2-20 Florida Insurance flashcards verified answers
Pure Risk ️a situation that presents the opportunity for loss, but no opportunity for gain.
due to physical damage or bodily injury.
Ex. Fire Loss- not anticipated but poss.
Speculative Risk ️We speculate or have uncertainty about an e...
2-20 Florida Insurance flashcards verified answers Pure Risk ✔️a situation that presents the opportunity for loss, but no opportunity for gain. due to physical damage or bodily injury. Ex. Fire Loss - not anticipated but poss. Speculative Risk ✔️We speculate or have uncertainty about an event under consideration that could produce either profit or loss. Ex. Lottery or Betting Policy ✔️Written contract or agreement effect ing insurance, including clauses and endorsements. Insurance ✔️A contract in which one party indemnifies another party a specific amount (a pre -
determined benefit for pre -determined contingencies) Casualty Insurance ✔️All insurance other than Life and Health Property Insurance ✔️Carrier pays directly to the Insured (First Party). Liability Insurance ✔️Carrier pays on behalf of the insured (Third Party). Assumed Risk ✔️Amount of risk that insured is willing to absorb. Whatever part of the risk maintained(responsible) by the insured. . How do pure risk and speculative risk differ? ✔️Pure risk is insurable and speculative risk is not. What is the law of large numbers? ✔️Statistical theory that the larger the # of individual risks (or exposures) that are studied in a group, the more predictable and accurate the estimate of expected losses for the group. What are the four parts that make up an insurance policy? ✔️1. Declaration Page - info page 2. In suring Agreement - promise to pay 3. Conditions - rules of the policy 4. Exclusions - situations which are not covered How do endorsements alter the policy? ✔️A written form attached to an insurance policy that alters the policy. Binder ✔️Temporary insuranc e (no longer than 60 days) - oral or written & includes all terms of the policy. What is the difference between an insurance policy and a binder? ✔️Binder is temporary until they receive there policy in the mail. The most accurate description of Pure Ri sk is which of the following? ✔️Insurable Which of the following can be found in Definitions? ✔️Who is an insured? Which of the following can be found in "Conditions"? ✔️Duties of the Insured at time of loss All of the following choices are found on Declarations page EXCEPT: ✔️Exclusions What is an "Exclusion?" ✔️Events not payable under the policy What is a Deposit Premium? ✔️Partial premium placed as a down payment at the start of the policy Which of the following best describes a "binder"? ✔️Temporary insurance What is an "Exclusion?" ✔️Events not payable under the policy What are personal contracts? ✔️covers persons - not property the property & casualty policies cover persons for their financial loss , not the damage to their property. Who has an insurable interest? ✔️Someone must possibly suffer an economic loss. The extent of the insurable interest establishes the % paid. It must exist at the same time of the loss. Who are the sources of underwriti ng? ✔️1. Insurance Policy Application 2. Insurer questionnaires 3. Inspections 4. in house indexes 5. Producer visits 6. Public records 7. Credit reports The most accurate definition of a Contract of Adhesion is: ✔️Contract created by insurance company; insured cannot negotiate terms; ambiguities in favor of insured What section in the PAP describes payments to others if the insured damages others? ✔️Liabi lity What is NOT a source of underwriting? ✔️Exclusions What type of hazards exist? ✔️Physical, Morale, and Moral Physical Hazard ✔️When an object is in the right place at the wrong time. Physical characteristic of an object. Moral Hazard ✔️Intentional Loss Ex. Arson & Insurance Fraud Morale Hazard ✔️Carelessness, accident What is the Proximate Cause Doctrine? ✔️Unbroken connection between a covered occurrence and the damage from the occurrence. If covered property is damaged by a covered peril, the carrier will pay all of the resulting damage, as long as it is continuous. Direct Loss ✔️damage to the covered real or personal property caused by a covered peril. Can Be Seen. Indirect Loss ✔️Economic loss as a consequence of Direct Loss. x. own 2 pr operties, Rent one. Fire. Loss of rent. loss of income. What is the Lender's Interest? ✔️"Mortgage Clause" or "Mortgage Rights" - makes lender a payee in any covered loss. - gives mortgagee advance notice of cancellation/non -renewal. - Mortgagee is covered even if insured is engaged in act of omission preventing payment. - Mortgagee can continue policy if premium is not paid.
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