Pecuniary Losses

Question 1

What does Pecuniary mean

Answer 1

Relating to or involving a monetary loss, Covers wealth

Question 2

Why are Pecuniary policies different to other policies

Answer 2

Wealth is intangible

Question 3

Are these usually commercial or personal policies?

Answer 3

Commercial

Question 4

Money insurance

Answer 4

Third-party theft of physical money

Question 5

Why is money insurance usually only offered to businesses

Answer 5

Susceptible to moral hazard

Question 6

What are excluded from money insurance policies?

Answer 6

Employee error and omissions

Question 7

When is money covered in a money policy

Answer 7

At all times: In transit, on-premises at the owners home, or authorised employees homes

Question 8

Credit insurance

Answer 8

If a debtor fails to meet obligations this cover the remainder of the debt they are due to payout

Question 9

Why might you get credit insurance besides financial reasons?

Answer 9

The management interment: the help you get from the insurer to monitor and recoup the debit

Question 10

Guarantees or bonds

Answer 10

If the insured does not or can not fulfil the contract or an insured event occurs that causes the loss

Question 11

Performance bond

Answer 11

Bond issued to one party of a contract as a guarantee against failure of the other party to meet obligations specified in the contract.

Question 12

What cost is covered in a performance bond?

Answer 12

The additional cost of switching providers

Question 13

Abandonment and cancellation

Answer 13

When an insured event causes an event to not happen due to unforeseen circumstances

Question 14

What is the difference between an abandoned and a cancelled event?

Answer 14

Abandoned stopped after it started, cancelled never happened

Question 15

Fidelity guarantee

Answer 15

Covers theft committed or aided by employees

Question 16

What must be proven in a fidelity guarantee claim?

Answer 16

That the loss happened due to an employee

Question 17

Who can Fidelity guaranteeas cover (2)

Answer 17

All employees or certain employees such as accountants

Question 18

Business interruption/consequential loss

Answer 18

Covers business losses against unforeseen risks that cause the business to lose money due to inability to continue business for a period of time as a result of an insured peril.

Question 19

What is covered in business interruption insurance

Answer 19

Loss of income and cost of working can also cover standing charges such as costs of working

Question 20

Why does FBD have to pay out claims of Covid but other insurers don’t have to?

Answer 20

FBD explicitly said to a client that their policy cover covid, other insurers did not say this explicitly and the pandemic in their contract intended to cover something like e coli, since they made no provision for it they had not intended to include it in the contact

Question 21

Contingent business interruption

Answer 21

Addons for business interruption policies

Question 22

Addons for business interruption insurance (5)

Answer 22

• Supplier extension: Cost of getting goods from somewhere else
• Customer extension: Customer cant accept delivery
• Public utility extension
• Motor vehicle
• Goods in transit

Question 23

Legal expenses insurance

Answer 23

Covers the cost of pursuing or defending a claim

Question 24

What are some of the limitations of legal expenses insurance

Answer 24

-Fines and penalties are excluded so are risks covered elsewhere (el, pl policies also cover this risk)

Question 25

How are pecuniary claims processed differently and why

Answer 25

They are thoroughly investigated because of the intangible nature and susceptibility to fraud