Property and Casualty TERMS Flashcards
Risk
The chance of financial loss- Uncertainty of a loss to happen
Assumed Risk
Amount of risk the insured is willing to absorb
Speculative Risk
Uncertainty about an event under consideration that could produce either a profit or a loss
Pure Risk
involves a situation that present the opportunity for loss but no opportunity for gain.
Law of Large Numbers
theory stating the larger the number of similar exposure the more predictable the estimate of expected losses
Policy
Written contract or agreement for insurance including clauses, riders and endorsements
Declarations Page
Incclude named insured and address, Policy period, , limits and loss payee
Insuring Agreement
the portion of the policy which insurer promisis to make payments for covered perils
Conditional Contract
Insured satisfying certain conditions
Exclusion
Section of polity which lists property, perils, losses, persons or situation which are not covered
Endorsements
alteration to policy coverage, terms and conditions
Binders
Temporary Insurance
Certificate of Insurance
evidence that insurance and limits have been purchased
Contract of Adhesion
contract is created by ins co - insured cannot negotiate
Unilateral Contract
only one party makes enforceable promise
