Key Terms CAIB 3 Flashcards
License
Issued by a regulatory body to set rules in order to safeguard the public
Permit
Same general function as License but the permit serves a prerequisite to the undertaking of a specific function associated with a business
Nuisance
Everything that endangeres ones life or health, provides offense to the senses, violates the laws of decency, or interferes with the reasonable and comfortable use of ones property
Risk Management
The process of making and carrying out decisions that will minimize the adverse effects of accidental loss upon an organization
Loss exposure
Chance of financial loss to an organization as a result of a peril striking a thing of value
Working Capital
Current assets - current liabilities
Working capital is the amount of funds required to pay for continuing business operating expenses until payment can be received for the work being undertaken by the contractor.
Negligence
Is the doing of something a reasonable and prudent man would not do.
Common Duty Owed
Refers to the obligations a person or organization owes to others to act reasonable to prevent injury or harm
Easement
A right of someone to use land belonging to others
Defamation
Is a statement that causes unjustified injury to the reputation of another person and which results in the loss of esteem and goodwill of a considerable part of the community
Compensatory damages
Damages that are intended to compensate the injured party for the bodily injury or property damaged sustained.
Product
Any goods other than real property manufactured, sold, distributed, disposed or handled by the insured
Express warranty
Are written into the policy documents and they stipulate that certain facts pertaining to the risk are or shall be true or certain acts have been done.
Obligee
The party to whom someone else is obligated under contract
Principle
The party who is primarily liable
Surety
The state of being sure, certain and secure
Surety Bond
An undertaking by one party to become accountable for another party for their performance of an obligation or undertaking to a third party. It is the promise to provide credit if and when needed to ensure the faithful performance of an obligation
Statutory bond
One that is required by municipal ordinance or federal or provincial legislation or statute.
Non statutory bond
One that is not required by law by flows from the contract or agreement between parties.
Contract bond
Guarantees the fulfillment of certain obligations required under public and private contracts
Going Concern
The difference between the value of property, which nusy be sold after a loss and its value had the business continues
Segregation
Involved arranging a businesses activities and resources so that no one event can cause simultaneous loses to all of them.
