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APA > 92 > Flashcards

92 Flashcards

0
Q

Rating plan

A

Set of directions that specify criteria of the exposure base, the exposure unit, and rate per exposure unit to determine premiums for a particular line of insurance

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1
Q

Rate

A

The price of insurance per exposure unit that when multiplied by number if exposure unit, determines premium

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2
Q

Insurance rate consists of

A

An expected loss component
Underwriting expense constant
Allowance for underwriting profit and contingencies

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3
Q

Expense loading

A

Element in gross rate that covers the insurers underwriting expense, profits, and contingencies

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4
Q

Pure premium

A

The amount included in the rate per exposure unit required to pay losses

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5
Q

Pure premium=

A

Dollar amount of losses incurred in the experience period/number of earned exposure units

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6
Q

Gross rate=

A

Pure premium/expected percentage of losses and loss adjustment expenses

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7
Q

Manual rate

A

Rate found in rating manual

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8
Q

Manual premium

A

Premium developed from applying manual rate

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9
Q

Credibility factor

A

Factor applied in rate making to adjust for the predictive value of loss data and used to minimize the variations in the rates that result from purely chance variations in losses

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10
Q

Trend factor

A

Adjustment to loss data for a change in general economic conditions such as inflation

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11
Q

Merit rating plan

A

Insurance rating plan that increases or decreases manual rates for a particular insured based in that insurers actual or expected loss experience

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12
Q

Retrospective rating plan

A

Rating plan that increases or reduces the premium for future policy period based on insureds own loss experience during the same policy period

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13
Q

Schedule rating plan

A

A rating plan that awards debuts or credits based on specific categories such as the care and condition I the premises or the selection and training of employees

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14
Q

Schedule rating plan

A

Rating plan that awards debuts or credits based in specific categories such as the care and condition of premises or the selection and training of employees. This amount does not generally exceed 25%

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15
Q

What is amount for loading and contingencies?

A

Usually 5%

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16
Q

Three major goals of rate regulation are to ensure

A

Rates are adequate, not excessive, and not unfairly discrimitory

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17
Q

Adequate

A

Rate should be high enough to pay all claims and expenses related to rates

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18
Q

Not excessive rates

A

Insurers rates should not he excessive

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19
Q

Rates should not be unfairly discriminatory.

A

Rates can be discriminate but not unfairly

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20
Q

Mandatory rate law

A

State law under which insurance rates are set by a state agency or rating bureau and all licensed insurers are required to use those rates

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21
Q

Prior approval law

A

State law under which insurance rates must be approved by the state insurance department before they can be used

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22
Q

File and use law

A

State Law under which insurance rates must be filed with the state insurance department but can then be used immediately

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23
Q

Use and file law

A

Insurance rates can be put into effect with filing information subsequently submitted and subject to regulatory review

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24
Q

Flex rating law

A

State law under which prior approval is required only if the new rates exceed a certain percentage above (and sometimes below) the rates previously filed

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25
Q

Open competition system

A

A system under which rates do not have to be files with the state insurance department

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26
Q

Admiralty law is

A

The traditional body of rules and practices relating to commerce transacted at sea, navigation, and general maritime affairs.

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27
Q

An in rem endorsement is a

A

Maritime endorsement that extends coverage to defendants in a vessel belonging to the insured, rather than just the named insured

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28
Q

A right of sailor is maintenance which is

A

A remedy for injured sailors and crew members to receive food and lodgining

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29
Q

A right of sailors is cure which is

A

A remedy for insured sailors and crew members to receive medical care, encompassing hospital and rehabilitation

30
Q

Comparative negligence

A

Is a defense to negligence that apportions damages to respective degree of fault within plaintiff and defendant.

31
Q

FELA - federal employees liability act

A

Provides comp regards to fault. Comparative negilgence. Interstate railroad workers are covered

33
Q

DOHSA - death on high seas act

A

Allows for recovery of a person caused by wrongful act, neglect or default occurring in high seas beyond maritime league from the shore of any state. DOHSA applies only to death occurring more than three nautical miles (1 nautical mile = 6080 feet) from shore of any state. The Jones act covers the 3 miles of land before that.

34
Q

Jones Act

A

Injured sailors have additional recourse and can sue the shipowner for damages caused by negligence in operating the ship

35
Q

LHWCA - United States Longshore and Harbor Workers’ Compensation Act

A

Federal statute that eliminates right of maritime workers to sue employers. It requires such employers to provide injured or ill workers with benefits like WC for injury and illness. LHWCA does not include “a master or member of a crew of any vessel.” They can seek remedies from Jones Act

36
Q

Seaman status test has four elements

A
  1. Vessel must be in navigation
  2. The worker must have been employed as a master or member of the crew and must call for service on a vessel.
  3. The employee must have a more or less permanent connection with the vessel.
  4. Worker’s duties must contribute to function of vessel or accomplishment of it’s mission.
37
Q

A seaman is not considered one if they spend less than ___% of his or her time in service of a vessel in navigation

A

30%

38
Q

What is navigable waters?

A

A body of water is navigable if it, by itself or by uniting with other waterways, forms a continuous highway capable of sustaining interstate or foreign commerce.

39
Q

The term “vessel” encompasses

A

most types of man-made floating objects as well as ships transporting passengers or cargo and fishing boats. This could include barges, dredges and the like.

40
Q

An injured worker can recover for damages such as

A

medical, pain and suffering, lost earnings, mental anguish, past and future economic loss, and impaired enjoyment of life.

41
Q

An injured workers can not recover for loss of

A

consortium (love, companionship, and affection).

42
Q

What is stevedoring?

A

The loading and unloading of vessels

43
Q

LHWCA covers all maritime employees. What is considered a maritime employee?

A

Maritime employment covers employees engaged in longshoring, harbor work, ship repair, shipbuilding, and ship-breaking in navigable waters except master or members or the crew of a vessel.

44
Q

Maritime employees do not include

A
  1. individuals employed exclusively to perform office clerical, secretarial, security, or data processing.
  2. individuals employed by a club, camp, recreational operation, restaurant, muesuem, or retail outlet
  3. individuals employed by a marina and who are not engaged in construction, replacement, or expansion of such marina (except routine maintanenance)
  4. individuals who are employed by suppliers, transporters, or vendors, temporarily doing business, not engaged in work normally performed by employees
  5. aquaculture workers
  6. individuals employed to build, rapir, or dismantle any recreational vessel under 65 feet in length.
  7. a master or member of a crew of any vessel
  8. any person engaged by a master to load or unload or repair any small vessel under eighteen tons net.
45
Q

terminal operations

A

cargo handling activities associated with stevedoring

46
Q

What is considered a small vessel?

A

a commercial barge under 900 lightship displacement tons and tugboats, towboats, crew boats, supply boats, fishing vessels under 1600 tons gross

47
Q

What is ships displacement?

A

Empty vessels weight measured in long tons (2240 pounds)

48
Q

What is a vessel’s gross tons (long tons)?

A

measurement of volume of vessel’s enclosed spaces, counting each 100 cubic feet as one gross ton.

49
Q

What is shipbreaking?

A

All facets of scrapping a vessel from striping non ferrous fittings, reducing hull to convenient size, moving and pulling scrap

50
Q

What are the two tests that are used to determine LHWCA coverage?

A

A status and situs test

51
Q

What is a status test?

A

The test to determine maritime employment. The worker’s shoreside presence is merely incidental to work on the water. If it is, the worker retains employee status while ashore.

52
Q

What is a situs test?

A

Claimants locatin at time of injury must be on navigable waters or certain adjoining areas.

53
Q

What is a dry dock?

A

A dock from which water can be pumped out and that is used for building ships or for repairing ships below their waterline. This includes floating dock and graving dock and cranes, scaffolds, etc with them

54
Q

What is a building way or marine rail way?

A

This is the land adjacent to incline or track system devoted to construcing or reparing vessels

55
Q

In stevedoring, there are penalty rates for handling

A

raw hides, soda ash, old bones, acids, ammunition, and explosives

56
Q

Is OT excluded in Stevedoring

A

Exclusion of overtime pay does not apply to payroll assigned to any classification under the caption “stevedoring” with a code number followed by the letter F.

57
Q

Robbery is?

A

The unlawful taking of property from care and custody of a person by one who has caused or threatened that person bodily harm

58
Q

Burglary is

A

The unlawful taking of property from inside a building by unlawful entry or exit, signs of force-able entry or exit must be visible

59
Q

What is embezzlement

A

The unlawful taking of money or property by a person to whom it has been entrusted

60
Q

Fideility agreement

A

covers loss caused by dishonest or fraudulent acts committed by employees

61
Q

Suretyship is?

A

obligation of one entity to answer for debt, default, or miscarriage of performance of duties by another entity

62
Q

segregation of duties

A

processes that ensure no one individual has physical and system access to control all phases of business process or transaction

63
Q

Book value (net depreciated value)

A

assets historic cost minus accumulated depreciation

64
Q

depreciation is

A

a noncash expense used to allocate cost of long term assets over multiple accounting periods

65
Q

Actual cash value is

A

replacement cost of a property minus its physical depreciation

66
Q

Replacement cost

A

is the amount required to replace lost, damage, or destroyed property with comparable property

67
Q

coinsurance clause

A

requires the insured to carry insurance equal to at least a specified percentage of insured propertys value

68
Q

Loss payable =

A

[limit of insurance/(value of covered property x coinsurance %)]* amount of covered loss} - deductible

69
Q

Value reporting form (CP 13 10)

A

a commercial property form that bases insured’s premium on business property values that insured reports to insurer periodically during the policy period

70
Q

Insurers payment =

A

(value reported/actual value) x loss) - deductible

71
Q

Business income coverage is

A

coverage for the loss of net income and continuing normal operating expenses during the period of inturruption

72
Q

Extra expense coverage is

A

insurance coverage for extra expenses incurred by the named insured to avoid or minimize suspension of operations resulting from direct damage caused by a covered cause of loss.

73
Q

Extended business income coverage

A

insurance coverage for business income losses that continue after period of restoration ends, coverage beings when the damaged property has been restored

APA (5 decks)

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