chapter three - casualty (liability) basics Flashcards
A wrongful act, other than a breach of contract, that violates a duty or the rights of another for which compensation may be sought from the responsible party.
Tort
The liability assigned to one party for the conduct of another, based solely on a relationship between the two.
Vicarious liability
Failure to use ordinary care.
Negligence.
Failure to exhibit any sort of care through recklessness or deliberate indifference to the well-being of others.
Gross negligence.
An artificial condition on land that attracts children.
Attractive Nuisance.
Compensation to a husband or wife for the loss of companionship of a spouse.
Loss of Consortium.
What is a civil wrong committed by one person against another?
Tort.
An award to an injured party, in addition to compensatory damages, to punish and discourage a wrongdoer from repeating negligent acts or omissions.
Punitive Damages.
Legal liability arising from physical injury, including sickness, disease, and death caused by the acts or omissions of an insured.
Bodily Injury.
Coverage for bodily injury of third-party sustained on an insured location or as a result of the insured’s activities.
Medical Payments Coverage.
The term for an award to an injured party to compensate for a loss.
Damages.
Awarded to return an injured party to his or her pre-loss condition and to make reparation for the actual loss that occurred.
Compensatory damages
Awarded for tangible losses that can be calculated and proven.
Special damages
Awarded for losses that are not tangible and cannot be objectively calculated.
General damages.
What type of damages is awarded to the injured party for the actual medical expenses incurred?
Special.
An accident includes continuous or repeated exposure to the same general harmful conditions.
Occurrence.
Payment of necessary medical expenses without regard to negligence is covered by which of the following insurance coverages?
Medical Payments.
What document informs an insurer that a loss has occurred?
Notice of loss.
4 elements of negligence:
Duty is owed.
Violation of duty
Violation of duty is the proximate cause
Foreseeable Consequence.
What is a common-law defense used by the insured when the injured party is partially responsible for his own injuries?
Contributory negligence.
A party injured in an auto accident is not allowed to sue the negligent party who caused the accident under which law?
No -fault.
What is designed to prevent the insured from collecting more than the actual extent of a loss?
Pro rata liability
A clause that in the event more than one insurance policy covers a loss, each will pay its share of loss in proportion to the total insurance on the risk.
Pro rata liability.
The most the policy will pay for all losses submitted during the policy period, regardless of all other policy limits.
Aggregate limits
The most the policy will pay for loss of different types that occur as a result of any one loss, regardless of other limits.
Split limit
In split limit, what is the order of the numbers. num 1/num 2/num 3
Per person limit bodily injury / Per occurence limit bodily injury / Per occurrence property damage liability
The most the policy will pay for all losses of all types resulting from any one occurrence, regardless of other limits.
Combined single limit.
The ___ is the most the policy will pay for the sum of all the losses occurring within a single policy period.
Aggregate.
The ____ Limit of liability applies to bodily injury. property damages, or both.
Combined Single.
When coverage under a particular form of insurance issued by an insurer is broadened without an additional premium charge, it automatically applies to all policies currently in effect.
Liberalization.
Insured cannot transfer policy ownership without the written consent of the insurer.
Assignment.
What is the name for a type of policy that doesn’t pay benefits until the limits of the primary policy have been exhausted?
Excess policy.
Which of the following terms includes pain and suffering, disfigurement, and mental anguish?
General Damages.
An insurer decides to increase the first aid benefits for one of its insureds for no extra premium. What is the name of the provision which automatically applies this broader coverage without additional premium to all policies currently in effect by the same insurer?
Liberalization.
Duty of care
Violation of Duty of care
Proximate Cause
Damages are foreseeable
Elements of Negligence
An unintended and unforeseen event from which a loss results is called what?
Accident.
The most that will be paid for any one occurrence.
Occurrence limit.
The most that will be paid within the policy period.
Aggregate limit.
What prevents all recovery for injuries if the claimant was also considered partially negligent?
Contributory Negligence.
The equal sharing of a loss by two or more insurers until the loss is paid, or until each insurer has exhausted its limits of insurance, whichever comes first, is the description of which of the following?
Contribution by Equal Shares
Unintentionally renting a leaky boat to vacationers might be considered what?
A negligent act.
An employer’s liability for the acts of an employee is an example of what?
Vicarious liability.
The most a policy will pay for a loss arising out of any one accident regardless of overall policy limits, is known as what?
Per occurrence limit.
The maximum amount payable for all losses within a policy period is known as what?
Aggregate limit.
Medical payments are made with or without regard to negligence or fault?
Without.
K gets a horrible rash after using a wrinkle-prevention cream for 2 months. This is considered what?
An occurence.
A continuous or repeated exposure to the same general harmful conditions.
An occurence.
Negligence is a type of what?
Tort.
The time period in which a lawsuit may be filed after the occurrence of a claim is referred to as:
Statutory law
Limit of liability
Common law defenses
Statute of limitations
Statute of limitations
Plaintiff K was injured after losing control of their skis on a slope with well-marked signs indicating the degree of difficulty. What legal defense is available to the ski resort to avoid liability for the injury?
Comparative negligence
Statute of limitations
Contributory negligence
Assumption of risk
Assumption of Risk.
When a person participates in an activity where a certain type of injury is known to be probable, that person’s rights of recovery are barred or diminished under the doctrine of ____
Assumption of risk.
A manufacturer is held liable if a product caused an injury whether the product was or was not defective. This describes what type of liability?
Strict
Absolute
Direct
Contingent
Strict
The doctrine of ___ Liability applies to products and their manufacturers. It holds that the manufacturer can be held responsible for an injury caused by a product, even if the product is not defective.
Strict.
Property damage covered by a liability policy includes which of the following?
Damage to property of others in the insured’s care, custody, or control
Damage to tangible property, including loss of use of that property caused by the insured’s negligence
Damage to the insured’s products arising out of the products
Damage to property owned by, or leased to, the insured
Damage to tangible property, including loss of use of that property caused by the insured’s negligence.
When damages are reduced in proportion to the degree of negligence, this is an example of:
Comparative Negligence
Absolute Negligence
Contributory Negligence
Proportional Negligence
Comparative Negligence.
___ negligence is a defense wherein damages are reduced to the proportion to the degree of the claimant’s negligence.
Comparative.
B has two policies on a property. Policy A is for $20,000; Policy B is for $40,000. If Policy A has a pro rata provision, how much will it pay for a covered loss of $15,000?
$15,000
$5,000
$7,500
$10,000
$5,000.
(The total amount of coverage is $60,000. Policy A provides 1/3 of that total, so Policy A’s pro rata contribution would be one-third, or $5,000. Policy B provides $40,000 or 2/3 of the total coverage, so Policy B pays two thirds.
Bodily Injury may include which of the following?
Slander
Loss of earnings
False arrest
Invasion of privacy
Loss of Earnings.
Bodily injury includes such items as medical expenses, lost wages, mental anguish, death, and disfigurement
A liability policy contains a per person bodily injury limit of $25,000 and a per occurrence limit of $50,000. If an accident were to occur and three persons have claims of $20,000 each, the total amount paid is:
$50,000
$60,000
$25,000
$75,000
$50,000.
(The policy pays up to $25,000 for each person injured, but no more than $50,000 per occurrence, regardless of the number of persons injured. Therefore, the limit for this accident is $50,000.)
What type of liability policy requires the injured party to collect benefits from his/her own insurance as if it were first-party coverage, eliminating the process of determining negligence?
Pro rata
Excess
No fault
Absolute liability
No fault
Under a ____ liability policy, the injured party collects insurance benefits from his or her own insurance as if it were first-party coverage, thus eliminating the process of determining negligence or legal liability.
No fault.
Medical expenses and loss of earnings awarded to an injured party are considered:
Punitive damages
Physical damages
General damages
Special damages
Special Damages.
Most liability policies do not provide coverage for:
General damages
Punitive damages
Special damages
Compensatory damages
Punitive Damages.
Liability coverage is designed to:
Protect the insured from bodily injury and property damage they are legally obligated to pay
Cover injuries and damages caused by the insured’s intentional and unintentional actions
Protect an insured from being sued by an injured party
Permit the insured to countersue the insurer for losses not covered
Protect the insured from bodily injury and property damage they are legally obligated to pay.
Personal injury liability includes which of the following?
Libel and slander
Theft
Sickness and disease
Medical payments
Libel and slander
_____ is the legal liability for injury other than bodily injury or property damage.
Personal Injury Liability.
Negligence is what kind of tort?
An unintentional tort
An intentional tort
A gross tort
A criminal tort
An unintentional tort.
