Property and Casualty Insurance Exam -
Georgia
PAP Part C: Uninsured Motorist Coverage - Uninsured motorist (UM) coverage provides the
insured with money for bodily injuries that the insured would be legally entitled to recover from the
owner or operator of a vehicle that does not carry the required liability insurance coverage. A vehicle
that does not carry the required insurance is defined in this section of the PAP as an uninsured vehicle
Accounts receivable coverage form - One of the most important and popular of the inland marine
coverage forms. Unlike most inland marine coverages, coverage is provided for property that is at a fixed
location, rather than mobile property. The accounts receivable coverage form is a filed form that
provides protection for losses of accounts due from customers that become uncollectible because of a
loss to the insured's accounts receivable records.
Absolute liability - A type of liability that occurs due to extremely dangerous operations, such as
the use of explosives or working at extreme heights. The injured party does not need to prove
negligence.
(HO) Coverage D-Loss of Use - All homeowners policies contain the Loss of Use coverage, which is
a combination of Coverage D (Fair Rental Value) and Coverage E (Additional Living Expense) in the
dwelling property policy.
3 elements of insurable risk - 1. Financial (a monetary interest)
2. Blood (a relative)
3. Business (a business partner)
3 types of hazards - Physical, Moral, Morale
5 coverage forms used in commercial auto insurance - business auto coverage form
business auto physical damage form
garage coverage form
truckers coverage form
motor carriers coverage form
,6 classes of insurance in Georgia - 1. Life, accident, and sickness
2. Property, marine, and transportation
3. Casualty
4. Surety
5. Title
6. HMOs
A DP can be purchased to insure property solely used for residential purposed under the following
situations: - 1. up to 5 boarders
2. up to 4 residential units
3. properties in the course of construction
4. owner occupied, tenant occupied, or both
5. Mobile homes on the basic form only, if they contain 1 apartment only, and are at the permanent
location listed on policy
6. Seasonal dwellings unoccupied for 3 or more months out of a 12-month period.
7. Not designed as farm property.
Abandonment - The relinquishing of insured property into the hands of another, or into the
possession of no one in particular.
Accident - An unexpected happening that may result in injury, loss, or damage.
Actual Cash Value (ACV) - Cost to replace property with new property of like kind and quality less
depreciation.
Additional insured - Individual or business that are not named as insured on the declaration page,
but are protected by the policy, usually in regard to a specific interest. Added by an endorsement.
,Additional/Supplementary Coverage - A provision in an insurance policy that provides an
additional amount of coverage for specific loss expense at no additional premium.
Aggregate Limits - The most the policy will pay for all losses submitted during the policy period,
regardless of other policy limits.
Agreement - Offer and acceptance.
Annual transit form - This policy is used by those businesses that ship goods on a regular basis.
Coverage can be written for all outgoing shipments, incoming shipments, or both that occur during the
policy period.
Apparent authority - The appearance or the assumption of authority based on the actions, words,
or deeds of the principal or because of circumstances the principal created.
Appraisal - If there is a disagreement between the insured and the insurer on the value of an
property loss, either party can make a written demand for an appraisal.
Arbitration - A method of casualty claim settlement used in the insurer and insured cannot agree
on how to settle a claim. The arbitrator makes the decision on the settlement.
Assignment - The transfer of a legal right or interest in an insurance policy. Prior written consent
of the insurer is required.
Auto Dealers Supplemental Schedule - The Auto Dealers Supplemental Schedule contains specific
information concerning the classes of vehicle operators (employees who regularly drive or are furnished
vehicles), coverage for customer's liability or damage to customer's vehicles, and physical damage
coverage on insured vehicles. The supplemental schedule also indicates whether coverage is written on a
reporting form basis and whether liability coverage for pick-up and delivery of automobiles is insured.
Automatic Increase in Insurance Endorsement - is used to provide at the annual renewal date of
the policy, an automatic increase in the Coverage A and B limits of insurance to help offset inflation
, automobile liability coverage - pays for any damages and liabilities that you are legally obligated to
pay for, and also pays defense costs. The cost of defense is over and above the limit of liability. However,
no defense is provided if the liability is not covered. When the liability is covered, the insurer has the
right to investigate and settle any claims independently of the insured
B.B. BICE-GOLF - Broad form coverage perils
Bursting of heating systems
burglary damage
breaking for water heaters
ice, snow, sleet
collapse of the building or parts of it
electrical damage (artificial)
glass breaking
objects falling from outside
leakage of water or steam damage
freezing of plumbing
Bailee's Customers Policy - Bailee's Customer coverage forms are used to cover losses to
customers' property in the care, custody or control of the insured. Includes bailee's customers, furriers
block, dry cleaners, and warehouseman's. Each of these forms is unfiled.
bill of lading - A bill of lading is a contract for the transport of goods between the shipper and the
carrier. This document specifies the carrier's duties and responsibilities for the property. Common
carriers are required to issue a uniform bill of lading to every person (shipper) that it transports goods
for. When a regular bill of lading is issued, the carrier will be responsible for the invoice cost of any
damaged property, and the shipper does not have to specifically declare a value. However, the carrier
may issue a released bill of lading in which the shipper must specifically declare the values of the
property being shipped. With the released bill of lading, the shipper is charged a lower fee because the
carrier is only liable for damage up to the stated amount.
Binder - A temporary agreement issued by an agent providing temporary coverage until a policy
can be issued.
