D Education Glossary

Question 1

What does the Louisiana Insurance Code require to receive and individual producer license?

Answer 1

18 years of age.

Reside or work mainly from an office located in Louisiana.

Complete pre-licensing education.

Pay fees and submit application.

Pass exam with a 70% or higher.

Question 2

lower or poorer risks more prone to losses than normal risks.

Answer 2

Adverse Selection

Question 3

the consideration that is being exchanged is unequal or unrelated to the consideration given by the other party.

Answer 3

Aleatory Contract

Question 4

named peril coverage, the least coverage available. In dwelling policies it includes: fire, lightning, removal, and internal explosion.

Answer 4

Basic

Question 5

named peril coverage, covering more named perils than the basic form. In dwelling coverage it covers all perils under basic including EC and V&MM plus: damage by burglars (not theft); weight of ice, snow or sleet; accidental discharge or overflow of water or steam; freezing of plumbing, heating, a/c, or sprinkler systems; falling objects; artificially generated electrical current; and tearing apart, cracking, burning, or bulging of a steam or water system.

Answer 5

Broad

Question 6

used to insure buildings under construction.

Answer 6

Builder’s risk

Question 7

(time element form) – covers loss of income when a business has to suspend because of a direct loss.

Answer 7

Business income

Question 8

is covered over the time the operations are suspended while the building is being repaired or replaced.

Answer 8

Business income

Question 9

Is calculated as the net income that would’ve been earned if the loss occurred and the cost to continue operations including payroll.

Answer 9

Business Income

Question 10

termination of a policy by either the insurer or insured before the expiration date.

Answer 10

Cancellation

Question 11

what the ship is hauling

Answer 11

Cargo

Question 12

after choosing commercial property coverage for the type of property your business needs covered, you then need to choose the causes of loss that will be covered.

Answer 12

Causes of Loss

Question 13

A business may choose Basic, Broad, or Special cause of loss forms and the extra is Earthquake (volcanic eruption additional) – that state the perils protected against.

Answer 13

Causes of Loss

Question 14

an official legal document that will require an individual to stop doing something.

Answer 14

Cease & Desist

Question 15

makes the insurer an admitted company and proves that the Department of Insurance finds the company financially sound and structured well enough to meet the requirements of the state insurance code to conduct insurance business in Louisiana.

Answer 15

Certifiate of Authority

Question 16

computing a rate for insurance that applies to all applicants in a certain risk class.

Answer 16

Class Rating

Question 17

covers unexpected falling down or caving in of a building.

Answer 17

Collapse

Question 18

pays for direct and accidental loss due to upset or collision of the vehicle with another object.

Answer 18

Collision

Question 19

would provide protection for an insured auto due to impact with another vehicle, impact with another object such as a bridge or tree, and upset or overturn of the vehicle subject to a deductible.

Answer 19

Collision

Question 20

a commercial organization that transports goods or passengers.

Answer 20

Carrier

Question 21

dedicates its property to public use in such a manner that its services are available to the public on a regular basis.

Answer 21

Common Carrier

Question 22

hold themselves out to the public as engaged in the business of transporting persons or property from site to site for compensation or a fee

Answer 22

Common Carrier

Question 23

Examples of common carriers include

Answer 23

railroads, bus companies, trucking firms, taxicab companies, airlines, and ferries.

Question 24

apply to all coverage parts such as cancellation, changes, inspections, examination of books and records, etc.

Answer 24

Common Conditions

Question 25

provides information as to who, what, when, where and how much.

Answer 25

Common Declarations

Question 26

include the insurance company name, the named insured, policy period, business description, coverage parts, premium, and policy forms

Answer 26

Common Declarations

Question 27

contains the list of 7 coverage parts followed by the appropriate premium if there is coverage for the part, but no premium listed if the part is not included in the package.

Answer 27

Common Declarations

Question 28

states with laws that require employers to provide worker’s compensation insurance under penalty of law.

Answer 28

Compulsory

Question 29

when a producer gets into the insurance business in Louisiana to sell only to themselves, their family and employer.

Answer 29

Controlled Business

Question 30

in states that have elective laws for workers compensation, an employer does not have to be subject to the State’s WC laws, but if they choose not to be subject to it they lose their common law defenses against liability suits.

Answer 30

Elective

Question 31

insurance for claims that are not covered under Workers compensation laws including: exempt employments, illegal employments, and non-compensable injuries.

Answer 31

Employer's Liability

Question 32

coverage protects insurance agents and brokers from financial losses they may suffer as a result of a client that sues for damages because the insured gave incorrect advice or didn’t inform the client about important issues.

Answer 32

Errors and Omissions

Question 33

the coverage will pay for damage property caused by the object described in the declarations. object must be in use or connected and ready for use when accident occurs

Answer 33

Equipment Breakdown

Question 34

insurance that covers the same thing as another policy, but only the amount of a claim or loss after the limit of the other policy is reached and may include amounts or events that may not be covered by the other policy.

Answer 34

Excess Coverage

Question 35

the rate is affected by the insured’s own past loss experience. Insured’s with fewer claims pay a lower premium.

Answer 35

Experience Rating

Question 36

authority to do certain things on behalf of the insurance company because those functions were expressed orally or in writing.

Answer 36

Express Authority

Question 37

in dwelling policies, extended coverage basic (EC) adds coverage for: windstorm or hail, explosion, volcanic eruption, riot or civil commotion, aircraft or vehicles (damage due to direct physical contact with an aircraft or vehicle not owned by the resident), and smoke to the basic coverage of fire, lightning and internal explosion.

Answer 37

Extended Coverage

Question 38

covers expenses more than normal business expenses the business will incur to keep it operational following a direct loss to the business property

Answer 38

Extra Expense

Question 39

covers property and liability for the business of a farm operation as well as a residence

Answer 39

Farm Policy

Question 40

What are the eligible risks included in a farm policy?

Answer 40

``` growing and marketing crops fruits mushrooms vegetables flowers green house or nursery stock sod raising or keeping of livestock poultry fur bearing animals bees aquaculture (fish farms) ```

Question 41

incorporated in states (or U.S. territories) other than Louisiana

Answer 41

Foreign

Question 42

the revenue to the ship owner to deliver the cargo.

Answer 42

Freight

Question 43

a type of bailee coverage (protecting the business for damage to the property of their customers) available to automobile dealerships

Answer 43

Garage Keepers

Question 44

provides coverage for damage to automobiles of others arising out of the general operations of the business

Answer 44

Garage Keepers

Question 45

does not cover property damage losses to automobiles in an insured’s care, custody, or control.

Answer 45

Garage Liability Insurance

Question 46

defined as an ocean marine loss which occurs through the voluntary sacrifice of any part of the vessel or cargo to safeguard the vessel or cargo

Answer 46

General Average

Question 47

coverage provided to an insured if a claim is made or a suit is brought against the insured for damages due to bodily injury or property damage to others.

Answer 47

Liability

Question 48

the decline in value of a person or thing, the decrease that is suffered after a peril occurs

Answer 48

Loss

Question 49

a base rate that includes the policy’s share of claims and expenses

Answer 49

Loss Cost

Question 50

coverage is for either additional living expenses or fair rental value if the premises become uninhabitable due to a covered loss

Answer 50

Loss of use

Question 51

when property ceases to be a thing of the kind insured and is payable as a total loss

Answer 51

Loss of Specie

Question 52

for physical damage or loss of the ship (Ocean Marine)

Answer 52

Hull Coverage

Question 53

the interest an insured may have in property that is the subject of insurance where damage or destruction of the property or a casualty occurrence would cause financial loss.

Answer 53

Insurable Interest

Question 54

endorsements that apply to more than one coverage part and are included in one page.

Answer 54

Interline Endorsements

Question 55

reports may come directly from interviews with friends and neighbors and affiliates of the consumers and cannot be made without consent within 3 days of the request.

Answer 55

Investigative Consumer Report

Question 56

It is the judgment of the underwriter to determine the risk and required rate

Answer 56

Judgement Rating

Question 57

the insurer will pay necessary medical expenses incurred or medically discovered within three years from the date of an accident that causes bodily injury

Answer 57

Medical Payments

Question 58

reasonable charges for medical, surgical, x-ray, dental, ambulance, hospital, professional nursing, prosthetic devices, and funeral services.

Answer 58

Medical Expenses

Question 59

coverage is provided without the necessity of proving fault or liability for the accident-causing injury and does not apply to the insured or regular residents of the household except residence employees.

Answer 59

Medical Payments

Question 60

an auto that may be driven by the insured, but he does not own it

Answer 60

Nonowned

Question 61

termination of a policy at its expiration date by not agreeing to continue or renew the policy.

Answer 61

Non-renewal

Question 62

individuals not living in Louisiana and those without an office in Louisiana

Answer 62

Non-resident

Question 63

pays up to a limit for the additional cost of construction to comply with building codes or land use regulations when repairing or rebuilding a covered premise after a covered loss.

Answer 63

Ordinance or Law

Question 64

provides coverage for any direct and accidental damage to the vehicle

Answer 64

Other than Collision

Question 65

Comprehensive Coverage is also known as

Answer 65

Comprehensive

Question 66

What are common other than collision coverage perils?

Answer 66

``` fire theft explosion earthquake windstorm missiles falling objects hail or water flood vandalism/malicious mischief riot and civil commotion glass breakage contact with birds or animals ```

Question 67

a clause that explains that, in the case of a loss to something that is part of a pair or set, the company may elect to repair, replace, or restore the damaged item(s) or pay the difference between actual cash value of the property before and after the loss.

Answer 67

Pair and Set

Question 68

premium dollars that are collected in excess of what is needed to run each year is given back to the policyholder (return of premium) similar to a dividend.

Answer 68

Participating Policy

Question 69

causes of loss or actual events from which decreases are suffered that are covered by the policy.

Answer 69

Peril

Question 70

provides coverage for private passenger autos (limited to 10,000 lbs.)

Answer 70

Personal Auto

Question 71

may include collision, other than collision, and liability coverage

Answer 71

Personal Auto

Question 72

physical condition or status that increases the chance for a loss.

Answer 72

Physical Hazard

Question 73

all persons or business entities referred to as an agent, broker, solicitor, or surplus lines broker that sell, solicit, or negotiate insurance are required to be licensed as an insurance producer.

Answer 73

Producer

Question 74

coverage is needed by individuals who provide professional services to others for a fee.

Answer 74

Professional Liability

Question 75

coverage for the dwelling, other structures, personal property, and loss of use such as in a homeowner’s policy, but not including liability coverage.

Answer 75

Property Coverage

Question 76

Ocean marine liability

Answer 76

Protection and Indemnity (P&I)

Question 77

no opportunity for financial gain, only loss is suffered

Answer 77

Pure Risk

Question 78

offering and accepting any incentives for buying a policy, including money, unauthorized discounts or money back, special favors or personal services.

Answer 78

Rebating

Question 79

groups of people that use individual indemnity agreements to insure each other as a group.

Answer 79

Reciprocal

Question 80

under workers compensation, injured employees are entitled to...

Answer 80

Rehabilitation

Question 81

Who is responsible for selecting a vocational counselor to evaluate and assist the employee to select the appropriate method of rehabilitation?

Answer 81

The employer

Question 82

insure other insurance companies against the risk of higher-than-expected losses.

Answer 82

Reinsurance

Question 83

the actual losses during the policy period determines the final premium

Answer 83

Retrospective Rating

Question 84

applying a list of charges and/or credits to a class rate to determine the proper rate for a particular risk.

Answer 84

Schedule Rating

Question 85

created to encourage employment of physically handicapped employees

Answer 85

Second Injury Fund

Question 86

covers the cost for employers in the event re-injury of the same injury on the job

Answer 86

Secondy Injury Fund

Question 87

all perils are covered with replacement cost unless specifically excluded In dwelling policies, it only covers the dwelling and other structures on an open peril basis

Answer 87

Special Form

Question 88

What is also known as an open peril form?

Answer 88

Special Form

Question 89

What form includes coverage for: theft of part of the dwelling; accidental discharge or overflow of water from off the premises; and the coverage of falling objects includes antennas, outdoor equipment, fences, and awnings?

Answer 89

Special Form

Question 90

policy will pay the labor cost of crew to protect cargo from further loss

Answer 90

Sue and Labor Expenses

Question 91

companies or independent truckers that transport or haul goods and other types of property owned by others for a fee are known as truckers

Answer 91

Truckers Coverage

Question 92

Where would you find public truckers coverage?

Answer 92

Commercial Auto

Question 93

coverage includes drivers insured but carry limits of liability too low to cover the damages sustained by the injured party

Answer 93

Underinsured

Question 94

Obtaining and reviewing information for an application

Answer 94

Underwriting

Question 95

coverage is designed to reimburse the insureds for amounts due from negligent drivers who do not carry insurance

Answer 95

Uninsured

Question 96

What is a vehicle that has no liability coveragecalled?

Answer 96

Uninsured Vehicle

Question 97

when no people have been living in or using the property for a period of time, but it is still the insured’s location (on vacation).

Answer 97

Unoccupancy

Question 98

vandalism and malicious mischief covers vandalism damage to the property but excludes coverage for glass or theft of property.

Answer 98

V&MM

Question 99

vacant is when no one is living in the property or it is empty (moved out).

Answer 99

Vacancy