Chapter 9 Vocab (Notes) Flashcards
Actual Cash Value (ACV)
The actual cash value of the property at the time of loss
Fair Market Value
price a willing buyer would pay a willing seller in a free market
Broad Evidence Rule
means the determination of ACV should include all relevant factors an expert would use topen determine the value of property
Valued Policy
pays the face amount of insurance if a total loss occurs
Valued Policy Law
requires payment of the face amount of insurance to the insured if a total loss to real property occurs form a peril specified in the law
Replacement Cost Insurance
means there is no deduction for depreciation in determining the amount paid for a loss
Representations
statements made by the applicant for insurance
Material
false representation that is relied on by the insurer; if the insurer knew the true facts, the policy would not have been issued or would have been issued on different terms
Concealment
intentional failure of the applicant for insurance to reveal a material fact to the insurer
Warranty
statement that becomes part of the insurance contract and is guaranteed by the maker to be true in all respects
Aleatory
values exchanged are not equal
Unilateral
only the insurer makes a legally enforceable promise
Conditional
policyowner must comply with all policy provisions to collect for a covered loss
Personal
Property insurance policy can’t be validly assigned to another party without insurers consent
Contract of Adhesion
the insured must accept the entire contract with all its terms and conditions
