Policy Provisions Contract Law Flashcards
When is an appraisal needed and how can it be requested?
If an insured and an insurer disagree about the value of a property loss, either party can make a written demand for an appraisal
What is consideration in an insurance contract?
Consideration is something of value that each party gives to the other. Consideration on the part of the insurer is binding.
Where is the policy period stated in an insurance policy?
On the declaration page
What process is used to settle a casualty claim when the insured and the insurer cannot agree?
Arbitration
Persons who are not named on the declaration page of a policy but who are protected by the policy are known as what type of insured?
Additional insured
When does pro rata liability apply?
When an insured has more than one policy covering a loss
What does an endorsement do to an insurance contract?
It modified the policy’s original terms
In property and casualty policies, what is required for an assignment to be valid?
A written consent of the insurer
In insurance contracts, when does acceptance usually occur?
When the insurer approves a prepaid application
What are the four elements of an insurance contract?
Agreement (offer and acceptance), consideration, competent parties, and legal purpose
What is the prove of loss?
A sworn statement from an insured notifying the insurer about a loss
What is additional coverage in an insurance policy?
A provision that adds more coverage for a specific loss at no additional premium
What part of an insurance policy contains the insurer’s promise to pay a claim?
Insuring agreement
what are an insured’s duties after loss?
Protect the damaged property from further damage, prepare an inventory of damaged property, cooperate with the insurer in settling a loss, notify police in case of theft; and submit proof of loss
What method of loss valuation is contrary to the principle of indemnity?
Replacement cost
