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Insurance > Insurance > Flashcards

Insurance Flashcards

1
Q

FAIR Plan Violation

A

1 - 2k
2 - 5k

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2
Q

Unfair Method of Competition Violation

A

1 - 5k
2 - 10k

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3
Q

Pretext interview

A

Attempts to gain information by pretending to be someone else
1 - Misrepresentation
2 - Falsely representing a person

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4
Q

Physical damage covered by PAD

A

Events of total loss, adjust made for physical damage

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5
Q

Persona Liability Endoresement

A

Coverage does apply to expenses occurred by residence employee but not named insured, regular residents of the named tenants
Covers:
First aid
Medical payments
Defense costs

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6
Q

Watchperson

A

Watch insured property while inside the property

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7
Q

Custodian

A

Watch property on the premises as a result of duty - inside or out

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8
Q

Principal / Obligor

A

Contractor

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9
Q

Obligee

A

Customer

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10
Q

Surety / Guarantor

A

Insruance company issue bond

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11
Q

Compensatory damages

A

Reimburse injured party for actual loss sustained

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12
Q

P&C 2 or 3 party contract

A

Property - two party contract
Casualty - three party contract

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13
Q

P&C Excluded losses

A

Catastrophic
Predictable
Covered elsewhere

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14
Q

Producing agent - what does the public think authority is

A

Apparent

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15
Q

Garagekeepers covers what

A

Covers damage to vehicles in the insureds care for service, storage, parking

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16
Q

Collapse - how to get coverage

A

Additional

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17
Q

DP2 characteristics

A

Named perils
Dwelling - Replacement costs
Contents - Actual cash value

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18
Q

DP 2 Covers

A

Damage by burglars
Falling objects
Weight of ice, sleet, snow
Accidental discharge of water
tear, cracking, bulging
Freezing
Artificial electricity

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19
Q

DP 1 Characteristics

A

Named
All on actual cash value

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20
Q

DP1 Covers

A

Basic - Fire, lightning, internal explosion
EC
External explosion
Smoke
Vehicles
Riot
Windstorm / hail
Volcanic Eruption

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21
Q

BOP for building and business personal property characteristic

A

Replacement cost

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22
Q

Auto Medical Payment covers

A

You and your resident relatives as occupents in any vehicle & as pedestrians injured by auto

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23
Q

Yacht

A

Greater than 26 feet with cooking and living quarters

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24
Q

Contractual Liability Definition

A

Enters into contract such as sharing property

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25
Q

BOP General Aggregate and Products completed operations are what

A

2x the occurrence limit

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26
Q

Fire Department Charges

A

Commercial - $1k
Home - $500
NEVER A DEDUCTIBLE

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27
Q

Workers Comp Primary or Secondary

A

ALWAYS PRIMARY

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28
Q

Conditional Loss

A

Provide proof of loss and respond in certain timeframe

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29
Q

PAP Family Member

A

Related by blood, marriage or adoption including foster children

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30
Q

Utmost good faith definition

A

Both parties want it to work

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31
Q

Reasonable expectations

A

It should work as expected

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32
Q

BOP Does not cover what

A

No cars, bars, banks or manufactures

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33
Q

PAP defense cost limit

A

NO DEFENSE COST LIMIT

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34
Q

Operations Liability

A

You are on someone else’s property during work and make a mistake

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35
Q

FCRA Requires how much notice

A

3 days and investigates customer reports

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36
Q

BOP Coinsurance

A

No coinsurance requirement
80% = Replacement cost
Less than 80% = Actual cash value

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37
Q

FOB Destination

A

Seller is responsible for property being transported until it has been delivered

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38
Q

POB Point of Shipping

A

Buyer interests begin at the start of the shipment and they will be responsible for loss or damage to cargo

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39
Q

Persona floater recieve what perils

A

Open Perils

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40
Q

Unfair trade practice in NJ how many days before hearing

A

10 days

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41
Q

Preservation of proerpty covered under

A

Again open perils for 30 days

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42
Q

Business coverage form - what perils

A

Open Perils

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43
Q

Service Carrier under PAIP

A

Accept PAIP Assignments from another issuer

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44
Q

Advisory Organization

A

Assist insures in making their own rule

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45
Q

Valuation of loss under building and property form

A

Method of evaluating losses, valuation and treats valuation of unsual property as stock that has been sold
Valuation of loss under building and property form

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46
Q

Commercial Building Risk Coverage Form Liability

A

No Liability in included

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47
Q

Part F 2 or more policies covering same auto

A

Max limit is equal to the limit of the policy with higher limits of liability

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48
Q

Workers comp assigned risk plan

A

Coverage for employees who are unable to purchase coverage in the volunteer market

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49
Q

Strict Liability Definition

A

Applies to products and their manufacturing
Held liable if product caused injury

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50
Q

Watercraft Liability

A

Watercraft, their trailers, furnishing, equipment, engines motes are subject to 1.5k limits

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51
Q

Per occurrence Limit

A

The most a policy will pay for a loss arising out of any one accident

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52
Q

Watercraft Liability Endorsement on Homeowners Policy Covers and not Cover

A

Covers - damage to others not done by them
Not Cover - Rented, Employee use, Insured, USed for racing

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53
Q

Personal and advertising injury liability in CGL Covers

A

False Arrest
Malicious prosecution
Copy right infringement

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54
Q

Bailee and Bailor

A

Bailor = Owner of item
Bailee = Servicer

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55
Q

BOP if coverage for 100% for 12 months auto increased by

A

25%

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56
Q

Commercial medical payment

A

Does not auto apply to BAP - Added by endorsement

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57
Q

Libralization

A

Provides change which favor the policy owner become effective immediately.
Changes that affect the policy owner negatively don’t become effective until the policy is renewed.

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58
Q

Subrogation

A

Subrogate = To go in place of another
States the insured must transfer to the insurance company its right of recovery against any party causing a loss after it accepts payment from the insurer for a loss.
Allows insurer to recover from the party that caused a loss any amount paid.

Prevents insured from collecting twice on the same loss
Helps the insurer control expenses and premiums
Holds the responsible third party accountable for the loss

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59
Q

Commercial and Personal Lines Rankings

A

Commercial Lines = First Named Insured
Personal Lines = Named Insured

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60
Q

Blanket Insurance

A

May be written on all property of a single type,
All property at one location
Multiple types of property at multiple locations

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61
Q

Nonconcurrent

A

Multiple companies should be sued to insure one property.
The peril power should match.

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62
Q

Where do you find the terms and phrases in an insurance contract

A

Definitions

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63
Q

Agreed Value

A

Insurer and the insured specify specific values of items before policy is issued
Impossible to replace (arts antiques)

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64
Q

Agreed Value

A

Insurer and the insured specify specific values of items before policy is issued
Impossible to replace (arts antiques)

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65
Q

Valued Policy

A

Provides payment of the full poliyc amount on the declarations page in the events of a total loss without ACV or depreciation

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66
Q

General Damages

A

Noneconomic damages, humiliation

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67
Q

Expressed

A

Written contract

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68
Q

Unilateral Contract

A

Contract says the insurer pays only after a loss.

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69
Q

Doctrine of reasonable expectations

A

Resolve any ambiguity in policy wording in favor of the insured

b/c the insurer has legal advice and writes the policy language, any ambiguity which means uncertainty in the contract will benefit the insured

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70
Q

Consideration

A

One element of a legal contract
Payment of premium by the insured in return for the promise to pay covered claims
Both parties to the contract must be present for contract to be valid.

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71
Q

Aleatory

A

Unequal exchange of value

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72
Q

Contract of Adhesion

A

Insurance company wrote it, they must stick to it

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73
Q

Unilateral Contracts

A

One Promiser = Unilateral
One Auther = Adhesion

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74
Q

Residual Market

A

When the private market does not ordinarily furnish the coverage, the residual market then steps in to provide that unavailable coverage. Example - Flood insurance

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75
Q

US Territorial Possession

A

Guam, Puerto Rico, US Virgin Island and the Norhtern Mariana Islands.

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76
Q

Surplus Line Transcation

A

When you need insurance that is unavailable in your state, you may go Through SURPLUS LINES PRODUCRS to purchase insurance from a non-admitted company.

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77
Q

Surplus Line Transaction

A

When you need insurance that is unavailable in your state, you may go Through SURPLUS LINES PRODUCRS to purchase insurance from a non-admitted company.

78
Q

Subject to loss

A

Exposure = Risk

79
Q

Homeowners earthquake endorsement - how long until earthquake shocks considered a single earthquake

A

72 hours

Commerical lines earthquake endorsement = 168 hours

80
Q

Homeowners earthquake covers losses due to earthquake and what else

A

Volcanic eruption

81
Q

Earthquake endorsement homeowner’s deductible

A

Use a % deductible instead of the flat dollar deductible

82
Q

Homeowners Limits for Coverage E (personal liability) & Coverage F (Med pay to others) is?

A

Liability = 100k
Med pay = 1k

83
Q

Damage to property of others will respond:

A

To losses committed intentionally or unintentionally by children who have not yet reached 13 years old

84
Q

Homeowners liability limits are expressed

A

per occurence

85
Q

Homeowners Medical Payments Cover

A

Resident Employees / Per person basis

86
Q

Homeowners Limits

A

Detached garage = 20,000
Auto = 0
Personal Prop = 100k
Additional exp = 60k

87
Q

Homeowners Audo and Visual Coverage C

A

Not subject to a special dollar limit

88
Q

H/O Cover A Dwelling Coverage Limit

A

Chosen by policy owner

89
Q

H/O Coverage B Other Structures Limit

A

10% of A

90
Q

H/O Coverage C Personal Property Limit

A

50% of A

91
Q

Coverage D Loss of use limit

A

30% of A

92
Q

H/O Tree debris removal cost

A

Fall tress = 500 and 1,000 per occurrence

93
Q

Fire Dept Service Charge H/O & Commercial

A

H/O = 500
Comm = 1000

94
Q

Transporation expenses cover under Part D of the personal auto policy after a collision

A

Rental Reimbursement of $20 a day up to $600

95
Q

Collision and Other Collision Open/Named

A

Collision is named peril (upset and collision)

Other Than Collision is open peril

96
Q

when is Collision triggered

A

Collision Coverage applies to the impact of a covered auto with an object or another vehicile or upset of a covered auto.

97
Q

Which Personal Auto Policy coverage would pay to repair a car if it was damaged by a hit and run driver

A

Collision

98
Q

Other Than Collision losses include

A

Missiles
Falling object
Fire
Theft or Larceny
Earthquake
Windstorm
Hail
Water
Flood
Malicious mischief or vandalism
Riot
Animal
Glass damage

99
Q

Monoline Policy

A

Covers Commercial Auto ONLY

100
Q

What is the garage coverage form designed for

A

Dealership

101
Q

Under a commercial auto policy, liability coverage includes

A

Supplementary payments - first aid, bonds, reasonable travel expenses

102
Q

Farm Broad Cover

A

Drowning of a covered livestock

Electrouction of covered livestock

Accidents involving loading and unloading

103
Q

Farm Special Form Covers

A

Voluntary parting with property

104
Q

Commercial Article Floater

A

Provides open peril coverage for fine arts, cameras, musical instruments and there related equipment when used for business or commercial use.

Theft is covered

105
Q

BOP and Homeowners - how to get Replacement cost

A

80% of coinsurance value of building

106
Q

Commerical Property Policy you can get replacement cost how

A

Purchase a replacement cost endorsement

107
Q

Earthquake will treat all losses within what time period as a single occurent

A

Commerical - 168
Personal - 72

108
Q

Equipment Breakdown coverage pays losses

A

Replacement cost

109
Q

When will written notice for suspension of coverage on an objected covered by equipment breakdown coverage become effective

A

Immediately

110
Q

When does the coverage for a BUILDERS RISK FORM being

A

At the time the insured becomes legally responsible for the property if that date occurs after the policy’s effective date

111
Q

Period of restoration beings after X hours after the physical loss for business income

A

72 hours

112
Q

Business Income

A

Designed to replace income lost when a business must close temporarily following a covered loss

113
Q

Cause of loss form

A

Shows the perils the property is insured against

114
Q

Commercial Vacancy

A

If vacant for 60 days and coverage is continued, the perils of SPRINKLER LEAKAGE, WATER DAMAGE, VANDALISM, GLASS AND THEFT ARE NOT COVERED

115
Q

Commercial Broad Form

A

Covers Plumbing

116
Q

Commercial common policy declaration

A

Who
What
When
Where
How much

117
Q

Coinsurance equation

A

(Did / Should)
* (loss-deductible)

118
Q

What is the purpose of commercial package policy

A

Eliminates redundancy by streamlining the various policy form into the package policy

119
Q

Commercial Package Policy that modifies several of the coverage parts

A

Interline Endorsement

120
Q

Fire Legal Liability

A

Provides coverage for a business that leases its premises and then causes negligent fire damage to those rented premises

121
Q

Strict Liability

A

Sets a higher bar than negligence.

Negligence - it must be established that the defendant had a duty to the Plaintiff

Strict Liability that is not necessary. The legal theory simply says that if you make, sell, distribute a product that hurts people, you are responsible

122
Q

What is included in the commercial liability policy limit of insurance

A

Medical
General Aggregate
Personal and Advertising injury

123
Q

Businessowners policy (BOP_ covers)

A

BOP insurers small and medium size businesses with one location for property, liability and other coverages as a singe policy similar to a homeowners policy

Small and low risk

124
Q

BOP CANNOT be sold to

A

Amusements.. bowling alley, theatres, amusement parks

will not cover cars,-bars, entertainment, manufacturers, banks

125
Q

BOP true statements

A

Open or named peril
Purchase the property coverages of a BOP, casualty, coverages of a BOP, or both

Workers comp can be added by an endorsement

DOES NOT HAVE CO INSURANCE REQUIREMENTS

126
Q

BOP Valuation feature

A

BOP feature is the REPLACEMENT COST LOSS SETTLEMENT on building and building personal property

127
Q

BOP covers losses of income up to how much

A

Provides business income and/or extra expense coverage for 12 full months following the loss

128
Q

General Aggregate limit and the products and completed operations aggregate limit

A

two times the occurrence limit

129
Q

What is the minimum deductible in the regular flood insurance program

A

$1000

130
Q

How many days after an application is received does flood coverage begin

A

Flood coverage begins 30 days after your application is received

131
Q

What is an optional coverage that can be added to a mobile home policy

A

Loss from collision damage

132
Q

Umbrella policies that are excluded

A

Business pursuits

133
Q

What is covered under an umbrella policy

A

Cover incidents over and above the coverage of underly`ing policies.

Personal injury is excluded from homeowners policies therefore an umbrella is necessary to provide coverage for the insured

134
Q

Which policy could pay claims over and above the limits of the commercial general liability policy

A

Both the:
1) Commercial Umbrella
2) Excess Liability Policies

135
Q

What is a self insured retnation

A

Deductible

136
Q

What is true regarding excess liability policies and commercial umbrella policies

A

Both excess liability and umbrella policies are designed to pay over and above the limits of the underlying liability policies

IF there is no underlying coverage:

1) Excess liability does not pay
2) Umbrella will pay AFTER the policyowner pays a predetermined amount called a retention limit.

Umbrella = retention
Liability = No retention

137
Q

What is a principal in a fidelity bond

A

Employee covered

138
Q

Obligee in a fidelity bond

A

Employer

139
Q

Surety in a fidelity bond

A

Insurance Company

140
Q

Principal/Obligor in a contract bond

A

Contractor

141
Q

Obligee in a contract bond

A

Customer

142
Q

Surety / Guarantor in a contract bond

A

Insurance company

143
Q

Surety Bond

A

Promises payment if the principal defaults on an obligation

144
Q

Employment practices liability

A

Covers wrongful employment behavior, such as
1) Discrimination
2) Harassment
3) Wrongful termination

145
Q

What liability is covered by a commercial general liability policy

A

The CGL covers
1) Contractual Liability

146
Q

What is the purpose of the homeowners policy

A

Provide both property and liability coverage in one policy designed to avoid overlaps or gaps in the coverage

147
Q

What Commerial Property Policy allows you to pay over and above its limits

A

Coverage additions like Fire Department service charge and debris removal benfit increase the amount paid followin a loss

148
Q

What is a pure no fault system

A

Abolish use of the tort system for bodily injuries resulting from auto accidents

149
Q

What forms the basis of a loss under an insurance policy

A

A loss

150
Q

What is the purpose of the causes of loss form that lists specific exclusions

A

To state which perils are insured against

151
Q

Without a replacement cost endorsement,

A

Personal Property losses on all H/O forms are paid on actual cash value basis

152
Q

Fire Legal Liability Provides

A

Coverage for a business that leases its premises and then causes negligent fire damage to those rented premises

153
Q

Homeowners Limit of Liability

A

Dwelling (chosen by policyowner)
B Other structure - 10%
C - Personal Prop - 50%
D - Loss of use - 30%

154
Q

Arbitration and Appraisal

A

Part c uninsured - Arbitration
Part d damage to your auto = Appraisal

155
Q

Pair & Set Calculations

A

Value before the loss
MINUS
Value following the loss

156
Q

HO-5

A

An HO5 policy is the Premier Homeowner Policy, which includes everything included in an HO3 policy. It provides replacement cost coverage. It covers the structure and all of the property inside the home. It is the most comprehensive policy available. However, coverage for earthquakes or floods is excluded. HO5 policies are usually limited to dwellings built within the last 30 years or renovated within the last 40 years.

157
Q

H01 is the Basic Homeowner Policy, which covers the home’s structure and the property inside. It also covers structures located on the property due to damage caused by:

A

Windstorm/hail
Fire/lightning
Vandalism/criminal mischief
Vehicles/aircraft
Explosions/riots
Glass breakage
Smoke
Volcanic eruption
Personal liability

Damage from flooding and earthquakes is excluded from coverage in HO1 policies. Coverage is provided on a replacement cost basis, so the insured receives the cost of rebuilding or repairing damage to the dwelling with materials of similar quality.

158
Q

HO2 Homeowners policies provides more coverage than an HO1 policy. It is also called a broad form policy. In addition to the events covered under a basic policy, HO2 policies also cover:

A

Falling debris/objects
Freezing
Collapses due to the weight of ice, snow or sleet
Accidental discharge or overflow of water or steam
Sudden and accidental destruction, burning, cracking or burning
Accidental damage caused by surges of electrical current

HO2 policies are available with replacement cost or actual cash value coverage. Be aware that an HO2 policy does not cover water damage caused by a water backup and foundation or slow leaks. It also does not cover open perils, including earthquakes or floods. However, they may provide mechanical breakdown coverage with respect to heat and air conditioning systems or water heaters, but not for kitchen or laundry appliances, computers, televisions, sound equipment or systems.

159
Q

An HO3 policy is one of the most comprehensive Homeowners policies available. It covers the dwelling’s structure from all perils unless specifically excluded. It does not cover the contents inside. The contents can be covered with a named perils policy. Some typical exceptions to HO3 dwelling coverage include:

A

Laws/ordinances
Earth movement
Water damage
Power failure
Animals owned by insured
Neglect
War/nuclear hazards
Intentionally caused loss
Government action
Collapse of structure
Theft of property from an under construction dwelling
Vandalism/Malicious mischief if the property is vacant for over 60 days
Mold/fungus/rot
Wear and tear or deterioration
Mechanical breakdown
Smog, rust, corrosion
Smoke caused by agricultural smudging or industrial operations
Discharge, dispersal, seepage of pollutants
Settling/shrinking/bulging/expansion
Birds/vermin/rodents/insects

Some HO3 insurance plans have a named perils policy, which means it specifically lists what is covered. Regardless of the type of coverage, HO3 insurance typically does not include floods and earthquakes in its perils coverage, according to the NAIC.

160
Q

An HO4 policy is also called the contents broad form. It is the tenant’s or renter’s form that provides named peril protection for the personal property of tenants. The coverage is meant for residents who rent and do not own a property, including single-family homes, apartment units/condominiums and mobile homes. The HO4 policy provides coverage similar to an HO-2 policy, though it covers personal property only and not any structures.

A
161
Q

An HO6 is an insurance policy for condominium owners and is similar to a renter’s insurance policy. An HO6 insurance policy only covers the condominium’s interior, including property, walls, ceilings, floors and property from the same perils covered in HO2 home insurance policies. The exterior of the condominium building is typically covered through a policy purchased by the Homeowners association or management company community manager. An HO6 policy may also provide coverage for reimbursement for additional living expenses. Additionally, HO6 policies provide personal liability protection, in the event a person is injured on the insured property and the insured is liable for the injury. The personal liability coverage pays for the cost of an attorney, court costs, medical expenses and any money awarded to the injured party.

A
162
Q

An HO8 policy covers special risks, such as unique properties and older properties whose market values are much lower than the replacement costs. It provides peril coverage to dwellings and personal property and may provide extended coverage for certain perils. It may also cover vandalism and criminal mischief. Payouts are made on an actual cash value basis.

A
163
Q

Which of the following dwelling types is not eligible for a Homeowners policy?

A

Dwellings eligible for a Homeowners policy include second homes/vacation residences, life estate and trustees occupied homes, under construction dwellings, properties that are subject to installment contract payment plans and mobile homes that have been purchased. A farm is not a dwelling for Homeowners insurance eligibility purposes.

For Homeowners coverage, the only eligible parties are the owner and occupants of a residential only dwelling, along with eligible residential renters. Both property and casualty lines must be purchased, unless the property is rented out. Additionally, there can be no more than four family units in the dwelling.

164
Q

Sharpie rents out his home to a tenant, pursuant to a 2 year lease. An electrical fire occurs due to faulty wiring. What coverage type would allow a payout to Sharpie?

A

Coverage D provides coverage for loss of use. The insured receives a payout if the insured dwelling is rendered uninhabitable as the result of a covered loss. The two possible methods of reimbursement are: 1) additional living expense, which allows the insured to maintain their standard of living if the insured loses use of the residence dwelling; and 2) Fair rental value, which covers lost rental payments if the dwelling is rented to another person.

165
Q

Rating a policy refers to calculating the premium amount for an insurance policy. There are three primary rating methods:

A

-Judgment rating: This is the simplest method. The underwriter uses their personal, expert judgment to determine the premium, instead of using rate tables. It is the oldest rating method.

-Manual rating (a/k/a class rating): This is the most common premium rating method. Rates are grouped into categories and listed on a table. The underwriter analyzes the risk and classifies it according to the table categories. A premium is selected based on the corresponding category and then calculated by multiplying the rate by the amount of insurance units. For example, if $100,000 of insurance is purchased at a listed rate of $5 per $1,000, the total premium would be $500. $100,000 / $1,000 = 100 units x $5 = $500.

-Merit rating is used for risks with unusual or unique characteristics. First, the manual rating is calculated and it is adjusted, in accordance with the specific risk involved. Types of merit rating include experience rating, schedule rating and retrospective rating. Experience rating analyzes the insured’s own loss history, so the premium will be higher for an insured with a loss experience greater than the average loss experience. However, if the loss experience is below the average loss experience, the premium will be less than the manual rate. Schedule rating utilizes a system of debits and credits, based on the insured’s own characteristics. Retrospective rating takes into account any losses occurring over the policy period.

166
Q

A business operating in a dwelling that is primarily used as a residence is called:

A

An incidental occupancy is a business conducted in a dwelling that is primarily used as a residence with no other businesses operating on the same property. The policy defines which types of incidental businesses are allowed. A private school, professional office or studio could qualify as incidental occupancies.

167
Q

The cost that is assessed to a claim due to the cost of investigating and adjusting the insurance claim is called:

A

Loss adjustment expense is the cost that is assessed to a claim due to the cost of investigating and adjusting the insurance claim.

168
Q

_________________________ occurs when an insurer steps into the shoes of the insured to recover money or damages paid out on behalf of the insured from another party.

A

Subrogation is the insurance principle referring to an insurer stepping into the shoes of the insured to recover money or damages paid out to or on behalf of the insured from another party.

169
Q

Combined Ratio

A

Loss Ratio + Expense Ratio

170
Q

Expense Ratio

A

Total Underwriting Expenses / Total Written Premiums

171
Q

Loss Ratio

A

Incurred Loss Amount / Earned Premium Amount

172
Q

NFIP coverage

A

Standard coverage provides up to $100,000 for the building contents.

A National Flood Insurance Program (NFIP) policyholder gets 2 flood insurance programs: emergency and regular. Emergency coverage is in effect before the NFIP processes the insurance application. Emergency coverage currently has a standard deductible of $1,000 and maximum coverage limits of $35,000 for buildings and $10,000 for the building contents (e.g. personal property). Once regular coverage is in effect, there is currently a standard deductible of $500 and coverage limits of $250,000 for buildings and $100,000 for the building contents.

173
Q

Which duties can an agent perform that a solicitor is not allowed to perform?

A

Solicitors sell insurance policies, receive insurance premiums and represent the insurance company. They share several duties with agents and can work for agents, but they cannot issue or countersign policies. Countersigning refers to the insurance agent’s authentication of an insurance contract. An agent is required to review and sign new insurance policies.

174
Q

When NFIP coverage is provided, it covers any loss directly caused by the covered event, such as the items of personal property within the damaged structure. The following property is excluded from coverage:

A

-Most self-propelled vehicles such as cars, including their parts
-Property and belongings outside of an insured building, such as trees, plants, wells, septic systems, gas/oil/liquid tanks, walks, decks, patios, fences, seawalls, hot tubs and swimming pools
-Currency, precious metals and valuable papers such as stock certificates

175
Q

Federally subsidized flood insurance is managed by the:

A

FIA

176
Q

Hynes loses his house as the result of a tidal flood. Luckily, his recently submitted flood insurance application was approved and he has had coverage for the last 3 months. He was able to move his valuable personal property to a safe location before the flood struck. For how long will his property be insured at the stored location?

A

Personal property that has been moved to a safe location to protect it from flood damage is covered for up to 45 days at the new location under NFIP.

The National Flood Insurance Program (a/k/a NFIP) is a federally subsidized program that provides flood insurance. The NFIP is managed by the Federal Insurance Administration (a/k/a FIA). Flood insurance coverage applies to a walled or roofed building permanently affixed to an above ground location. The building and its contents (e.g., personal property) are covered.

177
Q

Transit coverage

A

insures property while it is being transported over land from one location to another.

178
Q

Cargo insurance

A

provides coverage for goods while the goods are transported over water

179
Q

Robbery

A

Robbery is the theft of property accompanied by the use or threat of physical force.

180
Q

Burglary

A

Burglary is the theft of property by forced entry into a premises with visible evidence of the forced entry.

181
Q

Subrogation

A

insurance principle referring to an insurer stepping into the shoes of the insured to recover money or damages paid out to or on behalf of the insured from another party

182
Q

Waiver of subrogation

A

Waiver of subrogation is the insurance principle referring to an insurer giving up that right. The person from whom the insurer seeks recovery usually caused the loss requiring the payout. It is also called “transfer of rights of recovery”

183
Q

Solicitors are similar to _____________.

A

Solicitors have many of the same duties that agents have and they could work for agents. They can represent the insurance company, sell insurance and receive premiums. However, solicitors are not permitted to issue or countersign policies.

184
Q

Employee dishonesty

A

Employee dishonesty coverage protects a business against an employee’s theft of money, property or securities.

185
Q

Tree coverage is available if one of the following occurs:

A

-the downed tree causes damage to a covered structure
-the downed tree blocks a driveway entrance
-the tree is blocking a handicap accessible feature

186
Q

Surplus lines insurance

A

Surplus lines insurance provides coverage for unique situations or situations with high-risk. For example, a celebrity or artist who wants to insure a certain body part (e.g., legs, hands) could purchase surplus lines insurance. Medical malpractice insurance is also an example of a surplus line of insurance. Surplus agents (a/k/a excess agents) sell surplus lines of insurance. Surplus lines agents are permitted to sell surplus lines even in states where surplus lines insurance is not authorized or the insurer is not licensed.

187
Q

Time element insurance

A

property insurance for lost earnings or income caused by the inability to use the damaged property. That is the best answer, since the question involves a specific piece of property and all business operations were not affected.

188
Q

Coverage E in a homeowner’s policy covers

A

policy covers the insured when the insured causes property damage to another person’s property or is liable for causing injury to another person

189
Q

A loss payable provision

A

A loss payable provision authorizes insurance payments to someone or an entity that has an insurable interest in the insured property.

190
Q

Twisting

A

Twisting occurs when an agent misrepresents facts to a client in order to persuade the client into canceling an active insurance policy and purchasing a new policy. Twisting is a technique that solely benefits the agent by generating a new commission.

Insurance (3 decks)

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