Ch. 23 Managing Risk Flashcards
An insurance term that refers to the depreciated value of property.
actual cash value (ACV)
Stating in a property insurance policy that all direct damages are covered except those caused by perils specifically excluded.
all-risk approach
Coverage that reimburses a business for the loss of anticipated income following the interruption of business operations.
business interruption insurance
The possibility of losses associated with the assets and earnings potential of a firm.
business risk
A provision in a property insurance policy that requires the owner to have insurance for at least 80 percent of what it would cost to rebuild the building or replace the personal property.
coinsurance clause
Coverage for general liability loss exposure, including premises liability, operations liability, product liability, and completed operations liability.
commercial general liability (CGL) insurance
Economic or noneconomic damages intended to make the claimant whole by compensating the claimant for any injuries or loss arising from the negligent action.
compensatory damages
Coverage primarily against employee dishonesty.
crime insurance
A defect resulting from a dangerous design, even though the product was made according to specifications.
design defect
A loss in which physical damage to property reduces its value to the property owner.
direct loss
Coverage that guarantees a healthy partner enough cash to buy out a partner who becomes disabled.
disability buyout insurance
Coverage that provides benefits to a key employee upon his or her disability.
disability insurance
Compensatory damages that relate to economic loss, such as medical expenses and loss of income
economic damages
The unauthorized transfer of funds from a bank account.
funds transfer fraud
A managed-care network providing health insurance that is less expensive than that of a PPO but more limiting in choices of medical care providers.
health maintenance organization (HMO)
