Basics Of Casualty Insurance Flashcards
Property vs casualty
Property coveres personal belongings and real property
Casualty pays the “other guy”
Third party losses
Occurs when a person claims to have been injured by an insured or when a persons property has been damaged by the insureds actions.
Third party losses pt 2
First party- insured
Second party- insurance company legally representing or defending the insured
Third party is the other guy
Tort
Civil wrong that unfairly causes someone else to suffer loss or harm resulting in legal liability for the person who commits the tortious act.
Negligence
Failure to act or not act reasonable
Establishing negligence
Four factors must be involved:
1.Legal duty owed
2.Breach of legal duty owed
3.Proximate cause
4. Damages
Contributory negligence
Says that if a person contributed to his/her own damages in any way, another party cannot be held liable for the damages.
Comparative negligence
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.
Intervening cause
When an independent event affects the chain of events.
Defenses against a claim of negligence by another
Contributory
comparative
assumption of risk
intervening cause
statute of limitations
last clear chance
Absolute liability
Imposed by law on those participating in certain activities that are considered especially hazardous.
Another name is strict liability.
Vicarious liability
Liability for the actions of another.
Compensatory damages
Reimburses the injured party only for losses that were actually sustained. There are two types:
Special & General.
Special damages
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.
General damages
Compensate for things such as pain and suffering and mental anguish.
Non monetary losses
Referred to as full tort.
Punitive damages
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
Liability insurance
protects an insured from financial losses arising out of liability claims by transferring the burden of the loss from the insured to insurer
Bodily injury
Means injury, sickness, disease, and death arising out of injury, sickness or disease
Property damage
Damage to or destruction of property including loss of use of the property
Personal injury
Includes slander, libel, false arrest & invasion of privacy. Hurt feelings
