CPCU 553 - Personal Insurance and Financial Planning Exam with 100% Correct Answers

CPCU 553 - Personal Insurance and Financial Planning Exam with 100% Correct Answers Define: Liability loss exposure - Answer ️️ -Any condition or situation that presents the possibility of a claim alleging legal responsibility of a person or business for injury or damage suffered by another party. Define: Damages - Answer ️️ -Money claimed by, or a monetary award to, a party who has suffered bodily injury or property damage for which another party is legally responsible. Define: Special Damages - Answer ️️ -A form of compensatory damages that awards a sum of money for specific, identifiable expenses associated with the injured person's loss, such as medical expenses or lost wages Define: General Damages - Answer ️️ -A monetary award to compensate a victim for losses, such as pain and suffering, that does not involve specific, measurable expenses. Define: Punitive Damages (Exemplary Damages) - Answer ️️ -A payment awarded by a court to punish a defendant for a reckless, malicious, or deceitful act to deter similar conduct; the award need not bear any relation to a party's actual damages. Define: Civil Law - Answer ️️ -a classification of law that applies to legal matters not governed by criminal law and that protects rights and provides remedies for breaches of duties owed to others Define: Tort - Answer ️️ -A wrongful act or an omission, other than a crime or a breach of contract, that invades a legally protected right Define: Negligence - Answer ️️ -The failure to exercise the degree of care that a reasonable person in a similar situation would exercise to avoid harming others. Define: Intentional Tort - Answer ️️ -A tort committed by a person who foresees (or should be able to foresee) that his or her act will harm another person. Define: Strict (Absolute) Liability - Answer ️️ -Liability imposed by a court or by a statute in the absence of fault when harm results from activities or conditions that are extremely dangerous, unnatural, ultrahazardous, extraordinary, abnormal, or inappropriate. Define: Risk Management Process - Answer ️️ -The method of making, implementing, and monitoring decisions that minimize the adverse effects of risk on an organization Assets exposed to liability loss include: - Answer ️️ -all currently owned financial assets, and potentially some future income What is a cause of a liability loss? - Answer ️️ -claim for money damages Intentional Torts - Answer ️️ -Defamation (libel if written, slander if spoken) Assault (threat of touching) Battery (actual touching) Trespass (unauthorized use of another's land) Nuisance (interfering with peaceful enjoyment of property) Three financial consequences that might result from liability loss - Answer ️️ -1. investigation costs 2. defense costs 3. damages Five activities of the liability risk management process - Answer ️️ -1. scan the environment 2. identify risks 3. analyze risks 4. treat risks 5. monitor and review loss prevention reduces - Answer ️️ -frequency loss reduction reduces - Answer ️️ -severity ($$$) How many days to notify ins company of newly aquired auto for physical damage if phys dam already on other owned autos? - Answer ️️ -14 days for physical damage already on owned autos How many days to notify ins company of newly acquired auto for phys damage if phys damage NOT on other owned autos? - Answer ️️ -4 days to notify if physical damage not already on other owned autos Six Coverage Parts of the PAP - Answer ️️ -A- Liability coverage B- Medical Payments Coverage C- Uninsured Motorist (Um) Coverage D- Coverage for Damage to Your Auto E- Duties after an accident or loss F- General provisions PAP Coverage A - Supplementary Payments - Bail Bonds premiums - Answer ️️ -up to $250 PAP Coverage A Supplementary Payments - lost earnings - Answer ️️ -up to $200/day PAP Coverage D - Damage to Your Auto - is it required or optional? - Answer ️️ -this PAP coverage is optional Collision includes - Answer ️️ -upset and impact with another object other than collision includes - Answer ️️ -loss by anything other than collision or perils excluded Transportation expenses under Coverage D - Answer ️️ -up to $30/day with cap of $900 - 24 hour waiting period (48 hours for theft) The Miscellaneous Vehicle Endorsement adjusts the PAP to cover ... - Answer ️️ -to cover motor homes, motorcycles, and recreational vehicles Miscellaneous Vehicle Endorsement Part D excludes coverage for: - Answer ️️ -clothing, luggage, business equipment, sales samples, and property used in exhibitions Miscellaneous Vehicle Endorsement optional passenger hazard exclusion - Answer ️️ - excludes BI to passengers, and thus reduces premium for drivers who do not carry passengers Snowmobile Endorsement excludes ... - Answer ️️ -business use, others' rental of the snowmobile, and any racing or practice racing The Excess Electronic Equipment Endorsement - Answer ️️ -provides up to $200 for media used with electronic equipment and increases the $1000 limit for sound-reproducing equipment installed in a location NOT used by manufacturer or