Chapter 15A - Property Insurance Flashcards
Actual Cash Value
Policy pays for the replacement cost of item minus depreciation
Deductible
The amount the insured must pay on each loss
Direct Loss
Happens suddenly due to a covered peril
Indirect Loss
Occurs as a consequence of a direct loss - EX: rental income lost due to a fire
Liability
Coverage in case of a lawsuit filed by another claiming bodily injury or damage to property
Liability Insurance
Insurance that covers an individual for financial losses arising out of liability issues.
Monoline Policy
One line - covers real estate and personal property.
Mortgage Cause
Added to policy by lenders - protects their interest in the preservation and reconstruction of property after a loss, covers cost of loan value in a covered loss
Package Policy
Real estate and personal property, plus liability and theft.
Peril
1) fire
2) aircraft
3) smoke
4) sinkhole collapse
5) sprinkler leakage
6) lightning
7) explosion
8) wind/hail
9) volcano
10) riot/civil commotion
11) damage done by others’ vehicles
Property Insurance
Coverage that indemnifies a person with an interest in the property for a loss cause to property by a covered peril
Replacement Cost Basis
Policy pays the replacement cost for lost items.
Umbrella Policy
Provide very high limits of liability
Basic Form 1
11 perils
Basic Form 2
11 perils + weight of ice and snow, water damage from plumbing, damage from falling objects, freezing plumbing