Policy Structure

Question 1

Declarations

Answer 1

contains underwriting information such as the insured’s name, address, amount of coverage, premiums and locations.

Question 2

Definitions

Answer 2

Clarifies the terms used in the policy

Question 3

Insuring Agreement

Answer 3

Establishes the obligation of the insurer to provide the insurance coverages as stated in the policy

Question 4

Additional Coverage

Answer 4

Provides an additional amount of coverage for specific loss expense, at no additional premium

Question 5

Conditions

Answer 5

Indicates the general procedures or rules that the insured and insurer agree to follow under the terms of the policy.

Question 6

Examples of Conditions

Answer 6

• Inspections (can be made as needed by insurer)
• Changes to the policy (have to be in writing)
• Liberalization Clause
• Return of Premium

Question 7

Liberalization Clause

Answer 7

Guarantees that if the insurance provider introduces an improved free coverage, the insured wil immeadiately receive the benefit of new coverage and will not have to wait until policy renewal.

Question 8

Endorsements

Answer 8

Printed addendums to a contract that are used to revise the policy’s original coverages, terms, or conditions.

Question 9

Exclusions and Policy Limits

Answer 9

Perils that are not insured against and individuals who are not insured. Policy limits are the maximum amounts a policyowner can collect under the terms of the policy.