Basics Of Casualty Insurance

Question 1

Property vs casualty

Answer 1

Property coveres personal belongings and real property

Casualty pays the “other guy”

Question 2

Third party losses

Answer 2

Occurs when a person claims to have been injured by an insured or when a persons property has been damaged by the insureds actions.

Question 3

Third party losses pt 2

Answer 3

First party- insured
Second party- insurance company legally representing or defending the insured
Third party is the other guy

Question 4

Tort

Answer 4

Civil wrong that unfairly causes someone else to suffer loss or harm resulting in legal liability for the person who commits the tortious act.

Question 5

Negligence

Answer 5

Failure to act or not act reasonable

Question 6

Establishing negligence

Answer 6

Four factors must be involved:
1.Legal duty owed
2.Breach of legal duty owed
3.Proximate cause
4. Damages

Question 7

Contributory negligence

Answer 7

Says that if a person contributed to his/her own damages in any way, another party cannot be held liable for the damages.

Question 8

Comparative negligence

Answer 8

Laws allow a finding of liability to be made even when both parties have contributed to the loss, with an award based on the extent of each party’s negligence.

Question 9

Intervening cause

Answer 9

When an independent event affects the chain of events.

Question 10

Defenses against a claim of negligence by another

Answer 10

Contributory
comparative
assumption of risk
intervening cause
statute of limitations
last clear chance

Question 11

Absolute liability

Answer 11

Imposed by law on those participating in certain activities that are considered especially hazardous.

Another name is strict liability.

Question 12

Vicarious liability

Answer 12

Liability for the actions of another.

Question 13

Compensatory damages

Answer 13

Reimburses the injured party only for losses that were actually sustained. There are two types:
Special & General.

Question 14

Special damages

Answer 14

Include all direct and specific expenses involved in a particular loss, such as medical expenses, lost wages, funeral expenses, and the cost to repair or replace damaged property.
Provable monetary losses.
Referred to as a limited tort.

Question 15

General damages

Answer 15

Compensate for things such as pain and suffering and mental anguish.
Non monetary losses
Referred to as full tort.

Question 16

Punitive damages

Answer 16

Intended to reform or deter the defendant and others from engaging in conduct similar to that which formed the basis of the lawsuit.
Gross negligence

Question 17

Liability insurance

Answer 17

protects an insured from financial losses arising out of liability claims by transferring the burden of the loss from the insured to insurer

Question 18

Bodily injury

Answer 18

Means injury, sickness, disease, and death arising out of injury, sickness or disease

Question 19

Property damage

Answer 19

Damage to or destruction of property including loss of use of the property

Question 20

Personal injury

Answer 20

Includes slander, libel, false arrest & invasion of privacy. Hurt feelings