Definitions Flashcards
Risk
The chance of loss
Insurance
The premiums of the many pay the losses of the few
An event that may cause a loss
To occur
Peril
The immediate and effective cause of loss
Proximate Cause
Putting you back in the same financial position, just prior to loss, no better no worse
Indemnity
What is General Insurance?
All insurance other than life & health
What a reasonable and prudent person would do or not do in a similar situation
Negligence
What is Lloyds of London?
It’s not an insurance company. It’s a place to do business. It’s an insurance market.
A one-of-a-kind wording, developed for a particular risk or class of business.
Manuscript Wording
What is re-insurance?
It is insurance for insurance companies
Who is the first party?
The Insured
Who is the second party?
The Insurer
Frequency
The number of times something happens
Severity
The average cost of the loss
Payment or a promise to pay for an exchange of something of value
Consideration
What is a legal entity?
Someone who can sue or be sued
What is Actual Cash Value?
Today’s price, less depreciation
You can not deny what you’ve already said
Estoppel
When you’ve legally wronged someone
Tort
Silence when there’s an obligation to speak
Concealment or non-disclosure
The policy never existed and any premium must be refunded in its entirety
Void
Three or more persons acting unlawfully
Riot
What is a list policy voucher?
A one-page of the cancellation agreement
A condition that may cause a peril to occur or make the loss more severe
Hazard
Damage to property without regard of ownership
Vandalism
Damage to property due to ownership
Malicious Act
Monetary compensation to the plaintiff for bodily injury or property damage due to the negligence of the defendant
Damages
What is the definition of Insured?
Insured means the person(s) named as Insured on the Coverage Summary Page and, while living in the same household:
- his or her spouse
- the relatives of either; and
- any person under 21 in their care
What is the definition of Vacant?
The occupant(s) has moved out with no intent to return
What is Contribution?
Insurance under more than one policy
What is fair rental value?
It’s an optional extension of coverage that protects the rental income an insured receives from an insured building. If a building that is usually rented to others is damaged by a hazard named in the policy, this coverage will pay the rental value.
What are statutory conditions?
They are the rules of the game between the first and second party
What is a standard mortgage clause?
The rules of the game between the insurer and the bank
