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Glossary of Insurance 2-20 exam Review

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Inside the premises - Theft of Money & Securities covers what?
Money, securities resulting from TDD and damage to the residence if the insured is legally liable.
Under Employee theft what triggers immediate cancelation.
Discovery of any dishonest act commited by the employee whether before or after employment by the insured. The company can cancel for any employee with 30 days notice
What are the coverages provided by Employee Theft?
Loss of or damage to money securites and other property resulting from theft commited by an employee.
Define Safe Burglary
Taking or attempted taking of property from within a locked safe or vault by unlawful entry, with visible marks of forced entry, or taking of the safe or vault from inside the premises
What is the special limit per occurance for precious metals, stones, furs, and the the physical or intrinsic value of manuscripts, drawings or records.
$5,000 per occurance
What does outside the Premises coverage apply to?
Loss of money, Securities outside the premises in the care custody and control of a messanger or an armored care service resulting from TDD. Also covers robbery of other property under the same circumstance.
What is the additional exclusion that applies to computer fraud.
Inventory Storage.
What is the special limit for loss to manuscripts, drawings, and records that applies to computer fraud?
$5,000
What does Money Orders and Counterfiet Paper Currency coverage apply to?
Loss resulting from having accepted counterfiet currency or money orders in good faith in exchange for merchandise, money or securities. Includes money orders and counterfeit paper currency from other countries
How many primary insuring agreements are included in the basic Commercial Crime Coverage form?
Seven
Name the seven insuring agreements that may be added to the basic Commercial Crime coverage Form by endorsment.
Extortion, Clients Property, Funds Transfer Fraud, Lessee of Safe Deposit Boxes, Securities Deposited with others, safe depository, Guests Property
Explain the Discovery Basis for Loss.
Any loss discovered during the policy period or within 60 days after expiration is covered reqardless of when it occured
What is the standard deductable under Employee theft?
$500
Under what coverage form does the insured have legal expenses included?
Forgery or Alteration
Which coverage specifically excludes the loss of property contained in Money operated devices?
Inside the Premises - Theft of money & securites
Explain the Loss sustained basis of loss.
Covers only losses that both occured and were discovered within the policy period or within one year of expiration.
How are the following valued for payment of loss? Money, securities, other property.
Money - Face Value
Securites - Value on the day loss is discovered.
Other property - acv or cost to repair or replace whichever is less.
What are the three ways employee theft may be written
Employee Schedule, Employee postion or blanket.
Inland Marine was written as an extention of what coverage
Ocean Marine
What are the six catergories of risks eligible for Marine Coverage under the Nationwide Definitions?
1. Imports
2. Exports
3. Domestic Shipments
4. Instrumentalities of Trans & Comm
5. Personal Property Floater
6. Commercial Property Floater
What is the characteristic that make a risk eligible for Inland Marine Coverage?
An element of Portability
THe Function of Inland Marine is generally considered to be covering what type of property?
Property in transit or subject to transit, land mobile equipment, instrumentalities or transportation & communication.
What is a "controlled" line of coverage?
A standard provision form is promulgated be a bureau such as ISO and filed for uniform use.
What are the Principal Inland Marine specific coverage forms?
1. Cameras
2. Fine Arts
3. Golfers Equip
4. Jewerly & Furs
5. Musical Instruments
6. Stamp & Coin Collections
7. Silverware
What is the difference between an Inland Marine on a Homeowners forms versus a stand along policy?
The personal coverage form is written on which, basic, broad or all risk?
all risk
What does inherent vice mean?
A quality within an object that results in the object tending to damage or destroy itself.
What is the Territory for Personal articles floater?
worldwide
How is the loss valued under Personal Articles Floater?
Lesser of ACV, cost to repair or replace of the limit specified for coverage.
What is the pairs, set and parts condition under the PAF?
If there is loss to a pair or set the company may elect to repair or replace in a way to restore the pair or set to original value, or pay the diff between ACV before and after the loss. For loss of a part of covered property made up of parts, responsibility is only for the value of the part loss or damaged.
What does the definition of Jewerly Include?
articles of personal adornment containing percious metals, whether or not conatining jewels, pearls or semiprecious stones. Other Articles such as pens, flasks, smoking equipment, trophies and other similar items.
What is the automatic coverage provision?
25% of the coverage limit when property is of the same class but over $10,000 for 30 days after acquisition.
What does the definition of Furs Include?
Garments that are wholly genuine or imitation fur or trimmed in fur, fur rugs.
What does the defintion of Cameras Include?
All types of personal photography equipment, binoculars, telescopes, film and carrying case.
How is professional use covered under musical instruments?
Excluded but maybe endorsed to cover
What are the additional exclusions for organs that are not mobile?
Mechanical or electrical breakdown or failure, loss caused by repairing, adjusting, servicing or maintenance.
How are golf balls covered under Golfers Equipment?
Only for loss by fire or Burglary by forcible entry into a building, room or locker.
How is a loss valued under Fine Arts?
Valued Coverage (the amount specified in the policy)
What is the automatic coverage provision for fine arts?
90 days 25% of the total limit for scheduled items.
How does coverage apply to fine arts on exhibition away from the premises?
Excluded
How does the pairs sets and parts provision apply to fine arts?
The company pays the full scheduled amount on the pair or set and the insured surrenders the remaining articles to the company.
What does postage stamps include?
Due, Envelope, official, revenue, match & medical stamps, covers, locals, reprints, essays, proofs, and other philatelic property including books, pages and mountings.
What does rare and current coins include?
Medals, paper money, bank notes, tokens of money and other numismatic property, coin albums, containers, frames, cards display cabinets in use.
When coverage is blanket what is the limitation for unscheduled coin collections, any one stamp, coin, or individual article or one pair, strip, block, series sheet, cover, frame, or card.
$1,000 and $250 for any one.
The controlled coverage forms provide which type of coverage? Basic, Broad or all risk?
All risk
Which policy covers insureds goods either incoming or outgoing on an annual basis?
Annual Transit Policy
Which policy covers insureds goods on a per trip basis
Trip transit
Which policy protects the carrier instead of the shipper for good in transit?
Motor Truck Cargo
What does the mail coverage form do?
All risk coverage for loss of property sent by registerd mail, first call mail, certified mail, or express mail.
What are some examples of Instrumentalities of Transportation & Communications?
Bridges, tunnels, oil pipelines, dam, piers, docks, radio/tv towers.
What is bailment?
Delivery of property by the owner to someone else to be held for a specific purpose then returned to the owner.
What is a bailee?
One who recives the property.
What is bailor?
one who owns the property
Which form covers "confusion of goods"?
when damage to goods renders the goods unmatchable with the owner.
Which form covers heavy machinery, equipment and tools?
Contractors Equipment Floater.
Which form covers medical surgical and dental instruments on and off the premises, as well as furniture and fixtures in the DR. office?
Physicians and surgeons equipment coverage form.
Under the theatrical property coverage form what type of risks are specifically excluded?
Rental companies, supply houses, circuses, carnivals, rodeos.
What is covered under film coverage form?
Exposed motion picture film including sound track & properly recorded tapes until production is complete and positive prints are made.
What is the Commercial Articles Floater for used for?
Photographic equipment or musical instruments used commercially.
Which form reinburses the insured for amounts which can't be collected from customers due to damage to the company's accounts recievable records, extra collection expenses, costs to reestablish records and intrest on any loans the insured must obtain to
Accounts Recievable coverage form.
Which form would be used to cover equipment, machinary, building materials in transit or during the course of installation, testing, building, renovating, or repair?
Installation coverage form.
Which form covers hardware, data, media and software, extra expense, buisness interruption and liability?
Electric Data Processing Insurance
Which coverage form is used to cover merchandise for sale that has been financed and is written only on a reporting basis?
Floor plan form.
What is the basis for rating commercial inland marine policies?
the rating the is applicable for commercial property i.e. grp I & grp II plus a loading for all risk.
What is the oldest form of Insurance known?
Ocean Marine
What have the courts required for a valid ocean Marine contract to exist?
Utmost Good Faith.
What are the typical coverages under a Hull Policy?
Fire, lighting, earthquake, assailing theives, perils of seas, jettison, barratry of the master or mariners, ans all other like perils.
What are the types of deductables typically available for hull coverage?
Average, Franchise, percent of value.
What are two forms available for providing cargo coverage?
Floating or open or reporting form.
What does Freight Coverage do?
Protection for the Vessel owner in the event frieght charges are not paid.
Which coverage would protect the ship owner from liability for the negligent operation of the vessel in damaging another ship?
Running down clause.
Which coverage protects the ship owner from damage to passengers, crew members, or persons on other ships, damage to cargo dock or other property?
Protection and Indemnity.
What coverage is wind, waves, collision, stranding, sinking, and other such accidents.
perils of the sea
Which form buys back the war exclusion?
Free of capture and Seizure.
Which form provides coverage for all types of taking of the insureds property by force?
Enimes.
What coverage is used for the voluntary throwing overboard of parts of the ship or cargo to save the vessel from sinking of further damage?
Jettison
Which coverage is for fraud by the master or crew?
Barratry
Loss which is a voluntary sacrifice of a part of a ship or cargo made by the master to avert a common perils which might destroy the entire ship or cargo is called?
General Average Clause
Which clause requires the insured to take all steps necessary to save and preserve the goods from loss or to minimiza a loss which has occured?
Sue and Labor Clause
When the property no longer exists or is beyond salvage what type of loss is it?
Actual total loss
What type of loss is it when the costs to salvage plus the cost to recondition exceeds the value?
Constructive total Loss
When the buyer assumes responsibilty for the cargo once goods reach the designated point?
Free on Board F.O.B
The seller assumes complete responsibilty for securing which necessary insurance?
Cost, Insurance & Freight CIF
When the buyer purchases his own insurance?
Cost & Freight
When the seller assumes cost and risk until delivery alond side overseas vessel and withing reach of loading tackle?
Free along side FAS
Damages which a charterer agrees to pay as damages for delay in loading, unloading, or time lost by a vessel prevented from pursuing profitable employment by perils of the sea or accidental clause
Demurrage
What trigger the financial responsibility law?
accident that occurs involving bodily injury, serious traffic violation
Minimum limits required by state law?
10/20/10
what are the alternative way of satisfying the law?
Being self insured
Posting a bond
cash in the amount of 10/20/10
What is hangerkeepers coverage used for?
Aircraft in the hanger owners CCC simialr to garagekeepers.
name three general exclusions found in the aviation policy.
-Lack of Current GFAA airqorthiness certification.
-If craft is used or maintained for purposes other than its classification
- if operated by other than pilot named in declerations.
What type of deductible is generally used in Aircraft Hull Policies?
Percent of Value
Loss to the Aircraft Huss is generally valued on what basis?
Stated Value.
What are the usual coverages written on an Aircraft Liablity Policy?
Bodily Injury excluding passengers/ passenger liabilty / property damage.
How does the Aircraft policy cover an insured who has received a special permit or waive from the FAA?
Not Covered.
What coverage would be needed for passagners baggage?
Cargo
Define the ways in which hull coverage can be written?
1. all risk not in flight
2. named perisl not in flight
3. all risk in flight
What does Expediting Expense Cover?
Cost of Temporary reapirs and cost to hasten permanent repairs or replacement.
Define the Property covered under Boiler/Machinery Policy.
Property of the insured/property in insureds care custody and control if he is legally liable.
For the small buisness B/M form what is the maximum 80% replacement cost that may be written?
$5,000,000
What is the standard deductable under Boiler & Machinery
$250
Automatic coverage for new locations is what time period?
90 days
How is indirect loss covered?
Either Valued or actual cash loss sustained
For replacement cost to apply what is the time limit for the insured to repair or replace
18 months
What is the maximum limit for expediting expenses in Boiler & Machinery?
$5,000
What is the Maximum Expediting Expenses in Small Buisness B/M?
Spoilage loss from lack of power.
What is the definition of "Accident"
Sudden & accidental breakdown of the object of part of the objet
Explain the suspension Condition
Allows immediate suspension of coverage under certain circumstances.
Explain Valued Business Interruption endorsment.
Is indirrect coverage that pays an agreed amount each day of interruption with a daily limit and total dollar limit w/deductable that can be either days or dollars.
Explain Actual Loss Sustained endorsment.
Covers lost profits & continuing expenses subjec to 100% coinsurance.
Define the three parties to a surety bond
Surety, Obligee, principal.
Some bonds have a fourth party who is?
Imdemnitor.
Define Bid Bond.
Guarntees that the bidder will enter into contract & satisfy furture bonding requirements.
Define Performance Bond.
guarantees the obligee indemnification resulting in losses from principals failure to complete per contract.
Define Payment Bond.
guarantees payment by the contractor for labor and materials.
Define Maintenance Bond
guarantees replacement or correction of faulty work/ Materials for a specific period of time.
Define Fiduciary Bond
Performance and utmost good faith of a person appointed by the court.
Define Court Bond.
required of plaintiffs and or defendants to protect opposing parties from loss if legal entitlement is not shown.
Define Public official bond.
principal will uphold oath of office and faithfully perform.
Define License Bond.
required by public bodies to protect the public by guaranteeing compliance by the bondee with laws, ordinances.
Define Loss Instrument bond.
Protects the issuer of the instrument from loss when they make a replacement.
Define Blue Sky Bond.
required of investment companies to protect the public from fraud and misrepresentation.
Define customs bond.
guarantees the payment of duties/taxes.
Optionally Renewable (health Insurance).
Insuror can't cancel during term but can non renew at expiration.
Conditionally Renewable (Health Insurance)
Insuror can refuse to renew only under certain conditions.
Guaranteed Renewable.
Insuror is required to renew to a stated age and can increase premium in that class.
non cancellable.
Insuror can't cancel, or increase premiums and must renew to a stated age.
Generally what does an AD&D policy provide coverage for?
Death benefit, Dismemberment benefits as a percentage of principal sum or partial benefits for other diablements, hopstial & Med. Expense Reinbursment, earning.
Grace Period in Florida For Health Insurance/
Weekly 7 days
Monthly 10 Days
All other 31
Cancellation requirments (Fla Law) # of days during th policy term.
20 days
Explain the reinstatment provision in health policies in Florida.
reinstatment is at time of approval or automatic after 45 days is insurer fails to notify of dis-approval. at Reinstatment accident coverage is immediate, sickness 10 days waiting period.
Define elimnation period.
Same as waiting period. The time between when the policy is issued & accepted & sickness benefits begin.
What does hospitalization expense policy cover?
Basic cost of room & board nursing care, lab fees, operating room, medical supplies, etc.
What does hospitality indemnity cover?
Flat amount per day of hospitalization regardless of other insurance.
What does surgical expense cover?
Physicians fees for surgury.
What does physicians coverage do?
Non Surgical Care by a Doctor.
What does major medical refer to?
Coverage for a catastrophic loss usually w/ high max limit & co ins.
What type of coverage replaces income?
Disability insurance.
Florida has set standards for Medicare Supplmental policies they are?
Policy must: specify min limits that fill medicare gaps, must be in understandable language, pre-existing cond limit can't exceed 6 months
The standards for Medicare Supplmental Insurance are set by whom?
Florida Statutes.
From where are the majority of health insurance premiums derived?
Group Insurance.
What happens if the health policy is not paid by the end of the grace period?
It expires.
Define: Tmie limit on Certain Defenses Clause:
after 2 years a claim may not be reduces or denied due to preexisting conditions unless specifically excluded before date of loss.
What is the waiver of Premium?
Eliminates premium payment when insured is totally diabled.
What is the death benefit under Workers Compensation.
$100,000
What is the limit of coverage under Part 1 WC?
No Limit under part one pays medically necesaary expenses forever.
To be eligible for JUA Wc what is required?
Rejected by 2 other carriers, no umpaid premiums including audits.
For permanent total disability how is compensations caclcuated?
66 2/3% of AWW
What is the basic for determining disability beneifts?
Workers AWW past 13 wks.
Construction Industry- requires how many employees for WC?
One- sole proprietor are employees.
What is the purpose of the Statewide Average Weekly Wage?
sets the maximimum benefit for WC
What benefits are provided under the WC Policy?
Medical Expenses, death benefits, disability compensation.
What does part II of WC cover?
Employers liablility claims by employees for injuries not subject to WC lawm, claim by others for their liablities to insureds employees, claims by relatives of injured employees for consequential dgs.
What is the max time for partial disablility to be compensated?
10 weeks
What is part III other states coverage designed to do?
Provide Coverage in states where the insured begins operations after the policy is written.
What are the Statutory limits under Part Two?
100,000/100,000/500,000
What is the time limit for Death benefits under WC?
5 years if continuous Disability existed.
What is the time limit under WC for?
Waiting period 7 days
Retroactive period 21 days
What are the types of employment exempt from WC law?
Domestic, farm work less than 5 employees, professional athletes.
Define casual labor:
less than $100, not more thans 10 dys, not the same type of work insured normally performs.
Define the workers not considered to be employees under WC law?
Independent contractors, casual labor, unpaid volunteer in non-profit agencies.
Which department regulates WC law?
Dept of Labor & Employment security.
What is the time limit for auditing WC policies?
anytime during policy term & three years after expiration.
What is the limitation for medical expenses under WC?
No $ amount no time limit.
How does WC law address an employee waiving his rights to wc?
Illegal.
What are the eligibilty requirements for the Homeowners program?
owner occupied 1-4 family dwelling, rents in residential building, condo or co-op owner occupied.
What incidental non dwelling occupany is allowed?
not more than 2 roomers or borders.
What types of occupancies are specifically excluded under HO?
farm property other than light farming.
How is dwelling under construction treated?
its covered
Who are considered insureds under the Ho policy?
named insured, spouse, and residing relatives, anyone under 21 in care custody and control.
What is the standard deductable under the Ho for AOP-hurricane
$500 or 2% minimum
What is the definition of dwelling under the HO6?
contents.
What is the territory limitation under coverage C- personal property?
wherever it is located.
How are animals, birds, or fish covered under coverage C?
not covered.
Under the HO6 what is the basic limit for coverage A?
$5000.00
What is the limit for money, precious metals, & medals under the HO6?
$200.00 money $1,500 Precious metals, and metals theft only.
What is the limit from securities?
$1,500
What is the limit for watercraft, trailers, accessories, etc?
$1,500 also $1,500 for trailers not with watercraft.
What is limit for theft ir silverware, goldware, pewterware?
$2,500 theft only
What is the limit for theft of firearms?
$2,500
under additional coverages what is the limit for debris removal?
no limit
What is the limit for Fire Department service charges?
$500
What is the limit for unauthorized use of credit cards, forgery, counterfeit money?
$500.
What is the limitation for building ordances and law?
10% of coverage A additional amount to coverage A
What are the names perils under H02?
there are 18 perils.
Under the HO8 what is the limitation for theft?
named perils only. glass $100 ded. $1,000 ded teft @ premises.
UNder conditions, which properties are ACV in Lieu of RC?
owning, carpets, appliance, outdoor antennas, outdoor equipment.
Under Section II liability what is teh covered territory?
anywhere.
What is an HO3, HO4, or HO6?
HO3- single family owner occupied
HO4- renters policy
HO6- Condo unit owned policy (incl townhouse or villa.)
Under Section II what are the allowed buisness pursuits that will be covered?
Occational renting to others; the use as a studio, office, or private gargage; the partial rental.
Under Section II how are golf carts covered?
covered at an insured location while on a golfing facility being used for golf or other permitted activites and within a private residential which contains the insureds residence and the community has control over the roads and allows the use of golf carts on them.
What are the supplementary coverages under section II?
$250 loss of earnings per day.
What are the basic limits under section II?
Liability and med-pay
What is the limit for vicarious parental liability?
$10,000
What is the cancellation/ non-renewal provision?
Non-pay 10 days written
first 90 - 20 written
non renewal 90 days written.
What is the inflation guard endorsment?
It increases the policy limit over the year by a certain %
What are the increased limits available on A: money B: securities C: jewerly/furs D: silverware E: firearms F: Electronic Apparatus
A: 1,000
B: 2,000
C: 5,000 1,000 EACH ITEM
D: 10,000
E: 6,500
F: 6,000
What are the two standard policy forms for commercial packages?
commercial package & buisness owners.
All classes of risk are eligible for CPP except?
Homeowners.
Under the BP what is the limitaition for permitted incidental occupancies for apartments & residential condo?
No more than 25,000 sq ft.
what is the limitation for offices & office condos under the BP
not over 6 stories or 100,000 sq ft no more than 25,000 sq ft for one building.
What is the square foot limitaion and gross sales limitation for mercantile, wholesale & processing risks under the BP?
25,000 sq ft and 3 million
Under the BP for resturants what does "limited cooking" mean?
does not need fans or chemical system, no frying.
What are the 2 forms under the BP?
standard and special.
Under the BP property is what ACV or RP?
Replacment cost
What is the limitation for outdoor property under the BP?
$2,500 not more than $250 for any one.
What is the built in % for inflation guard under the BP?
8%
Under the BP which classes of personal property are at ACV in lieu of RC?
HOusehold contents, property of others, used goods, manuscripts, works or art or antiques.
What is the limitation for personal property other than money/securites?
$5,000
What is the on premises limitation for valuable papers/records?
$5,000 on premises $2,500 while away
What is the limitation for accounts receivable: 1: on premises 2: off premises?
1: $5,000
2: $2,500
What is the loss of income provision in the BP?
12 months.
What are the limits available under BP for Employee dishonesty?
*optional coverage* $5,000 , $10,000 , $25,000 , $50,000 , $100,000.
What is the minimum liability limit avaiable under the BP?
$300,000
What limits of fire legal liability are available under the BP?
$50,000 , $100,000 , $250,000 $500,000 , $1 million
What must an insured do to avoid penalties for non compliance with the Fr law?
claims must be satisfied, must provide Fr for future accidents.
What is the purpose for an Sr-22?
certifies coverage is in effect.
When an operator who does not own an auto needs an sr-22 what is required?
named non-owner policy.
Violations under the law such as making misstatments, commiting forger, filing false affidavits are punishable how?
2nd degree mistermeanor.
who administers the FR law?
Department of Highway safety & motor vehicles.
Define Motor vehicles?
self propelled vehicles with 4 or more wheels.
How does PIP apply to Non-Residents?
still are required to carry on any defined motor vehicles after 90 days.
What are the penalties for non compliance with the PIP law?
denied immunites, ownerpersonally liable, license registration suspension.
What are the four catergories of PIP benefits?
medical, work loss, death, replacement services.
What is the standard PIP deducatible?
$250, $500, $1,000
What is the death benefit under PIP?
$5,000
In which situations would PIP not apply?
when work comp present.
What are 4 things that pierce the tort threshold?
signifigant perm lose to a bodily function, permt injury other than scaring, signifigant permanent scaring, death.
What does the tort threshold refer to?
exceptions allowed for recovery of non economic loss.
When can and insured person sue for economic loss?
when threshold is met
A personal auto policy may not be issued for what type of risk?
incidental to insureds business of furniture or equipment install or repair, ranch , maintance, or farming.
For a newly aquired additional vehicle what is the time limit required for reporting to the insurer?
14 days.
For physical damage on a newly aquired auto when when there is no physical damage on any of the vehicles on the policy, what is teh time limit for reporting the vehcile to have it covered for physical damage?
4 days.
What are the supplementary payment on an auto policy?
$250 a day.
What is uninsured Motorist coverage used for?
Coverage to pay compensatory damages for bodily injuries, under one's own policy for amounts which would have otherwise not been recovered.
To whom does UM apply?
other persons as well as named insured, family member in their own vehicle as well as a passanger or pedestrian.
when does Um coverage apply?
injury must be cause by a vehicle with no liability or not enough.
what is the minimum single limit available for UM?
$20,000
What is the minimum split limit available?
10/20
How does FL state law say UM will be written if no elections?
Stacked.
What are the UM elections available?
Stacked, Non-stacked.
Are excess policies required to provide UM?
no
What does other than collision coverage provide?
covers indirect and accidental losses not covered by collision
What are the limits for transportation expenses?
20 a day max $650.00
What are the time limits for transportation expenses?
24 hrs after loss.
How are losses paid for physical damage?
payment of the lesser of actual cash value or cost to repair or replace.
What is the limit for physical damage on a non-owned trailer?
$500.00
What is the policy territory?
Us territory, possessions , canada, and puerto rico.
Which endorsment covers for liability and or medical expenses for a non owner auto furnished or available for regular use, using non owned autos in buisness and using non owned autos when carrying persons or property for a fee?
extended non owned coverage.
Which endorsments may be issued to cover motor homes, motorcycles, golf carts, atvs?
misc type vehicle.

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