Into to Insurance

Question 1

A risk management technique that transfers the potential financial consequences of certain specified loss exposures from the insured to the insurer.

Answer 1

Insurannce

Question 2

A company that sells insurance policies to protect insureds against financial hardship caused by financial losses.

Answer 2

Insurer

Question 3

Any person or organization who is insured under an insurance policy.

Answer 3

Insured

Question 4

The price of the insurance coverage provided for a specified period.

Answer 4

Premium

Question 5

The uncertainty about outcomes, some of which can be negative.

Answer 5

Risk

Question 6

Any condition or situation that presents a possibility of loss, whether or not an actual loss occurs.

Answer 6

Loss Exposure

Question 7

In the context of risk management, a risk financing technique by which the financial responsibility for losses and variability in cash flows is shifted to another party.

Answer 7

Transfer

Question 8

A contract that states the agreement between and the rights and duties of the insurer and insured.

Answer 8

Insurance Policy

Question 9

One of the two main sectors of the insurance industry, encompassing numerous types of insurance, most of which cover the financial consequences of damage to one’s own property or legal liability to others.

Answer 9

Property-Casualty Insurance

Question 10

The legally enforceable obligation of a person or an organization to pay a sum of money (called damages) to another person or organization.

Answer 10

Legal Liability

Question 11

Policy that covers most of the property and liability loss exposures that arise out of residential property ownership and occupancy, as well as property and liability loss exposures that individuals and families may have while they are away from their residences.

Answer 11

Homeowners Policy

Question 12

Coverage for damages, plus costs of any defense, related to a claim or suit brought against the insured that resulted from bodily injury or property damage caused by an occurrence covered under the policy.

Answer 12

Personal Liability Coverage

Question 13

An insurance policy that covers an individual or a family against loss exposures arising out of the ownership maintenance, or use of automobiles.

Answer 13

Personal Auto Policy (PAP)

Question 14

Personal Watercraft Policy

Answer 14

An insurance policy that covers an individual’s or a family’s loss exposures arising out of the ownership, maintenance, or use of watercraft used principally for recreation or personal transportation purposes.

Question 15

A liability policy that provides excess coverage above underlying policies and may also provide coverage not available in the underlying policies, subject to self-insured retention.

Answer 15

Umbrella Liability Policy

Question 16

Policy that covers two or more lines of business by combining ISO’s commercial lines coverage parts.

Answer 16

Commercial Package Policy (CPP)

Question 17

A package policy that combines most of the property and liability overages needed by small and medium-sized businesses.

Answer 17

Businessowners Policy (BOP)

Question 18

Insurance that covers commercial buildings and their contents against various types of property loss.

Answer 18

Commercial Property Insurance

Question 19

Insurance that covers (1) money and securities against numerous perils (not limited to crime perils) and (2) property other than money and securities against crime perils, such as employee theft, robbery, theft by outsiders and extortion.

Answer 19

Commercial Crime Insurance

Question 20

Insurance that covers many of the common liability loss exposures faced by an organization, including its premises, operations, and products.

Answer 20

Commercial General Liability (CGL) Insurance

Question 21

Insurance that covers a business or a not-for-profit organization against loss exposures arising out of the ownership, maintenance, or use of automobiles.

Answer 21

Commercial Auto Insurance

Question 22

Insurance that provides coverage for the benefits an employer is obligated to pay under workers compensation laws.

Answer 22

Workers Compensation Insurance