C131 Flash cards
Chapters 1-12
1
Q
What is the purpose of a cross-liability clause?
A
It allows the policy to respond as if each named insured had a separate policy.
2
Q
Resources to Assist Analysis
A
Survey Forms: designed to elicit specific details of exposures
Goal is to describe, classify and assess risk
Can be used as checklist to ensure that the broker gathers all relevant information
Prompts broker to initiate discussions about improving exposures
Analysis by Exception: determining which risk will likely affect the client the most
Familiarize yourself with the industry
Ask tailored questions to determine how client’s business is different from others in the same industry
Information Resources
Researching the company and industry online or at a library
Reading industry specific periodicals
Speaking with insurance company personnel who may be familiar with the exposures
Talking to insurance claims personnel to understand losses this industry has experienced
Research the Individual: how the company you are dealing with differs with others in the industry
Companies Differ Regarding:
o Specific risks faced including risks assumed in contracts
o Insurance requirements – both optional and mandatory for the jurisdictions
o Risk Appetite: what the client is prepared to retain – help with decision
Example: deductibles & self-insured retentions
Client’s Records: can reveal how the organization is run, specific losses it may be exposed to
Loss History: can provide information about the types of loss that a client is prone to
Frequency of small losses could indicate need to amend loss control procedures to avoid in future
Can indicate the need for a higher deductible
Potential for severe loss, loss control techniques and insurance is appropriate
Inspection: can reveal information pertinent to underwriting a risk
Example: client states premises protected by sprinkler but building is old and sprinklers painted over
3
Q
Risk Management
A
: permit insurance/risk professionals to apply systematic approach to eliminate loss exposures/minimize detrimental effects of loss exposures at least possible costs
o As a Science: identifies, measures and controls risk
o As an Art: relies heavily on experience and common sense
o Used as prospecting tool, ensures that brokerage and insurers taking only risks they are prepared to manage/service
4
Q
o The Risk Management Process:
A
Risk Analysis: identifying and analyzing risk exposures
Objective is to find a cost-effective manner to manage risk
Loss Prevention Advice: formulating options for dealing with each
exposure
Selecting the Best Technique/Combination of Techniques for Dealing with the Exposure
Implementing the Chosen Technique or Combination of Techniques
Monitoring the Results and Modifying Techniques Used as Necessary
5
Q
Risk Manager:
A
can be principal of the client’s business, working alone, working together with accountants/plant
managers/vice president/HR manager/lawyer
Large Organizations: responsible for developing/co-ordinating risk management functions, acting as
advisors to the business
Small Organizations: duties shared among line managers
6
Q
Outside Experts:
A
Outside Experts: may need to refer to if limits and boundaries of risk management are outside of your scope
Municipal Fire Departments: inspect a location, point out fire hazards and recommend corrective action
Police: crime prevention services
Accountants: estimate amounts subject to loss and determine resources available to handle the loss costs
Lawyers: review leases/contracts and give legal advice
Consultants: help identify exposures, critique practices, advice on compliance with legal requirements
o Example: safety consultants, trucking workplace health
Property Appraisers: set insured values
7
Q
Levels of Risk
A
Frequency of Loss: some risks are more likely to occur
Severity of Loss: some have greater financial consequences than other
Example: house by the side of a river and the river is known for potential to overflow – this is a high risk
situation
o If one home is a summer house valued at $35,000, placed on the bank
o Second is a luxury home valued at $500,000, placed up the hill
o First home is a greater risk for loss but second home has a larger severity of claim
Example: 1993 flooding of the Red River & Mississippi River
o Some residents decided to abandon their properties and move to higher ground
8
Q
How do you Identify & Analyze Risk Exposures?
A
What is at risk?
What may give rise to a loss?
How much could a loss cost?
Likelihood
Frequency
Severity
9
Q
Avoiding Risk:
A
Avoiding Risk: eliminate potential losses if possible
Example: if client permits members of public to tour plant, could be liable for injuries suffered on premises
o Can avoid risk by discontinuing tours
Eliminating one risk can cause another to be created
o Example: sending goods by common carrier instead of the insured’s own truck, can increase risk
of loss to the goods in transit
10
Q
Reducing Risk:
A
Reducing Risk: can be accomplished by a variety of loss control techniques – reducing frequency and severity
Physical Safety Measures:
o Examples: Installing safety devices on machines
Removing ice driveways/walkways reduces vehicle and pedestrian accidents
Lighting in parking areas reduces risk to individuals by deterring thieves
Removal of flammable waste
Administrative Safety Measures:
o Duplicating valuable information and storing off premises
o Monitoring driving records (MVRs) of drivers
o Regular audits of cash/inventory
o Requiring credentials, references and proof of insurance from independent contractors
11
Q
Retaining or Transferring Risk
A
Transferring Risk: two types
o Non-Insurance Transfers/Contractual Transfers: transfers risk to others in contractual agreements
Retaining Risk: two reasons for retention
o Minor Exposures: predictable and within the client’s tolerance
Example: a company owns 50 laptops valued at $3,000 each – average of ten stolen or otherwise each year resulting in claim of $30,000
Renewal premium to insure is $45,000
Client would be advised to retain the risk
12
Q
PIPEDA – 10 Principles
A
PIPEDA – 10 Principles • Accountability • Identifying purposes • Consent • Limiting collection • Limiting use, disclosure, and retention • Accuracy • Safeguards • Openness • Individual access • Challenging compliance
13
Q
What is FOIPP?
A
The Freedom of Information and Protection of Privacy Act
applies to all public bodies rather than private organizations in
the province of Alberta
14
Q
What is CASL?
A
Canada’s new Anti-Spam Legislation (CASL) is a broad
piece of legislation that was designed to prevent/reduce
‘spam’. It does so by prohibiting the sending of
‘commercial electronic messages’ unless they meet
specific form, content and consent requirements.
15
Q
Risk Managers
A
Identifying loss exposures Preventing loss Reducing loss Financing loss Educating others Act as a resource
16
Q
Sourcing Clients
A
Clients may be obtained ___actively____ & ______passively_
» How a client sources out a broker (passive)
» How a broker sources out a client (active)
17
Q
Standard
A
• insured pays deductible before insurer
will pay remainder of loss
18
Q
Franchise
A
• if loss exceed the deductible, insurer
will pay total loss
19
Q
Disappearing
A
• as loss increases, deductible decreases
20
Q
Risk Management Process
A
- Identify & Analyze Risk Exposures
- Formulate Options
- Select Best Technique(s)
- Implement Technique(s)
- Monitor Results; Modify as necessary
21
Q
How do you Select Best Technique(s)?
A
Reduce/ Eliminate
Assume / Retention
Transfer(insurance or contracts)
22
Q
How do you Monitor Results; and Modify as necessary?
A
How is the program working?
Any losses?
Any Changes?
23
Q
How do you Formulate Options?
A
Loss Control: Techniques that reduce (size)
1) Avoidance
2) Loss Prevention
3) Loss Reduction
4) Separation/Diversification
5) Non-insurance risk transfer
Loss Financing: Techniques to pay for losses that do occur
Retention: Self insurance through source of funds(current funds, unfunded reserves, funded reserves, borrowing, Captive Insurance Company)
Transfer: Business Contract Insurance Contract
24
Q
How do you Implement Technique(s)?
A
Requires a technical decision – what should be done
Requires a managerial decision – who should do it, and when it should be
done
A risk management plan needs to be created and should include:
• An overall implementation plan (how this will get done)
• Communications plan (telling people why - clients, business partners &
employees)
25
What types of client records could help you
| identify and / or analyze their risks?
```
Financial statements
Accounting records
Contracts
Sales brochures
Websites
```
26
What are the consequences of loss?
```
» Time shortage
» Cost of replacing customers
» Delay in taking products to market
» Loss of employees
» Interruption of business growth
```
27
Initial Assessment – Before the 1st Meeting
```
Size
Location
Structure
Industry
Customers
Processes
Services Offered
Objectives /
Goals
Attitudes / Beliefs / Culture
```
28
two factors to determine best method to use to contact and market to clients
1) What does the client want?
2)How much client contact does the intermediary need to be
effective?
29
Describe the initial interactions with clients when gathering data for
their insurance and risk management programs
First Steps: Will depend on the size and complexity of the account
Gaining Trust: Establishing credibility & building rapport
Selling Risk Analysis
Obtaining Documents
30
Evaluation of Client’s Needs: What can the information tell
| you?
Review Exclusions: examine wordings of existing policies to determine if any exclusions resulting in uninsured exposures
Locations and Values: do the values appear reasonable
Loss History: identify patterns of loss frequency or severity
Example: loss history of a retail bakery
o Claim involving broken tooth due to hard object in a sandwich
o Product list does not include pre-made sandwiches, client advises occasionally caters office parties
Financial Statements: analysis of client’s sales/exposures to calculate business interruption values,
Contracts: determine client’s exposures
31
What are examples of activities that you would do during subsequent
meetings?
```
-Additional questions
» Additional requests for information
» Site inspection
» Survey completion
» Loss prevention, risk control & risk retention conversations
```
32
How does a broker turn a lead into an opportunity to provide insurance quotation?
Step 1
• Research client & industry prior to the meeting. Prepare.
Step 2
• 1st meeting (engage , agree, & gather information)
Step 3
• Analyze & evaluate information (what remains, next steps)
Step 4
• 2nd meeting (more depth including inspection/visit)
Step 5
• Final analysis to ensure everything needed for insurer quotation
33
Outline the process of client contact and assessment of client needs and
service requirements
1. Do an initial assessment because each client is unique.
2. There is no set formula for how to interact, so consider the following:
o What does the client want?
o How much client contact does the intermediary need in order to be effective?
3. Gather information
4. Investigate risk exposures
5. Consult colleagues, insurers, the Internet, and the client’s website regarding account, industry trends, and profiles of the prospect’s industry
34
Describe the purpose of additional meetings with the client and the
information that can be collected during these interactions.
A second or even third meeting with a prospective client is a marketing exercise as much as a factfinding venture.
• Engage the client and ask appropriately targeted questions.
o Identify and clarify loss exposures
• If inspections are required, have the client conduct the tour at a time convenient to all insurers who want to visit the premises in order to limit inconvenience to the client.
• Engage in further discussions (e.g., cyber risk).
35
Soft
| Market
• Excess financial capacity.
• Marketing efforts are intensified.
• Premium rates fall, policy conditions relax, and loss
prevention reduces.
36
Hard
| Market
• Companies avoid being the first to raise premium rates.
• Follows from rates of return drops.
• Insurers approach risks cautiously, underwriting
standards exact, rates increase.
• Insurers withdraw from markets and run-off risks.
37
•Warranty
is a promise by an insured to maintain certain conditions of the risk during the term of the policy. It is a secondary or collateral promise of the contract, but it is deemed to be material to the risk;
38
Promissory warranty
promises not only that a fact is presently true but that it will
continue to be true during the policy period;
39
–Affirmative warranty
states that a fact is true when the insurance policy is purchased
40
How to Select insurers (3)
» Risk appetite
» Specialty markets
» Financial strength
41
What affects the choice of policy forms?
Exposures and size
» Coverage client wants plus enhancements recommended
» Variations between individual insurers
» Warranties
» EIL – environmental impairment liability insurance
42
What things should you Compare and contrast with each insurers? (5)
```
» Definitions
» Exclusions
» Extensions
» Limitations
» Conditions
```
43
Important fine print of the policy wordings:
Look for inconsistent terms: rider, floater, wording = same thing!
Term “all risks” inconsistently used.
Changing Markets = Change to policy wordings
(They change for a variety of reasons.)
Customization of wording using manuscript wording
44
What’s the difference between a Producer and a Marketer?
o Producer (Account Executive): responsible for prospecting for and meeting with clients, presents proposal to client
o Marketer: prepares request for quotations and submits the request to underwriters
Analyzes quotations received and prepares proposal
45
Outline the factors that affect how a risk is marketed
Organizing the Data:
Teamwork
Marketing
o Marketing Strategy
46
o By the End of the Second Meeting:
By the End of the Second Meeting:
Completed identification and analysis of client’s loss exposures
Gained understanding of business operations
Determined his/her wishes with respect to insurers
Begin preparing submission (completed after 3rd meeting)
47
Marketing approaches
o Market Intelligence: knowing what general market offers
Market Trends: knowledge allows you to make more detailed market comparisons and develop stronger strategies
Market Research: understanding various insurers’ appetite for business, being aware of premium levels/rates for different risks, keeping up to date on changes in wordings such as new exclusions
Universal Changes in Wordings: terrorism, mould, pollution exclusions due to events affected industry
Individual Changes in Wordings: insurer decides to change general liability wording from an occurrence basis form to claims made form for certain classes
Market Conditions: Hard/ Soft
48
Manuscript Wordings:
wording that does not conform to the standard wordings in general use, often unique to policy involved
o Can be developed by either the broker or the insurer (typically is the broker)
49
Quotation Request:
a set of documents submitted to an underwriter describing the risk to be insured and the coverages required
o Intended to provide the underwriter with sufficient detail to assess, underwrite and price the risk
o Cover Letter: brief summary of the risk and specify the date by which you want to receive the quote
o Effective Submissions: describe the risk/coverages required in format that enables underwriter to know if they can write
50
Proposal Contents
Name and address of the insured
List of locations, vehicles and equipment
Name and address of proposed insurers
Details of coverages being quoted along with details of any key exclusions, warranties, special extensions
Statement of terms and conditions of proposal
Recommendations for any additional coverages not currently carried
51
Subscription Policy
a single policy in which the coverage is shared among two or more companies – company with the largest share is the lead company & will issue policy documents
Same submission is sent to each insurer
Only lead will quote on the non-property coverages
Others will indicate rates/deductibles/wordings they require and percentage of risk they will write
52
Excess & Umbrella Policy
| What are they? When does a client need it?
* World Wide Coverage
* Excess Coverage over underlying personal insurance policies
* Personal Injury Coverage
* Defense, Settlement & Supplementary Payments
* Compensatory damages the insured is legally obligated to pay
* Omissions coverage for insured who is an officer/director of nonprofit organization
53
Underwriting Tips
» House hold members details
» Convictions/Accidents/Claims details for past 5 years
» All property owned
» Current primary insurance information
» Requested limit
» Business or income producing activities
» Denied, cancelled or non-renewed last 5 years
» Under age drivers
» Own, lease, charter aircraft
» Sit on non-profit board of directors
54
Possible insurer responses:
1) Request for more information
2) Decline the risk
3) Quote the terms (desired outcome!)
4) Quote part of the terms
55
When more than one insurer?
» Organize, document & illustrate the quotes so that you can formulate a
recommendation to your client
» Select the one that represents the best dollar value for the most
comprehensive coverage provided by the most stable insurer taking into
account client preferences
56
How to Prepare the Proposal?
» Customized based on size of client/account:
- Small: Informal meeting or phone call/F2F or e-mail.
- Medium: More elaborate presentation Phone or F2F.
- Large: Presented in person and in written form
All information the client needs to decide whether the intermediary can supply the wanted coverage & whether they will purchase this set of options and recommendations
57
What are the Proposal Contents?
Name and address of the insured
List of locations, vehicles and equipment
Name and address of proposed insurers
Details of coverages being quoted along with details of any key exclusions, warranties, special extensions
Statement of terms and conditions of proposal
Recommendations for any additional coverages not currently carried
58
The Fourth Meeting: Presenting the Proposal
o Discussion Content: Explain specific items of the written
proposal – the ones you know that matter the most. Introduce experts if applicable.
o Explaining Terms: Exclusions Warranties: actions that must be taken for coverage to exist Your Recommendations
-Legal: coverages accepted, recommended and declined. Coverage has yet to be bound until after the client selects the insurance program
o Document Advice
o Premiums
59
Closing the Sale
- Ask for the Sale
- Handle client hesitation
- Take out the word price in your vocabulary. » Replace it with value
60
Tactics to Combat Delay
“If I can do that for you today, will you go ahead with the
insurance?”
» Act as if the client has made the decision already.- Where can I send the pink card, to your personal email?
-Alternative Close: by offering more than one clearly defined alternative to the customer.» Would you like to go with $1 million in liability or $2
million.
61
-Alternative Close:
» The alternative close works by offering more than one clearly defined alternative to the customer.
» Examples:
» Would you like to go with $1 million in liability or $2
million.
» Would you like to go with Intact and 11 equal payments
of $---- or a down payment with Aviva and spread over
12 payment at $----
62
Obtain signature from client – why?
» Part of closing of sale
» Ensures it meets their expectations
» Confirms purchase of all coverages
» Agreement of the selected insurer
» Avoid E&O claim
» Any changes requires initials by client & broker
» Collect premiums (down pymt or total) once final instructions received
63
Ordering the Policy
```
Document any Changes
o Confirm Binding
o Binding Prerequisites
o Issue a Binder
-Confirm accuracy of documents before sending to client and forward them promptly
```
64
Contra Proferentem means
against the offeror
65
a contract of adhesion
a contract of adhesion
| When one party drafts the policy wording and controls it
66
Warranties
conditions an insured must fufiull
67
How long are binders usually issued for?
30-60 days
68
What are valid insurer responses? (4)
1. Requesting more info
2. Declining quote
3. Quoting on all or parts of the risk
4. not responding
69
What financial issues surround a broker's commissions as they relate to broker letters of record?
If the letter is sent during the policy term, you may not receive income for the remainder of the policy while you are liable for the outstanding premiums. If the letter is sent near the policy expiration, the previous broker may receive the renewal commission even though you are doing the work.
To avoid this, investigate the financial status of an account before you take it on, and if necessary, consider making arrangements for a fee for services.
70
What factors must be considered when preparing a premises survey? (6)
1. Property- suitability
2. Business interruption- bottlenecks
3. Crime -employee theft
4. Liability, automobile- cover and rating basis
5. Risk retention- claim reporting requirements
6. Unexpected exposures
71
What is the "shotgun" approach in marketing and why should it be avoided?
Sending a completed proposal for ANY given risk to ALL of the insurers you represent.
This negatively affects your relationship with underwriters as the risk may not be something that they are willing to take on, or if they want the risk, their chance of writing any given risk is greatly diminished.
72
Sales Objections Steps (4)
1. Acknowledge the concern
2. Clarify understanding & provide information
3. Restate or revise the recommendation
4. Check for acceptance
73
What are the 4 kind of contracts that need to be REVIEWED?
1. Premises Lease
2. Equipment Lease
3. Request for Proposals
4. Mergers & Acquisitions
74
a statement of values
a statement of values
the insured will have to provide. If insurance is provided on a stated amount co-insurance basis,
75
A boilerplate lease form
A boilerplate lease form
contains standard written content that is not changed from one contract to another
The term boilerplate refers to standardized text, copy, documents, methods, or procedures that may be used over again without making major changes to the original.
76
. If the business’s greatest need to remain viable is to stay open or to open again quickly following a
loss, what type of coverage does the client require?
: Extra expense insurance which pays the expenses over and above normal costs to facilitate early reopening
77
A shotgun approach involves sending
: A completed proposal for any given risk to all insurers represented
78
A bailee is someone who
receives the property of another for an agreed temporary period for some purpose other than a sale.
79
Two exclusions unique to a contractors’ equipment floater CEF are
muskeg and overloading
.: used to insure larger equipment such as equipment used for road building, excavation, building construction, municipal road maintenance and snow removal equipme
80
Which high-hazard operation is excluded in a normal commercial general liability policy?
: Underpinning
81
What is covered under insuring agreement V of the 3-D policy?
Losses that occur if the recipient of a cheque alters it to increase the amount
82
Bid Bond
guarantees that the contractor will accept the work if awarded it?
83
CGL exclusions(5)
1. Professional Liability. aka errors & omissions
2. injury to employees
3. cars, watercraft & aircraft
4. Care & custody
5. pollution
84
a CBE&S commercial building equipment and stock form (CBE&S) excludes
Boiler and Machinery.
- automobiles, watercraft
- furs or jewellery
- property vacant for more than 30 days
85
There are 3 forms of income replacement insurance under business interruption:
---Profits
» Gross earnings
» Rental income
86
Motor Truck Cargo
| » What are the Two forms written all risks or named perils
-– provides insurance for most property in the course of transit. Two forms –
1. Truckman’s form
2. Owner’s form
87
What kind of BI insurance does a manufacturer need?
Profits insurance – because cover continues until business returns to pre-loss levels or indemnity period
reached.
88
» Transit exposures forms (3)
» transportation floater
» motor truck cargo form
» trip transit floater
89
What does Cyber Risk Package usually cover? (4)
virus
theft data breach,
Network down
copy right/ trademark
90
General Contractors – two types
“Project Managers”
| “Jack of all Trades”
91
```
Guarantees that the
contractor will complete
the job as set out in the
contract, on time, within
the bid budget amount,
and free of liens upon
completion.
```
Performance Bond
92
Guarantees that all
suppliers of labour and
materials furnished for use
on the project will be paid.
Labour & Materials
| Payment Bond
93
Contractors can be held legally liable for injuries or damage that arise (2)
during their work and after its completion
94
If contractors rent premises, they are responsible for the physical damage under the
Tenants legal liability policy
95
What are the various types of “hazardous
| operations”? with contractors?
1. Excavation
2. Tunneling
3. Demolition
4. Underpinning work
96
Stop gap coverage
. Stop gap coverage protects business owners from lawsuits filed over workplace injuries.
97
Identify all exposures that arise out of builders risk construction projects.
```
• Exposures include the following:
o Children playing in area
o Damage to underground cables/pipes
o Tools dropped on passersby
o Materials blown off the roof
```
98
Property and liability policies typically EXCLUDE losses occurring during
alteration or
| addition unless permission has been granted
99
Factors affecting the quality of
| work:
Builder’s experience
Builder's expertise
Builder’s reputation
100
Contractors need to purchase various types of coverage:
o Bonds
o Liability
o Equipment coverage
101
What are the five usual exclusions in warehouseman’s legal liability insurance?
* Money, securities, and other financial documents, such as evidence of debt or title
* Employee theft and dishonesty
* Standard nuclear incident and war exclusions
* Loss of use of property
* Custody of care
102
List five items usually covered by environmental liability/pollution coverage
* Sudden and accidental pollution events
* Gradual pollution events
* Off-site cleanup costs
* Prior act
* Shareholders, officers, employees, directors, or other members of elected boards
* Damages involving noise or other sensory phenomena
103
What are five factors to consider when recommending cyber insurance?
* What security is already in place?
* What security needs to be in place?
* Where are their cloud accounts located?
* Which risks can be avoided, retained, or controlled?
* Which risks need to be insured (or transferred)?
* What kinds of personal information are being stored?
104
CGL insurance provides coverage for the insured’s legal liability arising from what and subject to
what? (5 marks)
a. CGL coverage arising from and subject to
• Premises
• Operations
• Products
• Completed operations exposures
• Subject to policy conditions, limitations, and exclusions
105
A CGL insurance wording insures clients’ legal liabilities under what four sub-sections
Coverage A: Bodily Injury and Property Damage Liability
Coverage B: Personal and Advertising Injury Liability
Coverage C: Medical Payments
Coverage D: Tenants Legal Liability
106
What exclusions are common to CGL policies?
- Injury to employees
- Automobiles, watercraft, and aircraft
- Care, custody, or control
- Pollution
107
. What five steps should an intermediary go through regarding initial contact for a policy renewal? (5
marks)
1. Review the client’s current exposures and coverages with them
• Discuss changes that have taken place during the policy term
• Prompt the client for any changes not previously brought to the intermediary’s attention
• Determine what progress has been made on any loss control measures or recommendations
• Start collecting renewal information
108
If the property is written on a blanket basis, the intermediary should prepare a new statement of
values. What updates should be included?
2. Updates to a new statement of values (any five of the following)
• Any new locations, including storage-only locations
• Changes in building values due to renovations and additions
• Changes in the value of any improvements and betterments
• Changes in inventory values due to increased stock or the addition of higher valued items
• Upgrades or changes in equipment
• Changes in values due to inflation
109
Advantages of wrap-up liability
* All parties and claims are insured on one policy
* Coverage is uniform
* Policy limits are dedicated to the particular project insured
* Costs can be controlled
* Loss history is insulated
110
b. Information needed for blanket builders risk coverage
- Locations of project
- Value of project
- Est time
- Materials used
- occupancy
- type
111
What are five general categories of exclusions of the commercial property broad form?
1. General categories of exclusions
• Generally not insurable—typically risks from causes that would be of such a magnitude that individual
insurers would not have the ability to cover them and remain in business
• Losses not accidental or extraneous, such as losses due to the nature of the property itself or
inherent vice
• Losses wholly or partly under the control of the insured
• Wear and tear losses
• Losses excluded because of the particular coverage
112
b. Information needed for blanket builders risk coverage
-Locations of all existing and planned sites
• Planned occupancy
• Construction materials
• Nature of each job (that is, new construction, addition, or renovation
• Estimated time to complete each job
113
What property can be insured under an equipment breakdown insurance policy?
- Electrical equipment
- Air conditioning and refrigeration un
- Boilers
- Computer and communications equipment,
- • Renewable and alternative energy electrical
1. Machinery
2. Electrical apparatus
3. Air conditioning units
4. Telephone equipment
5. Computers
114
What Extensions for the office contents floater?
* Theft or damage to the building
* Theft of money or stamps
* Loss of or damage to personal effects of the insured or others
* Extra expense
* Valuable papers and records
115
Indirect losses due to cyber risk
- Extra expenses
- Accounting and other professional fees
- Loss of competitiveness
- Loss of business
- Loss of reputation
116
five steps of the risk management process
* Identify and analyze the risk exposures
* Formulate options for dealing with each exposure
* Select the best techniques for dealing with the exposures
* Implement the risk management plan
* Monitor the results and modify the plan as necessary
117
List five consequences of losses
1. Time shortage—
2. Costs of replacing customers
3. Loss of employees—
4. interruption of business growth
5. product delay
118
five areas to take into account that affect the different risk management methods. (5 marks)
1. Social responsibility
2. —failure to abide by the law
3. Peace of mind/tolerance level for uncertainty
4. cost of risk
5. stable earnings and growth
119
Categories of assets subject to loss
1. Physical assets
2. Intangible assets
3. Loss of use
4. Human assets
5. Legal liabilities
120
List five retention methods of financing loss
```
1. Current expenses
2• Unfunded reserves
3• Funded reserves
•4 Borrowing
5• Captive insurance company
```
121
. List five documents an intermediary can consult to complete a risk analysis
1. Advertising brochures and catalogues—
2. Loss history
3. Statement of values
4. Annual financial reports
5. • Floor plan of the premises—
122
Statement of values
a schedule of the insurance values supported by appraisals of buildings,
stock, and equipment by location is completed with the assistance of the client or the client’s
accountant
123
General information regarding investigating risk exposures
* Details of the physical risk, occupancy, and processes
* Values at risk
* Minimum of five-year loss history
* Lists of equipment and vehicles to be insured
* Liability rating information, such as payroll or sales figures
* Signed applications and questionnaires where required
124
. What are five risks relevant to different kinds of businesses found in Best’s Underwriting Guide
• Underwriters’ checklists of questions to be asked and special hazards that may exist
```
• A profile of the industry
• materials and equipment
• insurance to consider
• Special exposures
- Loss control
```
125
What are five pieces of information relevant to different kinds of businesses found in a D&B
report?
1. The date on which the company commenced operations
• The gross sales
• The net worth
• The number of employees
• Information about special events, such as major losses or mergers and acquisitions
• A credit history
126
Risk management options
* Avoiding risk by not doing something
* Minimizing risk through risk improvement and contingency plans
* Transferring risk
127
Avoiding Risk Drawback
Avoiding risk eliminates exposure to loss but could also eliminate business opportunities and thus reduce revenues
128
Minimizing Risk Drawback:
, the length of time the business is unable to operate,
and/or insurance premiums, these tactics can be expensive and require planning and input from
the business’s financial officers.
129
Risk Transfer Drawback:
```
: Decisions regarding whether to arrange non-insurance risk transfers are
affected by
o market conditions
o legal issues
o convention
o experience and control
```
130
Risk Retention Drawback:
The client will probably need the assistance of an accountant to decide whether
the business can afford to absorb the losses that could occur.
131
. Decisions regarding whether to arrange non-insurance risk transfers
1. Market conditions—
2. Legal issues
3. Experience/ knowledge
132
4 ways brokers be Keeping up with changing market trends and conditions
1. Communicating regularly with insurers
2. Reading and retaining information from insurance journals
3. Maintaining a personal network and developing close relationships with individual underwriters
133
What attachments are needed to set up for the submission?
1. Application forms
2. Questionnaires required by the underwrite
3. statement of values
4. Advertising material
5. website
134
What are some pieces of special information she may need to draw to the underwriter’s attention?
1. An explanation of the loss history
2. Changes in deductible
3 Special wordings or coverages required due to contracts,
4. Reasons for any discrepancies
135
Elements of Loss Exposure
1. Cause of loss
2. Financial consequences of occurrence
3. Assets subject to loss
136
Safety measures
1. Physical
| 2. Admin safety
137
What do rating services monitor
They monitor insurer solvency and provide insurer ratings
138
Clients can minimize risks by transferring them to others through:
Contractual agreements or to insurers with an insurance policy
139
If the business’s greatest need to remain viable is to stay open or to open again quickly following a loss, what type of coverage does the client require?
: Extra expense insurance which pays the expenses over and above normal costs to facilitate early reopening
140
Insurers’ interest in participating on risks that require manuscript wordings varies based on the size of the account and
State of the market
141
Warranties are
Actions that an insured agrees to take or not take, or
| Protections the insured agrees to institute
142
What does an SIR allow the insured to do?
Be a partner with the insurer in the risk
143
A broker Letter does NOT
Does NOT obligate the client to purchase from them NOR transfers the account
144
When should a broker start arranging for new inspections required for a policy renewal?
Halfway through the policy term
145
When would a broker add down?
Protecting the name insured: by adding people above the client like a landlord not below like a tenant.
Ex- A broker adding a tenant as an additional insured to the landlords policy
146
A statement of defense
a plea in reply to a statement of a claim
147
For claims Under stat conditions clients must
1. Report loss promptly
2. Cooperate with insurer
3. Obtain estimates
4. mitigate the loss
148
Requests for certificates can come from
1. the client
| 2. from the party requiring roof of insurance
149
During merger or acquisition major changes in a clients risk exposure come from
liability risks
150
Accounts that require high volume of certificates the broker must consider if the account:
can afford the costs
151
what are 3 Financial rating companies
1. AM best company
2. Fitch ratings
3. Standard & poors
152
Wrap up policy
Wrap-Up liability insurance protects the team involved in a construction project, such as
1. owners & developers,
2. engineers,
3. architects,
4. project managers
5. General contractors,
All against third party and general liability exposures associated with their project
153
A boilerplate lease form
contains standard written content that is not changed from one contract to another.
154
Historically commercial property was insured for the peril of??
fire
155
Electronic Data processing insurance is difficult to arrange because
Because of the diversity in types and uses of computers & different wordings between insurers
156
A “shotgun” approach to the marketing of accounts occurs when the
broker sends completed proposal to all of the insurers the brokerage/agency represents
157
anchor properties
Businesses in the immediate neighbourhood that are the reason the client's customer are near their locations are known as:
158
Frank’s Furniture Warehouse has a property value of $1,500,000. His has a 90% coinsurance clause. He decides to insurance for 60%. Sadly, Frank’s Furniture Warehouse suffers a property damage loss of $120,000. How much of this loss will be paid by the insurer?
80,000
159
Which precedent setting court case did the judge disallow the transfer of liability through disclaimer, concluding that a ticking containing an exclusion of liability clause on the back had not been sufficiently drawn to the attention of the plaintiff?
Greeven v. Blackcomb Skiing Enterprises Ltd. (1994)
160
might be covered under a Commercial Property Broad Form?
a. resultant damage to property other than that being worked on while undergoing the process of heat.
161
Which of the following is typically an exclusion to cyber liability insurance:
. Reputational damage and loss of competitiveness
162
Which of the following are extensions to the Commercial Property Broad Form?
```
a. temporary locations,
newly acquired locations,
newly acquired contents
transit
Property in custody
```
163
When doing business in the USA, a Canadian broker must:
1. ensure that they are following the special requirements where imposed
2. permit a US broker to handle an account where the state requires a state-admitted insurer for mandatory insurance
3. have a US broker countersign a policy where required by law
164
What are the elements of a loss exposure?
1. assets subject to loss,
2. potential cause of loss,
3. financial consequences
165
Loss control includes:
avoiding and reducing risks
166
which statement is a disadvantage of a non-insurance loss transfer?
. the transfer may not be as complete as intended.
167
Sources of funds can meet the costs of retained losses. Which option is easy to administer, required no special accounting, yet funds may not necessarily available when needed?
c. Current expensing-ongoing business expenses that are accounted for as they occur
168
Errors & Omissions policy are written on which basis?
claims or occurrence.
MOSTLY claims
169
bailor
owner of property who temporarily transfers the possession of that property to another
170
A broker should recommend a professional liability policy for which of the following circumstances?
All or part of the client’s operations would be considered professional according to the definition in the CGL.
171
The case of Alie v Bertrand & Frère Construction (2002) 62 OR (3d) 345 has influenced which part of the protection offered by excess and umbrella policy wordings?
In the case of Alie v Bertrand & Frère Construction (2002) 62 OR (3d) 345, the Ontario appeals court allocated the defence costs between the primary and excess insurers.
: Whether or not an excess policy will pay for defence costs
172
What endorsement covers an employer’s moral obligation to compensate injured employees, even if the employer is not legally liable, because there is no coverage under workers’ compensation?
When employees are not covered under workers’ compensation legislation and employers have taken out employers liability coverage to protect such employees, employers may feel a moral obligation to compensate injured employees even if the employer is not legally liable.
Voluntary compensation insurance is a method of doing this.
173
What is the best way to add an entity that is insured with respect to liability arising out of the operations of the named insured only to the insured’s policy?
An additional insured is an entity that is insured with respect to liability arising out of the operations of the named insured only. The policy does not extend to insure any other separate unrelated operations of the additional insured—additional insureds still require their own CGL.
174
what a trading style is?
A trading style is a business’s operating name—generally, it is not a legal entity and therefore cannot enter into a contract.
175
Which of the following statements is correct when an umbrella policy stands in place of primary insurance?
When the umbrella policy stands in place of primary insurance, it will cover defence costs.
176
Which E&O policy will respond to this loss?
In a claims-made policy, a claim is covered (subject to the policy terms) by the policy in force at the time the claim is reported to the insurer.
EX
The policy that was in effect on the day the brokerage was contacted by the lawyer
177
In Alberta what coverage do ridesharing operators require?
SPF 9- Transportation Network policy
178
What does SPF 9- Transportation Network policy cover?
Covers accidents from using an automobile as a transportation network automobile
179
Which is the most effective way of reducing fidelity losses?
Risk assessment & loss prevention
180
What fidelity bond provides a specific limit per loss for all employees regardless of how many employees are involved in any one loss?
Primary commercial bond: Specific limit per loss for all employees, regardless of how many employees are involved in any one loss.
Other bond
» Blanket position bond: Provides a specific limit per employee.
181
What is comprehensive coverage for customers automobiles?
Is a garage policy endorsement that is generally used when insuring legal liability arising from carless acts by the insured and employees
182
What is the 3D policy known as
Comprehensive dishonesty, disappearance
& destruction
combine crime & fidelity in one form
183
What is license and permit bonds
Other bonds:
is a surety miscellaneous bond form required by a municipality or other public body as a condition to granting a license or permit to engage in a specified activity
Other bonds:
1. Customs
2. Court bond
3. lost document bond
4. financial guarantee
184
What is blanket insurance
covers multiple cars in one aggregate sum insured without separate amounts for each
185
Which 3 parties are included in a surety bond?
1. Principal
2. Oblige
3, surety
186
A broker arranges meetings with the client to
collect the required information to assess hazards, exposures, and insurance needs
187
Gross earnings coverage only provides for income lost from
Gross:
50- 80% co
a type of business interruption insurance covering the insured's reduction in gross earnings suffered as a result of a direct damage loss. Manfucators
Profits:
100% co
The profits form covers the client until the client’s profits reach the same level as they were before the business interruption
Recommended for businesses who may suffer a permanent loss of customers (they will have to attract new clients)
Business Income Coverage:
80% co
Cover ends when business reopens or
could have reopened
Manufacturers frequently need coverage beyond the time when the physical plant is restored and the equipment replaced.
For this reason, profits insurance is frequently the better choice as it provides coverage until the business income returns to pre-loss levels or until the end of the indemnity period; gross earnings coverage ends once the business can resume operations.
188
the freight forwarder, the customer shipping the goods, or the customer receiving them could be responsible for the goods, depending on which of the following?
Bill of lading terms
is a legal document issued by a carrier to a shipper that details the type, quantity, and destination of the goods being carried. A bill of lading also serves as a shipment receipt when the carrier delivers the goods at a predetermined destination.
189
The most common non-owned automobile exposures arise out of employees_____
using their own vehicles for business errands.
190
What does allowing outsiders greater access to a client’s plant or warehouse mean
Intermediaries must ask clients about exposure from allowing visitors or customers access to their plant or warehouse.
The greater the access that outsiders are permitted, the greater the risk of bodily injury losses.
191
when the values are high can cause the company’s income loss to extend beyond the reconstruction period. What should the intermediary tell the client in this case
When a company accumulates most of the year’s inventory during one portion of the year and distributes it over the remainder of the year,
profits may be the better form.
192
Customs and excise bonds
Are for the benefit of federal and provincial governments and guarantee that either taxes or duties or both will be paid by the principal when invoiced by the government
Customs and excise bonds guarantee the obligee (the federal government) that either taxes or duties or both will be paid by the principal (the owner of the goods) when invoiced by the government, or the surety will make the payment if the principal defaults on the obligation to pay the duty.
by the owner of the goods when invoiced by the government.
193
what is Physical damage coverage for specified owned automobiles Endorsement
Is an endorsement that provides coverage for loss or damage caused by collision to high-value owned vehicles only
194
Which of the following is a compulsory or mandatory coverage of automobile insurance in all provinces and territories?
Third-party liability
is compulsory in all provinces and territories for a minimum limit of insurance specified in the insurance act of each jurisdiction. The other coverages are optional.
195
Which of the following statements is true of a surety bond?
The bond is signed under seal by 2 parties:
1. principal
2. surety (insurance company).
196
What is most commonly used when insuring fleets?
Blanket fleet endorsement: with their effective dates reported at expiry;
final premium is then determined.
Other:
» Monthly reporting
197
What is a bid bond
Is a type of bond guarantees that the contractor will accept the work if awarded it
198
Which is a loss technique that a client may use to reduce the potential for a fidelity loss?
Countersign all cheques at the time of issuance.
199
Which of the following is an example of a commercial crime exposure originating from an inside source?
a. Computer fraud CorrectComputer fraud is an example of a crime exposure originating from an inside source. The property involved includes money, securities, merchandise, and confidential information.
200
what is a Fidelity bond
is a bond that protects the insured against the loss of money, securities, or other property resulting from the dishonest act or acts of an employee, alone or in collusion with others
201
Which of the following is an example of a commercial crime exposure originating from an inside source?
a. Computer fraud
Computer fraud is an example of a crime exposure originating from an inside source. The property involved includes money, securities, merchandise, and confidential information.
202
What are the 3 main issues with a manufactures property risks and exposures you must tell the client?
1. Property
2. Business interruption
3. Equipment breakdown
203
Investigating a clients corporate tree is useful for?
1. Deciding what the name insured should be on the insurance
| 2. Identifying overlooked exposures
204
Who is at risk for shipment of goods to the market
at the risk of the manufactor
205
What should The broker should ask for when discussing manufacturer automobile exposures? (4)
1. If their are any non owned automobile exposures
2. Number/ type of vehicles
3. Where the cars are used
4. How far they travel
206
Tenants legal liability exposure arises out of?
Arises out of the manufacturers lease of premises
207
Kidnap insurance covers:
Actual or threatened damage to a distributors physical premises or contamination of its products
208
Kidnap, ransom & extortion insurance for distributors covers:
Actual or threatened damage to a distributors physical premises or contamination of its products
209
What is a bonded warehouse?
is a secure, access controlled facility where goods subject to customs duties or taxes can be stored prior to the duty being paid
210
Who is at risk when cargo is stored in the freight forwarders warehouse while waiting to be assembled into larger shipments?
The freight forwarder is at risk
211
What is freight forwarding?
FF is the business of shipments using road, rail,air or ship
212
What is a performance bond?
performance bond guarantees that the contractor will complete the job as set out in the contract
213
What does contractors equipment floater cover?
it covers large construction equipment ex backhoe or a grader
214
What does a tool floater cover?
Tool that are mobile
215
What is a wrap up liability policy?
a policy insuring the legal liability of ALL the involved interests
216
What is a wrap up liability policy?
a policy insuring the legal liability of ALL the involved interests
All parties and claims are insured on one policy
217
Two exclusions unique to a contractors’ equipment floater are
—the muskeg exclusion and the overloading exclusion.
218
How is damage to unlicensed equipment insured?
: Contractor’s equipment floater
219
Liability exposures for a contractor include (6)
Contractors have liability exposures arising out of
1. premises,
2. operations,
3. products and completed operations,
4. pollution,
5. contracts,
6. non-owned automobile
220
What do individual-trade contractors usually specialize in?
individual-trade contractors usually specialize in only one type of work;
they are electricians, HVAC (heating, ventilation, and air conditioning) technicians, carpenters, excavators, or plumbers.
221
Which high-hazard operations are excluded in a normal commercial general liability policy? (4)
Construction work can involve high-hazard operations (such as the use of explosives), or operations that could lead to the collapse of the structure (such as
1. excavation,
2. demolition
3. underpinning work
4. tunneling).
Most standard commercial general liability (CGL) wordings exclude these exposures.
222
What does the builders risk wording cover?
Covers only property that will enter into and from part of the completed project
223
What is the permission clause ?
Grants the insured the authority to proceed without having to inform the insurer in advance
224
What is hoarding?
Hoarding is solid wood fencing that surrounds the entire building
225
What does a broker ask for with construction projects?
1. copies of construction plans
2. asks about costs
3. Asks about materials
4. soil conditions
5. General managers experience
226
What is the purpose of a cross-liability clause?
It allows the policy to respond as if each named insured had a separate policy.
allows insured parties to be protected under the policy against other parties insured under the same policy. In essence, it allows the policy to apply separately to each insured party as if they had their own insurance independent of one another.
227
To obtain the most favourable rates and coverage terms, when is it best to negotiate coverage and rates?
The rating for builders risk policies takes into consideration that the risk exposure starts with small values and increases as the project progresses. The rates and premiums are calculated on the estimated value exposed per month.
228
What are hard costs?
Hard costs are the costs to build the structure and include all costs of construction materials and the labour to complete the project.
229
Current expensing
Sources of funds can meet the costs of retained losses. Which option is easy to administer, required no special accounting, yet funds may not necessarily available when needed?
230
Commercial Property Broad Form provides insurance
This form provides insurance on an all risks basis subject to policy conditions, limitations, and exclusions
231
trip transit floater
The common type of transit coverage that covers an insured for unique, single shipment of goods from one specific location to another
232
disappearing deductible
This form of risk retention is primarily associated with fire policies, whereby a dollar amount deducted from the amount of loss is reduced as the loss increases and then disappears entirely to provide full coverage when the loss reaches a certain specified figure
if your claim exceeds your deductible by a specified amount you don't have to pay the deductible
233
Supplementary Payments
Under the CGL, the SP is a section of the policy that agrees to pay the legal, investigative, court and other costs involved in the defense and settlement of the claim
234
Volt Insurance Company’s co-insurance clause requires their client, High Impact Fitness Facility to carry 80% co-insurance on the value of their $1,000,000 property. High Impact Fitness Facility will therefore need to insure their property for what amount, to avoid having to pay in the event of a partial loss?
800,000
235
When taking over a policy mid-term with a broker of record letter,
the broker is liable for outstanding premiums on the account that result from a premium adjustment form.
236
Which of the following is NOT a common feature of professional liability coverage:
written on an occurrence basis
237
What are common features of professional liability coverage (3)
a. contains an aggregate limit of insurance
b. usually excludes bodily injury and property damage losses
c. written on a claims made basis
238
ABC of liability?
A duty of care
Breach of duty
Causal relationship between breach and damage is shown
239
Risk Retention
Risk retention is an individual or organization's decision to take responsibility for a particular risk it faces
240
What are the most widely used broad form policy wordings? (3)
Commercial building form (CBF) insuring the building
Commercial property floater (CPF) insuring stock, equipment and other contents
Commercial building equipment and stock form (CBE&S)
241
What are examples of property excluded under the Commercial Building Equipment and Stock Form (5)
1. Money and other valuable property,
2. Automobiles, Watercraft,
3. Furs or jewellery,
4. Property vacant for more than 30 days
5. Damage to work in process (resulting damage is covered)
242
What are the commonly excluded perils under a broad form property wording? (8)
1. Flood and Earthquake
2. Sewer Backup-
3. Bylaws- Four bylaw endorsements available.
4. Inventory Shortage.
5. Pollution-
6. Environmental Hazards-
7. Terrorism
8. Boiler and Machinery Breakdown-
243
What are the usual EXTENSIONS to the broad form wording (3)
1. Unnamed or temporary locations
2. Transit- provides insurance for property while in transit to or from the insured's premises
3. Salesman's Samples
244
What are some policy and coverage factors that must be considered when determining the limit of insurance?(4)
1. (replacement cost vs. actual cash value),
2. the coinsurance clause
3. , blanket vs. separate limits,
4. whether values fluctuate over the course of the year
245
Actual Cash Value (ACV)
Depreciated value of the property at the time of the loss. Fair market value- taking into consideration factors that might augment or reduce the value
246
Replacement Cost (RC)
)- Amount it would cost to repair or replace the particular article with a new item of like kind and quality without taking depreciation into account
247
What is required for a policy to be written on a stated amount coinsurance basis?
Insured provides insurer with a statement of values (written, signed statement attesting to the values of all property to be insured)
248
What is the coverage afforded by the blanket limits for property of every description (POED) or contents of every description (COED)?
Combines the coverage at a single location, or at multiple locations, into one limit.
POED combines property and contents into one.
which avoids the problem of temporary underinsurance at any one location from sudden influx of stock or equipment.
249
What options could a broker offer to deal with problems from fluctuating values?
1. Stock reporting basis
| 2. Peak season endorsement
250
Which type of risk might require an office contents floater?
examples include the practice of an accountant, engineer, architect, doctor, or insurance broker
251
What are the common coverages to an office floater? (3)
Coverages:
1 office furniture,
2 equipment, supplies,
3 tenants improvements and betterments
252
What are the common extensions to an office floater (6)
```
Extensions:
1. Theft damage to the building,
2. Theft of money
3, Loss or damage to personal effects of the insured or others
5, Extra expense,
6. Valuable papers and records
```
253
Why is it preferable to insure computer equipment under an Electronic Data Processing Floater (EDP)?
makes it desirable to insure separately under a wording which affords broader coverage.
254
**Hardware vs. Firmware vs. Software
Hardware- physical parts of a computer (hard drive, monitor, printer or processor/CPU)
Firmware- programming instructions embedded into a hardware device (operating system on a router)
Software- programs that enable a computer to perform specific tasks and functions (Microsoft Office, AutoCAD)
255
Firmware
Firmware- programming instructions embedded into a hardware device (operating system on a router
256
Software
Software- programs that enable a computer to perform specific tasks and functions (Microsoft Office, AutoCAD)
257
Under what conditions would an insured require extraordinary measures to recover from an EDP loss?Electronic Data Processing (EDP) Equipment Insurance.
hey may require extraordinary measures to recover because the equipment may not be compatible with the replacement(s)
258
What is the usual policy territory of the EDP floater?
Usual policy territory of the EDP floater includes Canada and the USA only.
259
Transportation Floater
Transportation Floater- insures goods that are being shipped by truck, rail, air or inland water.
Good for clients with many shipments
260
Motor Truck Cargo-
provides coverage for most property in the course of transit.
261
Motor Truck Cargo exclusions (3)
excludes
1. valuable property (money or jewellery)
, 2. scratching or breakage,
3. changes in temperature
262
a trip transit floater?
Insures a single shipment of specific goods from one specified location to another. Perils insured are designed for the single trip. Useful for clients who send or receive shipments very infrequently.
263
What are the client's considerations when deciding which type of business interruption policy to purchase?
(3)
1. Operations,
2. Client base,
3. Business income,
.
264
What is the indemnity period for a profits policy?
Generally 6, 12, 18, 24, or more months
265
What coverage is provided by a rental income policy?
Cover loss of income from client being unable to derive income from the rented space in their buildings.
266
What advantage is extra expense coverage to a business that will suffer no real loss of customers in the case of business interruption, and to a business that purchases another form of business interruption policy such as gross earnings or profits?
Provides protection for the additional expenses of continuing in business following an insured loss to the premises insured. Businesses that benefit the most from this form of insurance include office exposures (doctor's offices or real estate agents
267
What are three types of contingent business interruption coverages?
1. Key Suppliers-
2. key Customers
3. Anchor Stores-
nsurance reimburses a company for lost profits and other possible transferred risks, such as necessary continuing expenses, due to an insurable loss suffered by one or more of its suppliers or customers.
268
Anchor Stores-
Anchor Stores- Exposure that arises because of another business, which the insured has no direct economic connection, suffers a loss.
Ex Sears closing at the mall
269
5 extensions to the limit of insurance
1. Temp locations
2. Newly acquired buildings
3. Newly acquired contents
4. Property in transit
5. property in the custody of sales
270
» Describe the 2 exclusions of the commercial property broad form CPBF
1. Property
| 2. Perils
271
property Exclusions – CBE&S Form (5)
```
Property exclusions »
1. Money and valuable property
» Automobiles
» Watercraft
» Furs & jewelry
» Vacant property over 30 days
```
272
Perils Exclusions – CBE&S Form
1. flood, earthquake
2. Sewer
3. Bylaws
4. Pollution
5. terrorism
273
• There are FIVE sections to the CGL:
```
– Section I: Coverages
– Section II: Who is an insured
– Section III: Limits of Insurance & Deductibles
– Section IV: Conditions
– Section V: Definitions
```
