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RMIN 4000 Test 3 Brown Exam Questions and Answers 100% Solved Principal of Indemnity - insurer pays no more than actual amount of the loss; insurer should not profit from the loss Replacement cost - the cost to replace an inventory item in its identical f $9.99   Add to cart

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RMIN 4000 Test 3 Brown Exam Questions and Answers 100% Solved Principal of Indemnity - insurer pays no more than actual amount of the loss; insurer should not profit from the loss Replacement cost - the cost to replace an inventory item in its identical f

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RMIN 4000 Test 3 Brown Exam Questions and Answers 100% Solved Principal of Indemnity - insurer pays no more than actual amount of the loss; insurer should not profit from the loss Replacement cost - the cost to replace an inventory item in its identical form (similar workmanship and quality) ...

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  • September 27, 2024
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RMIN 4000 Test 3 Brown Exam

Questions and Answers 100% Solved


Principal of Indemnity - ✔✔insurer pays no more than actual amount of the

loss; insurer should not profit from the loss

Replacement cost - ✔✔the cost to replace an inventory item in its identical

form (similar workmanship and quality)

Actual Cash Value - ✔✔replacement cost - depreciation



in property ins, usually based on the actual cash value of the property at

the time of loss

Market Value - ✔✔the price at which property would sell

Valued Policy - ✔✔a policy that pays the face amount of insurance if a total

loss occurs (life insurance)

Value Policy Law - ✔✔requires payment of the face amount of insurance if

a total loss to real property occurs from a peril specified in law

Principle of Insurable Interest - ✔✔The insured must be in a position to lose

financially if a covered loss occurs

,Examples of Insurable Interest - ✔✔-ownership of property (house, car)

-potential legal liability (business owners)

-secured creditors

-contractual rights (goods in transit)

When must an insurable interest legally exist in life insurance? - ✔✔at

inception of the policy; ex-spouse can still collect on life insurance if listed

as policy beneficiary

Principle of Subrogation - ✔✔substitution of the insurer in place of the

insured for the purpose of claiming indemnity from a third party for a loss

covered by insurance

Reasons for subrogation - ✔✔-prevents insured from collecting twice (once

from insurer, once from responsible party)

- holds the negligent party responsible for the loss

- reduces insurance claims costs and therefore rates

principle of upmost good faith - ✔✔a higher degree of honesty is imposed

on both parties to insurance contracts than is imposed on parties to other

contracts

What three legal doctrines support the principle of upmost good faith? -

✔✔-representations

, -concealment

-warranty

Representations - ✔✔statements made by the applicant for insurance

What makes a contract voidable on the premise of misrepresentation? -

✔✔1. material

2. false, and

3. relied on by the insurance company

concealment - ✔✔intentional failure of the applicant for insurance to reveal

a material fact to the insurer

What makes a contract voidable on the premise of concealment? - ✔✔-

concealed fact was known by the insured to be material

-insured intended to defraud the insurer

Warranty - ✔✔a statement that becomes part of the insurance contract and

is guaranteed by the maker to be true in all respects



a condition agreed to by an insured in order to receive coverage

What is bad faith? - ✔✔law that allows lawsuits against insurance

companies for: improper denial of claims and improper delay of claims

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