INTRO TO CONTRACTS

Question 0

UNIQUE CHARACTERISTICS OF INS CONTRACT

Answer 0

CONTRACT OF ADHESION
ALEATORY CONTRACT
UNILATERAL CONTRACT
CONDITIONAL CONTRACT
PERSONAL CONTRACT

Question 1

ELEMENTS REQUIRED TO FORM ANY CONTRACT:

Answer 1

• COMPETENT PARTIES(AT LEAST 18YRS OLD)
• AGREEMENT- OFFER AND ACCEPTANCE
• LAWFUL OBJECTIVE
• CONSIDERATION-AN EXCHG OF VALUE(INSUREDS PREMIUM)

Question 2

ALL PARTIES AGREE TO ADHERE TO THE ENTIRE CONTRACT AS A WHOLE

Answer 2

CONTRACT OF ADHESION

Question 3

A CONTRACT IN WHICH THE VALUES EXCHANGED ARE NOT EQUAL

Answer 3

ALEATORY CONTRACT

Question 4

ONLY ONE PARTY MAKES A LEGALLY ENFORCEABLE PROMISE

Answer 4

UNILATERAL CONTRACT

Question 5

THE CONTRACT MAY BE VOIDED IF ALL POLICY CONDITIONS ARE NOT MET

Answer 5

CONDITIONAL CONTRACT

Question 6

THE INSURED MAY NOT TRANSFER RIGHTS AND DUTIES UNDER THE CONTRACT WITHOUT THE INSURERS WRITTEN PERMISSION

Answer 6

PERSONAL CONTRACT

Question 7

WARRANTIES

Answer 7

WRITTEN PROMISE IN THE POLICY THAT THE INSURED WILL OR WILL NOT DO SOMETHING; IF BREACHED, COVERAGE WILL BE SUSPENDED AND THE CLAIM DENIED AS IT RELATES TO WARRANTY(KEEP FIRE PROTECTION ON)

Question 8

REPRESENTATION

Answer 8

STATEMENTS MADE BY THE PROSPECTIVE INSURED ON AN APPLICATION FOR INS THAT ARE BELIEVED TO BE ENTIRELY TRUE

Question 9

MISTEPRESENTATION

Answer 9

INCORRECT INFORMATION GIVEN BY PROSPECT/INSURED THAT DOES NOT EFFECT COVERAGE; INSURER WOULD HAVE MADE THE SAME COVERAGE DECISIONS WHETHER OR NOT THE TRUTH WAS KNOWN

Question 10

MATERIAL MISREP

Answer 10

INCORRECT INFO GIVEN BY THE PROSPECT THAT VOID THE INS CONTRACT BECAUSE THE INSURER WOULD HAVE MADE A DIFFERENT DECISION OF TRUTH HAD BEEN KNOWN

Question 11

CONCEALMENT

Answer 11

DELIBERATELY WITHHOLDING MATERIAL INFORMATION FROM THE INSURER; THIS WILL VOID COVERAGE

Question 12

WAIVER

Answer 12

THE VOLUNTARY RELINQUISHMENT OF A KNOWN RIGHT

Question 13

ESTOPPEL

Answer 13

THE INVOLUNTARY RELINQUISHMENT OF A KNOWN RIGHT

Question 14

A CONTRACT BASED UPON THE PRINCIPLE OF INDEMNITY THAT TRANSFERS RISK FROM PERSON OR ORG TO INS COMPANY

Answer 14

INSURANCE

Question 15

A TEMPORARY INSURANCE CONTRACT

Answer 15

BINDER

Question 16

CHANCE OF A LOSS OR UNCERTAINTY OF LOSS:

Answer 16

RISK

Question 17

INSURANCE COMPANIES DO NOT INSURE THIS TYPE OF RISK

Answer 17

SPECULATIVE

Question 18

PERILS

Answer 18

CAUSE OF LOSS

Question 19

THE MATHEMATICAL CONCEPT USED BY INS COMPANIES TO PREDICT FUTURE LOSSES

Answer 19

THE LAW OF LARGE NUMBERS

Question 20

WHAT ARE THE FOUR TYPES OF LOSSES:

Answer 20

• DIRECT LOSS-IMMEDIATE ACTUAL PHYSICAL DMG
• INDIRECT LOSS-INABILITY TO USE PROPERTY AS A RESULT OF DIRECT LOSS

CONSEQUENTIAL LOSS- USUALLY RESULTING FROM SPOILAGE OR TEMP CHANGE

LIAB LOSS-A DAMAGE/INJURY CLAIM THAT ARISE OUT OF ACTIONS THAT CAUSE LOSS TO A THIRD PARTY

Question 21

HAZARDS

Answer 21

CONDITIONS THAT CREATE OR INCREASE THE CHANCE OF LOSS

Question 22

PHYSICAL HAZARD

Answer 22

VISIBLE

Question 23

MORAL

Answer 23

DISHONESTY OF AN INSURED

Question 24

MORALE

Answer 24

ATTITUDE OF CARELESSNESS OR INDIFFERENCE TO LOSS

Question 25

FOUR PARTS OF THE INSURANCE CONTRACT (DICE)

Answer 25

DECLARATIONS
INSURING AGREEMENT
CONDITIONS
EXCLUSIONS

Question 26

DECLARATION PAGE INCLUDES

Answer 26

PROPERTY DISCRIPTION
PARTIES TO THE CONTRACT
POLICY PERIOD
POLICY LIMITS
DEDUCTIBLES
PREMIUMS

Question 27

INSURING AGREEMENT INCLUDES

Answer 27

INSURERS PROMISE INCLUDING THE COVERED PERILS

Question 28

CONDITIONS

Answer 28

TERRITORIAL RESTRICTIONS
PROCEDURES
DUTIES
AND RIGHTS OR THE INSURED/INSURER

Question 29

EXCLUSIONS

Answer 29

LIST THE PROPERTY AND PERILS THAT ARE NOT COVERED

Question 30

ENDORSEMENTS

Answer 30

CHANGES THAT ADD, DELETE OR MODIFY A POLICY

Question 31

COMMON CONDITIONS OF INS POLICIES

Answer 31

POLICY TERRITORY

Question 32

SUBROGATION RIGHTS

Answer 32

RIGHTS OF INSURER TO RECOVER FROM AN AT FAULT THIRD PARTY

Question 33

ASSIGNMENT CLAUSE

Answer 33

EXPLAINS THE POLICY MAY ONLY BE ASSIGNED TO ANOTHER WITH THE INSURERS WRITTEN CONSENT

Question 34

THE RIGHT OF SALVAGE

Answer 34

STATES; THE INSURER MAY TAKE POSSESSION OF A TOTAL PROPERTY AFTHER A FINANCIAL AGREEMENT IS SETTLED

Question 35

OTHER INSURANCE CLAUSE

Answer 35

PRO RATA-THE BIGGER POLICY PAYS PROPORTIONALLTY MORE THAN THE SMALLER POLICY
PRIMARY-THE PRIMARY POLICY WILL PAY FIRST
EXCESS-THE EXCESS POLICY WILL PAY AFTER THE PRIMARY POL IS EXHAUSTED

Question 36

FOUND ON ALL LIABILITY POLICIES AND ARE PAID IN ADDITION TO THE POLICY LIMITS

Answer 36

SUPPLEMENTARY PAYMENTS (BAILED):
BOND
FIRST AID
INTEREST ON JUDGEMENTS
LOSS OF EARNINGS
EXPENSES INCURRED AT REQUEST OF INSURER
DEFENSE AND INVESTIGATION