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CIC Commercial Multi-line Exam Prep.
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CIC Commercial Multi-line Exam PrepApply conditions of an EPLI policy to claims situations. - ANS-duties in the event of a
claim or wrongful act that may result in a claim
**Consent to settle (hammer cause)
Transfer of duties when limit of insurance is used up
Representations and separation of insured
Apply the defense provision of EPLI Policies - ANS-Most include right and duty to
defend
No duty to defend if a wrongful act is not covered
Some EPLI policies give the insured the right to select defense, it big.
The insurer typically has the right to investigate and settle not the insured
*** Cost of defense is within the limits
Defense expenses ty typically are in excess of the deductible or retention
Defense ends when limits have been exhausted by payment of defense expenses,
judgements or settlements
Definition of "defense expenses" - cost investigate defend, or settle a claim, defense
expense do not include insurer or insured internal claims handling expenses,
Apply the definition of wrongful acT as contained in an EPLI policy. - ANS-Many
coverage broad range of wrongful acts, but each policy defines
wrongful acts no standard definition may include:
Discrimination
Sexual Harassment
Retaliation
Wrongful termination
Wrongful employment practices
Breach of employment
Failure to grant tenure
Workplace tort
Discrimination
Wrongful demolition, termination....
Apply the EPLI policy exclusions to claim situations - ANS-1. All EPLI exclude criminal,
fraudulent, or malicious acts but almost all promise to defend until the issue has been
adjudicated
,2. Contractual liability unless the liability exist in the absence of the contract or
agreement
3. Workers compensation, unemployment compensation, disability benefits and similar
laws
4. Violations of certain federal facts
5. Strikes and lockouts
6. Prior or pending litigation
7. Prior events or activities
Compare and contrast the insuring agreement known as pay on behalf and indemnify -
ANS-Pay on Behalf of
The insure has stricter control of defense, investigation or settlements
The insurer pays damages directly to third party on behalf of
The insure has the duty to defent when the underlying does not provide coverage
Idemnify
Define "Self-Insured Retention" (SIR) and apply it - ANS-SIR is the dolllar amount listed
in the declarations paid by the named insured before the excess insurance becomes
applicable
Applies only when the excess policy provide broader insurance protection
Does not apply when the umbrella drops down over exhausted limits or when exceee
over underlying limits.
SIR may be written per occurrence or policy period basis
Describe "money" "securities", other property., "theft" and "employee" as found in the
Commercial Crime Coverage Form - ANS-money- coins, cash, has a face value and
can be spent now (no confederate money)
securities- Tokens, Tickets, Notes, takes more work
Other property- tangible property, No Electronic Data
Theft- unlawful taking of property to deprive the N.I.
Employee:
-Current or past (30 day window)
-Temp/leased
-Former Employee who is now a consultant
, -intern
-Merger or Conslidated employees
-Managers, directors, trustees
NOT EMPLOYEES: AGENTS, BROKERS FACTORS, CONSIGNEES, INDEPENDENT
CONTRACTORS
Describe and apply policy conditions pertaining to insuring Agreement A.1. Employee
theft - ANS--Termination of coverage to any employee who you know had a past of
dishonesty (Ex. 9 years old stealing)
-Extends policy territory when an employee is gone for 90 days
-Employee Benefit Plan- IF an employee steals payment will be to plan+ ded. applies
Describe and apply policy exclusions pertaining to insuring agreement A.1. Employee
Theft - ANS--inventory shortages discovered by inventory or profit loss computation
-Trading Losses (Stocks etc...)
-Warehouse Receipts
Describe and apply the coverage provided by the Insuring Agreement A.1. Employee
Theft - ANS-Covered Property= money, securities, other property from direct theft from
an employee.
Property could be held by N.I. or something they are legally liable for
Coverage applies per loss; not per employee
Employee does not have to be ID'd unless specifically stated in Endorsement
Describe and apply the coverages exclusions, limitations and conditions pertaining to
Insuring Agreement A.6. Compute And Funds Transfer Fraud. - ANS-1.) movement of
monies of an employee acting in good faith after receiving orders from software
contractor
2.) Loss resulting from a fraud instruction to a financial institution
EXCLUSIONS:
-Fruad from person with authorized access to transfer money
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