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NY Study Group > 1J-1L > Flashcards

1J-1L Flashcards

1
Q

Valuation is the ________ of an item’s worth.

A

Estimation

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2
Q

1.Actual Cash Value - ACV
2.Replacement Cost - RC
3.Stated Amount
4.Agreed Value - Valued Policy
Are various methods of what?

A

Valuation

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3
Q

Actual Cash Value take an item’s ________ into account.

A

Depreciation

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4
Q

Replacement Cost is based on what?

A

Current market prices

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5
Q

Define Depreciation

A

An item’s estimated loss of value due to wear, tear, and age.

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6
Q

Annual and Accumulated are ways to calculate depreciation. True or False

A

True

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7
Q

Broad Evidence Rule takes into consideration any evidence available to determine value. This rule is used in ALL states.

A

False - only used in some states

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8
Q

No depreciation, based on replacement cost at the time of loss, and higher premiums are all characteristics of what?

A

Replacement Cost

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9
Q

What does the principle of indemnity state?

A

The insured cannot profit from an insurance transaction.

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10
Q

_______ ________ ______pays to replace an outdated, obsolete item with a functionally equivalent item - mot an identical item

A

Functional Replacement Cost

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11
Q

When something is no longer used or wanted, despite being in good working order is the definition of what?

A

Obsolescence

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12
Q

What is the policy where the insurer and insured agree to a specific value for an item, appraised at the inception of the policy.

A

Valued Policy

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13
Q

A Stated Amount (also called a Stated Value) is the value that the insured claims an item is worth
when applying for an insurance policy. On this type of policy, how are the premiums determined?

A

The policy premiums are then based on this stated value.

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14
Q

What is the difference in a partial loss and a total loss.

A

Partial Loss - insured property is only partly damaged, and repair costs fall within the policy limit
Total Loss - insured property is damaged so badly that it is not worth repairing

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15
Q

What are two types of total loss?

A

Actual total loss and Constructive total loss

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16
Q

A _________ is a predetermined amount that a policyholder must pay in order to activate the
financial benefits of an insurance policy.

A

Deductible

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17
Q

What are the three types of deductibles?

A
  1. Fixed Deductible
  2. Percentage
  3. Franchise
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18
Q

What type of depreciation is predetermined amount that a policyholder must pay out-of pocket
before he can be indemnified?

A

Fixed Deductible

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19
Q

On percentage deductibles, what value is the percentage based on?

A

The percentage is based on the value of the insured risk.

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20
Q

A _________ deductible states that the policyholder only pays for damages that are less than his
deductible. If the cost of damages equals or exceeds his deductible, the insurer pays the full
amount and the policyholder pays nothing.

A

Franchise

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21
Q

Coinsurance imposes a penalty on coverage for partial losses if the property is not fully insured - ____% of its RC.

A

80

22
Q

Define Liable

A

Obligated according to law or equity; responsible

23
Q

Liability insurance protects the policyholder by paying for such damage on behalf of the
responsible, or liable, party. True or False

A

True

24
Q

_______ insurance only covers people who are listed as “insured” under the policy.

A

Liability

25
Q

Failure to exercise a reasonable degree of care in a particular situation is Negligence. Negligence can be one of two things, what are they?

A

An act or the omission of an act.

26
Q

When does Vicarious liability apply?

A

When an act of negligence is transferred from one party to another.

27
Q

Negligence is always an unintentional act. True or False

A

True

28
Q

What are the three types of liability policy limits?

A
  1. Single limits
  2. Split limits
  3. Aggregate limits
29
Q

Define Single limit.

A

Establishes on maximum payout for liability damages caused by the PH and the limit applies for each occurrence.

30
Q

Split limit liability insurance establishes HOW MANY different limits of payouts in the policy.

A

Three

31
Q

Aggregate limits are usually found in _______ liability policies and establishes HOW MANY liability limits?

A

Commercial

Two

32
Q

________ Law: based on written laws (e.g. state legislature)

A

Statutory

33
Q

_______ Law: based on court decisions and customs when statutory law does not provide an answer.

A

Common

34
Q

Statutory Law governs the authority of Common Law. True or False

A

True

35
Q

Any civil wrongdoing, whether intentional or unintentional is know as ______

A

Tort

36
Q

In a criminal case the ______ charges an individual.

A

State

37
Q

In a civil case one individual charges another. True or False

A

True

38
Q

The authority of a court or judge to hear a case and to make a judgement is _________.

A

Jurisdiction

39
Q

Plaintiff is the party who suffered injury or damage; aka claimant. True or False

A

True

40
Q

Define Tortfeasor.

A

The party accused of committing a tort, otherwise known as the defendant.

41
Q

A group of two or more parties accused of committing a tort is know as?

A

Joint Tortfeasor

42
Q

What are the two types of tort?

A

Intentional Tort and Negligent Tort

43
Q

Define Complaint.

A

When a claimant files a lawsuit against a policyholder for damages the policyholder caused.

44
Q

Define Answer.

A

The tortfeasor, or defendant’s, response to the complaint

can be one of the following:
● I accept the complaint and will pay for damages
● I deny the complaint
● I accept the complaint with a right to insert evidence into the case

45
Q

When a policyholder is taken to court, the insurer must do what?

A

● Defend the policyholder

● Pay any legal expenses that are incurred at its own request

46
Q

When the circumstances of a lawsuit or a claim may not be covered under the policy, the insurer will issue a _______ __ ______ .

A

Reservation of Rights

47
Q

Money awarded to punish egregious misconduct
● For intentional acts, such as slander, fraud, violence, oppression, or recklessness
● Not typically covered in liability insurance

A

Punitive Damages

48
Q

Awards money for tangible and intangible damages.

A

Compensatory Damages

49
Q

A law limiting the amount of time an injured party has to file a complaint after an occurrence is known as.

A

Statute of Limitations

50
Q

Define Wrongful Death Act.

A

Law that defines the rights of individuals who are associated with someone who was killed because of a negligent act.

51
Q

Law that restricts people from suing governmental entities.

A

Sovereign Immunity

52
Q

What do workers’ compensation laws do?

A

Restrict an employee’s right to sue his or her employer for injuries that occurred on the job

NY Study Group (8 decks)

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