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300 Cards in this Set

  • Front
  • Back
DOMESTIC
Insurance company admitted and writing insurance in Texas.
FOREIGN
Insurer organized in another state but doing business in Texas.
ALIEN
Insurance company organized and doing business outside of United States
TO GET ADJUSTERS LICENSE IN TEXAS
1. Be 18
2. Be a Texas resident or approved
3. Comply with federal laws
4. Be trustworthy
5. Have training/experience
6. Pass an exam
ADDRESS CHANGE NOTIFICATION
Must notify Commissioner within 30 days.
EXPIRATION AND RENEWAL OF LICENSE
Expires every two years; can renew up to 90 days after expiration if you pay 50% penalty; must take 30 hours of continuing education, 2 of which must be ethics and 15 of which must be class.
STAFF ADJUSTER
Is on payroll of insurance company.
INDEPENDENT ADJUSTER
Generally works for a number of insurance companies.
PUBLIC ADJUSTER
Works on behalf of the insured in negotiating claims.
CLAIM
Request for indemnification due to financial loss.
FIRST PARTY
The insured.
SECOND PARTY
The insurance company.
THIRD PARTY
The "claimant".
UTMOST FAITH
Means full disclosure, honesty and cooperation; is a contractual requirement.
STOWERS FURNITURE COMPANY vs. AMERICAN INDEMNITY
Any time an adjuster believes the exposure is greater than the policy limit, the adjuster must send letter to insured ("Stowers Letter").
BUSINESS DAY
Not Saturday, Sunday, or holiday.
DAY
Any day (including Saturday, Sunday and holidays).
60+ DAY DELAY IN SETTLEMENT
Insurance company will pay damages, including 18% interest.
NOTICE OF CLAIM
Provided by claimant to insurer; covers facts surrounding claim.
15 *DAYS* AFTER RECEIVING CLAIM
Insurer must acknowledge receipt, commence investigation, request forms and proof needed.
15 *BUSINESS* DAYS AFTER RECEIVING REQUIRED INFORMATION
Insurer must accept or deny the claim.
5 *BUSINESS* DAYS
To write check after liability is determined.
ESSENTIAL ELEMENTS TO FORM CONTRACT
"CALC"

1. Competent parties (18+, sane and sober)
2. Agreement (both offer and acceptance)
3. Lawful objective (legal purpose)
4. Consideration (exchange of value)
CONTRACT OF ADHESION
All parties agree to follow entire contract; insured has no negotiation power - take it or leave it.
ALEATORY CONTRACT
Values exchanged are unequal (payment made dues not equal claim dollars paid).
UNILATERAL CONTRACT
Only one party makes promises.
CONDITIONAL
May be voided if violated.
ESTOPPEL
Involuntary relinquishing of rights.
WARRANTIES
Must be true at time of loss in order for policy to be enforceable.
REPRESENTATIONS
Statements made by insured that are true to their knowledge.
MISREPRESENTATIONS
Incorrect information given by applicant that - when corrected - does not impact coverage.
MATERIAL MISREPRESENTATION
Bad information that *does* impact coverage; could be fraudulent.
CONCEALMENT
Deliberately withholding information; voids coverage; could be fraudulent.
WAIVER
Voluntary relinquishment of a right.
INDEMNIFICATION
Restores insured to a pre-loss economic or financial condition - no better, no worse.
INSURANCE
Transfer of risk from one person to an insurance company that accumulates funds.
DIRECT LOSS
Immediate damage to physical property.
INDIRECT
Inability to use property due to loss.
CONSEQUENTIAL
Indirect loss resulting from spoiling or temperature change.
RISK
Chance of uncertainty/loss.
SPECULATIVE RISK
Examples: Gambling or stockmarket.
PURE RISK
Involves only chance of loss.
PERILS
Exposure to risk or imminent danger; identified in contract.
HAZARDS
Conditions that create or increase likelihood of loss.
PHYSICAL HAZARDS
Arise from material, structural, etc. (ice on sidewalk).
MORAL HAZARDS
Intentionally dishonest (owner burns down store).
MORALE HAZARDS
Attitude of carelessness or indifference (leaving keys in ignition).
LAW OF LARGE NUMBERS
Large frequency of occurrances help predict future events; insurance companies can use these large numbers of frequency to predict risk.
FOUR PART OF INSURANCE CONTRACT
1. Declarations
2. Agreement
3. Conditions
4. Exclusions
PRO-RATA LIABILITY
Bigger policy pays more than smaller policy.
CONCURRENT POLICIES
Two different policies insuring for the same peril.
RIGHT OF SALVAGE
Insurer may take posession of a totaled vehicle after financial agreement is settled.
LIBERALIZATION CLAUSE
If insurer broadens coverage at no additional cost, then the insured is automatically given coverage.
EXCLUSIONS
1. Prevent duplicate coverage
2. Eliminate unnecessary coverage
3. Manage hazards
SUPPLEMENTARY PAYMENTS/ADDITIONAL COVERAGES
1. Bonds
2. Aid
3. Interest
4. Loss of earnings
5. Expenses incurred
6. Defense and investigation costs
CONINSURANCE CLAUSE
Encourages insured to carry insurance coverage close to the full replacement value of property (80%).
MONOLINE POLICY
Provides one type of insurance.
PACKAGE POLICY
Property and liability insurance in one policy.
INFLATION GUARD
Offsets increased cost of replacing property during inflationary times.
VACANT
No people, no property.
UNOCCUPIED
No people, property still present; owner intends to return.
VANDALISM COVERAGE
Suspended after 60 days of property being vacant.
BLANKET POLICY
One limit to cover multiple buildings or locations.
CONSTRUCTION CLASSIFICATIONS
Six classifications; #6 is lowest risk due to flame-retardent building material.
LIABILITY
Legal obligation to pay for damages caused to another.
BODILY INJURY COVERAGE
Covers injuries caused to other people in the event of an accident.
PERSONAL DAMAGE
Damage caused by libel or slander.
TO PROVE NEGLIGENCE
1. Duty owed
2. Duty breached
3. Actual loss
4. Proximate cause
DIRECT LIABILITY
One party committed wrongful act that injured another.
VICARIOUS LIABILITY
Example: Parent of a child.
CONTRACTUAL LIABILITY
One party assumes responsibility under agreement.
ABSOLUTE LIABILITY
Law-imposed liability (Example: pool or pitbull)
STRICT LIABILITY
Defect claims (Example: defective tires)
ACCIDENT LIMIT
Accident is sudden and unforeseen.
OCCURENCE LIMIT
Includes loss caused by continued or repeated exposure to peril over time.
AGGREGATE LIMIT
Maximum amount of coverage during policy period.
COMPENSATORY DAMAGES
Used to make injured person whole again.
PUNITIVE DAMAGES
Used to punish wrongdoer.
SPECIAL DAMAGES
Specific, such as "medical expenses".
GENERAL DAMAGES
Intangible, such as "mental anguish".
DENIAL OF COVERAGE
Investigation reveals either wrongdoing, or coverage does not cover claim.
DENIAL OF LIABILITY
Investigation determines that insured is not the liable party.
INVESTIGATION
Gathering the facts pertinent to a loss.
THREE BASIC STEPS OF CLAIM INVESTIGATION
1. Verify insurance coverage
2. Obtain information about claim
3. Verify and compare information
ALTERNATIVE DISPUTE RESOLUTIONS
Appraisal, Negotiation, Arbitration, Mediation, Competitive estimates
NAMED PERILS POLICY
Policy covers only causes of loss specifically listed.
OPEN PERILS POLICY
If exclusion is not listed, then its covered.
EVALUTION
Determining the value of a claim.
DEPRECIATION
Decrease in property value due to use, age, wear and tear.
TOTALED
Cost to repair is greater than pre-loss value.
REPLACEMENT COST
Provides funds to insured to replace property with something of like-kind.
ACTUAL CASH VALUE (ACV)
Cost to replace - depreciation = payment
SALVAGE
Insurer takes title to property and sells it to reduce their net loss.
ADVANCE PAYMENT
Partial payment of claim issued without obtaining signed release.
DROP-DRAFT SETTLEMENT
Draft and relase sent to claimant for amount that should be sufficient to settle.
TO DETERMINE LIABILITY
1. Gather physical evidence
2. Gather verbal descriptions
3. Gather witness statements
NON-WAIVER AGREEMENT
Company can continue investigating without losing its right to deny coverage; REQUIRES SIGNATURE.
RESERVATION OF RIGHTS
Company can continue investigating without losing its right to deny coverage.
DRAFT AUTHORITY
Check amount adjuster can write without approval.
RELEASE
Claimant cannot collect additional damages after receiving payment.
DECLARATORY JUDGEMENT
Court determines coverage and rights of involved parties before liability and damage is determined.
SUBROGATION
Transfer the rights of recovery from insured to the insurance company.
SUBROGATION PROCESS
1. Identify parties potentially responsible
2. Notify responsible party
3. Investigate
4. File claim or lawsuit with other party or their insurance company.
INITIAL OR FIELD REPORT
Report filed within 24 hours to 7 days.
INTERIM OR STATUS REPORT
Subsequent reports filed every 15 to 30 days tracking status of claim.
FULL FORMAL REPORT
Loss exceeds authority, claim is denied or fraud is suspected.
TEXAS MINIMUM LIMITS
30/60/25, combined single limit - $85,000
FOUR WAYS TO MEET FINANCIAL RESPONSIBILITIES
1. Post bond payable in amount of $85,000
2. Deposit $85,000 with Texas Secretary of State
3. Self-insure (primarily for businesses)
4. Carry auto insurance with 30/60/25 limits
SR-22 FORM
Generally for drivers convicted of major offence (DWI) or who didn't have insurance and caused accident with damage over $1,000, filed with TX DPS and maintained for 2 years.
INSURED VEHICLES UNDER PAP
1. Temporary vehicles (while insured being repaired)
2. Rental vehicles
3. Additional and replacement automobiles
4. Insured automobiles
5. Trailors
PEOPLE INSURED UNDER PAP
1. Insured
2. Spouse
3. Anyone driving with permission
4. Resident relatives
OUT-OF-STATE CLAUSE
If in an accident in a state that requires higher liability limits, insured's Texas policy will adjust to provide higher limits.
EXTENDED NONOWNED AUTO COVERAGE
Broadens coverage to include company vehicles.
TOWING AND LABOR
Up to $120 per vehicle.
MISCELLANEOUS VEHICLE COVERAGE
To include motorhomes, ATVs, dune buggy's (NOT snowmobiles.)
TEXAS AUTOMOBILE INSURANCE PLAN ASSOCIATION
Provides insurance for those who have been denied elsewhere.
ENDORSEMENTS
Used to modify, alter or delete coverage.
SPLIT LIMITS - FIRST FIGURE
The maximum amount any one person will be paid out for any one accident.
SPLIT LIMITS - SECOND FIGURE
The total for all claim checks for injuries cannot go beyond this number.
SPLIT LIMITS - THIRD FIGURE
The most property damage that can be paid for the total of all damage in one accident.
TREES, SHRUBS AND PLANTS
Up to $500 each for damage caused by specified perils.
DEBRIS REMOVAL
Coverage for debris by a covered peril; automatically included in dwelling policy.
FIRE DEPARTMENT SERVICES CHARGE
Up to $500 for covered property from covered peril.
DWELLING POLICY - COVERAGE A
Dwelling
DWELLING POLICY - COVERAGE B
Other structures
DWELLING POLICY - COVERAGE C
Personal property
DWELLING POLICY - COVERAGE D
Fair rental value
DWELLING POLICY - COVERAGE E
Additional living expenses
DWELLING POLICY - LIABILITY SUPPLEMENT - COVERAGE L
Personal liability, bodily injury and property damage to others (Example: Pitbull bite, drowning, etc.) Policy limit is $100k.
DWELLING POLICY - LIABILITY SUPPLEMENT - COVERAGE M
Medical payments and funeral expenses of others within three years of accident related to insured and/or property regardless of fault.
DWELLING POLICY - BROAD THEFT COVERAGE ENDORSEMENT
Covers personal property on and off premises; adds theft coverage for any insured.
DWELLING POLICY - DWELLING UNDER CONSTRUCTION ENDORSEMENT
Used when home is under construction; premium generally based on 65% of completed value.
MOBILE HOME ENDORSEMENT - DWELLING POLICY
Requires mobile home to have wheels removed and be tied down to foundation.
KEEP RECORDS OF CONTINUING EDUCATION
For four (4) years.
HOMEOWNERS POLICY - COVERAGE A
Dwelling
HOMEOWNERS POLICY - COVERAGE B
Other structures
HOMEOWNERS POLICY - COVERAGE C
Personal property
HOMEOWNERS POLICY - COVERAGE D
Additional living expenses/Loss of use
HOMEOWNERS POLICY - COVERAGE E
Bodily injury and property damage
HOMEOWNERS POLICY - COVERAGE F
Medical payments (within three years)
REASONABLE REPAIRS COVERAGE
Automatic coverage pays to make reasonable repairs after a covered loss to protect the property from further loss.
PROPERTY REMOVAL COVERAGE
Automatic coverage for removing property from premises for 30 days to protect it from loss.
CREDIT CARD, FORGERY AND COUNTERFEIT MONEY COVERAGE
Up to $500 of coverage for receiving counterfeit money or the theft of a credit card.
GRAVE MARKERS COVERAGE
Up to $5,000 per loss for grave markers that are damaged.
PAIR OR SET CLAUSE
Will first try to repair or replace missing piece; if not possible, adjuster must pay for lost value of missing piece.
HOMEOWNERS POLICY STANDARD DEDUCTIBLE
$250
HO-4 RENTERS INSURANCE
Made for renters, not homeowners (does not protect structure or other buildings).
HO-6 CONDOMINIUM UNIT-OWNERS FORM
Covers structure and permanent fixtures not covered by HOA.
HOMEOWNERS POLICY - SCHEDULED PERSONAL PROPERTY ENDORSEMENT
Covers property not covered adequately under homeowners policy.
HOMEOWNERS POLICY - EARTHQUAKE ENDORSEMENT
Covers earthquakes; movement within a 72 hour period is considered a single loss.
HOMEOWNERS POLICY - PERSONAL INJURY ENDORSEMENT
Covers the insured's liability to third part for libel, slander, invasion of privacy.
HOMEOWNERS POLICY - HOME DAY CARE ENDORSEMENT
Allows in-home daycare to be operated by insured on premises.
HOMEOWNERS POLICY - PERMITTED INCIDENTAL OCCUPANCIES ENDORSEMENT
Allows incidental business operations to be run on premises (doctor or lawyer at home).
HOMEOWNERS POLICY - BUSINESS PURSUITS ENDORSEMENT
Provides liability protection for employees engaged in sales, teaching, or clerical work activities.
HOMEOWNERS POLICY - WATERCRAFT ENDORSEMENT
Extends watercraft liability coverage beyond size and horsepower limits of policy.
THEFT
Always covered by Homeowners Policy.
HOMEOWNERS POLICY - JEWELRY, WATCHES AND FURS
$1500 due to theft.
HOMEOWNERS POLICY - FIREARMS
$2500 due to theft.
HOMEOWNERS POLICY - BUSINESS PROPERTY
$2500 due to theft.
HOMEOWNERS POLICY - COLLAPSE
Covered if caused by hidden insects or vermin, weight of contents or people, and weight of rain or snow on a roof.
INSURANCE COMPANY'S CONTRACTUAL DUTY TO THIRD PARTY
None.
COMMERCIAL INSURANCE - COVERAGE A
Building, permanent fixtures, machinery and equipment, other structures on premises and personal property used to service building.
COMMERCIAL INSURANCE - COVERAGE B
Business personal property; extended to properties within 100 feet of premises.
COMMERCIAL INSURANCE - COVERAGE C
Personal property of others; must be located in or within 100 feet of premises.
BUSINESS PERSONAL PROPERTY
Everything that is not a structure or permanently attached to the structure (stock, furniture, fixtures, machinery, tenant improvements).
COMMERCIAL INSURANCE - PERSONAL PROPERTY TEMPORARILY OFF PREMISES
Up to $10,000.
COMMERCIAL INSURANCE - OUTDOOR PROPERTY
Up to $1,000 for fences, antennae, signs attached to a building, and debris removal.
HOMEOWNERS POLICY - FIRE DEPARTMENT SERVICES CHARGE
Up to $500 when the fire department is called to save or protect covered property from a peril insured against.
COMMERCIAL POLICY - FIRE DEPARTMENT SERVICES CHARGE
Up to $1000 when the fire department is called to save or protect covered property from a peril insured against.
COMMERCIAL POLICY - POLLUTION CLEANUP AND REMOVAL
Maximum of $10,000.
COMMERCIAL POLICY - COST OF RESTORATION OF ELECTRONIC DATA
$2500 covered.
COMMERCIAL POLICY - DEBRIS REMOVAL
Up to 25% of the actual loss sustained for debris removal related to the covered loss. If that is not adequate, up to $10,000 is available.
BUILDER'S RISK COVERAGE COVERS
1. Buildings under construction
2. Building supplies in or within 100 feet
3. Temporary structures on site
COMPLETED VALUE FORM
Policy is set up to insure the full value of the completed building at the beginning of the policy.
VALUE REPORTING FORM
Allows insured to report the value of the construction project monthly; coverage increases as work progresses.
CONDOMINIUM ASSOCIATION COVERAGE
Purchased by condo or HOA to provide primary coverage for dwellings; primary policy.
CONDOMINIUM COMMERCIAL OWNERS FORM
Purchased by condo owners that operate a business in unit; covers contents and personal property of business.
LEGAL LIABILITY INSURANCE COVERAGE
Coverage for tenant of leased building space that covers risks the tenant might be responsible for due to direct physical loss or damage.
BUSINESS INCOME
Loss of net income plus continuing operating expenses.
EXTRA EXPENSE
Any expense incurred to minimize the time a business is closed and continue operations.
ORDINANCE OR LAW ENDORSEMENT - COVERAGE A
Covers losses to the undamaged portion of the building resulting from the enforcement of a building code or ordinance.
ORDINANCE OR LAW ENDORSEMENT - COVERAGE B
Pays for costs to demolish the undamaged part of the building if required by a building code or ordinance.
ORDINANCE OR LAW ENDORSEMENT - COVERAGE C
Pays increased repair costs incurred to bring the damaged portion of the building up to code after a covered loss.
PEAK SEASON ENDORSEMENT
Seasonal fluctuations to inventory; applies only during the period scheduled on the endorsement.
PEAK SEASON ENDORSEMENT - VALUE REPORTING FORM
Regularly report inventory; failure to do so If means insurer will not pay more than last reported amount.
COMMERCIAL INSURANCE - FLOOD
Flood is not covered on a basic, broad, or special form; requires flood policy.
BUSINESS INTERUPTION COVERAGE
Covers business’s indirect losses.
PREMISES
Coverage as a result of the condition of the insured's premises (slips and falls).
OPERATIONS
Coverage as a result of operations (delivery boy on bike injures pedestrian).
PRODUCT
Coverage as a result of a product that the business manufactured or sold (lead paint).
COMPLETED OPERATIONS
Coverage as a result of work that was completed negligently (injury due to improperly repaired stove).
FIRE LEGAL
Coverage for fire damage due to negligent tenant (food court employee causes fire, damaging rental space).
HOST LIQUOR
Coverage for business of alcoholic beverages inhosting a party where guest becomes intoxicated.
OCCURENCE FORM
If insured is being sued for an accident in the past, the insurer who provided coverage at the time of the incident would be used.
CONTRACTS COVERED BY COMMERCIAL GENERAL LIABILITY ("CGL") POLICY
("LEASE")
1. Lease of a premises (not lease of equipment)
2. Easement agreement
3. Agreement to indemnify a municipality
4. Sidetrack agreement
5. Elevator maintenance agreement
COMMERCIAL GENERAL LIABILITY ("CGL") POLICY - COVERAGE B
Personal and Advertising Injury Liability (Personal Injury)
PERSONAL INJURY
Damage to another's party's character or reputation.
COMMERCIAL GENERAL LIABILITY ("CGL") POLICY - COVERAGE A
Bodily injury and Property Damage
PERSONAL INJURY
Damage caused by libel or slander or intentional torts.
ADVERTISING INJURY
Copyright infringement.
COMMERCIAL GENERAL LIABILITY ("CGL") POLICY - COVERAGE C
Medical payments paid to others regardless of fault within one year of accident.
COMMERCIAL GENERAL LIABILITY ("CGL") POLICY - PREMIUM
Premium is assessed at inception, then audited at a later date and unused premium retured.
GARAGE POLICY
Any commercial insured that has customers’ cars in their care, custody, and control.
TRUCKERS POLICY
Truckers hired to haul the goods of others by using tractor-trailer rigs.
MOTOR CARRIER POLICY
Used to cover businesses hauling the goods of others but not limited to large tractor-trailers.
BUSINESS AUTO POLICY
Provides protection for risk exposure arising out of the use of an automobile for business use.
BUSINESS AUTO POLICY - COLLISION
Includes colliding with another object or overturning of the insured’s vehicle.
BUSINESS AUTO POLICY - COMPREHENSIVE
Open perils form; excludes coverage in Collision policy; includes flood.
COLLISION vs. COMPREHENSIVE
Insured must first purchase comprehensive or specified causes of loss before eligible to purchase collision.
GARAGE POLICY COVERAGE - PHYSICAL DAMAGE COVERAGE
Provides comprehensive and collision coverage for vehicles owned by business.
TRUCKERS POLICY - PHYSICAL DAMAGE COVERAGE
Pays for damage to tractors and trailers that are owned by the trucker.
TRUCKERS POLICY - TRAILER INTERCHANGE COVERAGE
Bailee coverage and provides physical damage caused to another’s trailer being hauled by the trucker; does not cover cargo.
MOTOR CARRIER POLICY
Used to cover businesses hauling the goods of others, but not limited to large tractor-trailers.
COMMERCIAL AUTO INSURANCE - INDIVIDUAL NAMED INSURED ENDORSEMENT
Extends coverage to the insured’s family members with liability coverage as a named insured.
EQUIPMENT BREAKDOWN COVERAGE FORM
Only covers explosion and mechanical breakdown of equipment.
EQUIPMENT BREAKDOWN INSURANCE - EXPEDITING EXPENSES COVERAGE
Pays for the cost of temporary repairs or the cost to expedite permanent repairs to avoid interuption of business.
EQUIPMENT BREAKDOWN INSURANCE - BUSINESS INCOME COVERAGE
Pays for the indirect loss a business suffers as the result of having to close temporarily due to equipment breaking.
EQUIPMENT BREAKDOWN INSURANCE - SUSPENSION
Coverage can be suspended if covered equipment is in poor or dangerous condition.
INLAND MARINE COVERAGE
Portable property, property subject to movement, propery not in the possession of its owner.
FLOATERS
Refers to the moveable nature of the property being insured.
INLAND MARINE COVERAGE CAN BE WRITTEN ON
1. Imports
2. Exports
3. Domestic shipments
4. Bridges and tunnels
5. Cables, telephone lines
6. Personal floaters (furs, jewelry)
7. Commercial floaters (cameras, musical instruments)
ACCOUNTS RECEIVABLE FLOATER
Insures the value of the insured account and billing records.
COMMERCIAL ARTICLES FLOATER
Used by professional photographers and musicians to insure high-value items; policy is worldwide.
EQUIPMENT DEALERS FLOATER
Used by companies that sell agricultural and construction equipment.
JEWELER'S BLOCK COVERAGE
Used to insure inventory at jewelry store, as well as items sold but not yet delivered and property in the case of the business (example: customer's jewelry).
OUTDOOR SIGNS FLOATER
Used to insure outdoor signs that cannot be covered adequately by commerical property policy.
VALUABLE PAPERS AND RECORDS FLOATER
Used to insure valuable papers and records (blueprints, maps, deeds). Covers property away from premises up to $5,000.
RECEPTABLE WARRANTY
Requires the insured to keep all valuable papers and records in fireproof containers at all times.
CONTRACTOR'S EQUIPMENT FLOATER
Covers contractor's tools and equipment used in their businesses.
INSTALLATION FLOATER
Used to insure property being delivered to or installed in the premises of customer; coverage does not begin until the installer takes possession of property to be installed.
ELECTRONIC DATA PROCESSING FLOATER
Provides open perils coverage for computer hardware, software and data. Excludes damage caused by electrical damage more than 500 feet off premises.
BROAD FORM vs. SPECIAL FORM
The broad form is better coverage than the special form because the special form has more exclusions.
THEFT
Any unlawful taking of property (example: robbery, burglary, embezzlement, stealing, and shoplifting) but does not include mysterious disappearance.
BURGLARY
Must be evidence of forcible entry or exit.
ROBBERY
Threat of violence, although no weapon is required.
CUSTODIAN
Person who has custody of insured property inside premises.
MESSENGER
Person who has custody of property outside of premises (manager taking money to bank).
GUARD/WATCHMAN
Person the insured has hired to watch property (has no other duties).
DISCOVERY FORM
Written to cover losses discovered during the policy period but not necessarily sustained during that policy period; includes retroactive date.
LOSS-SUSTAINED FORM
Covers only losses discovered within the policy period, or within one year.
EMPLOYEE THEFT AGREEMENT
Pays for theft of money by employees.
FORGERY OR ALTERATION AGREEMENT
Pays for losses due to outside parties that forge or alter company checks.
INSIDE THE PREMISES AGREEMENTS
Covers various forms of burglary and theft to money, damage to safes, etc.
OUTSIDE THE PREMISES AGREEMENT
Property in care of messenger or armored vehicle.
COMPUTER FRAUD
Pays for theft of money when computer used to fraudulently transfer money.
FUND TRANSFER FRAUD
Pays for losses resulting from fraudulent instructions to transfer funds from one account to another.
PRINCIPAL
Party making promise to abide by the laws and regulation (Example: appear in court, perform job).
OBLIGEE
Party receiving a promise under bonding agreement (Example: court).
SURETY
Party that gaurantees fulfillment of the promise, or will pay penalty (bail bonds company).
BID BONDS
Used when submitting a bid for a contract.
PERFORMANCE BONDS
Used by contractors to guarantee work will be completed to certain standards.
PAYMENT BONDS
Guarantee that bills will be paid by contractor.
FIDUCIARY BONDS
"Extraordinary Fiduciary". Guarantee the performance of fiduciaries entrusted with property or money of others.
COURT BONDS
Allows a person to seek remedy in court.
BAIL BOND
Guarantees appearance in court.
PENALTY
Maximum limit of liability under a bond.
NATIONAL FLOOD INSURANCE PROGRAM (NFIP)
Separate policy (not endorsement); available to people located in flood zone-prone areas; policy can be transferred to new owners.
FLOOD PERIL INCLUDES
1. Overflow of creek, river, lakes
2. Any unusual accumulation of surface water (rain or melted snow)
3. Tidal surge
4. Mudslide caused by flooding
FLOOD INSURANCE WAITING PERIOD
30 days
WHO WRITES FLOOD POLICIES?
Federal government
FLOOD DAMAGE COVERAGE
Very small amounts (up to $35,000 for single family dwelling).
BOATOWNERS POLICY
Smaller watercraft, under 26 feet in length.
BOATOWNERS POLICY COVERAGE
Physical damage to boat, trailer, motors and equipment necessary for operation of boat.
YACHT POLICY
Made for larger personal boats with overnight spaces.
IMPLIED WARRANTIES
Unwritten.
BARRATRY
Any illegal act to defraud the owners of the ship or cargo.
PERILS OF THE SEA
Naturally occurring causes of loss like unusual wind or wave action.
PERILS ON THE SEA
Manmade causes of loss occurring during ocean travel.
JETTISON
Covers throwing cargo overboard to balance out load to save ship.
INCHMAREE CLAUSE
Covers losses resulting from negligence of captain or crew.
PILOT WARRANTY
Used to restrict coverage to specified pilots by name.
BAILEE
Person taking care of property (example: person who owns a hangar with a plane that is not his).
UMBRELLA POLICIES SOLD IN INCREMENTS OF
$1M.
UMBRELLA POLICY - WHEN UNDERLYING LAPSES
Umbrella pays as if the primary policy was present; the self insured retention does not apply to claims when the umbrella is acting as excess coverage.
ACT OF TERRORISM
1. A violent act
2. Results in damage
3. Minimum loss $5M
AUTOMOBILE INSURANCE - COVERAGE A
Liability
AUTOMOBILE INSURANCE - COVERAGE B
Medical payments and personal injury protection
AUTOMOBILE INSURANCE - COVERAGE C
Uninsured/Underinsured Motorist
AUTOMOBILE INSURANCE - COVERAGE D
Physical Damage
BUSINESS OWNERS POLICY
Small to medium sized businesses (insurance companies, mom-and-pop's, barbershop)
STATED AMOUNT POLICY
An agreed amount of insurance paid in the event of total loss regardless of the actual value (antiques, collectibles).
INSURABLE INTEREST
Interest in something that is insured.
FIDELITY BOND
Covers insured for losses that they incur as a result of fraudulent acts by specified individuals.
PROXIMATE CAUSE
Without the act, the injury wouldn't have occurred.
MYSTERIOUS DISAPPEARANCE
Cause of the loss cannot be identified.
ADMITTED INSURER
Can sell insurance policies in the state.
NONADMITTED INSURER
Can only issue surplus lines (high risk).
DISCIPLINARY ACTION
If adjuster is accused, Commissioner will investigate and provide 10 days' notice of hearing.
BAD FAITH
Does not require wrongful intent.
TIMEFRAME TO INVESTIGATE FRAUDULENT CLAIMS
60 days from date received.
EXTENSION DUE TO WEATHER DELAYS
15 days; granted by commissioner.
"BURGLE A BUILDING, ROB A BOB."
"BURGLE A BUILDING, ROB A BOB."
COMMERCIAL PACKAGE POLICY
Serves alcohol, has a place of entertainment, or medium to large businesses (McDonalds, USAA).
RIGHTS OF MORTGAGEE
May act as insured by submitting payments, has full right of recovery for claims, has right to receive advance written notice of cancellation, nothing insured does can prevent from collecting on mortgage.
PROOF OF LOSS
Statement made by insured to insurer regarding claim so insurer can determine liability.
FAIR CREDIT REPORTING ACT
Promotes the fairness and accuracy of all information contained in consumer reports (credit report).
WORKERS' COMPENSATION
Between the business and the insurance company (not employee); 30 days to turn in claim; always the primary.
"WCSHAVVER"
Windstorm
Civil commotion
Smoke
Hail
Aircraft
Vehicles
Volcanic Eruption
Explosion
Riot
"DACE"
1. Declarations
2. Agreement
3. Conditions
4. Exclusions
BROAD COVERAGE
"The CURRENT WEIGHT of the FREEZING WATER caused the COLLAPSE."