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A snapshot of the insurer's financial position
What is a balance sheet?
The only kind of risk that is insurable because there is no possibility of gain.
What is pure risk?
The policy cover page which contains answers to who, what, when, where, and how much coverage is offered.
What is the declarations page?
The characteristic of insurance contracts that states that both parties are responsible for fulfilling certain requirements
What is Conditional?
The shifting of financial risk from one party to another
What is Transfer?
The portion of a premium for which insurance has already been provided.
What is earned premium?
The quadrant of risk that represents conditions that increase the likelihood of loss
What is hazard risk?
This part of the policy contains provisions, including what is expected of the insurer and insured
What are the Conditions?
The characteristic that prevents a homeowner from transferring their policy to the new buyer
What is personal?
The principle that insurance policies are easier to rate the more data they have on a group of similar exposures
What is the law of large numbers?
The unit of measure used to determine an insurance policy premium
What is an exposure unit?
An uninsurable risk that occurs due to changes in the market forces on assets and liabilities
What is financial risk?
This part of the policy contains coverages that are included without additional cost.
What are additional coverages?
The characteristic of insurance that requires insurers to restore insureds to their previous financial position, but prevents the insured from gaining
What is indemnity?
The loss valuation method that factors in depreciation
What is actual cash value?
The premium for a policy insuring a 2500 square foot home at a rate of 0.3.
What is $750.
A wet floor would be this kind of hazard risk
What is a physical hazard?
The four core pieces of an insurance policy
What are the Declarations, Insuring Agreement, Conditions, Exclusions
The characteristic that refers to the contract being non-negotiable
What is adhesion?
When this is greater than 100, it indicates and underwriting loss
What is a combined ratio?
THE COMBINED RATIO:
Earned Premiums: $4,000,000
Written Premiums: $6,000,000
Incurred Losses: $1,000,000
Incurred UW Expenses: $3,000,000
What is 0.75 or 75%
The kind of hazard risk that is uninsurable because it is intentional
What is moral hazard?
The part of the policy that lists covered causes of loss.
What is the insuring agreement.
The characteristic of insurance contracts that refers to one party benefiting more than the other
What is unequal or aleatory?
General damages collected due to a spouse passing and no longer sharing their companionship
What is loss of consortium?