause states you cannot benefit from the insurer's insurance policy and is liable for any damages that occur while they have custody?
No benefit to bailee clause
What homeowners policy is mysterious disappearance covered on?
HO-5
When would you use an umbrella liability policy?
when the underlying policies do not provide coverage or do not provide enough coverage
Surplus line carriers
Company A insures your property with a limit of $50,000 and Company B for $150,000. Using Pro Rata how much will Company A pay if the insured suffers a $20,000 loss?
Company A will pay $5,000
What must be offered in Virginia when a policy holder has collision or other than collision?
Rental Reimbursement
Ordinance or Law pays the increased cost to bring repairs up to current code/regulation after a covered loss, what is the limit?
10% of coverage A
Who is responsible for identifying an area that is at-risk for flooding?
Federal Emergency Management Agency (FEMA)