Definitions Flashcards
any act or omission with a view to illegally obtaining an insurance benefit
Insurance Fraud:
Latin for the guilty; guilty knowledge or intention to commit a crime
Mens Rea:
Coverage for losses from fire and lightning and also the resultant damage caused by smoke and water
Fire insurance:
Incorrect or missing information about a material fact that is offered, or not, by an application or insured with or without the intent to mislead
Misrepresentation:
The intentional and voluntary relinquishment of a known right. A waiver under a policy is required to be clearly expressed and in writing
Waiver:
A bar created when someone by his action indicates he will not exercise a right he has
Estoppels
An agreement signed by the policyholder after a loss agreeing that the investigation and determination of the amount of damage by the insurance company shall not be construed as admission of liability
Non-waiver agreement
A material that is used to start or spread a fire. It is usually flammable to combustible liquid
Accelerant
The fair market value of the property, taking into account factors that might augment or reduce the value of the property in question
Actual cash value
one who investigates insurance claims, makes recommendations regarding the payment of benefits from insurance policies and negotiates payments and settlements
Adjuster
a person who is employed or authorized to act on behalf of another. Agents can be independent or direct writers. An independent agent is one who contracts with at least two or more insurance companies to sell their insurance policies to the public and is paid a commission based on the percentage of each premium paid. This includes a fee for each policy serviced. A direct agent represents only one company and sells for only one company and is also paid on a commission basis similar to the independent agent.
Agent
Damages designed to compensate the plaintiff for suffering intangible damages such as humiliation and distress, as a result of the defendant’s actions.
Aggravated damages
A name given to an insurance policy that covers each and every loss except those that are specifically excluded. If the insurer does not exclude. If the insurer does not exclude it, then it is automatically covered. This is the broadest type of coverage that can be purchased
All risk Policy
An actual or attempted malicious and deliberate burning of physical property by its owner or another person
Arson
Design to deceive or mislead another. Conscious wrongdoing. Constructive fraud
Bad faith
A written or oral agreement given by an insurer to insure a risk, pending the issuance of a formal policy. A binder is deemed to be the policy and must be cancelled in the same manner
Binder:
the collection of client business (policies) and agent or broker has placed with insurers. Generally, a broker owns her book of business while the agent’s book of business is owned by the insurer
Book of business
A licensed independent person or firm who acts on behalf of an insured in placing business with insurance companies.
Broker
The standard by which a claim must be proven to prevail. The burden of proof is typically borne by one party or another
Burden of proof:
The path of travel and the shape of the charred areas from the point of origin of a fire
- ᶺ - A vee down suggests chemical ; V- A vee up is normal
Burn Pattern
Evidence based on making inferences from connected facts such as blood samples at a crime scene
Circumstantial evidence
An illegal agreement between two or more persons to defraud or deceive another
Collusion
Evidence that proves a fact without inference or presumption, which is true and establishes the fact, such as eyewitness testimony
Direct evidence:
An insurance form that protects the insured against liability against liability for committing an error or omission in the performance of professional duties. Generally, such policies are designed to cover financial losses rather than liability for bodily injury or property damage.
Errors of omissions:
A bar created when someone by his action indicates he will not exercise a right he has
Estoppels:
Anything presented at trial which attempts to prove the case. Two main categories of evidence are direct and circumstantial
Evidence
Being responsible for providing the principal with all the information that materially affects the principal’s interests; all information that is relevant to the affairs entrusted to the agent
Fiduciary duty
Coverage for losses from fire and lightning and also the resultant damage caused by smoke and water
Fire insurance
A public official involved in fire prevention and in the investigation of fires, particularly where arson is suspected.
Fire Marshal
additional coverage for moveable items like jewellery or antiques, beyond what’s included in the basic homeowners policy. Also called a rider or endorsement. A policy designed to cover property that floats or moves from location to location
Floater policy
Someone connected to a court of law and can be hired by an insurer or an insured to appear in court as a witness. The Expert Combines knowledge of legal cases to the principles of a profession. The expert can help to prove or contradict the cause of a claim.
Forensic expert
Most ordinary contracts are contracts. Insurance contracts are agreements made in the utmost good faith. This implies a standard of honesty greater than that usually required in most ordinary commercial contracts.
Good faith
An official mark that is present on jewellery. It is a mark of assurance and provides a clear indication of the quality of metal, having been tested at one of the country’s assay offices
Hallmark
one who adjusts losses on behalf of insurance companies but is not employed by any one insurance company
Independent adjuster:
any act or omission with a view to illegally obtaining an insurance benefit
Insurance Fraud
An investigation interview where the known facts are matched to a particular suspect for the purpose of obtaining a confession
Interrogation
A court order that freezes the assets of a defendant, in certain circumstances, pending the determination of a plaintiff’s claim. These injunctions are often used to prevent a defendant from transferring assets out of a court’s jurisdiction as soon as a claim is served, in order to frustrate enforcement of any ensuing judgment
Mareva Injunction
The value of an asset based on a current market valuation; the amount for which the item can be sold on the open market
Market value
Latin for the guilty; guilty knowledge or intention to commit a crime
Mens Rea
Incorrect or missing information about a material fact that is offered, or not, by an application or insured with or without the intent to mislead
Misrepresentation
A hazard arising from the nature of the insured or any other person involved with the insurance, including their character, interest, habits, lack of integrity or some combination thereof. This would encompass those instances where the change of loss is increased by the insured’s carelessness, incompetence, recklessness, indifference to loss or fraudulent nature
Moral Hazard
A hazard that is based in the insured’s attitude toward the insureds belongings. This hazard exists when the insured no longer cares about his or her possessions because they are insured. For example: an insured consistently leaves doors unlocked and windows open at home because they have insurance. If there is a burglary; homeowners insurance will cover any loss or damage suffered.
Morale Hazard
Intentionally falsifying information on a mortgage loan application with the objective of receiving a larger amount than would have allowed if the application was honestly made. False information on an application can include claiming to make a higher income than actual real income to providing falsified proof of identification or a falsified appraisal of the property.
Mortgage fraud
A policy in which the perils insured against are listed, as opposed to one that insures against all risk
Named Peril Policy:
An agreement signed by the policyholder after a loss agreeing that the investigation and determination of the amount of damage by the insurance company shall not be construed as admission of liability
Non-waiver agreement
also known as “soft” fraud, this occurs when an insured deliberately inflates a legitimate insurance claim. It is an unplanned act, and arises when the opportunity presents itself
Opportunistic Fraud:
Arise from an opportunity to submit an inflated claim when a legitimate loss has occurred. For example, your automobile has been broken into. The claim is for damages to the interior but you submit a claim for a broken tail light that occurred months before.
Padded claims:
When parties conspire to create the illusion of a legitimate accident using either pre-damaged vehicles or by intentionally and covertly inflicting damage on the suspect’s vehicles. Generally, law enforcement is not called to the scene of the accident
Paper Collision
Also known as “hard” fraud, this involves the deliberate planning or inventing of claims of improper insurance benefits by an individual. It involves fabricating a claim for the purpose of defrauding the insurer.
Premeditated or planned fraud
A general term used to identify a broker or agent who is licensed to sell insurance
Producer
An insurance claims adjuster representing an insured on a fee basis in a claim settlement
Public Adjuster
Damages in excess of those required to compensate the plaintiff for the wrong done, which are imposed in order to punish the defendant because of the particularly wanton or willful nature of his or her wrongdoing. Also called “exemplary damages”.
Punitive damages:
One who enlists others to act as claimants in a scheme to commit fraud and to reap a monetary benefit for participating in the crime. The people recruited in the scam and in return are offered a portion of the accident benefits.
Recruiter
A provision, generally in property insurance coverage, to provide a substitute of the damaged or loss property with something similar; including having the same use but not necessarily identical to the property being replaced, without extra cost to the insured.
Replacement cost coverage
Is an insurer’s notification to an insured that coverage for a claim may not apply
Reservation of rights letter
One who recovers or assists in recovering damaged property, especially property damaged by fire
Salvor
A Fragment, chip, or splinter of stone or ore. Usually happens over time ( Erosion)
Spall:
The destruction of evidence. The alteration of a policy by a party other than the insurer or the insured without consent
Spoliation
The test to establish whether a party has succeeded in proving a fact in issue. Standard of proof in civil matters is generally “on balance of probabilities” or a “preponderance of the evidence”, meaning that if it is likely that the fact is true, then the standard has been met.
Standard of proof
Property taken without permission or right, either secretly or by force
Stolen Property
A fraud that occurs when a criminal steals the identity of a homeowners or uses that false identity to steal their home through false documentation filed at the land registry office. This could allow the criminal to sell the home or obtain mortgages to purchase other properties in the homeowner’s name.
Title fraud
When the history of salvaged vehicle is hidden
Title washing
Fast- burning materials used by arsonists as fuses to rapidly spread a fire throughout a structure or area. They are called because they leave trails of their burn pattern
Trailers:
The insurance company or group that underwrites of insures a particular risk. The individual within an insurance company whose responsibility it is to accept or reject business or modify submissions in the particular line in which he or she specializes and in this way choose the risks the principals are prepared to underwrite.
Underwriter:
A phrase in a legal document calling for the highest standards of integrity on the part of the insured and the insurer
Utmost good faith
A policy that provides that a special amount shall be paid in the event of the total loss of the property
Valued policy
The intentional and voluntary relinquishment of a known right. A waiver under a policy is required to be clearly expressed and in writing
Waiver
A vehicle that does not exist or is already wrecked
Phantom Vehicle:
