Chapter 1
The risk-evaluation process used by insurance companies to decide whether to accept an applicant
Underwriting
The same financial or physical condition that existed prior to the loss
Indemnity
Today's cost minus depreciation is
ACV
Which Party does property insurance cover
1st Party You and Yours
How often must the TDI examine a companies Records
5 years
Define Peril
Cause of Loss
Name the Four Major Parts of an Insurance Contract
Declarations, Insuring Agreement, Conditions, Exclusions
Coinsurance / 80%
This type of liability exists through the action of others
Vicarious Liability
A person in a position of trust that cares for or acts on behalf of another financially:
Fiduciary
What are the 2 types of Risk and explain the difference between them
Pure Risk - No Chance of Financial Gain
Speculative Risk - Chance of Gain or Loss
This must exist at the time of the loss
Insurable Interest
A dispute between the 1st Party and the 2nd Party resolved with an Umpire
Appraisal
The four elements of Negligence are
Duty, Breach of Duty, Damages, Proximate Cause
What must a licensed agent do prior to transacting insurance?
Get Appointed
Protects the consumer’s right to the privacy of credit and financial information, ensuring that all collected data is confidential, accurate, relevant, and properly used for a specific purpose
FCRA
The customer makes the offer by submitting the application and the Company Accepts by providing Policy Number
Clause that states a 3rd party with Care, Custody, and Control of property cannot benefit from your insurance
No Benefit to Bailee
Special Damages - Specific damages with specific dollar amount/ Hospital Bill, Repair Costs etc..
General Damages - No specific dollar amount and has to be determined / Disfigurement, Scarring, etc...
Which type of producer places business with an unauthorized company?
Surplus Lines Agent
The legislation defined an act of terrorism as any act certified by the _______
Secretary of Treasury
Name the 4 Legal Elements of a Contract
Consideration, Legal Purpose, Agreement, Competent Parties
Used to eliminate small nuisance claims and control your premium
Deductible
Any payments associated with investigating and resolving claims are paid in addition to the policy’s limits.
Supplemental
What is an agent/producer authorized to do once appointed by a company
Sale, Solicit, Deliver, Negotiate, Transact, Accept Premium etc..