Study 5: Underwriting the Risk: Liability - Key Terms Flashcards

1
Q

Statute law

A

A law set down in a government act and passed by legislature.

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2
Q

Umbrella policy

A

A special form of liability policy designed to protect the insured for certain unknown contingencies over and above other coverages and to provide excess insurance.

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3
Q

Contributory negligence

A

Many accidents are the partial fault of both parties who are involved in the accident. The plaintiff who sues another party for damages may also be guilty of some negligence, which is a concurrent cause of the damage, and is therefore guilty of contributory negligence.

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4
Q

Hold-harmless agreement

A

An agreement that allows one party to protect another party against any future losses or claims that may result from a particular activity. Also known as an indemnity agreement.

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5
Q

Occupancy

A

The act of holding possession of a property or premises. The term implies the use of the building for the purposes described in the policy, and no other. An occupied building has furnishings and/or people in it.

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6
Q

Tort

A

A legal wrong arising from a duty fixed by law. A breach of this duty that causes injury to persons or property is repressible by legal action for damages. Liability for tort involves a private or civil wrong or injury and is distinct from that under contract in that the duty is owed to people, generally, rather than to a specified individual.

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7
Q

Licensee

A

A person who has permission to enter a premises for their own purposes.

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8
Q

Liability insurance

A

Insurance that agrees to indemnify the insured for sums they may be required by law to pay to third parties as damages for bodily injury or damage to property. The maximum amount of insurance provided under a policy of liability insurance.

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9
Q

Negligence

A

Failure to use the degree of care expected from a reasonable and prudent person.

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10
Q

Private nuisance

A

An unlawful interference of a person’s enjoyment and use of their land.

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11
Q

Contractual entrant

A

A person who enters onto premises under a contract with the occupier; for example, a hotel guest or a theatre-goer.

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12
Q

Public nuisance

A

An action or a thing that interferes with the general public. It interferes with the public as a class, not merely with one person or a group of citizens.

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13
Q

Nuisance

A

In law, a class of wrong that arises out of unreasonable, unwarranted, or unlawful use by a person of their own property, whether that property be real or personal or from their own improper, indecent, or unlawful personal conduct and producing an annoyance, inconvenience, discomfort, or hurt to others or to their property that the law would presume a consequential damage. In insurance claims, it is most frequently met as a cause of action, arising from the escape of some obnoxious substance.

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14
Q

Duty of care

A

The obligation that a person has to exercise reasonable care with respect to the interests of others, including protecting them from harm.

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15
Q

Trespasser

A

A person who wrongfully enters onto someone else’s land with neither the right nor permission to be there.

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16
Q

Indemnity agreement

A

A written contract entered into between indemnitor and surety in which the indemnitor secures surety against loss the surety may sustain as a result of having issued a bond for a third party (usually a company owed by the indemnitor) or for the indemnitor.

17
Q

Invitee

A

A person who is expressly or impliedly invited onto the premises for some purpose involving economic or potential economic benefit to the occupier of the premises. For example, a customer entering a store for the purpose of making a purchase.

18
Q

Employers liability insurance

A

Coverage for the legal liability imposed on an employer to pay damages to an employee injured by the employer’s negligence. This is not workers’ compensation insurance, where special acts of legislation set out specifically the relationship between the employer and employees in certain circumstances and the formula by which awards in each case are computed.