Questions Flashcards
WHAT IS LLOYDS OF LONDON?
a) A MARKET PLACE WHERE SOME SIGNATORY BROKERS CAN PLACE BUISNESS
WHAT IS LLOYDS OF LONDON?
a) A MARKET PLACE WHERE SOME SIGNATORY BROKERS CAN PLACE BUISNESS
What is the difference between Facultative and Treaty Insurance?
- Facultative – Reinsurance arranged on a case by case basis and Treaty, Reinsurance Contracts
- How can we deal with Risk
1) Avoidance of Risk – Eliminate all chance of Financial loss (impractical)
2) Controlling Risk – Taking measures to reduce frequency & severity of losses ex: alarm, stay home after snowfalls
3) Retention of Risk – Self insurance, large deductible – Large corps and government gCW 500k+ policy
4) Transfer of Risk – Through Insurance, choosing to go through insurance when you need it.
4) Transfer of Risk – Through Insurance, choosing to go through insurance when you need it.
A guy buys a bar (The Bar is a pure risk). It is winter when he purchases it and wants to have a summer patio but isn’t sure yet about the city permit that are required. He has not yet decided the hours of operation but expects to be open until 1 am 6 nights a week and open Sundays till 9pm. Although there are few lounges servicing alcohol in the neighbourhood he is not sure about his alcohol food sales percentages, he expects them to be 50%, 50% ratios
WHAT TYPE OF RISK IS THIS? WHY?
This is a PURE RISK – because The Bar needs insurance, he has a possibility of fire, theft
What are the 5 elements needed to enforce a contract? ACL LG
ACL LG
1) Agreement – Offer is made, unconditional, meeting of the minds, oral agreement
2) Consideration – exchange for something – ex premium
3) Legality of Object - It needs to be legal – No insuring drug houses, etc.
4) Legal capacity of parties - Mental capacity, under influence
5) Genuine Intent - Exchange of something of value between two parties – Insurance premium. I paid you for something
What are Three additional elements in addition to the 5 basic elements to enforce a contract HINT: II, UF, I
1) Insurable Interest – People have an insurable interest if they can show they would suffer financially by a loss
2) Uberrima Fides – Latin for Utmost Good Faith (UF) Complete honesty
3) Indemnity – Law restricts payment under insurance contract s to ensure people receive the actual amount of their loss – no more, no less
THERE ARE FIVE ELEMENTS OF EVERY CONTRACT AND THREE ELEMENTS UNIQUE TO INSURANCE CONTRACTS, WHAT ARE THEY ?
A) Genuine intent, insurable interest, indemnity
b) indemnity, uberrima fides, consideration
c) legal object, insurable interest, indemnity
d) indemnity, integrity, insurable interest
d) indemnity, integrity, insurable interest (They trick us by using integrity which is the same as Uberrima Fides aka Utmost Good Faith
Where would a broker look for a binding authority?
Agency/Brokers agreement
What does an Endorsement do?
A) adds coverage
B) Removes coverage (You golf course with glass windows, endorsement to remove glass coverage)
C) Amends policy coverage – Adds and removes coverage
C) Amends policy coverage – Adds and removes coverage
define Void and provide an example
when a contract is considered never to have existed -
example - purchased a policy after a fire. We would void the policy and refund all premiums
SEEN IN MISREPRESPENTATION - Falsely describing property – misrepresentation of risk, omits to communicate risk or condition can VOID a contract
Define Voidable and provide an example
A contract is is voidable to the wrongdoer but not void to damage caused to third parties :
If I arson my own house and the next door neighbors house is damaged we would cover the neighbors house but not the arsonists house
A binder aka a cover note is
Binders or cover note is a piece of paper, certificate of insurance stating coverage .
Binders – It is common to bind an insurer on a risk meaning that the broker has committed the insurer to a contract of insurance
Binders may be orally written
Riders
Floater:
Rider - Adds additional coverage to an existing contract
Floater - Provides coverage for a property which moves from place to place
What are Physical Hazards PROVIDE AN EXAMPLE OF THEM
Hazards you can see and touch
Occupants, building construction, housekeeping, not shoveling driveway
*Moral Hazards
Subjective – characteristics of the applicant which may or may not be observed: Eg Financial condition of buisnes, moral character
*Difference between a peril and hazard and provide an example
A hazard is the condition of the property that can cause a peril.
Slippery sidewalks, not shoveling, speeding in school zone. The peril is the cause of loss.
What is covered under the following policies in building and contents
BASIC, BROAD AND COMPREHENSIVE
– Named Perils, only covers perils listed
- Named Perils on the building
- Named Perils on the contents
Broad – All Risk on building
- Named Perils on contents
Comp
- All Risk on contents
- all risk on building
What is covered under the following policies in building and contents
BASIC, BROAD AND COMPREHENSIVE
– Named Perils, only covers perils listed
- Named Perils on the building
- Named Perils on the contents
Broad – All Risk on building
- Named Perils on contents
Comp
- All Risk on contents
- all risk on building
what IS COVERED UNDER COVERAGE A FOR OUTDOOR TREES AND SHRUBS, percent, total, perils
Outdoor trees, shrubs, and plants 5% of A/ 500 / tree only covered under the 6 perils (fire, lightning, explosion, impact by aircraft or land vehicle, Riot, Vandalism or malicious acts
*COVERAGE A: Dwelling, Building & Attached Structures - WHAT IS COVERED
Hint,
I have a PERMINANT POOL, it’s attached to my house. I store MATERIALS ON and ADJACENT to my house for fixing up my house and pool, one day I had to remove the SUPPLIES TEMPORARLY REMOVED. That day someone hit my tree with their car.
- Anything permanently installed or attached to a house , attached garage, deck, shutters, basketball net, underground swimming pool
- Outdoor swimming pools and their attachments
- *Materials and their supplies on or adjacent (beside) designed for the betterment of this dwelling or private structures
- Building fixtures and fittings, temporarily removed (storage repair)
- Outdoor trees, shrubs, and plants 5% of A/ 500 / tree only covered under the 6 perils (fire, lightning, explosion, impact by aircraft or land vehicle, Riot, Vandalism or malicious acts
*A person had $2000 worth of wood delivered and stacked on their lawn. They don’t have enough room for it because they are building more outhouses and a larger deck. They have another stack of wood delivered to dad’s house down the street. Dads house burns down.
where is the wood covered ?
a) Our insureds home policy, coverage A
b) The fathers home policy
C) Our insureds home policy, coverage C section 1 – Contents temporarily removed
d) Not covered
C) Our insureds home policy, coverage C section 1 – Contents temporarily removed
COVERAGE B - WHAT IS IT AND HOW MUCH IS EXTENDED FROM COVERAGE COVERAGE a?
Coverage B - Building or structures
- Extends an additional 10% from Coverage A – 10 percent total not 10 percent per outhouse
- Buildings structures located on the premises separated from dwelling by a clear space, if attached only by a fence line, utility line or similar connection only is it detached (aka: Outhouses - Gazebo, detached shed, workshop, greenhouse, hot tub not embedded into the deck. They need to increase coverage B) you can customize the policy and increase as needed
Explain contents coverage
Coverage C Contents : - All Contents - On premises all contents of the dwelling
- ON premises all contents normal to maintenance
Off premises contents are also covered if they are temporarily removed world wide
ALL CONTENTS ON AND OFF PREMESIS NORMAL TO MAINTENANCE, OFF PREMISIS WHEN TEMP REMOVED
Which of the following property is subject ot a special limit of insurance for all insured causes of loss under a home owners package policy A. Jewelry B. Philatelic collection C. Fur and fur garments d. Business property
d. Business property
What percent of coverage is ALE of coverage A ?
WHEN WOULD COVERAGE COME INTO AFFECT ?
20 percent
- The Dwelling is damaged by A Peril
- when the damage is bad enough to make the dwelling unfit for occupancy requiring the insureds to move out while repairs are being made
In Guaranteed replacement cost or RC will the insurer will pay any increased cost of construction due to the application of zoning regulation, demolition repair construction?
if yes provide an example, if no provide an example
*The increased cost of construction due to the application of a zoning bi law is
Only covered by endorsement
What policy excludes wind
The Basic or the Basic fire policy
*VACANT:
Regardless of the presence of furnishings, all occupants have moved out, with no intent of returning and no new occupant has taken residency.
UNOCCUPIED
There is a big difference between vacant and unoccupied. An unoccupied residence the insured is returning. The vacant is they have moved out with no intent of return
what are the Basic policy Perils (7)
Frank explodes, smelly fireworks in Rome, Very uncool man
1) Fire + Lightning
2) Explosion EXCLUSION – Water hammer (WHY, because it’s maintenance)
3) *smoke it must be sudden and unusual, escape from cooking/heat unit . Exclusion – Smoke from Fire place
4) *Falling Objects – Object must first strike the exterior of a building – Tree falls on a patio – it wouldn’t be covered. Tree bounces off the eav, it would be covered because it hit the house first. Kids leaves the patio door open and a golf ball from the park gets hit and strikes the TV – It wouldn’t be covered because the window was left open and it didn’t hit the exterior of the house first. If it hit a screen window it would count
5) *Impact by aircraft or land vehicle - If you or your employee Drive into your own house a student drives home from university and hits your house with his car. IF they have the basic policy it’s not covered under the basic policy but it would be under auto . A nanny hits the house, it is not covered because the Nanny should know where the driveway is. Pets are excluded
6) Riot – City needs to call it a riot
7) Vandalism & Malicious Acts You Vandalize it yourself – Kids have a house party and your concrete fence is graffiti . you ask the son if he vandalized it he says yes, it’s not covered under this basic policy
- When the house is under COC who would cover the vandalism, the builder would pay for the damage. Another exclusion is if the house was vacant. Theft
Basic policy exclusions
4
W,Y,P,Y,T
EXCLUSION – Water hammer (WHY, because it’s maintenance)
- you or your employee Drive into your own house
- Pets are excluded
- You Vandalize it yourself
- Theft when house is vacant
explain water damage coverage and exclusions
Water Damage – Must be sudden and accidental from a domestic water main, domestic water container, inside or outside dwelling. Damage to the water container is excluded. Ex: Hot tub crack, the hot tub isn’t covered because its wear and tear.
ex: Freezing during the normal heating season (Winter) to an unheated portion of the house (Mud Room on Front) ***
ex: If away for MORE THEN 4 CONSECUTIVE DAYS days in winter there is no coverage if your pipes freeze unless you have someone **COMPETENT watch your house daily. If shut off the water and drained every tap.
ex: Seepage and Leakage, Sewer Back Up, (however there is an endorsement). Ground or surface water (high river)
** You can go away for 3 consecutive days to the family day weekend and go to van for 3 ½ days do you need take any precautionary measures for coverage to apply?
a Day I left
b Day after I left
c days after I left
d The day after 4 days after I left
b Day after I left (why because I was home today, Jane doesn’t understand this trap question, its unfair)
WE have a house and there as a satellite dish on it. A windstorm comes though and blows the dish off the house, and it damages the shingles. Do we cover the loss.
Yes because wind caused the satellite dish to come off causing the damage to the shingles . The actual satellite dish is excluded.
When is glass breakage and accidental breakage covered
insured peril
excluded
while under course or construction
vacant
FROM ground shifting
*THE HOME OWNERS BASIC POLICY PROVIDES COVERAGE FOR THE PERIL OF GLASS BREAKAGE WHICH OF THE FOLLOWING IS TRUE:
A. There is no coverage provided when the dwelling is under construction or vacant
B. There is no coverage provided if the owner of the dwelling causes the glass breakage
c. coverage is automatically included in all situations
d. There is coverage when the dwelling is vacant under 30 days.
A. There is no coverage provided when the dwelling is under construction or vacant
Under the basic policy when is transportation coverage of your items covered and when is it excluded
Covered provided your items were temporarily removed anywhere in the world
EXCLUDED
IF AT A Property at another location you own like a (cottage)
Theft or attempted theft is covered under the basic policy, when is it NOT (4)
EXCEPT not tenants belongings or theft by your tenant theft of your animal, bird or fish, while the house is under COC if you gave your stuff away
TENNANTS
ANIMMAL - BIRD/FISH
COC
GIVE AWAY
When is electricity covered under the basic policy
a sudden surge
Exclusions to basic policy aka named perils, basic, fire policy (17)
1) Farm buildings or buildings used for farm purposes
2) *property at any fair ground or on exhibit – Question on exam, it is excluded under basic
3) Stollen property ie illegal acquired
4) **Debt
5) **Data
6) Lawfully Seized property
7) **occurring when the house is vacant for greater then 30 days after 30 days they need a vacancy permit
8) Caused by Nuclear, war, radioactive, Terrorism
9) Intentional Act Arson/ failure to act – You see your house on fire but because they didn’t like their house, they didn’t call 911
10) Application of heat – what ever you are applying heat to
11) Earth movement, ground movement
12) Caused by the release or discharge or dispersal of fuel oil
13) domestic water container
14) Residence employee – maid or shoveler – lives elsewhere but comes to perform work.
15) service water
16) Terrorism
17) any motorized vehicles are excluded
BASIS OF CLAIMS PAYMENT AND what will an insured receive the least of ?
An insured will receive the least of the following
ACV (Replacement cost – depreciation)
INSUREDS INTEREST IN THE PROPERTY – (WHATEVER THEY CAN SELL IT FOR)
POLICY LIMIT
The home owners policy contains a basis of claim payment clause regarding a damaged or destroyed building and detached private structures and personal property and payment of monies. This clause states that the insurer will pay
a) The cost of repair re replacement without deduction for depreciation
b) The ACV of the damaged property on the date of the occurrence
c) Up to the insureds financial interest in the property, but not exceeding applicable limit of insurance
d) Their rateable proportion of the loss or damage.
c) Up to the insureds financial interest in the property, but not exceeding applicable limit of insurance
Explain ACV and when we provide replacement cost if an item is replaced
Actual Cash Value - Depreciation. We provide the difference from ACV to replacement cost if the item is replaced within 180 days
Comprehensive Home Policy – What does it cover.
everything is covered unless it’s excluded
What are the exclusions under the Comp home policy 14
Buildings used for farm purposes
- Property at fairground or on exibit - Same as basic
- Illegally Acquired property - Same as basic
- Evidence of debt - - Same as basic
NEW
-Sporting equipment Broken in use
– Damage to your animal, bird or fish unless it’s by a specified peril - Animals – ACV minus depreciation.
- Scratching marring, abrasion, of personal property of any fragile or brittle articles unless caused by a sepc peril
- Cost of making good faulty material or workmanship
- Settling, expansion on contraction
- Data
- or loss or damaged ca
- intentional act or failure to act
- Rodents, insects
- Smoke by pollution
- Rust
A guy is snowboarding his snowboard broke. Will the comp policy cover the damage?
No because it was broken while in use
An owner of a condo unit has a condo unit owners policy. This policy provides protection for.
A Ale based on the amount of personal property
b. improvements and betterments done by the owner to his or her unit
c. special assessments (Loss Assessment) due to short falls from being under insured in a building loss
d. all of the above
d. all of the above
You insured purchases a condo unit owners policy. The condo has a policy which does not adequately insure the damages to the common areas. There is 150k loss to the common areas. As a result a loss has been assessed of $2000 per condo unit owners. Your insured is adequately covered but only 75 percent of other condo unit owners are. How will your policy respond.
A 75 percent as only 75 percent of other unit owners have adequate coverage
b. $2000 less $500 ded
c) 112.500
d$15,000
b. $2000 less $500 ded
The condo corp has damages to their building and contents. The condo corp has insurance plus your client has insurance on his condo unit as well. which policy will act to cover the damage to the condo building and it’s contents.
a. The condo corps master policy will pay the whole amount
b. The condo corps insurance will act first and then your clients condo unit owners insurance will cover any shortfall which is evenly divided between the condo owners
c. Your clients insurance WILL COVER YOUR PART Divided among the condo owners for the entire damages
d. The condo corps insurance will cover the damage to the building but your clients insurance will cover the contents.
The condo corps insurance will act first and then your clients condo unit owners insurance will cover any shortfall which is evenly divided between the condo owners
Are losses due to moving mobile home covered under the policy?
No, they would be covered under the trucking policy
Explain emergency removal of a mobile home and the deductible
IF a fire is coming and we need to remove the mobile home we will cover the cost. No deductible.
What is another name for a rental policy
residential
- Comp home policy A home is covered for 220k, including debris removal, how much is the building insured for ?
a) 220k
b) 231k
220k
Extensions of Coverage Comp home policy 9
Property removed Moving to another home Fire department charges – No Deductible Freezer food Lock replacement Tear out Arson conviction reward Credit or debit cards, forgery and counterfeit Inflation protection
Comp home - IF A RIOT HIT YOUR HOME GLASS BROKE, WOULD IT BE COVERED UNDER THIS SECTION
yes
COMP - What will we pay if you are Moving to a different home under this section – HOw long does coverage apply
we will pay to insure personal property while in transit to another location within Canada which is to be occupied by you as a principal residence.
Coverage applies for 30 days commencing on the date personal property is removed from principle residence but not beyond the date the policy is terminated or expires
COMP POLICY - FREEZER FOOD - WHAT AMOUNT WILL WE PAY UNDER THE COMP POLICY, WHAT IS INCLUDED IN THE COVERAGE AND IS THERE A DEDUCTIBLE ?
We will pay $2000 per freezer for frozen foods that aren’t good due to an accidental interruption of power or mechanical breakdown of freezer.
This includes damage to the freezer itself. And reasonable expenses to save the food, buying coolers and ice, generators – No deductible
EXCLUDED - CIRCUIT BREAKER
HOME OWNERS unplugged their freezer to plug in their vacuum. They forget to plug in their freezer. is there coverage?
NO
FREEZER - A Cat is behind freezer and unplugs the freezer, is it covered
NO
**FREEZER Your client is out of town and a truck runs into his house cutting off the electricity. As a result the food in his freezer goes bad. How will his own home policy respond?
A. Nothing – 3rd policy Auto Policy will pay
B. His home policy will pay 2000 – deductible
C. His home policy will only pay if he bought a freezer food endorsement
D. Nothing if he is gone more then 4 days in a normal freezing season
A. Nothing – 3rd policy Auto Policy will pay
The inflation protection coverage under a Dwelling Fire Policy
a. Increases coverage A during the policy period by the portion by which the latest published building construction index was increased since the last premium due date
b. Increases only coverage C
c. Increases coverage A and C during the policy period by the portion which the latest published building construction index was increased since the last premium due date
d. Increases coverage A during the policy period by the portion by which the latest published building construction index was increased since the last premium due date and charges the insured an additional premium.
a. Increases coverage A during the policy period by the portion by which the latest published building construction index was increased since the last premium due date
What are examples of TORT 7
*Defamation of character
-Liabel and slander
-Nuisance
-Trespassing
-Assault
-Fraud
Deceit
Whats the difference between Liable and Slander??
Liable is written, ex: slander is said. That guy is a goofball, is slander. If you post something nasty about a business, you could be liable
*Elements of Tort (4)
- owe a duty – “she owned a duity not to hurt people”
- duty breached “somehow that duty was breached”
- As proximate cause damages cause damages could be suffered – ex: you are the wrong dooer “is it possible she is in the wrong?”
- results must be foreseeable ex: Have you ever gone the wrong way down the one way street? “what are the results”
OWE DUITY
DUITY BREACHED
FORSEEABLE
PROXIMATE DAMAGE
wHAT IS A TORT FEEZER
A WRONG DOER
Negligence
Doing something that a reasonable person of sound mind would never do
Strict liability
Guilty until proven otherwise
DUTY OF CARE OF PROPERTY - We have a duty to THESE . In this order
1) utmost duty to CHILDREN – Remove dangers free and CLEAR
2) Licensee (meter man, flyer delivery) – we know they come to a property but we don’t know when. We must warn them of dangers. Beware of Dog sign
3) Invitee – we know they are coming so we need to warn of dangers, things we know of as well as potential dangers
4) Trespasser – we cannot set trap,
Who whom does the home owner own the greatest care? A)Minor b)Invitee C)Infant D)Thief
minor
Who do we owe the greatest care to ? a)ubs deliver
b) pizza deliver
c) thief
d) snowmobiler
PIZZA GUY - WHY? BECAUSE WE CALLED THEM
WHO IS THE Licensee AND PROVIDE AN EXAMPLE OF THEM
one who comes onto your property with the occupiers consent but the occupier may not know when.
Snowmobilers, hunters, mail delivery, others who come to the property. Social guests also because they can drop in.
WHAT IS ANOTHER NAME FOR E& O insurance
vicarious liability
who is responsible for the liability of an independent contractor?
how can we prevent independent contractor liability ?
Example of independent contractor liability? An example of when they are not liable ?
Home owners are not liable for the negligence of a contractor if care was taken when hiring the contractor.
ex: looking at the contractors reviews, are they are member of the BBB, did someone recommend them?
IF they are building us a deck and mess up, it is there liability except in the case where for example I loan the contractor a saw and someone gets hurt. Then the liability is shared.
Liability for Animals - are you covered ? If a dog bites someone else who is responsible
IF you own an animal it is covered from a liability standpoint if it bites someone
Occurrence
something that happens suddenly and unexpected or over a long party of time or as a continuous and repeated exposure
Liability covers
third party damages only on an occurrence basis
An accident including continuous or repeated exposure to substantially the same general harmful conditions describes
a. Occurrence
b. B. an injury
c. An accident
d. A liability loss
a. Occurrence
Under the liability section of a habitational form for coverage to be provided for BI or PD it must be
a. Sudden and unexpected
b. Continuous and repeated exposure to generally the same harmful condition
c. Occurring over a long period of time
d. All of the above
D ALL OF THE ABOVE
Under the property section of a habitational form for coverage to be provided for BI or property damage it must be
a. Sudden and unexpected
b. Continuous and repeated expore to generally the same harmful condition
c. Occurring over a long period of time
d. All of the above.
A
SPECIAL DAMAGES VS GENERAL DAMAGES
special - out of pocket expenses, medical expenses, loss of earnings General damages - Less quantifiable expenses such as pain and suffering, disability of future earnings
Compensatory Damages
the cost of property damage, to cost of the injury
Exempla airy - provide an example
we don’t pay for volunteer time
nominal damage
we don’t pay for a fine if you were speeding aka the fine
Punitive
The cost to punish
*A person has a history of drinking and driving and has been convicted three times previously of both offences. He is driving drunk and suspended and this time the judge wants to inpouse penalties not oly to punish him but also to make an example to others. What penalties are not covered by the insurance policy A special damages B punitive damages C general damages D punitive and exemplary damages
D punitive and exemplary damages
STUDY EFGH ON WORD EXAM
STUDY EFGH ON WORD EXAM
NAME SECTION E, F, G & H
E - PERSONAL PREMISES LIABILITY
F – Voluntary Medical payments
G - Coverage G – Voluntary Property Damage
H – Voluntary Compensation for Residence Employees.
explain coverage F
Coverage F – Voluntary Medical payments
• good neighbour policy to avoid lawsuits, no deductible because a liability coverage
• Incurred within 1 year, up to $5000 if someone is injured and you feel liable
Explain Coverage G – Voluntary Property Damage
- good neighbour policy to avoid lawsuits, no deductible
* Up to $1000, for accidents unintentionally caused, or even if intentionally caused by a child of
Coverage H – Voluntary Compensation for Residence Employees
Very tiny limits if your housecleaner falls cleaning your house
First question to ask yourself regarding coinsurance
IS THIS A TOTAL LOSS
What is the coinsurance percentage required and minimum amount
claim less then 2 percent of the did, AND if it’s less then $5000.00 we pay out the claim
Why is Theft best
if it’s gone it’s covered, all policies have it, even if there are no signs of forced entry
explain Burglary coverage
If it’s stolen there is only coverage when forced entry is visible. in Common in Mercantile stock policies (Walmart, target) . For Burglary to be covered there needs to be a threat to the employee
*A store clerk is leaving for the night, and doesn’t realize someone is behind her. They see the safe code and steal all the money. What is covered if the store has Broad form coverage with burglary coverage?
a. Everything is covered because they have theft
b. Nothing is covered as there was no visible sign of forced entry
c. Nothing is covered because the store staff was negligent
d. The store staff may be charged with theft
B Nothing is covered as there was no visible sign of forced entry
Our insured owns a condo in a multi plex. Our condo building has a comp condo policy. They forgot to lock the door to their suite. Someone knows this and enters stealing the tv, stereo, speakers and receiver. How will the policy respond.
a. Everything is covered minus their deductible
b. Nothing is covered because they were at fault
c. Nothing is covered because a condo policy has burglary coverage, not theft
d. Theft has no deductible so everything is covered
a. Everything is covered minus their deductible
*A client of yours is opening $$ Exchange here inc which is A money exchange location at the airport. They are worried about Theft. Underwriting will only allow the coverage of robbery. How will you explain the difference.
Answer – Because cash is always readily on hand, the loss experience is that these types of businesses are targets therefor the broker will only write the peril of robbery not offering theft .
YOu can’t have theft, UW’s only will allow robbery
*The Insured leaves a door unlocked in a seasonal dwelling and leaves the property for two months planning to return to shut the cottage off for fall. There is a theft but the insured is only covered for the peril of “burglary” under his seasonal dwelling property policy.
The clients claim has ben denied by the adjuster. How do you explain this to your insured.
a) Theft is always covered as the client has a comprehensive cottage policy. The loss has to be greater then their deductible
b) The adjuster denied the claim because there was no visible sign of forced entry required for burglary coverage to take effect
c. IT is not covered because the client is negligent in leave the cabin unlocked
d. the claim has been denied because they did not have someone entering every four days to check it.
b)The adjuster denied the claim because there was no visible sign of forced entry required for burglary coverage to take effect
DETAILED Perils of the BASIC commercial policy 7
(A) FIRE OR LIGHTNING
(B) (B) EXPLOSION: Except with respect to explosion of natural, coal or manufactured gas, there shall in no event be any liability hereunder for loss or damage caused by explosion, rupture or bursting in or of the following property owned, operated or controlled by the Insured:
(C) IMPACT BY AIRCRAFT, SPACECRAFT OR LAND VEHICLE:
The terms Aircraft and Spacecraft include articles dropped from them.
There shall in no event be any liability for cumulative damage or for loss or damage:
(i) caused by land vehicles belonging to or under the control of the Insured or any of his employees;
(ii) to aircraft, spacecraft or land vehicles causing the loss;
(iii) caused by any aircraft or spacecraft when being taxied or moved inside or outside of a “building”.
(D) RIOT, VANDALISM OR MALICIOUS ACTS:
(E) SMOKE:
The term “Smoke” means smoke due to a sudden, unusual and faulty operation of any stationary furnace.
There shall in no event be any liability for any cumulative damage.
(F) LEAKAGE FROM “FIRE PROTECTIVE EQUIPMENT”:
The term Leakage from “Fire Protective Equipment” means:
(i) the leakage or discharge of water or other substances from;
(ii) the collapse of;
(iii) the rupture due to freezing of;
(G) “fire protective equipment” for the “premises” or for adjoining structures
(H) (G) WINDSTORM OR HAIL:
what are the Perils of the basic commercial policy
(A) FIRE OR LIGHTNING
(B) EXPLOSION:
(C) IMPACT BY AIRCRAFT, SPACECRAFT OR LAND VEHICLE:
(D) RIOT, VANDALISM OR MALICIOUS ACTS:
(E) SMOKE:
(F) LEAKAGE FROM “FIRE PROTECTIVE EQUIPMENT”:
(G) WINDSTORM OR HAIL
Perils of the basic commercial policy
(A) FIRE OR LIGHTNING
(B) EXPLOSION:
(C) IMPACT BY AIRCRAFT, SPACECRAFT OR LAND VEHICLE:
(D) RIOT, VANDALISM OR MALICIOUS ACTS:
(E) SMOKE:
(F) LEAKAGE FROM “FIRE PROTECTIVE EQUIPMENT”:
(G) WINDSTORM OR HAIL:
What are all the insured Perils on a commercial property named perils policy except
a. Fire, lightning, explosion, riot, smoke, windstorm, burglary
b. Fire, lightning, explosion, leakage from fire protective equipment, hail
c. Smoke, fire, lightning, impact by aircraft, impact by space craft, windstorm
d. None of the above
a. Fire, lightning, explosion, riot, smoke, windstorm, burglary (BURGLARY IS NOT A PERIL)
BETWEEN BROAD AND ALL PERILS WHAT POLICY IS MORE EXPENSIVE
Broad for is more expensive
BROAD COMMERCIAL - WHAT ARE THE BENEFITS
covers vehicle impact by business owner/manager
- Covers all sources of smoke
- Covers all sources of smoke excluding agricultural and industrial smudging
- Water damage with the exception of flooding
- Theft unless it is mercantile stock
- Collapse of building except earthquake
- All other causes of loss not specifically excluded
What is the calculation of premium for commercial policies
ON a 500k building the underwriter came up with a .70 rate per $100
500kx0.70 = 3500
*How are commercial policies determined?
- A rate per $100.00
WHAT IS LoadingAND WHAT DOES LOADING DO?
An amount added to the base rate to cover more perils
- Loading increases the premiums (cost)
- Sometimes loading can be a surcharge for additional premium required
What is it called with an underwriter adds an additional fee for tickets and claims?
Loading
Definition of a Building Commercial Broad
the building(s) described on the “Declarations Page” and includes:
(i) fixed structures pertaining to the building(s) and located on the “premises”; (balconies, breezeway)
(ii) additions and extensions communicating and in contact with the building(s); (Fencing around school)
(iii) permanent fittings and fixtures attached to and forming part of the building(s); (toilets, pools, skylights, doors, French doors, Heating, AC Units)
(iv) materials, equipment and supplies on the “premises” for maintenance of, and normal repairs and minor alterations to the “building” or for building services; (shovels, cleaning supplies,
(v) growing plants, trees, shrubs or flowers inside the “building” used for decorative purposes when the Insured is the
owner of the “building”.
Fixtures on premises, additions like fencing. permanent fittings attached, toilets, pools, skylights, materials, equipment and supplies, trees and plants inside
Definition of Stock
**Stock - Merchandise of every description usual for the insureds business .
- Packing, wrapping and advertising materials
- Similar property belonging to others which the insured is under obligation to keep insured. Ex: Consignment store may have others cloths which they plan to sell
Definition of Equipment
**-generally all contents usual to the insureds business including furniture, furnishings, fittings, fixtures, machinery, tools, utensils and appliances (clocks, fork lift, rolling shelving, photo copy machine, fax machine. All lease equipment cheques may be co payable, toasters, tables and chairs,
- LEASED EQUITPMENT
-
Tenants improvements, where is it covered and what does it cover?
Under equipment III
Tenants improvements which are defined as building improvements, alterations and betterments made at the EXPENSE OF THE INSRUED to a building occupied by the insured and which are not otherwise insured provided the insured is not the owner of such building. If the insured purchased the use interest in tenants improvements made by a predecessor tenant this form applies as though such tenants improvements had made at the expense of the insured
** Under a mercantile stock burglary policy what is insured and not required for the claim to be successful?
a. The insured property was unlawfully taken from within the premises
b. The insured property was of high value
c. The premises was unlawfully entered
d. There were visible signs of forced entry
b. The insured property was of high value
**Safe Burglary: The insured must provide the insurer with evidence that
a. Force was used to gain access to the safe
b. The safe was ULC approved
c. The safe contained both cash and securities
d. All of the above
a. Force was used to gain access to the safe
** Which of the following is not considered part of the building?
a. Yard Lights
b. Tree Growing inside building
c. Tree Growing outside of the building
d. Burglary alarm
c. Tree Growing outside of the building
- *What is considered as Equipment under a commercial building, equipment, and stock form
a. General contents usual to the insured business including tools, furnishings, furniture
b. Merchandise of every description
c. Materials and supplies on the premises for the building maintenance
d. All of the above
a. General contents usual to the insured business including tools, furnishings, furniture
