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Casualty insurance b

Casualty principles and concepts

Declarations Who,what,where,when an how much a policy is
Insuring agreement Summarizes covered risks
Conditions Lists the insureds responsibilities both at the time of application and time of loss
Exclusions Lists the hazards and perils not covered by the policy
Supplementary Payments the insurer will pay over policy limits such as claim expenses, legal fees
Policy period Loss must occur between policy inception and cancellation
Policy territory In ,commercial lines it's a list of states the company does business in
Non concurrency When 2 or more policies do not cover a risk in the same way at the same time
Primary insurance Is the main coverage on a risk
Excess insurance Starts when the underlying policy's coverage ends
Pro rata If a loss occurs that is covered by more than one policy ,each policy pays it's portion of the loss
Policy limits The maximum life time benefit of an insurance policy
Coinsurance A clause which requires the insured to keep insurance equal or greater than the stipulated percentage of full value .insurance carried ÷ amount of insurance needed ×amount of loss
UNOCCUPENCY Buildings that have no residents or active business for more than 60days
Vacancy Buildings that are both unoccupied and have no personal property
Appraisal In the event of a disagreement over the insureds handling of a claim. The insured and the insurer may select an appraiser
Assignment To transfer the policy to someone else
Abandonment Property cannot be abandoned to the inurer
Duty to defend The insurer has the responsibility to defend the insured against lawsuits
Liberalization If the insurer changes the same type of policy the insured owns in any way. , providing for more coverage without additional premium the insureds original policy will be extended for those coverages
Subrogation The insurer has the right to pursue legal action in its own name, or the name of a policy holder against a third party who is liable for a loss that has been paid
Salvage The insurer may pay the cost to replace or repair damaged property
No benefit to the bailee Someone that holds property of another and is responsible for its safe return. They will not receive payment for coverage of the insureds property .
Judgment rating Premium is determined without manuals or tables. Rather the underwriter evaluates the individual risk to determine the probability of loss
Manual rating This method separates risks into category groupings or classes .
Merit rating Takes particular aspects of the individual risk into account
Negligence Failure to act in a reasonable manner
Assumption of risk A person who understands the danger involved in a particular activity and voluntarily chooses to do the activity anyway
Contributory negligence Any negligence on the part of an injured party will normally defeat a claim
Mississippi rule Any defendant who is partly at fault must pay in proportion to their share of the fault
Wisconsin rule Used in most states the defendant who is least at fault is not required to pay for any of the damages
Intervening cause/last clear chance The injured party would be able to collect damages even if she /he had contributory negligence if the other party had a opportunity to avoid the accident
Statue of limitations Time limit on how long an injured person can sue for damages
Common law fellow servant rule An employer cannot be held liable for the actions of a coworker if an employee is injured due to the negligence of that coworker
Special or specific damages The actual expenses incurred by an individual or entity as the result of lost wages or income , medical bills or damaged property
General damages Damages due to pain, suffering, mental anguish
Punitive damages Damage that are assessed in edition to general and specific damages as a punishment for extreme or gross negligence by the offending and liable damages
Absolute /strict liability A legal doctrine that states that an individual can be held liable even if negligence does not exist or cannot be proven. Strict liability is workman's comp Absolute liability is dangerous activities
Vicarious liability Arises out of imputed negligence in which one individual becomes liable for the negligent behavior of another
Blanket policy Covers a class of objects or perils
Specific policy Covers only those objects or perils named in the policy
Proof of loss A sworn statement made by the insured verifying the amount, date and cause of loss
Per occurance (accident )limits Amount available for any individual loss or claim up to the aggregate limits unless the aggregate limits have been met
Per person limits The amount available for any one person through the policy.
Split limit Similar to per person limits , in a split liability amount coverage is a different amount fo different things. Example 20,000 bodily 8injury per person, 40000 bodily injury per occurance, 150000 property damage per occurance
Acceptable with standard rates The insurance policy will be issued as applied for, subject to full premium payments
Acceptable with substandard rates or with exclusion The policy will be issued, but the insured must sign an endorsement showing he or she accepts the changes
Unacceptable and denied coverage If the insurer denies coverage to applicant the insurer denies coverage to an applicant. The insurer must give detailed explanation
Loss ratio One way of measuring the insurers profitability. It takes claim expenses and compares them to premiums
Comparative negligence More lenient and used by more states,can be used in some way to lessen the damages
Created by: Jenny10795
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