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