Introduction to Property-Casualty Insurance 7

Question 1

A condition that presents the possibility that a person or an organization will sustain a loss resulting from damage (including destruction, taking, or loss of use) to property in which that person or organization has a financial interest.

Answer 1

Property Loss Exposure

Question 2

The actual means by which property is damaged or destroyed.

Answer 2

Cause of Loss (Peril)

Question 3

Tangible property consisting of land, all structures permanently attached to the land, and whatever is growing on the land.

Answer 3

Real Property (realty)

Question 4

All tangible or intangible property that is not real property.

Answer 4

Personal Property

Question 5

Any condition or situation that presents the possibility of a claim alleging legal responsibility of a person or business for injury or damage suffered by another party.

Answer 5

Liability Loss Exposures

Question 6

Under Coverage D - Loss of Use of a homeowners policy, the amount of rent (less any discounted expenses) that the insured would have received for the residence of any part of the residence rented to another individual for residential purposes, if the residence had not been damaged.

Answer 6

Fair Rental Value

Question 7

A legal responsibility for the consequences of an act or omission.

Answer 7

Liability

Question 8

A specific cause of loss listed and described in an insurance policy. Also used to describe policies containing perils.

Answer 8

Named Perils

Question 9

A type of policy or coverage that insures against risks of direct physical loss except for those specifically excluded or limited by the policy.

Answer 9

Open Perils

Question 10

Coverage that provides a source of recovery for occupants of a covered auto or for qualifying pedestrians who are injured in an accident caused by an at-fault motorists who does not have the state minimum liability insurance or by a hit-and-run driver.

Answer 10

Uninsured Motorists (UM) Coverage

Question 11

Coverage that provides compensation to insureds who have suffered bodily injury in an accident with an at-fault motorists whose bodily injury liability insurance limits are lower than the injured person’s underinsured motorists coverage and are not sufficient to pay all the insured’s damages.

Answer 11

Underinsured Motorists Coverage

Question 12

Coverage for direct and accidental loss or damage to a covered auto caused by collision with another object or by overturn.

Answer 12

Collision Coverage

Question 13

Coverage for physical damage to a covered auto resulting from any cause of loss except collision or a cause of loss specifically.

Answer 13

Other Than Collision (OTC) Coverage

Question 14

Insurance that covers automobile accident victims on a first-party basis, allowing them to collect damages from their own insurers regardless of who was at fault.

Answer 14

No-Fault Automobile Insurance

Question 15

Coverage that pays benefits regardless of fault, for medical expense, income loss, and other benefits resulting from bodily injury to occupants of a covered auto.

Answer 15

Personal Injury Protection (PIP) Coverage

Question 16

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

Answer 16

Umbrella Policy