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LM chapter 5

Introduction to Property Insurance

The person, business, or other entity named in the declarations to whom the policy is issued. Named insured
The person listed first on the declarations page. First named insured
Another person or business listed on the declarations. Additional insured
The time and date inccluded where, and in what time zone, coverage begins and ends. Policy period
Policy limit is also known as (3)? Limit of coverage. Limit of liability. Limit of insurance.
These policies insure property only against the perils specifically listed in the policy. Named Peril
Policy that insures against all risks of physical loss except those specifically excluded in the policy. Open Peril
This is a financial loss resulting directly from a loss to property, such as a hosue being damaged in a windstorm or a valuable piece of jewelry being stolen. Direct loss
This is a result of the original loss. Indrect loss
Duties following a loss (6). Contact insurance company. Protect from future damage. Complete a detailed proof of loss. Make the property available for inspection. Submit to examination under oath. Assist the insurer during claim investigation.
Term used for how losses will be paid. Valuation
5 methods of valuation. Insurable interest. Policy limits. ACV. Cost to repair. Replacement cost.
Replacement cost minus depreciation. ACV - Actual cash value
Damaged property is repaird or replaced with less expensive but functionally equivalent materials. Functional replacement cost basis
Replacing based on the cost it could be sold for at the time of the loss. Market value
Encourages policy holders to insure property to value. (requires coverage of at least 80% of the total value covered) The coinsurance condition
Value of the set minus the remaining peices equals the payout. Pair or set condition
The insured pays the first amount of every loss. This is known as what? Deductible
Provides that the insurance company can take possession of damaged property after payment of loss. Salvage condition
States that the insured may not abandon property to the company and ask to be reimbursed. Abandonment condition
An insured suffers a loss for which they were not at fault, the other party eithe rhas no insurance or they refuse to pay so the insured's insurance company may step in and pay and then go after the other party or insurance company to recoup funds. Subrogation
Also known as "Transfer of rights of recover against others to us." Subrogation
If there is a disagreement on value of property then either party can demand what? Appraisal
A disagreement on coverage. It is limited to disputes over the value of the loss. Arbitration condition
Sets out how other insurance the insured may have on the same property affects the reimbursement under the policy in question when a loss occurs. Other insurance condition
When an insured has two or more policies on the same property that do not provide coverage to the same extent. Nonconcurrency
Provides that if the insurer broadens coverage under a policy form or endorsement without requiring an additional premium then all existing similar policies or endorsements will be construed to contain the broadened coverage. Liberalization condition
Specifies that a policy may not be transferred to anyone else wihtout the written consent of the insurer unless the named insured dies. Assignment condition
A person or organization that has temporary possession of someone else's property. Bailee
States that the Baliee is not covered under the insured's policy while the bailee has possession of the insured's property. No benefit to bailee
Specifies the rights and duties of the mortgagee or loss payee under the policy. Loss Payable condition or Mortgage condition
Covered policy territories Canada, Puerto Rico, US
Means no people. Unoccupied
Means no people and no stuff. Vacant
Contracts for which a flat premium is charged every time a policy is renewed. Auto and homeowners policies are examples of these. Non-reporting policies
Created by: landonhill
Popular Insurance sets




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